EXHIBIT 10.1
$225,000,000
CREDIT AGREEMENT
Dated as of May 15, 2002
among
ARKANSAS BEST CORPORATION
as the Borrower,
XXXXX FARGO BANK TEXAS, NATIONAL ASSOCIATION
as Administrative Agent and Lead Arranger,
and
FLEET NATIONAL BANK and SUNTRUST BANK
as Co-Syndication Agents,
and
WACHOVIA BANK, NATIONAL ASSOCIATION
as Documentation Agent,
and
THE BANKS NAMED HEREIN
as the Lenders
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS........................................................................1
Section 1.1 Certain Defined Terms..................................................................1
Section 1.2 Computation of Time Periods...........................................................22
Section 1.3 Accounting Terms; Changes in GAAP.....................................................22
Section 1.4 Types of Advances.....................................................................23
Section 1.5 Miscellaneous.........................................................................23
ARTICLE II THE ADVANCES AND THE LETTERS OF CREDIT................................................................23
Section 2.1 The Advances..........................................................................23
Section 2.2 Method of Borrowing...................................................................24
Section 2.3 Fees..................................................................................28
Section 2.4 Reduction of the Commitments..........................................................28
Section 2.5 Repayment of Advances.................................................................29
Section 2.6 Interest..............................................................................29
Section 2.7 Prepayments...........................................................................31
Section 2.8 Breakage Costs........................................................................32
Section 2.9 Increased Costs.......................................................................33
Section 2.10 Payments and Computations.............................................................35
Section 2.11 Taxes.................................................................................36
Section 2.12 Illegality............................................................................38
Section 2.13 Letters of Credit.....................................................................38
Section 2.14 Determination of Borrowing Base.......................................................41
Section 2.15 Bank Replacement......................................................................42
Section 2.16 Sharing of Payments, Etc..............................................................43
Section 2.17 Increase of Commitments...............................................................43
Section 2.18 Extensions of the Maturity Date.......................................................44
Section 2.19 Agreements regarding Subsidiaries.....................................................44
ARTICLE III CONDITIONS OF LENDING................................................................................45
Section 3.1 Conditions Precedent to Effectiveness of this Agreement...............................45
Section 3.2 Conditions Precedent for each Borrowing or Letter of Credit...........................47
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................48
Section 4.1 Corporate Existence; Subsidiaries.....................................................48
Section 4.2 Corporate Power.......................................................................48
Section 4.3 Authorization and Approvals...........................................................48
Section 4.4 Enforceable Obligations...............................................................49
Section 4.5 Financial Statements..................................................................49
Section 4.6 True and Complete Disclosure..........................................................49
Section 4.7 Litigation............................................................................49
Section 4.8 Use of Proceeds.......................................................................50
Section 4.9 Investment Company Act................................................................50
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Section 4.10 Taxes.................................................................................50
Section 4.11 Pension Plans.........................................................................51
Section 4.12 Condition of Property; Casualties.....................................................51
Section 4.13 Insurance.............................................................................51
Section 4.14 No Burdensome Restrictions; No Defaults...............................................51
Section 4.15 Environmental Condition...............................................................52
Section 4.16 Permits, Licenses, Etc................................................................53
Section 4.17 Existing Mortgage Debt................................................................53
Section 4.18 Property and Liens....................................................................53
ARTICLE V AFFIRMATIVE COVENANTS..................................................................................53
Section 5.1 Compliance with Laws, Etc.............................................................53
Section 5.2 Insurance.............................................................................53
Section 5.3 Preservation of Corporate Existence, Etc..............................................54
Section 5.4 Payment of Taxes, Etc.................................................................54
Section 5.5 Visitation Rights.....................................................................54
Section 5.6 Reporting Requirements................................................................54
Section 5.7 Maintenance of Property...............................................................57
Section 5.8 Ownership of ABF......................................................................57
Section 5.9 Further Assurances....................................................................57
ARTICLE VI NEGATIVE COVENANTS....................................................................................57
Section 6.1 Liens, Etc............................................................................57
Section 6.2 Amendment of Material Documents.......................................................59
Section 6.3 Agreements Restricting Distributions From Subsidiaries................................59
Section 6.4 Merger or Consolidation; Asset Sales..................................................59
Section 6.5 Restricted Payments...................................................................60
Section 6.6 Investments, Loans, Advances..........................................................60
Section 6.7 Affiliate Transactions................................................................61
Section 6.8 Maintenance of Ownership of Subsidiaries..............................................61
Section 6.9 No Further Negative Pledges...........................................................62
Section 6.10 Other Businesses......................................................................62
Section 6.11 Interest Coverage Ratio...............................................................62
Section 6.12 Net Worth.............................................................................62
Section 6.13 Maximum Leverage Ratio................................................................63
Section 6.14 Capital Expenditures..................................................................63
Section 6.15 Indebtedness..........................................................................64
Section 6.16 Acquisition Expenditures..............................................................65
ARTICLE VII REMEDIES.............................................................................................66
Section 7.1 Events of Default.....................................................................66
Section 7.2 Optional Acceleration of Maturity.....................................................68
Section 7.3 Automatic Acceleration of Maturity....................................................68
Section 7.4 Cash Collateral Account...............................................................69
Section 7.5 Non-exclusivity of Remedies...........................................................69
Section 7.6 Right of Set-off......................................................................69
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ARTICLE VIII AGENCY AND ISSUING BANK PROVISIONS..................................................................70
Section 8.1 Authorization and Action..............................................................70
Section 8.2 Agent's Reliance, Etc.................................................................70
Section 8.3 The Agent and Its Affiliates..........................................................71
Section 8.4 Bank Credit Decision..................................................................71
Section 8.5 Indemnification.......................................................................71
Section 8.6 Successor Agent and Issuing Banks.....................................................71
Section 8.7 Co-Syndication Agents.................................................................72
Section 8.8 Documentation Agent...................................................................72
ARTICLE IX MISCELLANEOUS.........................................................................................72
Section 9.1 Amendments, Etc.......................................................................72
Section 9.2 Notices, Etc..........................................................................73
Section 9.3 No Waiver; Remedies...................................................................73
Section 9.4 Costs and Expenses....................................................................73
Section 9.5 Binding Effect........................................................................73
Section 9.6 Bank Assignments and Participations...................................................74
Section 9.7 Indemnification.......................................................................76
Section 9.8 Execution in Counterparts.............................................................77
Section 9.9 Survival of Representations, Etc......................................................77
Section 9.10 Severability..........................................................................77
Section 9.11 Commercial Loans......................................................................77
Section 9.12 Usury Not Intended....................................................................77
Section 9.13 Governing Law.........................................................................78
Section 9.14 Consent to Jurisdiction...............................................................78
Section 9.15 Banks not in Control..................................................................78
Section 9.16 Headings Descriptive..................................................................78
Section 9.17 WAIVERS OF JURY TRIAL.................................................................78
Section 9.18 Binding Arbitration...................................................................79
Section 9.19 ENTIRE AGREEMENT......................................................................81
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EXHIBITS:
Exhibit A - Form of Assignment and Acceptance
Exhibit B - Form of Borrowing Base Certificate
Exhibit C - Form of Compliance Certificate
Exhibit D - Form of Guaranty
Exhibit E - Form of Increased Commitment Agreement
Exhibit F - Form of Notice of Borrowing
Exhibit G - Form of Notice of Conversion or Continuation
Exhibit H - Form of Revolving Note
Exhibit I - Form of Swingline Note
Exhibit J - Form of Withholding Tax Certification
Exhibit K - Form of Borrower's/Guarantors' Counsel Opinion
SCHEDULES:
Schedule 1.1(a) - Commitments
Schedule 1.1(b) - Letters of Credit Outstanding
Schedule 1.1(c) - Certain Subsidiaries
Schedule 4.1 - Subsidiaries
Schedule 4.7 - Litigation
Schedule 4.10(a) - Tax Disclosure
Schedule 4.10(b) - Tax Returns; Waivers of Statute of Limitations
Schedule 6.1 - Existing Liens and Secured Indebtedness
Schedule 6.7 - Certain Intercompany Arrangements
Schedule 6.9 - Certain Negative Pledges
Schedule 6.15 - Outstanding Indebtedness
Schedule 6.16 - Acquisition Expenditures
Schedule 9.2 - Notice Information for Banks
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CREDIT AGREEMENT
This
Credit Agreement dated as of May 15, 2002 is among ARKANSAS BEST
CORPORATION, a Delaware corporation, as the Borrower, XXXXX FARGO BANK
TEXAS, NATIONAL ASSOCIATION, as Agent and lead arranger, FLEET NATIONAL
BANK and SUNTRUST BANK, as Co-Syndication Agents, WACHOVIA BANK,
NATIONAL ASSOCIATION, as Documentation Agent, and the BANKS (as defined
hereinbelow).
The parties hereto do hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.1 Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (unless otherwise indicated,
such meanings to be equally applicable to both the singular and plural forms of
the terms defined):
"Accession Agreement" means an Accession Agreement in the form
attached to the Guaranty as Annex 2 thereto, which agreement causes the
Person executing and delivering the same to the Agent to become a party
to the Guaranty.
"Acquisition Expenditures" means, for any period, the
aggregate of all expenditures and costs of the Borrower or any of its
Subsidiaries paid in cash, debt securities, Property, other than common
stock of the Borrower, or the assumption of Indebtedness during such
period for (a) the purchase or acquisition of assets of a business of
another Person other than the Borrower or any of its Subsidiaries or
(b) the acquisition of stock, partnership, joint venture interests or
other equity interests in any Person other than the Borrower or any of
its Subsidiaries.
"Additional Permitted Indebtedness" has the meaning set forth
in Section 6.15(d).
"Adjusted EBITDA" means EBITDA as adjusted, when applicable,
to include (a) the historical financial results for the Calculation
Period of a Subsidiary or a business acquired by the Borrower or any of
its Subsidiaries pursuant to an acquisition consummated during the
Calculation Period, in each case if, but only if, such Subsidiary or
business acquired continues to be owned by the Borrower or its
Subsidiaries as of the Calculation Day, and (b) any applicable
adjustments pursuant to Article 11, Regulation S-X promulgated by the
Securities and Exchange Commission.
"Adjustment Event" has the meaning set forth in Section
2.14(b).
"Advance" means either a Revolving Advance or a Swingline
Advance, any such Revolving Advance being either a Base Rate Advance or
a Eurodollar Rate Advance.
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"Affected Bank" has the meaning set forth in Section 2.15(a).
"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, through one or more intermediaries, controls,
is controlled by or is under common control with such Person or any
Subsidiary of such Person. The term "control" (including the terms
"controlled by" or "under common control with") means the possession,
directly or indirectly, of the power to direct or cause the direction
of the management or policies of a Person, whether through ownership of
a Control Percentage, by contract or otherwise.
"Agent" means Xxxxx Fargo Bank
Texas, National Association in
its capacity as administrative agent for the Banks pursuant to Article
VIII and any successor administrative agent appointed pursuant to
Section 8.6.
"Agent's Fee Letter" means the letter agreement dated as of
March 15, 2002 between the Borrower and Xxxxx Fargo.
"Agreement" means this
Credit Agreement, as it may be amended,
restated, supplemented, renewed, extended or otherwise modified from
time to time in accordance with its terms (including, without
limitation, as it may be supplemented by any Increase Commitment
Agreement).
"Applicable Lending Office" means, with respect to each Bank,
such Bank's Domestic Lending Office in the case of a Base Rate Advance
and such Bank's Eurodollar Lending Office in the case of a Eurodollar
Rate Advance.
"Applicable Margin" means, subject to the terms and provisions
of this definition, at any time with respect to any Revolving Advances,
facility fees or letter of credit fees hereunder, the following
percentages determined as a function of the ratings by S&P or Xxxxx'x,
applicable on such date, of the Borrower's Senior Debt as set forth
below:
Senior
Debt Rating Eurodollar Letter of
Tier ------------------------- Rate Base Rate Facility Credit
Level S&P Xxxxx'x Advances Advances Fees Fees
--------- ---------- ----------- ---------- --------- -------- ---------
I A- A3 0.325% 0.000% 0.125% 0.325%
or higher or higher
II BBB+ Baa1 0.575% 0.000% 0.150% 0.575%
III BBB Baa2 0.825% 0.000% 0.175% 0.825%
IV BBB- Baa3 0.925% 0.000% 0.200% 0.925%
V BB+ Ba1 1.075% 0.000% 0.300% 1.075%
BB Ba2
VI or or 1.350% 0.000% 0.400% 1.350%
less less
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If (with respect to the table above) the ratings fall within different
Tier Levels, the Applicable Margin shall be based on the numerically
lower of the two Tier Levels (where Tier I is the numerically lowest
such Tier and Tier VI is the numerically highest such Tier) unless the
numerically higher Tier Level is two or more Tier Levels above the
numerically lower Tier Level, in which case the Tier Level which is one
level above the numerically lower Tier Level will apply. If the ratings
established by Xxxxx'x or S&P for the Borrower's Senior Debt change
(other than as a result of a change in the rating system of Xxxxx'x or
S&P), such change shall be effective as of the date on which it is
first announced by the applicable rating agency. If the rating system
of Xxxxx'x and/or S&P shall change when a rating for the Borrower's
Senior Debt exists from both Xxxxx'x and S&P, then the Xxxxx'x or S&P,
respectively, "Senior Debt Rating" as referred to in the table above
shall be, if and to the extent objectively determinable, changed to the
equivalent new rating with the effect that such change in the rating
system shall have no effect on the Applicable Margin that would have
been determined under the table above if such rating change had not
occurred or, if and to the extent the same is not objectively
determinable, then the Applicable Margin shall be based on the rating
of the agency that has not changed its rating system or, if both
agencies have changed their rating system, the agency as to which the
change is objectively determinable or, if the change is not objectively
determinable as to either agency, then the Applicable Margin shall be
determined as provided in the last sentence of this definition. If
either such rating agency shall cease to rate corporate debt
obligations of the Borrower, then the Applicable Margin shall be based
on the rating of the agency that continues to rate the corporate debt
obligations of the Borrower. If both Xxxxx'x and S&P shall change their
rating system and the effect thereof is not objectively determinable as
explained above, cease rating the Borrower's Senior Debt or cease to be
in the business of rating corporate debt obligations, then the Borrower
and the Agent shall select a substitute nationally recognized
statistical rating agency or agencies, as the case may be; provided,
however, that if the Borrower and the Agent cannot mutually agree on
such a substitute rating agency, then a substitute nationally
recognized statistical rating agency or agencies, as the case may be,
shall be selected and approved by the Borrower, the Agent and the
Majority Banks; provided, further, however, that if the Borrower, the
Agent and the Majority Banks cannot mutually agree on such a substitute
rating agency, then the Applicable Margin shall be the rate then most
recently determined in accordance with this definition.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Bank and an Eligible Assignee, and accepted by the
Agent, in substantially the form of the attached Exhibit A.
"Banks" means each of the lenders party to this Agreement,
including without limitation each Eligible Assignee that shall become a
party to this Agreement pursuant to Section 9.6.
"Base Rate" means, on any date, the interest rate per annum
equal to the greater of (a) the Federal Funds Rate in effect on such
day plus one-half of one percent (0.5%) or (b) the Prime Rate in effect
on such day. Any change in the Base Rate due to a change in the
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Federal Funds Rate or the Prime Rate shall be effective on the
effective day of such change in the Federal Funds Rate or the Prime
Rate, respectively.
"Base Rate Advance" means an Advance which bears interest as
provided in Section 2.6(a).
"Borrower" means Arkansas Best Corporation, a Delaware
corporation, and any successor, legal representative or permitted
assignee thereof.
"Borrowing" means a Revolving Borrowing or the making of a
Swingline Advance by Xxxxx Fargo.
"Borrowing Base" means an amount (without duplication) equal
to the remainder of (a) the sum of (i) 75% of the Net Depreciated Value
of Eligible Revenue Equipment, plus (ii) 85% of the aggregate
outstanding amount of Eligible Receivables, plus (iii) 50% of the Net
Depreciated Value of Eligible Other Equipment, plus (iv) 65% of the
Real Estate Value of Eligible Real Property, minus (b) the aggregate
outstanding principal amount of all unsecured Total Funded Debt of the
Borrower and/or any of its Subsidiaries other than such Total Funded
Debt which constitutes a part of the Obligations.
"Borrowing Base Certificate" means a certificate of the
Borrower in substantially the form of the attached Exhibit B,
appropriately completed.
"Borrowing Base Determination Date" means any date the
Borrowing Base is determined in accordance with Section 2.14.
"Business Day" means a day of the year on which banks are not
required or authorized to close in New York City or Dallas,
Texas and,
if the applicable Business Day relates to any Eurodollar Rate Advances,
on which dealings are carried on by banks in the London interbank
market.
"Calculation Day" means the last day of each fiscal quarter.
"Calculation Period" means, with respect to any Calculation
Day, the period of the four consecutive fiscal quarters ending on such
day.
"Canadian Subsidiaries" means, collectively, ABF Freight
System (B.C.) Ltd., a British Columbia corporation, ABF Freight System
Canada, Ltd., a Canadian corporation, and CaroTrans Canada, Ltd., a
Canadian corporation.
"Capital Expenditure" means any payment made directly or
indirectly for the purpose of acquiring or constructing fixed assets,
real property or equipment which in accordance with GAAP would be added
as a debit to the fixed asset account of such Person making such
expenditure, including, without limitation, amounts paid or payable for
such purpose under any conditional sale or other title retention
agreement or under any Capital Lease, but
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excluding repairs of Property made during such period in the normal and
ordinary course of business in keeping with past practices; provided,
however, that, for purposes of this Agreement, (a) Capital Expenditures
of the Borrower and its Subsidiaries shall be determined on a
Consolidated basis in accordance with GAAP (and, accordingly,
intercompany Capital Expenditures between or among members of the
consolidated group shall be excluded as and to the extent required by
GAAP) and (b) Capital Expenditures of the Borrower and its Subsidiaries
shall exclude payroll and benefit costs required to be capitalized in
accordance with GAAP as internally developed software.
"Capital Lease" means, for any Person, any lease of any
Property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a
capital lease on the balance sheet of that Person.
"Capital Stock" means, for any Person, corporate stock and any
and all securities, shares, partnership interests (whether general,
limited, special or other partnership interests), limited liability
company interests, membership interests, equity interests,
participations, rights or other equivalents (however designated) of
corporate stock or any of the foregoing issued by such Person and
includes, without limitation, securities exchangeable for or
convertible into Capital Stock and rights, warrants or options to
acquire Capital Stock.
"Cash Collateral Account" means a special cash collateral
account containing cash deposited pursuant to Section 2.7(c), 7.2(b) or
7.3(b) to be maintained at the Agent's office in accordance with
Section 7.4.
"CERCLA" means the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, state and local
analogs, and all rules and regulations and requirements thereunder in
each case as now or hereafter in effect.
"Closing Date" means May 15, 2002.
"Code" means the Internal Revenue Code of 1986, as amended,
and any successor statute.
"Collateral" shall mean any Property in which the Agent, for
and on behalf of the Banks, has been granted, or is required to be
granted, a Lien as security for the payment or performance of the
Obligations.
"Commitment" means, with respect to any Bank, the amount set
forth opposite such Bank's name on Schedule 1.1(a) as its Commitment,
or if such Bank has entered into any Assignment and Acceptance, the
amount set forth for such Bank as its Commitment in the Register
maintained by the Agent pursuant to Section 9.6(c), as such amount may
be reduced pursuant to Section 2.4 or increased pursuant to Section
2.15(b) or 2.17.
"Commitment Supplement" has the meaning set forth in Section
2.17.
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"Compliance Certificate" means a certificate of the Borrower
in substantially the form of the attached Exhibit C, appropriately
completed.
"Consolidated" refers to the consolidation of the accounts of
the Borrower and its Subsidiaries in accordance with GAAP, including,
when used in reference to the Borrower, principles of consolidation
consistent with those applied in the preparation of the Financial
Statements.
"Control Percentage" means, with respect to any Person, the
percentage of the outstanding Capital Stock of such Person having
ordinary voting power which gives the direct or indirect holder of such
stock the power to elect a majority of the board of directors (or
individuals or body or group of individuals performing the same or
substantially similar functions as the board of directors of a
corporation) of such Person.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated)
under common control which, together with the Borrower, are treated as
a single employer under Section 414 of the Code.
"Convert", "Conversion" and "Converted" each refers to a
conversion of Advances of one Type into Advances of another Type
pursuant to Section 2.2(b).
"Co-Syndication Agents" means Fleet National Bank and SunTrust
Bank, in their capacities as co-syndication agents for the Banks.
"Credit Documents" means this Agreement, the Notes, the
Guaranty, the Foreign Stock Pledge Agreements, if any are required
hereunder, the Agent's Fee Letter and each other agreement, instrument
or document executed by the Borrower or any of its Subsidiaries at any
time in connection with this Agreement.
"Cumulative Net Income" has the meaning set forth in Section
6.12.
"Default" means (a) an Event of Default or (b) any event or
condition which with notice or lapse of time or both would, unless
cured or waived, become an Event of Default.
"Documentation Agent" means Wachovia Bank, National
Association, in its capacity as documentation agent for the Banks.
"Dollar Equivalent" means the equivalent in another currency
of an amount in Dollars to be determined by reference to the rate of
exchange quoted by the Agent, at 10:00 a.m. (Dallas,
Texas time) on the
date of determination, for the spot purchase in the foreign exchange
market of such amount of Dollars with such other currency.
"Dollars" and "$" means lawful money of the U.S.
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"Domestic Lending Office" means, with respect to any Bank, the
office of such Bank specified as its "Domestic Lending Office" opposite
its name on Schedule 9.2 or such other office of such Bank as such Bank
may from time to time specify to the Borrower and the Agent.
"Domestic Subsidiary" means a Subsidiary of the Borrower
formed under the laws of the U.S. or any state or territory thereof.
"EBITDA" means, as to any Person and its Consolidated
Subsidiaries and for any period for which such amount is being
determined, without duplication, the sum of the following for such
Person for such period in accordance with GAAP (a) Consolidated Net
Income plus (b) Consolidated Interest Expense, plus (c) income and
franchise taxes to the extent deducted in determining Consolidated Net
Income, plus (d) depreciation and amortization expense to the extent
deducted in determining Consolidated Net Income.
"Effective Date" means the date all of the conditions
precedent set forth in Section 3.1 have been satisfied or waived by the
Agent and the Banks, and the Agent shall have confirmed the same in
writing to the Borrower and the Banks.
"Eligible Assignee" means (a) a commercial bank organized
under the laws of the U.S., or any State thereof, and having primary
capital of not less than $250,000,000 and approved by the Agent, the
Issuing Banks and (provided no Default has occurred and is continuing)
the Borrower, which approvals will not be unreasonably withheld, (b) a
commercial bank organized under the laws of any other country which is
a member of the Organization for Economic Cooperation and Development
and having primary capital (or its equivalent) of not less than
$250,000,000 (or its Dollar Equivalent) that is approved by the Agent,
the Issuing Banks and (provided no Default has occurred and is
continuing) the Borrower, which approvals will not be unreasonably
withheld, (c) a Bank that is approved by the Agent and the Borrower,
which approvals will not be unreasonably withheld or (d) an Affiliate
of the respective assigning Bank, without approval of any Person but
otherwise meeting the eligibility requirements of clause (a) or (b)
above.
"Eligible Other Equipment" means, as of any Borrowing Base
Determination Date, all Other Equipment which is owned by the Borrower
or any Guarantor other than a Canadian Subsidiary on such date and was
so owned on the date of the most recent Borrowing Base Certificate
delivered to the Banks.
"Eligible Real Property" means, as of any Borrowing Base
Determination Date, any real property located in the U.S. which is
owned by the Borrower or any Guarantor on such date and was so owned on
the date of the most recent Borrowing Base Certificate delivered to the
Banks.
"Eligible Receivables" means, as of any Borrowing Base
Determination Date, all Receivables of the Borrower or any Guarantor
other than a Canadian Subsidiary as of the date of the most recent
Borrowing Base Certificate delivered to the Banks, except:
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(a) any Receivable which remains unpaid more than 90 days
after the date of the original invoice for such Receivable;
(b) any Receivable which is from an obligor which is to
the Borrower's or any Guarantor's knowledge Insolvent;
(c) any Receivable which is not free and clear of all
Liens except (i) Liens, if any, in favor of the Agent for the benefit
of the Banks securing the Obligations, (ii) Permitted Liens on
Receivables of a Intermodal Subsidiary pursuant to Section 6.1(l) to
the extent the aggregate obligations secured by such Liens do not
exceed $3,000,000 in the aggregate, or (iii) nonconsensual Liens which
are permitted to exist in accordance with Section 6.1;
(d) any Receivable which does not arise under a contract
representing the legal, valid and binding payment obligation of the
obligor thereon, enforceable by the Borrower or such Guarantor in
accordance with its terms;
(e) any Receivable which together with the related
contract does not comply in all material respects with all Legal
Requirements of the jurisdictions where it originated;
(f) any Receivable which does not provide, according to
its original terms, that the amount payable thereunder will be due
within 60 days following the date upon which the related obligor became
obligated thereon;
(g) any Receivable which is payable by an obligor which
is located in any jurisdiction outside of the U.S., Puerto Rico or
Canada;
(h) any Receivable which is payable by an Affiliate, an
officer, director or employee of the Borrower; and
(i) any Receivable to the extent such Receivable is
subject to setoff, counterclaim, defense, allowance, dispute or
adjustment other than allowances or discounts in the ordinary course of
business consistent with past practices.
"Eligible Revenue Equipment" means, as of any Borrowing Base
Determination Date, all Revenue Equipment which is owned by the
Borrower or any Guarantor other than a Canadian Subsidiary as of such
date and was so owned as of the date of the most recent Borrowing Base
Certificate delivered to the Banks.
"Environment" or "Environmental" shall have the meanings set
forth in 42 U.S.C. Section 9601(8) (1998).
"Environmental Claim" means any third party (including
governmental agencies and employees) action, lawsuit, claim, demand,
regulatory action or proceeding, order, decree,
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consent agreement or notice of potential or actual responsibility or
violation (including claims or proceedings under the Occupational
Safety and Health Acts or similar laws or requirements relating to
health or safety of employees) which seeks to impose liability under
any Environmental Law.
"Environmental Law" means all Legal Requirements arising from,
relating to or in connection with the Environment, health or safety,
including without limitation CERCLA, relating to (a) pollution,
contamination, injury, destruction, loss, protection, cleanup,
reclamation or restoration of the air, surface water, groundwater, land
surface or subsurface strata, or other natural resources; (b) solid,
gaseous or liquid waste generation, treatment, processing, recycling,
reclamation, cleanup, storage, disposal or transportation; (c) exposure
to pollutants, contaminants, hazardous, medical, infectious or toxic
substances, materials or wastes; (d) the safety or health of employees;
or (e) the manufacture, processing, handling, transportation,
distribution in commerce, use, storage or disposal of hazardous,
medical, infectious or toxic substances, materials or wastes.
"Environmental Permit" means any permit, license, order,
approval or other authorization under Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Federal Reserve Board (or any successor),
as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any Bank,
the office of such Bank specified as its "Eurodollar Lending Office"
opposite its name on Schedule 9.2 (or, if no such office is specified,
its Domestic Lending Office) or such other office of such Bank as such
Bank may from time to time specify to the Borrower and the Agent.
"Eurodollar Rate" means, for the Interest Period for each
Eurodollar Rate Advance comprising part of the same Borrowing, the
interest rate per annum (rounded upward to the nearest whole multiple
of 1/100 of 1% per annum) equal to (a) the rate, set forth on the
applicable Dow Xxxxx Market Service (formerly known as the Telerate
Page) as the London interbank offered rate, for deposits in Dollars at
approximately 11:00 a.m. (London, England time) two Business Days
before the first day of such Interest Period and for a period equal to
such Interest Period, provided, that, if no such quotation appears on
the applicable Dow Xxxxx Market Service (formerly known as the Telerate
Page), the Eurodollar Rate shall be an interest rate per annum equal to
the rate per annum at which deposits in Dollars are offered by the
principal office of Xxxxx Fargo in London, England to prime banks in
the London interbank market at approximately 11:00 a.m. (London,
England time) two Business Days before the first day of such Interest
Period, in the case of Advances made in Dollars, in each case in an
amount substantially equal to Xxxxx Fargo's Eurodollar Rate Advance
comprising part of such Borrowing and for a period equal to such
Interest Period divided by (b) one minus the applicable statutory
reserve requirements of the Agent, expressed as a
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decimal (including without duplication or limitation, basic,
supplemental, marginal and emergency reserves), from time to time in
effect under regulations issued by the Federal Reserve Board
(including, without limitation, Regulation D) or any other Governmental
Authority during such Interest Period. It is agreed that for purposes
of this definition, Eurodollar Rate Advances made hereunder shall be
deemed to constitute Eurocurrency Liabilities as defined in Regulation
D and to be subject to the reserve requirements of Regulation D. The
determination and calculation of the Eurodollar Rate and each component
thereof by the Agent shall be conclusive and binding, absent manifest
error.
"Eurodollar Rate Advance" means an Advance which bears
interest as provided in Section 2.6(b).
"Events of Default" has the meaning set forth in Section 7.1.
"Existing Bank" has the meaning set forth in Section 2.17.
"Existing
Credit Agreement" means the
Credit Agreement dated
as of June 12, 1998, as amended, among the Borrower, the banks party
thereto, Xxxxx Fargo Bank (
Texas), N.A., as administrative agent and
co-documentation agent, and Bank of America National Trust and Savings
Association, as co-documentation agent.
"Existing Lien" means a mortgage Lien on real Property which
is existing on the Effective Date and which is identified on Schedule
6.1.
"Expiration Date" means, with respect to any Letter of Credit,
the date on which such Letter of Credit will expire or terminate in
accordance with its terms.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum (rounded upward, to the nearest whole multiple
of 1/100 of 1% per annum) equal, for each day during such period, to
the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for any such
day on such transactions received by the Agent from three Federal funds
brokers of recognized standing selected by it.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System or any of its successors.
"Financial Statements" means the financial statements
described in Section 4.5.
"Foreign Stock Pledge Agreements" has the meaning set forth in
Section 2.19(b).
-10-
"Foreign Subsidiary" means a Subsidiary of the Borrower other
than a Domestic Subsidiary.
"GAAP" means U.S. generally accepted accounting principles as
in effect from time to time, applied on a basis consistent with the
requirements of Section 1.3.
"G.I. Leased Properties" means the three California terminal
facilities that are owned by a Subsidiary of the Borrower and leased to
G.I. Trucking Company ("G.I. Trucking") for a period of up to four
years from August 1, 2001, the date the Borrower sold G.I. Trucking,
and which terminal facilities G.I. Trucking has the option, at any time
during the four-year lease term, to purchase for $19,500,000.
"Governmental Authority" means any foreign governmental
authority, the U.S., any state of the U.S. and any subdivision of any
of the foregoing, and any agency, department, commission, board,
authority or instrumentality, bureau or court having jurisdiction over
any Bank, the Borrower or the Borrower's Subsidiaries or any of their
respective Properties.
"Governmental Proceedings" means any action or proceedings by
or before any Governmental Authority, including, without limitation,
the promulgation, enactment or entry of any Legal Requirement.
"Guarantor" means each Domestic Subsidiary that executes, or
is required by this Agreement to execute, the Guaranty, and
"Guarantors" means such Persons collectively. The Guarantors on the
Effective Date are identified on Schedule 4.1.
"Guaranty" means the Subsidiary Guaranty and Contribution
Agreement dated of even date herewith in substantially the form of the
attached Exhibit D, appropriately completed, executed by the Domestic
Subsidiaries, as it may be amended hereafter in accordance with its
terms.
"Hazardous Substance" means the substances identified as such
pursuant to CERCLA and those regulated under any other Environmental
Law, including without limitation pollutants, contaminants, petroleum,
petroleum products, radionuclides, radioactive materials, and medical
and infectious waste.
"Hazardous Waste" means the substances regulated as such
pursuant to any Environmental Law.
"Increase Amount" means the total amount by which the Borrower
desires to increase the aggregate Commitments pursuant to Section 2.17,
which amount shall be (a) an amount not less than the lesser of (i)
$275,000,000 minus the then current amount of the aggregate Commitments
or (ii) $10,000,000, and (b) an amount that is either (i) an integral
multiple of $5,000,000 or (ii) if (but only if) the amount of the
aggregate Commitments then in effect is $270,000,000 or more, an amount
equal to the remainder of $275,000,000 minus the amount of the
aggregate Commitments then in effect.
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"Increase Notice" means a written notice sent by the Borrower
to the Agent instructing the Agent that the Borrower wishes to increase
the aggregate Commitments hereunder pursuant to the terms and
conditions of Section 2.17, which notice shall include (a) the identity
of the Supplementing Banks, (b) the Commitment Supplement of each
Existing Bank, if any, (c) the New Commitment of each New Bank, if any,
(d) the aggregate amount of the Commitment Supplements and the New
Commitments, (e) the requested Commitment of each Existing Bank and New
Bank, as the case may be, after giving effect to such requested
increase, and (f) the Increase Amount.
"Increased Commitment Agreement" means an Increased Commitment
Agreement in substantially the form of the attached Exhibit E,
appropriately completed, executed by the Borrower, the Agent and the
other lending institutions party thereto.
"Indebtedness" means (without duplication), at any time and
with respect to any Person:
(a) indebtedness of such Person for borrowed money
(whether by loan or the issuance and sale of debt securities) or for
the deferred purchase price of property or services purchased and all
other obligations of such Person evidenced by bonds, notes, debentures
or other similar instruments, but excluding (i) amounts constituting
trade payables or bank drafts payable within 120 days, (ii) accrued
liabilities (including liability amounts for compensation, compensated
absences, workers' compensation, property damage and liability claims
and other similar liabilities) which are required to be accrued on the
balance sheet of such Person in accordance with GAAP and (iii) other
liabilities (including liability amounts for pensions, deferred
compensation agreements, derivative instruments and other similar
liabilities) which are required to appear as liabilities on the balance
sheet of such Person in accordance with GAAP, in each case (i.e., as to
each of clauses (i), (ii) and (iii) preceding) only if and to the
extent the same arise in the ordinary course of business and are not
evidenced by bonds, notes, debentures or other similar instruments;
(b) indebtedness of others which such Person has directly
or indirectly assumed or guaranteed or otherwise provided credit
support therefor;
(c) indebtedness of others secured by a Lien on assets of
such Person, whether or not such Person shall have assumed such
indebtedness;
(d) obligations of such Person in respect of letters of
credit, surety bonds, acceptance facilities or drafts or similar
instruments issued or accepted by banks and other financial
institutions for the account of such Person, other than amounts
constituting trade payables or bank drafts payable within 120 days and
arising in the ordinary course of business (provided, however, that the
foregoing shall not constitute "Indebtedness" if and to the extent they
constitute only contingent obligations, such as the undrawn portion of
outstanding letters of credit, surety bonds or other similar
instruments which are not required to be recorded on a balance sheet
prepared in accordance with GAAP);
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(e) obligations of such Person under Capital Leases; and
(f) the outstanding amount of preferred trust securities
or other similar arrangements.
"Insolvent" means, with respect to any Person, (a) the present
fair saleable value of such Person's assets is less than the amount
that will be required to pay its probable liability on its then
existing legal liabilities, either matured or unmatured, liquidated or
unliquidated, absolute, fixed or contingent, as they become absolute or
matured, or (b) the property remaining in its hands is an unreasonably
small capital for the business or transaction in which it is engaged or
is about to engage.
"Interest Expense" means, as to any Person and for any period,
and without duplication, all interest on debt or other Indebtedness of
such Persons accrued during such period, including the interest portion
of payments under Capital Leases, and the amortization of deferred
financing costs and letter of credit fees with respect to such debt or
other Indebtedness during such period, in each case in accordance with
GAAP.
"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period commencing on the
date of such Advance or the date of the Conversion of any Base Rate
Advance into such an Advance and ending on the last day of the period
selected by the Borrower pursuant to the provisions below and Section
2.2 and, thereafter, each subsequent period commencing on the last day
of the immediately preceding Interest Period and ending on the last day
of the period selected by the Borrower pursuant to the provisions below
and Section 2.2. The duration of each such Interest Period shall be
one, two or three weeks (with respect to the initial Advances only) or
28 days or one, two, three or six months, in each case as the Borrower
may, upon notice received by the Agent not later than 11:00 a.m.
(Dallas,
Texas time) on the third Business Day prior to the first day
of such Interest Period (except as otherwise provided in Section
2.2(a)), select; provided, however, that:
(a) Interest Periods commencing on the same date for
Advances comprising part of the same Borrowing shall be of the same
duration;
(b) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next succeeding
Business Day, provided that if such extension would cause the last day
of such Interest Period to occur in the next following calendar month,
the last day of such Interest Period shall occur on the next preceding
Business Day; and
(c) any Interest Period which begins on the last
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day of the calendar
-13-
month in which it would have ended if there were a numerically
corresponding day in such calendar month.
"Intermodal Subsidiary" means any Subsidiary of the Borrower
which contracts for the benefit of its customers the railroad shipment
of such customer's goods with any railroad company.
"Issuing Bank" means Xxxxx Fargo or any Bank which agrees at
the request of the Borrower to act as issuer of a Letter of Credit
hereunder, in each case in its capacity as issuer of a Letter of
Credit, or any Bank acting as a successor issuing bank pursuant to
Section 8.6, and "Issuing Banks" means, collectively, all of such
Banks.
"Legal Requirement" means any law, statute, ordinance, decree,
requirement, order, judgment, rule or regulation (or official
interpretation of any of the foregoing) of, or the terms of any license
or permit issued by, any Governmental Authority.
"Letter of Credit" means, individually, any standby letter of
credit issued by an Issuing Bank which is subject to this Agreement,
including, without limitation, the letters of credit described on
Schedule 1.1(b), and "Letters of Credit" means all such letters of
credit collectively.
"Letter of Credit Documents" means, with respect to any Letter
of Credit, such Letter of Credit and any agreements, documents and
instruments entered into in connection with or relating to such Letter
of Credit.
"Letter of Credit Exposure" means, at any time, the sum of (a)
the aggregate undrawn maximum face amount of each Letter of Credit at
such time and (b) the aggregate unpaid amount of all Reimbursement
Obligations at such time.
"Letter of Credit Obligations" means any obligations of the
Borrower under this Agreement in connection with the Letters of Credit.
"Leverage Ratio" means the ratio of the Borrower's Total
Funded Debt to its Adjusted EBITDA.
"Lien" means any mortgage, lien, pledge, charge, deed of
trust, security interest, encumbrance or other type of preferential
arrangement to secure or provide for the payment of any obligation of
any Person, whether arising by contract, operation of law or otherwise
(including, without limitation, the interest of a vendor or lessor
under any conditional sale agreement, Capital Lease or other title
retention agreement).
"Liquid Investments" means:
(a) direct obligations of, or obligations the principal
of and interest on which are unconditionally guaranteed by, the U.S. or
an agency of the U.S.;
-14-
(b) (i) negotiable or nonnegotiable certificates of
deposit, time deposits or other similar banking arrangements maturing
within 180 days from the date of acquisition thereof ("bank debt
securities"), issued by (A) any Bank or (B) any other bank or trust
company which has a combined capital surplus and undivided profit of
not less than $250,000,000 or the Dollar Equivalent thereof, if at the
time of deposit or purchase, such bank debt securities are rated not
less than "A" (or the then equivalent) by the rating service of S&P or
Xxxxx'x, and (ii) commercial paper issued by (A) any Bank or (B) any
other Person if at the time of purchase such commercial paper is rated
not less than "A-2" (or the then equivalent) by the rating service of
S&P or not less than "P-2" (or the then equivalent) by the rating
service of Xxxxx'x, or, upon the discontinuance of both of such
services, such other nationally recognized rating service or services,
as the case may be, as shall be selected by the Borrower with the
consent of the Majority Banks;
(c) repurchase agreements relating to investments
described in clauses (a) and (b) above with a market value at least
equal to the consideration paid in connection therewith, with any
Person who regularly engages in the business of entering into
repurchase agreements and has a combined capital surplus and undivided
profit of not less than $250,000,000 or the Dollar Equivalent thereof,
if at the time of entering into such agreement the debt securities of
such Person are rated not less than "A" (or the then equivalent) by the
rating service of S&P or of Xxxxx'x;
(d) shares of any mutual fund registered under the
Investment Company Act of 1940, as amended, which invests solely in
underlying securities of the types described in clauses (a), (b) and
(c) above and which do not constitute "margin stock" within the meaning
of Regulation U of the Federal Reserve Board; and
(e) such other instruments (within the meaning of Article
9 of the UCC) as the Borrower may request and the Majority Banks may
approve in writing, which approval will not be unreasonably withheld.
"Majority Banks" means, at any time, two or more Banks holding
(either directly in the case of the Revolving Advances or directly or
indirectly through participation interests in the case of the Letter of
Credit Exposure) at least 51% of the sum of (a) the then aggregate
unpaid principal amount of the Revolving Advances and (b) the then
aggregate amount of the Letter of Credit Exposure at such time, or, if
no such principal amount or Letter of Credit Exposure is then
outstanding, Banks having at least 51% of the aggregate amount of the
Commitments at such time.
"Mandatory Revolving Borrowing" means a Revolving Borrowing
comprised of Base Rate Advances made to repay a Swingline Advance which
has not been repaid to Xxxxx Fargo on the date due.
"Material Adverse Change" shall mean a material adverse change
in (a) the business, assets, financial condition or results of
operations of the Borrower and the Guarantors, taken
-15-
as a whole, in each case since the date of the Borrower's latest
quarterly financial statements provided to the Agent, (b) the ability
of the Borrower to pay or perform the Obligations when due or (c) the
validity or enforceability of any of the Credit Documents against the
Borrower or any Subsidiary of the Borrower or any Guarantor then a
party thereto..
"Maturity Date" means May 15, 2005, as such date may be
extended from time to time pursuant to Section 2.18.
"Maximum Rate" means the maximum nonusurious interest rate
under applicable law.
"Moody's" means Xxxxx'x Investors Service, Inc. and any
successor thereto which is a nationally recognized statistical rating
organization.
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which the Borrower or any member of
the Controlled Group is making or accruing an obligation to make
contributions.
"Net Cash Proceeds" means (a) the aggregate cash proceeds
(including without limitation, insurance proceeds) received by the
Borrower or any Subsidiary in connection with any sales, transfers or
dispositions of assets, minus (b) the reasonable expenses of the
Borrower or such Subsidiary in connection with any such sales,
transfers or dispositions of assets, minus (c) the amount, if any, of
all taxes paid by the Borrower or such Subsidiary directly resulting
from such sales, transfers or other dispositions of assets.
"Net Depreciated Value" means, with respect to Revenue
Equipment and Other Equipment, (a) the aggregate value of such Revenue
Equipment and Other Equipment on the books of the Borrower or any
Guarantor as of the date of acquisition thereof by the Borrower or such
Guarantor or the actual cost of such Revenue Equipment or Other
Equipment to the Borrower or such Guarantor, whichever is less (the
"Cost"), minus (b) depreciation computed in accordance with GAAP.
"Net Income" means, for any Person for any period for which
such amount is being determined, the net income of such Person after
taxes, as determined in accordance with GAAP, excluding, however, any
after-tax net gains or losses or costs during such period resulting
from (a) extraordinary items as determined in accordance with GAAP,
including but not limited to any net gain or loss arising from the
sale, exchange or other disposition of capital assets (such term to
include all fixed assets and all securities) other than in the ordinary
course of business or any write-up or write-down of assets, (b) changes
in accounting principles and other one time non cash charges and (c)
the disposition of the Subsidiaries identified on Schedule 1.1(c).
"Net Losses" has the meaning set forth in Section 6.12.
-16-
"Net Purchase Price" means the aggregate cash consideration
paid in connection with any Acquisition Expenditure plus any
assumptions of Indebtedness in connection with such Acquisition
Expenditure.
"Net Worth" means, for any Person, stockholders' equity of
such Person determined in accordance with GAAP.
"New Bank" has the meaning set forth in Section 2.17.
"New Commitment" has the meaning set forth in Section 2.17.
"Non-U.S. Lender" has the meaning set forth in Section
2.11(e).
"Note" means a Revolving Note or the Swingline Note.
"Notice of Borrowing" means a notice of borrowing in the form
of the attached Exhibit F, appropriately completed, signed by a
Responsible Officer of the Borrower.
"Notice of Conversion or Continuation" means a notice of
conversion or continuation in the form of the attached Exhibit G,
appropriately completed, signed by a Responsible Officer of the
Borrower.
"Obligations" means all Advances, Reimbursement Obligations
and all other amounts payable by the Borrower to the Agent or any Bank
under the Credit Documents (including, without limitation, all fees,
costs and expenses (including, without limitation, attorney's fees)
provided for in the Credit Documents).
"Other Equipment" means, with respect to any Person, all
equipment other than Revenue Equipment owned by such Person free and
clear of all Liens.
"Other Taxes" has the meaning set forth in Section 2.11(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Liens" means the Liens permitted to exist pursuant
to Section 6.1.
"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, limited liability company, joint venture or
other entity, or a government or any political subdivision or agency
thereof or any trustee, receiver, custodian or similar official.
"Plan" means an employee benefit plan (other than a
Multiemployer Plan) maintained for employees of the Borrower or any
member of the Controlled Group and covered by
-17-
Title IV of ERISA or subject to the minimum funding standards under
Section 412 of the Code.
"Prime Rate" means a fluctuating interest rate per annum as
shall be in effect from time to time equal to the rate of interest then
most recently publicly announced by or within Xxxxx Fargo at its
principal office in San Francisco, California, as its prime rate
evidenced by the recording thereof after its announcement in such
internal publication or publications as Xxxxx Fargo may designate
(which may not be the lowest rate offered to its customers), whether or
not the Borrower has notice thereof. Each change in the Prime Rate will
be effective on the day such change is announced within Xxxxx Fargo.
"Property" of any Person means any and all property or assets
(whether real, personal, or mixed, tangible or intangible) of such
Person.
"Proposed Participant" has the meaning set forth in Section
9.6(e).
"Pro Rata Share" means, at any time with respect to any Bank,
either (a) the ratio (expressed as a percentage) of such Bank's
Commitment at such time to the aggregate Commitments at such time or
(b) if the Commitments have been terminated, the ratio (expressed as a
percentage) of such Bank's aggregate outstanding Advances and direct
interest (if such Bank is the Issuing Bank with respect to such Letter
of Credit) or participation interest in the Letter of Credit Exposure
at such time to the aggregate outstanding Advances and Letter of Credit
Exposure of all the Banks at such time.
"Real Estate Value" means, with respect to any Eligible Real
Property, the remainder of (a) the greater of (i) the net book value of
such Eligible Real Property as of the date of the most recent Borrowing
Base Certificate delivered to the Banks or (ii) at the sole election of
the Borrower, the appraised value of such Eligible Real Property
provided in an appraisal performed by an independent appraiser approved
by the Agent (which approval shall not be unreasonably withheld) dated
not more than one year prior to the date of the most recent Borrowing
Base Certificate delivered to the Banks, minus (b) the aggregate amount
of Indebtedness secured by Liens on such Property.
"Receivables" means all rights to receive payment for goods
sold or for services rendered in the ordinary course of business.
"Recovery Period" has the meaning set forth in Section 6.12.
"Register" has the meaning set forth in Section 9.6(c).
"Regulation D" means Regulation D of the Board of Governors of
the Federal Reserve System as the same may be amended, modified or
supplemented from time to time or any successor regulation thereto.
-18-
"Reimbursement Obligations" means all of the obligations of
the Borrower set forth in Section 2.13(c).
"Release" shall have the meaning set forth in CERCLA or under
any other Environmental Law.
"Reportable Event" means any of the events set forth in
Section 4043(b) of ERISA.
"Response" shall have the meaning set forth in CERCLA or under
any other Environmental Law.
"Responsible Officer" means, with respect to any Person, the
chief executive officer, the president, the chief financial officer,
any vice president, the treasurer or the secretary of such Person.
"Restricted Payment" means (a) any direct or indirect payment,
prepayment, redemption, purchase, or deposit of funds or Property for
the payment (including any sinking fund or defeasance), prepayment,
redemption or purchase of Subordinated Debt, and (b) the making by any
Person of any dividends or other distributions (in cash, property or
otherwise) on, or payment for the purchase, redemption or other
acquisition of, any shares of any Capital Stock of such Person, other
than dividends payable in the same class of such Person's Capital
Stock.
"Revenue Equipment" means, with respect to any Person, all
trucks, tractors, trailers, city tractors, converter gears and all
accessories and parts attached thereto, owned by such Person as of the
date of determination free and clear of all Liens.
"Revolving Advance" means any advance by a Bank to the
Borrower pursuant to Section 2.1(a).
"Revolving Borrowing" means a borrowing consisting of
simultaneous Revolving Advances of the same Type made by each Bank
pursuant to Section 2.1(a) or Converted by each Bank to Revolving
Advances of a different Type pursuant to Section 2.2(b).
"Revolving Note" means a promissory note of the Borrower
payable to the order of any Bank, in substantially the form of the
attached Exhibit H, appropriately completed, evidencing indebtedness of
the Borrower to such Bank resulting from Revolving Advances owing to
such Bank.
"S&P" means Standard & Poor's Ratings Service, a division of
The XxXxxx-Xxxx Companies, Inc., or any successor thereof which is a
nationally recognized statistical rating organization.
"Senior Debt" means the Senior Secured Debt or the Senior
Unsecured Debt; provided, however, that if Moody's and/or S&P have
different ratings for the Senior Secured
-19-
Debt and the Senior Unsecured Debt, then "Senior Debt" shall mean the
Senior Unsecured Debt.
"Senior Secured Debt" means the Borrower's senior, secured,
non-credit enhanced, long-term indebtedness for borrowed money.
"Senior Unsecured Debt" means the Borrower's senior,
unsecured, non-credit enhanced, long-term indebtedness for borrowed
money; provided, however, that if either Moody's or S&P does not rate
the Borrower's Senior Unsecured Debt, then all references in this
Agreement to such rating agency's rating of "Senior Unsecured Debt"
shall mean the Borrower's "corporate credit rating".
"Subordinated Debt" means any Indebtedness of the Borrower or
any of its Subsidiaries which is subordinated to their respective
obligations under the Credit Documents and which is on terms and
conditions satisfactory to the Agent and the Majority Banks.
"Subordinated Debt Documents" means all documents, instruments
and agreements now or hereafter executed by the Borrower or any of its
Subsidiaries in respect of Subordinated Debt and any and all
amendments, modifications, supplements, renewals or restatements
thereof (if any) which may be permitted in accordance with this
Agreement.
"Subsidiary" of a Person means any corporation, association,
partnership or other business entity of which more than 50% of the
outstanding shares of Capital Stock having by the terms thereof
ordinary voting power under ordinary circumstances to elect a majority
of the board of directors or Persons performing similar functions (or,
if there are no such directors or Persons, having general voting power)
of such entity (irrespective of whether at the time Capital Stock of
any other class or classes of such entity shall or might have voting
power upon the occurrence of any contingency) is at the time directly
or indirectly owned or controlled by such Person, by such Person and
one or more Subsidiaries of such Person or by one or more Subsidiaries
of such Person.
"Supplementing Banks" has the meaning set forth in Section
2.17.
"Swingline Advance" has the meaning set forth in Section
2.1(b).
"Swingline Note" means a promissory note of the Borrower
payable to the order of Xxxxx Fargo in substantially the form of the
attached Exhibit I, appropriately completed, evidencing the
indebtedness of the Borrower to Xxxxx Fargo from Swingline Advances
owing to Xxxxx Fargo.
"Synthetic Lease" means any synthetic lease, tax retention
operation lease or similar financing transaction where such transaction
is considered borrowed money indebtedness for tax purposes, but is
classified as an operating lease in accordance with GAAP.
-20-
"Taxes" has the meaning set forth in Section 2.11(a).
"Termination Event" means (a) the occurrence of a Reportable
Event with respect to a Plan, as described in Section 4043 of ERISA and
the regulations issued thereunder (other than a Reportable Event not
subject to the provision for 30-day notice to the PBGC under such
regulations), (b) the withdrawal of the Borrower or any of its
Affiliates from a Plan during a plan year in which it was a
"substantial employer" as defined in Section 4001(a)(2) of ERISA, (c)
the giving of a notice of intent to terminate a Plan under Section
4041(c) of ERISA, (d) the institution of proceedings to terminate a
Plan by the PBGC or (e) any other event or condition which constitutes
grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan.
"Termination Notice" has the meaning set forth in Section
2.4(b).
"Treadco Pension Plan" means the noncontributory defined
benefit plan covering employees of Tread-Ark Corporation (formerly
Treadco, Inc.) dated effective January 1, 1972.
"Total Funded Debt" means (without duplication), on a
Consolidated basis and at any time, the sum of (a) all Indebtedness of
the Borrower and/or any of its Subsidiaries, other than Indebtedness
consisting of (i) indebtedness for which the Borrower and its
Subsidiaries are obligated only by virtue of a guaranty of such
indebtedness, (ii) obligations of the Borrower and its Subsidiaries in
respect of standby letters of credit associated with the replacement of
surety bonds not to exceed $45,000,000 in aggregate amount, (iii) trade
payables or bank drafts and (iv) Indebtedness referred to in clause (d)
of the definition of such term, plus (b) the present value of all lease
payments at any time then or thereafter payable under all Synthetic
Leases (discounted at the interest rate implicit in the Synthetic
Leases or, if such implicit rate cannot be determined, at the Base
Rate).
"Type" has the meaning set forth in Section 1.4.
"UCC" means the Uniform Commercial Code as in effect in the
State of
Texas and/or any other jurisdiction, the laws of which may be
applicable to or in connection with the creation, perfection or
priority of any Lien on any Property.
"U.S." means the United States of America.
"Xxxxx Fargo" means Xxxxx Fargo Bank
Texas, National
Association.
"Wingfoot" means Wingfoot Commercial Tire Systems L.L.C..
"Wingfoot Put and Call" means (a) the right a wholly-owned
Subsidiary of the Borrower has, at any time after April 30, 2003 until
April 30, 2004, to sell its interest in Wingfoot to The Goodyear Tire &
Rubber Company ("Goodyear") for a cash "put price" equal to
approximately $73,400,000 (the "Put Price") or (b) the right Goodyear
has, at any
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time after April 30, 2003 until October 31, 2004, to purchase the
Borrower's entire interest in Wingfoot, for cash, at a "call price"
equal to the Put Price plus $5,000,000.
Section 1.2 Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".
Section 1.3 Accounting Terms; Changes in GAAP.
(a) Subject to Section 1.3(c), all accounting terms not
specifically defined in this Agreement shall be construed in accordance
with GAAP applied on a consistent basis with those applied in the
preparation of the Financial Statements.
(b) Unless otherwise indicated, all financial statements of
the Borrower, all calculations for compliance with covenants in this
Agreement and all calculations of any amounts to be calculated under
the definitions in Section 1.1 shall be based upon the Consolidated
accounts of the Borrower and its Subsidiaries in accordance with GAAP.
(c) If any changes in accounting principles after the
Effective Date are (i) required by GAAP or the Financial Accounting
Standards Board of the American Institute of Certified Public
Accountants or similar agencies, or (ii) recommended by the Borrower or
its certified public accountants and implemented by the Borrower and
such change results in a change in the method of calculation of, or
affects the results of such calculation of, any of the financial
covenants, standards or terms found in this Agreement and the Borrower
notifies the Agent that the Borrower requests an amendment to any
provision of this Agreement to eliminate the effect of such change or
(iii) if the Agent notifies the Borrower that the Agent or the Majority
Banks request an amendment to any provision of this Agreement for such
purpose, regardless of whether any such notice is given before or after
such change in GAAP or in the application thereof, then the parties
shall enter into and diligently pursue negotiations in order to amend
such financial covenants, standards or terms so as to equitably reflect
such change, with the desired result that the criteria for evaluating
the Borrower's and its Consolidated Subsidiaries' financial condition
shall be the same after such change as if such change had not been
made. Notwithstanding anything to the contrary contained in this
Agreement, from the date of any such request in accordance with this
Section 1.3(c) and until such time (if ever) as such an amendment shall
have been executed and delivered by the Borrower, the Agent and the
Banks or the request for such an amendment has been withdrawn by the
Person or Persons making such request, all financial covenants,
standards and terms in this Agreement shall continue to be calculated
or construed as if such changes in accounting principles required by
GAAP or recommended by the Borrower or the Borrower's certified public
accountants and implemented by the Borrower had not occurred.
(d) To enable the ready and consistent determination of
compliance with the covenants set forth in this Agreement, neither the
Borrower nor any of its Subsidiaries will change the last day of its
fiscal year from December 31st or the last days of the first three
fiscal quarters of the Borrower and its Subsidiaries in each of its
fiscal years from that
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existing on the Closing Date unless the Borrower has given written
notice to the Agent of the Borrower's intention to make such change at
least 60 days prior to the effective date of such change.
Section 1.4 Types of Advances. Advances are distinguished by "Type".
The "Type" of an Advance refers to the determination whether such Advance is a
Base Rate Advance or Eurodollar Rate Advance, each of which constitutes a Type.
Section 1.5 Miscellaneous. Article, Section, Schedule and Exhibit
references are to Articles and Sections of and Schedules and Exhibits to this
Agreement, unless otherwise specified.
ARTICLE II
THE ADVANCES AND THE LETTERS OF CREDIT
Section 2.1 The Advances.
(a) Revolving Advances. Subject to the succeeding proviso,
each Bank severally agrees, on the terms and conditions set forth in
this Agreement, to make Revolving Advances to the Borrower from time to
time on any Business Day prior to the Maturity Date in an aggregate
amount not to exceed at any time outstanding an amount equal to the
remainder of such Bank's Commitment minus such Bank's Pro Rata Share of
the Letter of Credit Exposure at such time; provided, however, that the
aggregate amount of all outstanding Revolving Advances, all outstanding
Swingline Advances and the Letter of Credit Exposure at any time may
not exceed the lesser of (i) the aggregate Commitments at such time or
(ii) the Borrowing Base at such time. Within the limits of each Bank's
Commitment and the Borrowing Base limitation set forth above, the
Borrower may from time to time borrow, prepay (in whole or in part) and
reborrow Revolving Advances.
(b) Swingline Advances. Subject to the succeeding proviso, on
the terms and conditions set forth in this Agreement, Xxxxx Fargo may,
in its sole discretion from time to time on any Business Day during the
period from the date of this Agreement until the Maturity Date, make
advances ("Swingline Advances") under the Swingline Note to the
Borrower in an aggregate principal amount not to exceed $15,000,000
outstanding at any time; provided, however, that the aggregate amount
of all outstanding Revolving Advances, all outstanding Swingline
Advances and the Letter of Credit Exposure at any time may not exceed
the lesser of (i) the aggregate Commitments at such time or (ii) the
Borrowing Base at such time; and provided, further, than no Swingline
Advance shall be made by Xxxxx Fargo if, to its knowledge, the
statements set forth in Section 3.2(a) are not true on the date of such
Swingline Advance, it being agreed by the Borrower that the giving of
the applicable Notice of Borrowing and the acceptance by the Borrower
of the proceeds of such Swingline Advance shall constitute a
representation and warranty by the Borrower that on the date of such
Swingline Advance such statements are true. Subject to the other
provisions hereof, the Borrower may from time to time borrow, prepay
(in whole or in part) and reborrow Swingline Advances.
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(A) Except as provided in the following clause (B) below,
each request for a Swingline Advance shall be made pursuant to
telephone notice to Xxxxx Fargo given no later than 1:00 p.m. (Dallas,
Texas time) on the date of the proposed Swingline Advance, promptly
confirmed by a completed and executed Notice of Borrowing telecopied to
the Agent. Xxxxx Fargo will promptly make the Swingline Advance
available to the Borrower at the Borrower's account designated in its
written notice to the Agent.
(B) The Borrower and the Banks agree that in the event
any Swingline Advance is not repaid on the date due to Xxxxx Fargo,
each Bank shall pay to the Agent its Pro Rata Share of such Swingline
Advance and such payment shall be deemed to be a Base Rate Advance made
pursuant to such Bank's Commitment, whether made before or after
termination of the Commitments, acceleration of the Advances or
otherwise, and whether or not a Default has then occurred or is
continuing or any of the other conditions precedent set forth in
Article III have been satisfied. The Agent shall give each Bank notice
of such Mandatory Revolving Borrowing by 11:00 a.m. (Dallas, Texas
time) on the date the Mandatory Revolving Borrowing is to be made. Each
Bank shall make its Advance available to the Agent for the account of
Xxxxx Fargo in immediately available funds by 1:00 p.m. (Dallas, Texas
time) on the date requested, and the Borrower hereby irrevocably
instructs Xxxxx Fargo to apply the proceeds of such Mandatory Revolving
Borrowing to the payment of the outstanding Swingline Advances.
Section 2.2 Method of Borrowing.
(a) Notice. Each Revolving Borrowing shall be made pursuant to
a Notice of Borrowing given, not later than (i) 11:00 a.m. (Dallas,
Texas time) on the third Business Day before the date of the proposed
Borrowing, in the case of a Eurodollar Rate Advance or (ii) 11:00 a.m.
(Dallas, Texas time) on the Business Day of the proposed Borrowing, in
the case of a Base Rate Advance, by the Borrower to the Agent, and on
the day of its receipt of a timely Notice of Borrowing, the Agent shall
transmit a copy of such notice to each Bank by telecopier; provided,
however, that the Agent and each of the Banks hereby waive the
requirement in clause (i) of this Section 2.2(a) that the Borrower
provide three Business Days advance written notice of the date of the
initial Borrowing. Each Swingline Advance shall be made pursuant to a
Notice of Borrowing given by the Borrower to each of the Agent and
Xxxxx Fargo not later than 1:00 p.m. (Dallas, Texas time) on the day of
the proposed Borrowing. Each Notice of Borrowing shall be in writing or
by telecopier specifying the requested (A) date of such Borrowing, (B)
Type of Advances comprising such Borrowing, (C) aggregate amount of
such Borrowing, and (D) if such Borrowing is to be comprised of
Eurodollar Rate Advances, the Interest Period for each such Advance. In
the case of a proposed Borrowing comprised of Eurodollar Rate Advances,
the Agent shall promptly notify each Bank of the applicable interest
rate under Section 2.6(b). Each Bank shall (1) in the case of all
Revolving Borrowings other than Borrowings made on the same day as the
day the Notice of Borrowing is received, before 1:00 p.m. (Dallas,
Texas time) on the date of such Borrowing and (2) in the case of
Revolving Borrowings made on the same day as the date of the Notice of
Borrowing or Mandatory Revolving Borrowings, before 1:00 p.m. (Dallas,
Texas time), make available for the account of its Applicable Lending
Office to the Agent at the Agent's address referred to in Section 9.2,
or such other location as the Agent
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may specify by notice to the Banks, in same day funds, such Bank's Pro
Rata Share of such Borrowing. After the Agent's receipt of such funds
and, except in the case of Mandatory Revolving Borrowings, upon
fulfillment of the applicable conditions set forth in Article III, the
Agent will make such funds available to the Borrower or, in the case of
Mandatory Revolving Borrowings, to Xxxxx Fargo, in each case at the
Borrower's or Xxxxx Fargo's (as applicable) account designated in its
respective written notice to the Agent.
(b) Conversions and Continuations. In order to elect to
Convert or continue Advances comprising part of the same Revolving
Borrowing under this Section, the Borrower shall deliver an irrevocable
Notice of Conversion or Continuation to the Agent at the Agent's office
no later than 11:00 a.m. (Dallas, Texas time) (i) on the Business Day
of the proposed conversion date in the case of a Conversion of such
Advances to Base Rate Advances and (ii) at least three Business Days in
advance of the proposed Conversion or continuation date in the case of
a Conversion to, or a continuation of, Eurodollar Rate Advances. Each
such Notice of Conversion or Continuation shall be in writing or by
telecopier, specifying (A) the requested Conversion or continuation
date (which shall be a Business Day), (B) the Borrowing amount and Type
of the Advances to be Converted or continued, (C) whether a Conversion
or continuation is requested and, if a Conversion, into what Type of
Advances, and (D) in the case of a Conversion to, or a Continuation of,
Eurodollar Rate Advances, the requested Interest Period. Revolving
Advances may only be Converted or continued as Revolving Advances.
Swingline Advances may not be Converted or continued. Promptly after
receipt of a Notice of Conversion or Continuation under this Section
2.2(b), the Agent shall provide each Bank with a copy thereof and, in
the case of a Conversion to or a continuation of Eurodollar Rate
Advances, notify each Bank of the applicable interest rate under
Section 2.6(b). For purposes other than the conditions set forth in
Section 3.2, the portion of Revolving Advances comprising part of the
same Revolving Borrowing that are Converted to Revolving Advances of
another Type shall constitute a new Revolving Borrowing.
(c) Certain Limitations. Notwithstanding anything in Sections
2.2(a) and 2.2(b) above:
(i) each Borrowing (other than a Borrowing of
Swingline Advances) shall be in an aggregate amount not less
than (A) $1,000,000 or greater multiples of $500,000, in the
case of Eurodollar Rate Advances, or (B) $500,000 or greater
multiples of $100,000, in the case of Base Rate Advances, and
shall consist of Advances of the same Type made on the same
day by the Banks ratably according to their respective
Commitments;
(ii) at no time shall there be more than five
Interest Periods applicable to outstanding Eurodollar Rate
Advances;
(iii) the Borrower may not select Eurodollar Rate
Advances for any Borrowing to be made if (A) the aggregate
amount of such Borrowing is less than $1,000,000 or (B) a
Default has occurred and is continuing;
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(iv) the Borrower may not select Eurodollar Rate
Advances for any Borrowing to be Converted or continued if (A)
the aggregate amount of such Borrowing is less than $1,000,000
or (B) an Event of Default has occurred and is continuing;
(v) (A) if any Bank shall, at any time prior to the
making of any requested Borrowing comprised of Eurodollar Rate
Advances, notify the Agent that the introduction of or any
change in or in the interpretation of any law or regulation
makes it unlawful, or that any central bank or other
Governmental Authority asserts that it is unlawful, for such
Bank or its Eurodollar Lending Office to perform its
obligations under this Agreement to make Eurodollar Rate
Advances or to fund or maintain Eurodollar Rate Advances, such
Bank's Pro Rata Share of such Borrowing shall be made as a
Base Rate Advance of such Bank, but otherwise shall be
considered part of the same Borrowing and interest on such
Base Rate Advance shall be due and payable at the same time
that interest on the Eurodollar Rate Advances comprising the
remainder of such Borrowing shall be due and payable; and (B)
such Bank agrees to use commercially reasonable efforts
(consistent with its internal policies and legal and
regulatory restrictions) to designate a different Applicable
Lending Office if the making of such designation would avoid
the effect of this clause (v) and would not, in the reasonable
judgment of such Bank, be otherwise disadvantageous to such
Bank;
(vi) if the Agent is unable to determine the
Eurodollar Rate for Eurodollar Rate Advances comprising any
requested Borrowing, the right of the Borrower to select
Eurodollar Rate Advances for such Borrowing or for any
subsequent Borrowing shall be suspended until the Agent shall
notify the Borrower and the Banks that the circumstances
causing such suspension no longer exist, and each Advance
comprising such Borrowing shall be a Base Rate Advance;
(vii) if the Majority Banks shall, at least one
Business Day before the date of any requested Borrowing,
notify the Agent that the Eurodollar Rate for Eurodollar Rate
Advances comprising such Borrowing will not adequately reflect
the cost to such Banks of making or funding their respective
Eurodollar Rate Advances, as the case may be, for such
Borrowing, the right of the Borrower to select Eurodollar Rate
Advances for such Borrowing or for any subsequent Borrowing
shall be suspended until the Agent shall notify the Borrower
and the Banks that the circumstances causing such suspension
no longer exist, and each Advance comprising such Borrowing
shall be a Base Rate Advance; and
(viii) if the Borrower shall fail to select the
duration or continuation of any Interest Period for any
Eurodollar Rate Advances in accordance with the provisions
contained in the definition of "Interest Period" in Section
1.1 and Section 2.2(a) or 2.2(b) above, the Agent will
forthwith so notify the Borrower and the Banks and such
Advances will be made available to the Borrower on the date of
such Borrowing as Base Rate Advances or, if an existing
Advance, Converted into Base Rate Advances.
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(d) Notices Irrevocable. Each Notice of Borrowing and Notice
of Conversion or Continuation shall be irrevocable and binding on the
Borrower. In the case of any Borrowing which the related Notice of
Borrowing specifies is to be comprised of Eurodollar Rate Advances, the
Borrower shall indemnify each Bank against any loss or out-of-pocket
cost or expense incurred by such Bank as a result of any condition
precedent for Borrowing set forth in Article III not being satisfied or
waived by the Agent and the Majority Banks for any reason, including,
without limitation, any loss, cost or expense actually incurred by
reason of the liquidation or reemployment of deposits or other funds
acquired by such Bank to fund the Advance to be made by such Bank as
part of such Borrowing when such Advance, as a result of such failure,
is not made on such date.
(e) Agent Reliance. Unless the Agent shall have received
notice from a Bank before the date of any Revolving Borrowing or
Mandatory Revolving Borrowing that such Bank will not make available to
the Agent such Bank's Pro Rata Share of the Borrowing, the Agent may
assume that such Bank has made its Pro Rata Share of such Borrowing
available to the Agent on the date of such Borrowing in accordance with
Section 2.2(a) and the Agent may, in reliance upon such assumption,
make available to the Borrower on such date a corresponding amount. If
and to the extent that such Bank shall not have so made its Pro Rata
Share of such Borrowing available to the Agent, such Bank and the
Borrower severally agree to immediately repay to the Agent on demand
such corresponding amount, together with interest on such amount, for
each day from the date such amount is made available to the Borrower
until the date such amount is repaid to the Agent, at (i) in the case
of the Borrower, the interest rate applicable on such day to Advances
comprising such Borrowing and (ii) in the case of such Bank, the
Federal Funds Rate for such day. If such Bank shall repay to the Agent
such corresponding amount and interest as provided above, such
corresponding amount so repaid shall constitute such Bank's Advance as
part of such Borrowing for purposes of this Agreement even though not
made on the same day as the other Advances comprising such Borrowing.
(f) Bank Obligations Several. The failure of any Bank to make
the Advance to be made by it as part of any Borrowing shall not relieve
any other Bank of its obligation, if any, to make its Advance on the
date of such Borrowing. No Bank shall be responsible for the failure of
any other Bank to make the Advance to be made by such other Bank on the
date of any Borrowing.
(g) Notes. The indebtedness of the Borrower to each Bank
resulting from Revolving Advances owing to such Bank shall be evidenced
by the Revolving Note of the Borrower payable to the order of such Bank
in substantially the form of Exhibit H, appropriately completed. The
indebtedness of the Borrower to Xxxxx Fargo resulting from Swingline
Advances owing to Xxxxx Fargo shall be evidenced by the Swingline Note
of the Borrower payable to the order of Xxxxx Fargo in substantially
the form of Exhibit I, appropriately completed.
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Section 2.3 Fees.
(a) Facility Fees. The Borrower agrees to pay to the Agent,
for the pro rata benefit of the Banks, a facility fee on the average
daily aggregate amount of the Commitments, irrespective of the
Borrower's usage of such Commitments, at a rate per annum equal to the
Applicable Margin for the period from the Effective Date until the
Maturity Date, which fee shall be due and payable quarterly in arrears
on the last Business Day of each March, June, September and December
and on the Maturity Date.
(b) Letter of Credit Fees. The Borrower agrees to pay to the
Agent, for the pro rata benefit of the Banks, a fee in respect of all
Letters of Credit outstanding at a rate per annum equal to the
Applicable Margin calculated on the average daily maximum amount
available from time to time to be drawn under such outstanding Letters
of Credit, which fee shall be due and payable quarterly in arrears on
the last Business Day of each March, June, September and December and
on the Maturity Date. In addition to the fees referred to in the
preceding sentence, the Borrower agrees to pay to each Issuing Bank for
its own account amendment, transfer and negotiation fees, in respect of
all Letters of Credit outstanding and issued by such Issuing Bank,
which fees shall be due and payable in such amounts, at such times and
otherwise in accordance with such Issuing Bank's then current policy.
(c) Agent Fees. The Borrower agrees to pay to the Agent and/or
Xxxxx Fargo, for its benefit, the fees set forth in the Agent's Fee
Letter.
Section 2.4 Reduction of the Commitments.
(a) Voluntary Reduction. The Borrower shall have the right,
upon at least three Business Days' irrevocable notice to the Agent, to
terminate in whole or reduce ratably in part the unused portion of the
Commitments; provided that each partial reduction shall be in the
aggregate amount of $1,000,000 or greater multiples of $1,000,000.
Subject to Section 2.17, any termination or reduction of the
Commitments pursuant to this Section 2.4 shall be permanent, with no
obligation of the Banks to reinstate such Commitments and the facility
fees provided for in Section 2.3(a) shall thereafter be computed on the
basis of the Commitments, as so reduced.
(b) Change of Control. Upon the occurrence of any of the
following:
(i) a change in control is reported by the Borrower
in response to either Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), or
(ii) any "person" (as such term is used in Section
13(d) and Section 14(d)(2) of the Exchange Act) is or becomes
the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of voting Capital Stock
of the Borrower (or securities convertible into or
exchangeable for such Capital Stock) representing the Control
Percentage or more of the combined voting power of the
Borrower's then outstanding Capital Stock,
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then, in such event the Majority Banks may, at their sole option upon written
notice to the Borrower (a "Termination Notice"), declare the obligation of each
Bank to make Advances and the obligation of each Issuing Bank to issue, increase
or extend Letters of Credit to be terminated, whereupon the same shall forthwith
terminate and the Commitments shall reduce to zero.
Section 2.5 Repayment of Advances.
(a) Revolving Advances. The Borrower shall repay the
outstanding principal amount of each Revolving Advance on the Maturity
Date.
(b) Swingline Advances. The Borrower shall repay the
outstanding principal amount of each Swingline Advance on the earlier
of the Maturity Date or the date which is three Business Days after the
date such Swingline Advance was made.
Section 2.6 Interest. The Borrower shall pay interest on the unpaid
principal amount of each Advance from the date of such Advance until such
principal amount shall be paid in full, at the following rates per annum:
(a) Base Rate Advances. If such Advance is a Base Rate
Advance, a rate per annum equal, at all times, to the lesser of (i) the
Base Rate in effect from time to time plus the Applicable Margin and
(ii) the Maximum Rate, payable in arrears on the last Business Day of
each calendar quarter and on the date such Base Rate Advance is payable
in full, provided that any amount of principal which is not paid when
due (whether at stated maturity, by acceleration or otherwise) shall
bear interest from the date on which such amount is due until such
amount is paid in full, payable on demand, at a rate per annum equal at
all times to the lesser of (A) the rate required to be paid on such
Advance immediately prior to the date on which such amount becomes due
plus two percent (2%) and (B) the Maximum Rate.
(b) Eurodollar Rate Advances. If such Advance is a Eurodollar
Rate Advance, a rate per annum equal, at all times during the Interest
Period for such Advance, to the lesser of (i) the Eurodollar Rate for
such Interest Period plus the Applicable Margin and (ii) the Maximum
Rate, payable in arrears on the last day of such Interest Period and on
the date such Eurodollar Rate Advance is payable in full; provided,
however, in the case of an Interest Period greater than three months,
accrued interest shall also be payable on the date that is three months
after the first day of such Interest Period; and provided, further,
that any amount of principal which is not paid when due (whether at
stated maturity, by acceleration or otherwise) shall bear interest from
the date on which such amount is due until such amount is paid in full,
payable on demand, at a rate per annum equal at all times to the lesser
of (A) the greater of (1) the Base Rate in effect from time to time
plus two percent (2%) and (2) the rate required to be paid on such
Advance immediately prior to the date on which such amount became due
plus two percent (2%) and (B) the Maximum Rate.
(c) Swingline Advances. If such Advance is a Swingline
Advance, a rate per annum equal, at all times, to the lesser of (i) the
rate agreed to pursuant to the the letter agreement between the
Borrower and Xxxxx Fargo dated May 15, 2002 and (ii) the Maximum
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Rate, payable in arrears on the earlier of the Maturity Date of this
Agreement or the last Business Day of each calendar quarter and, if a
Default has then occurred and is continuing, on the date such Swingline
Advance is payable in full, provided that any amount of principal which
is not paid when due (whether at stated maturity, by acceleration or
otherwise) shall bear interest from the date on which such amount is
due until such amount is paid in full, payable on demand, at a rate per
annum equal at all times to the lesser of (1) the rate required to be
paid on such Advance immediately prior to the date on which such amount
becomes due plus two percent (2%) and (2) the Maximum Rate.
(d) Usury Recapture. In the event that, but for limitations
regarding the Maximum Rate set forth in this Agreement, the rate of
interest otherwise chargeable under this Agreement at any time is
greater than the Maximum Rate, then the unpaid principal amount of the
Advances shall bear interest at the Maximum Rate until the total amount
of interest paid or accrued on the Advances equals the amount of
interest which would have been paid or accrued on the Advances if the
stated rates of interest set forth in this Agreement, without giving
effect to limitations regarding the Maximum Rate set forth in this
Agreement, had at all times been in effect. In the event, upon payment
in full of the Advances, the total amount of interest paid or accrued
under the terms of this Agreement on the Advances is less than the
total amount of interest which would have been paid or accrued if the
rates of interest set forth in this Agreement, without giving effect to
limitations regarding the Maximum Rate set forth in this Agreement,
had, at all times, been in effect, then the Borrower shall, to the
extent permitted by applicable law, pay the Agent for the account of
the Banks an amount equal to the difference between (i) the lesser of
(A) the amount of interest which would have been charged on the
Advances if the Maximum Rate had, at all times, been in effect and (B)
the amount of interest which would have accrued on the Advances if the
rates of interest set forth in this Agreement, without giving effect to
limitations regarding the Maximum Rate set forth in this Agreement, had
at all times been in effect and (ii) the amount of interest actually
paid or accrued under this Agreement on the Advances. In the event the
Banks ever receive, collect or apply as interest any sum in excess of
the Maximum Rate, such excess amount shall, to the extent permitted by
law, be applied to the reduction of the principal balance of the
Advances, and if no such principal is then outstanding, such excess or
part thereof remaining shall be paid to the Borrower.
(e) Default Interest. Notwithstanding anything to the contrary
contained in this Agreement, (i) at all times during which an Event of
Default has occurred and is continuing, interest shall accrue and be
payable on the outstanding principal amount of each Advance, and (ii)
to the fullest extent permitted by applicable law and whether or not an
Event of Default has occurred and is continuing, interest shall accrue
on any other amount of the Obligations which is not paid in full when
due (whether at stated maturity, by acceleration or otherwise), in each
case payable on demand at a rate per annum equal to the lesser of (A)
the Base Rate plus two percent (2%) and (B) the Maximum Rate, which
interest at such rate shall accrue from the initial date of the giving
of notice by the Agent to the Borrower of the occurrence of such Event
of Default (as to clause (i) preceding) or from the date such amount of
the Obligations became due until the date such amount is paid in full
(as to clause (ii) preceding).
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Section 2.7 Prepayments.
(a) Right to Prepay. The Borrower shall have no right to
prepay any principal amount of any Advance except as provided in this
Section 2.7.
(b) Optional Prepayments. The Borrower may elect to prepay any
of the Advances, after giving notice thereof to the Agent (i) by 11:00
a.m. (Dallas, Texas time) on the day of prepayment of any Swingline
Advance, and (ii) by 11:00 a.m. (Dallas Texas time) at least three
Business Days' prior to the day of prepayment of any Eurodollar Rate
Advances and at least one Business Day prior to the day of prepayment
of any Base Rate Advances. Such notice must state the proposed date and
aggregate principal amount of such prepayment, whether such prepayment
should be applied to reduce outstanding Revolving Advances or Swingline
Advances, and if applicable, the relevant Interest Period for the
Advances to be prepaid. If any such notice is given, the Borrower shall
prepay Advances comprising part of the same Borrowing in whole or
ratably in part in an aggregate principal amount equal to the amount
specified in such notice, and shall also pay accrued interest to the
date of such prepayment on the principal amount prepaid and amounts, if
any, required to be paid pursuant to Section 2.8 as a result of such
prepayment being made on such date; provided, however, that each
partial prepayment of Eurodollar Rate Advances shall be in an aggregate
principal amount not less than $1,000,000 or greater multiples of
$500,000.
(c) Mandatory Prepayments.
(i) Change of Control. On the fifth Business Day
following the Borrower's receipt of a Termination Notice
pursuant to Section 2.4(b) hereof, the Borrower shall be
required to prepay all outstanding Advances and all other
unpaid Obligations in full and to deposit with the Agent into
the Cash Collateral Account an amount equal to the Letter of
Credit Exposure.
(ii) Borrowing Base Deficiency. On each Borrowing
Base Determination Date, the Borrower shall be required to
prepay the Advances in an aggregate amount equal to the
positive remainder, if any, of (A) the aggregate amount of all
outstanding Advances and the Letter of Credit Exposure on such
date minus (B) the Borrowing Base, as determined on such
Borrowing Base Determination Date (or, upon payment in full of
all outstanding Advances, to deposit with the Agent into the
Cash Collateral Account an amount equal to the amount by which
the Letter of Credit Exposure exceeds the Borrowing Base).
(iii) Reduction of Commitments. In the event the
Commitments are reduced in accordance with Section 2.4(a), the
Borrower shall prepay the Advances to the extent the aggregate
amount of all outstanding Advances and the Letter of Credit
Exposure exceeds the aggregate amount of the Commitments after
giving effect to such reduction (or, upon payment in full of
all outstanding Advances, to deposit with the Agent into the
Cash Collateral Account an amount equal to the amount by which
the Letter of Credit Exposure exceeds the Commitments as so
reduced).
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(iv) Accrued Interest. Each prepayment pursuant to
this Section 2.7(c) shall be accompanied by accrued interest
on the amount prepaid to the date of such prepayment and
amounts, if any, required to be paid pursuant to Section 2.8
as a result of such prepayment being made on such date.
(v) Avoidance of Breakage Costs. In the event that
the amount of any mandatory prepayment of Advances under this
Section 2.7(c) exceeds the aggregate principal amount of
Advances which consist of Base Rate Advances (the amount of
such excess being the "Excess Amount"), the Borrower shall
have the right, in lieu of making such prepayment in full, to
prepay such outstanding Advances which are Base Rate Advances
and to deposit an amount equal to the Excess Amount with the
Agent in the Cash Collateral Account maintained by and in the
sole dominion and control of the Agent for the ratable benefit
of the Banks. Any amount so deposited shall be held by the
Agent as collateral for the Obligations and applied to the
prepayment of Advances which are Eurodollar Rate Advances at
the end of the current Interest Period(s) applicable thereto.
On any day on which amounts collected in the Cash Collateral
Account remain on deposit in or to the credit of the Cash
Collateral Account after giving effect to the payment made on
such day pursuant to this Section 2.7(c), and the Borrower
shall have delivered to the Agent a written request or a
telephonic request (which shall be promptly confirmed in
writing) prior to 10:00 am (Dallas, Texas time) that such
remaining collected amounts be invested in cash equivalents
specified in such request, the Agent shall invest such funds,
to the extent the Agent is reasonably able to do so, in such
cash equivalents as are acceptable to, and with no risk to,
the Agent on an overnight basis or with maturities such that
amounts will be available to pay the Obligations secured
thereby as they become due, whether at maturity, by
acceleration or otherwise; provided, however, that any loss
resulting from such investments shall be charged to and be
immediately payable by the Borrower on demand by the Agent.
(d) Ratable Payments. Each payment of any Advance pursuant to
this Section 2.7 or any other provision of this Agreement shall be made
in a manner such that all Advances comprising part of the same
Borrowing are paid in whole or ratably in part.
(e) Effect of Notice. All notices given pursuant to this
Section 2.7 shall be irrevocable and binding upon the Borrower.
Section 2.8 Breakage Costs. If (a) any payment of principal of any
Eurodollar Rate Advance is made other than on the last day of the Interest
Period for such Advance as a result of any payment pursuant to Section 2.7 or
the acceleration of the maturity of the Advances pursuant to Article VII or
otherwise, (b) any Conversion of a Eurodollar Rate Advance is made other than on
the last day of the Interest Period for such Advance pursuant to Section 2.12 or
otherwise, or (c) the Borrower fails to make a principal or interest payment
with respect to any Eurodollar Rate Advance on the date such payment is due and
payable, the Borrower shall, within 10 days of any written demand sent by any
Bank to the Borrower through the Agent, pay to the Agent for the account of such
Bank any amounts (without duplication of any other amounts payable in respect of
breakage costs) required to compensate such Bank for any additional losses or
out-of-pocket costs or expenses
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which it may reasonably incur as a result of such payment or nonpayment,
including, without limitation, any loss (including loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Bank to fund or maintain such Advance.
Section 2.9 Increased Costs.
(a) Eurodollar Rate Advances. If, after the date hereof, due
to either (i) the introduction of or any change (other than any change
by way of imposition or increase of reserve requirements included in
the calculation of the Eurodollar Rate) in or in the interpretation of
any law or regulation or (ii) the compliance with any guideline or
request from any central bank or other Governmental Authority (whether
or not having the force of law), there shall be any increase in the
cost to any Bank of agreeing to make or making, funding or maintaining
Eurodollar Rate Advances, then the Borrower shall from time to time,
within 30 days of written demand by such Bank (with a copy of such
demand to the Agent), immediately pay to the Agent for the account of
such Bank additional amounts (without duplication of any other amounts
payable in respect of increased costs) sufficient to compensate such
Bank for such increased cost; provided, however, that, before making
any such demand, each Bank agrees to use commercially reasonable
efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Applicable Lending Office if the
making of such a designation would avoid the need for, or reduce the
amount of, such increased cost and would not, in the reasonable
judgment of such Bank, be otherwise disadvantageous to such Bank. In
determining such increased costs, each Bank will act reasonably and in
good faith and will use averaging and attribution methods which are
reasonable, provided that such Bank's reasonable good faith
determination (made in a manner generally consistent with the Bank's
standard practices) of compensation owing under this Section 2.9(a)
shall, absent manifest error, be conclusive and binding for all
purposes. Each Bank, at the time such Bank demands payment under this
Section 2.9(a), shall submit to the Borrower and the Agent a
certificate (A) as to the amount of such increased cost, (B) detailing
the calculation of such cost, and (C) certifying that such Bank is
generally charging such costs to other similarly situated borrowers
under similar credit facilities; provided that, unless such Bank is
also demanding compensation generally from other similarly situated
borrowers of such Bank under similar credit facilities, the Borrower
shall not be required to compensate such Bank pursuant to this Section
2.9(a) for any increased costs.
(b) Capital Adequacy. If any Bank or any Issuing Bank
determines in good faith that compliance with any law or regulation or
any guideline or request from any central bank or other Governmental
Authority (whether or not having the force of law) implemented or
effective after the date of this Agreement affects or would affect the
amount of capital required or expected to be maintained by such Bank or
such Issuing Bank and that the amount of such capital is increased by
or based upon the existence of such Bank's commitment to lend or such
Issuing Bank's commitment to issue Letters of Credit or any Bank's
commitment to risk participate in Letters of Credit and other
commitments of this type, then, upon 30 days prior written notice by
such Bank or such Issuing Bank (with a copy of any such demand to the
Agent), the Borrower shall pay to the Agent for the account of
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such Bank or to such Issuing Bank, as the case may be, from time to
time as specified by such Bank or such Issuing Bank, additional amounts
(without duplication of any other amounts payable in respect of
increased costs) sufficient to compensate such Bank or such Issuing
Bank, in light of such circumstances, (i) with respect to such Bank, to
the extent that such Bank reasonably determines such increase in
capital to be allocable to the existence of such Bank's commitment to
lend under this Agreement or its commitment to risk participate in
Letters of Credit and (ii) with respect to such Issuing Bank, to the
extent that such Issuing Bank reasonably determines such increase in
capital to be allocable to the issuance or maintenance of the Letters
of Credit. In determining such additional amounts, each Bank will act
reasonably and in good faith and will use averaging and attribution
methods which are reasonable, provided that such Bank's reasonable good
faith determination (made in a manner generally consistent with the
Bank's standard practices) of compensation owing under this Section
2.9(b) shall, absent manifest error, be conclusive and binding for all
purposes. Each Bank, at the time such Bank demands payment under this
Section 2.9(b), shall submit to the Borrower and the Agent a
certificate (A) as to the amount of such additional amounts, (B)
detailing the calculation of such additional amounts, and (C)
certifying that such Bank is generally charging such additional amounts
to other similarly situated borrowers under similar credit facilities;
provided that, unless such Bank is also demanding compensation
generally from other similarly situated borrowers of such Bank under
similar credit facilities, the Borrower shall not be required to
compensate such Bank pursuant to this Section 2.9(b) for any additional
amounts.
(c) Letters of Credit. If, after the date hereof, any change
in any law or regulation or in the interpretation thereof by any court
or administrative or Governmental Authority charged with the
administration thereof shall either (i) impose, modify or deem
applicable any reserve, special deposit or similar requirement against
letters of credit issued by, or assets held by, or deposits in or for
the account of, any Issuing Bank or any Bank or (ii) impose on such
Issuing Bank or any Bank any other condition regarding the provisions
of this Agreement relating to the Letters of Credit or any Letter of
Credit Obligations, and the result of any event referred to in the
preceding clause (i) or (ii) shall be to increase the cost to such
Issuing Bank of issuing or maintaining any Letter of Credit, or
increase the cost to such Bank of its risk participation in any Letter
of Credit (which increase in cost shall be determined by such Issuing
Bank's or such Bank's reasonable allocation of the aggregate of such
cost increases resulting from such event), then, within 30 days of
written demand by such Issuing Bank or such Bank (with a copy sent to
the Agent), as the case may be, the Borrower shall pay to the Agent for
the account of such Issuing Bank or such Bank, as the case may be, from
time to time as specified by such Issuing Bank or such Bank, additional
amounts which shall be sufficient to compensate such Issuing Bank or
such Bank for such increased cost. Each Issuing Bank and each Bank
agrees to use commercially reasonable efforts (consistent with internal
policy and legal and regulatory restrictions) to designate a different
Applicable Lending Office for the booking of its Letters of Credit or
risk participations if the making of such designation would avoid the
effect of this Section 2.9(c) and would not, in the reasonable judgment
of such Issuing Bank or such Bank, be otherwise disadvantageous to such
Issuing Bank or such Bank, as the case may be. In determining such
increased costs, each Bank will act reasonably and in good faith and
will use averaging and attribution
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methods which are reasonable, provided that such Bank's reasonable good
faith determination (made in a manner generally consistent with the
Bank's standard practices) of compensation owing under this Section
2.9(c) shall, absent manifest error, be conclusive and binding for all
purposes. Each Bank, at the time such Bank demands payment under this
Section 2.9(c), shall submit to the Borrower and the Agent a
certificate (A) as to the amount of such increased cost, (B) detailing
the calculation of such cost, and (C) certifying that such Bank is
generally charging such costs to other similarly situated borrowers
under similar credit facilities; provided that, unless such Bank is
also demanding compensation generally from other similarly situated
borrowers of such Bank under similar credit facilities, the Borrower
shall not be required to compensate such Bank pursuant to this Section
2.9(c) for any increased costs.
Section 2.10 Payments and Computations.
(a) Payment Procedures. Except if otherwise set forth herein,
the Borrower shall make each payment under this Agreement and under the
Notes not later than 11:00 a.m. (Dallas, Texas time) on the day when
due in Dollars to the Agent at the location referred to in the Notes
(or such other location as the Agent shall designate in writing to the
Borrower) in same day funds without set-off, counterclaims or other
deduction. The Agent will promptly thereafter cause to be distributed
like funds relating to the payment of principal, interest or fees
ratably (other than amounts payable solely to the Agent, the Issuing
Banks or a specific Bank pursuant to Section 2.1(b), 2.3(b), 2.3(c),
2.6(c), 2.8, 2.9, 2.11, 2.12 or 2.13(c) but after taking into account
payments effected pursuant to Section 9.4) to the Banks in accordance
with each Bank's Pro Rata Share for the account of their respective
Applicable Lending Offices, and like funds relating to the payment of
any other amount payable to any Bank or any Issuing Bank to such Bank
or such Issuing Bank for the account of its Applicable Lending Office,
in each case to be applied in accordance with the terms of this
Agreement.
(b) Computations. All computations of interest or fees based
on the Base Rate, the Eurodollar Rate or the Federal Funds Rate shall
be made by the Agent on the basis of a year of 360 days, in each case
for the actual number of days (including the first day, but excluding
the last day) occurring in the period for which such interest or fees
are payable. Each determination by the Agent of an interest rate shall
be conclusive and binding for all purposes, absent manifest error.
(c) Non-Business Day Payments. Whenever any payment shall be
stated to be due on a day other than a Business Day, such payment shall
be made on the next succeeding Business Day, and such extension of time
shall in such case be included in the computation of payment of
interest or fees, as the case may be; provided, however, that if such
extension would cause payment of interest on or principal of Eurodollar
Rate Advances to be made in the next following calendar month, such
payment shall be made on the next preceding Business Day.
(d) Agent Reliance. Unless the Agent shall have received
written notice from the Borrower prior to the date on which any payment
is due to the Banks that the Borrower will
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not make such payment in full, the Agent may assume that the Borrower
has made such payment in full to the Agent on such date and the Agent
may, in reliance upon such assumption, cause to be distributed to each
Bank on such date an amount equal to the amount then due to such Bank.
If and to the extent the Borrower shall not have so made such payment
in full to the Agent, each Bank shall repay to the Agent forthwith on
demand such amount distributed to such Bank, together with interest,
for each day from the date such amount is distributed to such Bank
until the date such Bank repays such amount to the Agent, at the
Federal Funds Rate for such day.
(e) Application of Payments. Unless otherwise specified in
Section 2.7 hereof, whenever any payment received by the Agent under
this Agreement is insufficient to pay in full all amounts then due and
payable under this Agreement and the Notes, such payment shall be
distributed and applied by the Agent and the Banks in the following
order: first, to the payment of fees and expenses due and payable to
the Agent or Xxxxx Fargo under and in connection with this Agreement or
any other Credit Document; second, to the payment of all expenses due
and payable under Section 2.11(c), ratably among the Banks in
accordance with the aggregate amount of such payments owed to each such
Bank; third, to the payment of fees due and payable to the Issuing
Banks pursuant to Section 2.3(b); fourth, to the payment of all other
fees due and payable under Section 2.3 ratably among the Banks in
accordance with their applicable Commitments; and fifth, to the payment
of the interest accrued on and the principal amount of all of the
Advances, Reimbursement Obligations and other Obligations, regardless
of whether any such amount is then due and payable, ratably among the
Banks in accordance with the aggregate accrued interest plus the
aggregate principal amount owed to such Bank.
Section 2.11 Taxes.
(a) No Deduction for Certain Taxes. Any and all payments by
the Borrower shall be made, in accordance with Section 2.10, free and
clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Bank,
each Issuing Bank and the Agent, taxes imposed on its income, and
franchise taxes imposed on it, by the jurisdiction under the laws of
which such Bank, such Issuing Bank or the Agent (as the case may be) is
organized or any political subdivision of such jurisdiction (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings
and liabilities being hereinafter referred to as "Taxes") and, in the
case of each Bank and each Issuing Bank, Taxes by the jurisdiction of
such Bank's Applicable Lending Office or any political subdivision of
such jurisdiction. If the Borrower shall be required by law to deduct
any Taxes from or in respect of any sum payable to any Bank, any
Issuing Bank or the Agent, (i) the sum payable shall be increased as
may be necessary so that, after making all required deductions
(including deductions applicable to additional sums payable under this
Section 2.11), such Bank, such Issuing Bank or the Agent (as the case
may be) receives an amount equal to the sum it would have received had
no such deductions been made; provided, however, that if the Borrower's
obligation to deduct or withhold Taxes is caused solely by such Bank's,
such Issuing Bank's or the Agent's failure to provide the forms
described in Section 2.11(e) and such Bank, such Issuing Bank or the
Agent could have provided such forms, no such increase shall be
required; (ii) the
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Borrower shall make such deductions; and (iii) the Borrower shall pay
the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law.
(b) Other Taxes. In addition, the 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 or from the execution, delivery or registration of, or otherwise
with respect to, this Agreement, the Notes, or the other Credit
Documents (hereinafter referred to as "Other Taxes").
(c) Indemnification. In addition, the Borrower agrees to
indemnify each Bank, each Issuing Bank and the Agent for the full
amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable
under this Section 2.11) paid by such Bank, such Issuing Bank or the
Agent (as the case may be) and any liability (including interest and
expenses) arising therefrom or with respect thereto, whether or not
such Taxes or Other Taxes were correctly or legally asserted. Each
payment required to be made by the Borrower in respect of this
indemnification shall be made to the Agent for the benefit of any party
claiming such indemnification within 30 days from the date the Borrower
receives written demand detailing the calculation of such amounts
therefor from the Agent on behalf of such Bank, such Issuing Bank or
the Agent. If any Bank, any Issuing Bank or the Agent receives a refund
in respect of any taxes paid by the Borrower under this Section
2.11(c), such Bank, such Issuing Bank or the Agent, as the case may be,
shall promptly pay to the Borrower such refund.
(d) Evidence of Tax Payments. The Borrower will pay prior to
delinquency all Taxes payable in respect of any payment. Within 30 days
after the date of any payment of Taxes, the Borrower will furnish to
the Agent, at its address referred to in Section 9.2, the original or a
certified copy of a receipt evidencing payment of such Taxes.
(e) Foreign Bank Withholding Exemption. Each Bank and each
Issuing Bank that is not incorporated under the laws of the U.S. or a
state thereof (a "Non-U.S. Lender") agrees that it will deliver to the
Borrower and the Agent on the date of this Agreement or upon the
effectiveness of any Assignment and Acceptance (i) two duly completed
copies of U.S. Internal Revenue Service Form W-8ECI or W-8BEN or, in
the case of a Non-U.S. Lender claiming exemption from U.S. federal
withholding tax under Section 871(h) or 881(c)of the Code, with respect
to payments of "portfolio interest", a statement substantially in the
form of Exhibit J hereto, appropriately completed, and a form W-8BEN,
or other equivalent successor form, as appropriate, certifying in each
case that such Bank is entitled to receive payments under this
Agreement and the Notes payable to it, without deduction or withholding
of any U.S. federal income taxes and (ii) any other governmental forms
which are necessary or required under an applicable tax treaty or
otherwise by law to reduce or eliminate any withholding tax, which have
been reasonably requested by the Borrower. Each Bank which delivers to
the Borrower and the Agent a Form W-8ECI or W-8BEN, or other equivalent
successor form, as appropriate, further undertakes to deliver to the
Borrower and the Agent two further copies of such form, or successor
applicable forms, or other manner of certification, as the case may be,
on or before the date that any such form expires or
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becomes obsolete or after the occurrence of any event requiring a
change in the most recent form previously delivered by it to the
Borrower and the Agent, and such extensions or renewals thereof as may
reasonably be requested by the Borrower and the Agent certifying in the
case of a Form W-8ECI or W-8BEN that such Bank is entitled to receive
payments under this Agreement without deduction or withholding of any
U.S. federal income taxes. If an event (including without limitation
any change in treaty, law or regulation) has occurred prior to the date
on which any delivery required by the preceding sentence would
otherwise be required which renders all such forms inapplicable or
which would prevent any Bank from duly completing and delivering any
such letter or form with respect to it and such Bank advises the
Borrower and the Agent that it is not capable of receiving payments
without any deduction or withholding of U.S. federal income tax, such
Bank shall not be required to deliver such forms. The Borrower shall
withhold tax at the rate and in the manner required by the laws of the
U.S. with respect to payments made to a Bank failing to timely provide
the requisite Internal Revenue Service forms.
Section 2.12 Illegality. If any Bank shall notify the Agent and the
Borrower that the introduction of or any change in or in the interpretation of
any law or regulation after the date hereof makes it unlawful, or that any
central bank or other Governmental Authority asserts that it is unlawful, for
such Bank or its Eurodollar Lending Office to perform its obligations under this
Agreement to maintain any Eurodollar Rate Advances of such Bank then outstanding
hereunder, then, notwithstanding anything herein to the contrary, the Borrower
shall, if demanded by such Bank in its notice, no later than 11:00 a.m. (Dallas,
Texas time), (a) if not prohibited by law or regulation to maintain such
Eurodollar Rate Advances for the duration of the Interest Period, on the last
day of the Interest Period for each outstanding Eurodollar Rate Advance of such
Bank or (b) if prohibited by law or regulation to maintain such Eurodollar Rate
Advances for the duration of the Interest Period, on the second Business Day
following its receipt of such notice from such Bank, Convert all Eurodollar Rate
Advances of such Bank then outstanding to Base Rate Advances and pay accrued
interest on the principal amount Converted to the date of such Conversion and
amounts, if any, required to be paid pursuant to Section 2.8 as a result of such
Conversion being made on such date. Each Bank agrees to use commercially
reasonable efforts (consistent with its internal policies and legal and
regulatory restrictions) to designate a different Applicable Lending Office if
the making of such designation would avoid the effect of this Section 2.12 and
would not, in the reasonable judgment of such Bank, be otherwise disadvantageous
to such Bank.
Section 2.13 Letters of Credit.
(a) Issuance. From time to time from the date of this
Agreement until three months before the Maturity Date, at the request
of the Borrower, each Issuing Bank shall, on any Business Day and on
the terms and conditions hereinafter set forth, issue, increase,
decrease, amend or extend the expiration date of Letters of Credit for
the account of the Borrower (for its own benefit or for the benefit of
any of its Subsidiaries). No Letter of Credit will be issued, increased
or extended (i) if such issuance, increase or extension would cause the
Letter of Credit Exposure to exceed the lesser of (A) $100,000,000 or
(B) an amount equal to the remainder of (1) the lesser of the Borrowing
Base or the aggregate Commitments minus (2) the aggregate outstanding
principal amount of the Revolving Advances and Swingline Advances at
such time; (ii) unless such Letter of Credit has an
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Expiration Date not later than the earlier of (A) one year after the
date of issuance thereof or (b) five days before the Maturity Date;
(iii) unless such Letter of Credit is in form and substance acceptable
to the respective Issuing Bank in its sole discretion; (iv) unless such
Letter of Credit is a standby letter of credit not supporting the
repayment of indebtedness for borrowed money of any Person, other than
a Letter of Credit issued in substitution of any letter of credit
outstanding on the Effective Date and listed on Schedule 1.1(b); (v)
unless the Borrower has delivered to the respective Issuing Bank a
completed and executed letter of credit application on such Issuing
Bank's standard form, which shall contain terms no more restrictive
than the terms of this Agreement; and (vi) unless such Letter of Credit
is governed by the Uniform Customs and Practice for Documentary Credits
(1993 Revision), International Chamber of Commerce Publication No. 500
("UCP") or any successor to the UCP. If the terms of any letter of
credit application referred to in the foregoing clause (v) conflicts
with the terms of this Agreement, the terms of this Agreement shall
control.
(b) Participations. With respect to each letter of credit
described on Schedule 1.1(b), the Borrower, the Agent, the Issuing Bank
and the Banks agree that such letters of credit shall constitute
Letters of Credit for all purposes of this Agreement and each Bank
agrees that it has a participation in the related Letter of Credit
Exposure equal to such Bank's Pro Rata Share on the Effective Date. On
the date of the issuance or increase of any Letter of Credit on or
after the Effective Date, each Issuing Bank shall be deemed to have
sold to each other Bank and each other Bank shall have been deemed to
have purchased from such Issuing Bank a participation in the Letter of
Credit Exposure related to the Letters of Credit issued by such Issuing
Bank equal to such Bank's Pro Rata Share at such date and such sale and
purchase shall otherwise be in accordance with the terms of this
Agreement. Each Issuing Bank shall promptly notify each such
participant Bank by telex, telephone or telecopy of each Letter of
Credit of such Issuing Bank issued, increased or decreased, and the
actual dollar amount of such Bank's participation in such Letter of
Credit. Each Bank's obligation to purchase participating interests
pursuant to this Section 2.13(b) and to reimburse the respective
Issuing Bank for such Bank's Pro Rata Share of any payment under a
Letter of Credit issued by such Issuing Bank and not reimbursed in full
by the Borrower shall be absolute and unconditional and shall not be
affected by any circumstance, including, without limitation, (i) any of
the circumstances described in Section 2.13(d) below, (ii) the
occurrence and continuance of a Default, (iii) an adverse change in the
financial condition of the Borrower or any Guarantor, or (iv) any other
circumstance, happening or event whatsoever, whether or not similar to
any of the foregoing, except for any such circumstance, happening or
event constituting or arising from gross negligence or willful
misconduct on the part of such Issuing Bank.
(c) Reimbursement. The Borrower hereby agrees to pay on demand
to each Issuing Bank in respect of each Letter of Credit issued by such
Issuing Bank an amount equal to any amount paid by such Issuing Bank
under or in respect of such Letter of Credit. In the event any Issuing
Bank makes a payment pursuant to a request for draw presented under a
Letter of Credit and such payment is not promptly reimbursed by the
Borrower upon demand, such Issuing Bank shall give notice of such
payment to the Agent and the Banks, and each Bank shall promptly
reimburse such Issuing Bank for such Bank's Pro Rata Share of such
payment, and such reimbursement shall be deemed for all purposes of
this Agreement to
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constitute a Base Rate Advance to the Borrower from such Bank. If such
reimbursement is not made by any Bank to any Issuing Bank on the same
day on which such Issuing Bank shall have made payment on any such
draw, such Bank shall pay interest thereon to such Issuing Bank at a
rate per annum equal to the Federal Funds Rate. The Borrower hereby
unconditionally and irrevocably authorizes, empowers and directs the
Agent and the Banks to record and otherwise treat each payment under a
Letter of Credit not immediately reimbursed by the Borrower as a
Borrowing comprised of Base Rate Advances to the Borrower.
(d) Obligations Unconditional. The obligations of the Borrower
under this Agreement in respect of each Letter of Credit shall be
unconditional and irrevocable, and shall be paid strictly in accordance
with the terms of this Agreement under all circumstances,
notwithstanding the following circumstances:
(i) any lack of validity or enforceability of any
Letter of Credit Documents;
(ii) any amendment or waiver of or any consent to
departure from any Letter of Credit Documents;
(iii) the existence of any claim, set-off, defense or
other right which the Borrower or any Bank or any other Person
may have at any time against any beneficiary or transferee of
such Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), the
respective Issuing Bank or any other Person or entity, whether
in connection with this Agreement, the transactions
contemplated in this Agreement or in any Letter of Credit
Documents or any unrelated transaction;
(iv) any statement or any other document presented
under such 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 to the
extent the respective Issuing Bank would not be liable
therefor pursuant to the following Section 2.13(e);
(v) payment by the respective Issuing Bank under such
Letter of Credit against presentation of a draft or
certificate which does not comply with the terms of such
Letter of Credit; or
(vi) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing;
provided, however, that nothing contained in this Section 2.13(d) shall be
deemed to constitute a waiver of any remedies of the Borrower in connection with
the Letters of Credit.
(e) Liability of Issuing Banks. The Borrower assumes all risks
of the acts or omissions of any beneficiary or transferee of any Letter
of Credit with respect to its use of
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such Letter of Credit. No Issuing Bank nor any of its officers or
directors shall be liable or responsible for:
(i) the use which may be made of any Letter of Credit
or any acts or omissions of any beneficiary or transferee in
connection therewith;
(ii) the validity, sufficiency or genuineness of
documents, or of any endorsement thereon, even if such
documents should prove to be in any or all respects invalid,
insufficient, fraudulent or forged;
(iii) payment by such Issuing Bank against
presentation of documents which do not comply with the terms
of a Letter of Credit, including failure of any documents to
bear any reference or adequate reference to the relevant
Letter of Credit; or
(iv) any other circumstances whatsoever in making or
failing to make payment under any Letter of Credit (including
such Issuing Bank's own negligence),
except that the Borrower shall have a claim against such
Issuing Bank, and such Issuing Bank shall be liable to, and shall
promptly pay to, the Borrower, to the extent of any direct, as opposed
to consequential, damages suffered by the Borrower which the Borrower
proves were caused by (A) such Issuing Bank's willful misconduct or
gross negligence in determining whether documents presented under a
Letter of Credit comply with the terms of such Letter of Credit or (B)
such Issuing Bank's willful failure to make lawful payment under any
Letter of Credit after the presentation to it of a draft and
certificate strictly complying with the terms and conditions of such
Letter of Credit. In furtherance and not in limitation of the
foregoing, any Issuing Bank may accept documents that appear on their
face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary.
Section 2.14 Determination of Borrowing Base. The Borrowing Base shall
be determined by the Agent, as follows:
(a) Monthly. On the 25th day of each calendar month the Agent
shall determine the Borrowing Base upon receipt of a Borrowing Base
Certificate dated as of the last day of the immediately preceding
calendar month.
(b) Property Adjustments. Following (i) any sale by the
Borrower or any Guarantor of any Property included in the Borrowing
Base with a sales value in excess of $25,000,000 individually or in the
aggregate since the most recent month end, (ii) any loss or casualty
not covered by insurance resulting in destruction of any Property
included in the Borrowing Base if the loss or casualty exceeds
$25,000,000 individually or in the aggregate since the most recent
month end, or (iii) any permitted purchase by the Borrower or any
Guarantor of any Property which can be included in the Borrowing Base
with a purchase price in excess of $25,000,000 individually or in the
aggregate since the most recent month end (each of such events
hereinafter called an "Adjustment Event"), the Borrower shall (in
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the case of clauses (i) and (ii) above) or may (in the case of clause
(iii) above) give the Agent notice of such Adjustment Event within five
Business Days of the closing of such Adjustment Event, and the Agent
may in its sole reasonable discretion (in the case of clauses (i) and
(ii) above) or shall (in the case of clause (iii) above) further adjust
the appropriate Borrowing Base components set forth in the most recent
month end Borrowing Base Certificate delivered by the Borrower to the
Banks to reflect the Adjustment Events occurring since the date of such
Borrowing Base Certificate.
(c) Notice of Borrowing Base Change. Promptly following any
date the Borrowing Base is redetermined in accordance with this Section
2.14, the Agent shall give notice to the Banks and the Borrower of the
new Borrowing Base.
Section 2.15 Bank Replacement.
(a) Right to Replace. The Borrower shall have the right to
replace each Bank affected by a condition under clause (v) of Section
2.2(c), Section 2.9 or Section 2.12 for more than 90 days or each Bank
which fails to consent to any extension of the Maturity Date pursuant
to Section 2.18 (each such Bank, an "Affected Bank") in accordance with
the procedures in this Section 2.15 and provided that no reduction of
the total Commitments occurs as a result thereof.
(b) First Right of Refusal; Replacement.
(i) Upon the occurrence of any condition permitting
the replacement of a Bank, each Bank which is not an Affected
Bank shall have the right, but not the obligation, to elect to
increase its respective Commitment by an amount not to exceed
the amount of the Commitments of the Affected Banks, which
election shall be made by written notice from each such Bank
to the Agent and the Borrower given within 30 days after the
date such condition occurs specifying the amount of such
proposed increase in such Bank's Commitment.
(ii) If the aggregate amount of the proposed
increases in Commitments of all such Banks making such an
election is in excess of the Commitments of the Affected
Banks, (A) the Commitments of the Affected Banks shall be
allocated pro rata among such Banks based on the respective
amounts of the proposed increases to Commitments elected by
each of such Banks, and (B) the respective Commitments of such
Banks shall be increased by the respective amounts as so
allocated so that, after giving effect to such termination and
increases, the aggregate amount of the Commitments of all of
the Banks will be the same as prior to such termination.
(iii) If the aggregate amount of the proposed
increases in Commitments of all such Banks making such an
election equals the Commitments of the Affected Banks, the
respective Commitments of such Banks shall be increased by the
respective amounts of their proposed increases so that, after
giving effect to such termination and increases, the aggregate
amount of the Commitments of all of the Banks will be the same
as prior to such termination.
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(iv) If the aggregate amount of the proposed
increases in Commitments of all such Banks making such an
election is less than the Commitments of the Affected Banks,
(A) the respective Commitments of such Banks shall be
increased by the respective amounts of their proposed
increases, and (B) the Borrower shall add additional Banks
which are Eligible Assignees to this Agreement to replace such
Affected Banks, which additional Banks would have aggregate
Commitments no greater than those of the Affected Banks minus
the amounts thereof assumed by the other Banks pursuant to
such increases.
(c) Procedure. Any assumptions of Commitments pursuant to this
Section 2.15 shall be made by the purchasing Bank or Eligible Assignee
and the selling Bank entering into an Assignment and Assumption and by
following the procedures in Section 9.6 for adding a Bank. In
connection with the increase of the Commitments of any Bank pursuant to
the foregoing Section 2.15(b), each Bank with an increased Commitment
shall purchase from the Affected Banks at par such Bank's ratable share
of the outstanding Advances of the Affected Banks and assume such
Bank's ratable share of the Affected Banks' Letter of Credit Exposure.
Section 2.16 Sharing of Payments, Etc. If any Bank shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off or otherwise) on account of its Advances or its share of Letter of
Credit Obligations in excess of its Pro Rata Share of payments on account of the
Advances or Letter of Credit Obligations obtained by all the Banks, such Bank
shall notify the Agent and forthwith purchase from the other Banks such
participations in the Advances made by them or Letter of Credit Obligations held
by them as shall be necessary to cause such purchasing Bank to share the excess
payment ratably in accordance with the requirements of this Agreement with each
of them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Bank, such purchase from each Bank
shall be rescinded and such Bank shall repay to the purchasing Bank the purchase
price to the extent of such Bank's ratable share (according to the proportion of
(a) the amount of the participation sold by such Bank to the purchasing Bank as
a result of such excess payment to (b) the total amount of such excess payment)
of such recovery, together with an amount equal to such Bank's ratable share
(according to the proportion of (i) the amount of such Bank's required repayment
to the purchasing Bank to (ii) the total amount of all such required repayments
to the purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Borrower agrees
that any Bank so purchasing a participation from another Bank pursuant to this
Section 2.16 may, to the fullest extent permitted by law, unless and until
rescinded as provided above, exercise all its rights of payment (including the
right of set-off) with respect to such participation as fully as if such Bank
were the direct creditor of the Borrower in the amount of such participation.
Section 2.17 Increase of Commitments. By delivery of an effective
Increase Notice to the Agent (which the Agent shall promptly distribute to the
Banks), the Borrower may request an increase of the aggregate amount of the
Commitments; provided that (a) the aggregate amount of the Commitments both
before and after giving effect to such requested increase shall not exceed
$275,000,000, (b) no Default or Event of Default shall have occurred and be
continuing or would result therefrom and (c) the Borrower shall cause to be
delivered to the Agent a commitment (or
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commitments) from (i) at least one Bank that commits to lending to the Borrower
more than its then current Commitment (such Bank to be referred to herein as an
"Existing Bank" and such amount of its commitment above its then current
Commitment to be referred to herein as a "Commitment Supplement") and/or (ii)
any other Person (including an Affiliate of a Bank) that meets the requirements
(other than the approval requirement) of clause (a) or (b) of the definition of
"Eligible Assignee" (as defined in Article I hereof) and that commits to lending
to the Borrower and becoming a Bank under this Agreement (such Person to be
referred to herein as a "New Bank" and the amount of its commitment to be
referred to herein as a "New Commitment") (each Existing Bank and each New Bank
to be referred to herein collectively as the "Supplementing Banks"). Upon
receipt of notice from the Agent to the Banks and the Borrower that the
Supplementing Banks have agreed to commit to increase the Commitments by an
aggregate amount equal to the Increase Amount (as defined below) and execution
and delivery by the Borrower, the Agent and the Supplementing Banks of an
Increased Commitment Agreement evidencing such agreement, then (A) the then
current aggregate Commitments shall be increased by the Increase Amount, (B) the
then current Commitment of each Existing Bank shall be increased by such
Existing Bank's Commitment Supplement and (C) each of the New Banks will be
added as a Bank under this Agreement and each such New Bank's Commitment shall
be such New Bank's New Commitment. On the effective date of the Increased
Commitment Agreement, the Borrower shall request a Revolving Advance hereunder,
which Revolving Advance shall be made by (and only by) the Supplementing Banks
in the appropriate amounts as provided below. The proceeds of such Revolving
Advance shall be utilized by the Borrower to repay the Banks that did not agree
to increase their Commitments, such Revolving Advance and repayment to be in
amounts sufficient so that, after giving effect to the Increased Commitment
Agreement, the Revolving Advances and the Letter of Credit Exposure shall be
held by the Banks according to their Pro Rata Share of the Commitments as
increased in accordance with the Increased Commitment Agreement.
Section 2.18 Extensions of the Maturity Date. In the manner set forth
in this Section 2.18, the Borrower may request that the Maturity Date may be
extended (i) up to two times, in each case, for a period of one year measured
from the Maturity Date then in effect or (ii) once for a period no longer than
two years measured from the Maturity Date in effect as of the Effective Date. If
the Borrower wishes to request such an extension of the Maturity Date, it shall
give written notice to that effect to the Agent not less than 60 days prior to
the date that is one year prior to the Maturity Date then in effect. If the
Agent approves of the requested extension of the Maturity Date, the Agent shall
promptly notify each Bank of receipt of such request and of the new requested
Maturity Date. Each Bank shall endeavor to respond to such request, whether
affirmatively or negatively (such determination in the sole discretion of such
Bank), by notice to the Borrower and the Agent within 21 days of receipt of such
request. If (but only if) all Banks approve of the requested extension of the
Maturity Date, the Maturity Date for all purposes of this Agreement shall be the
extended Maturity Date specified in the notice from the Agent to the Banks that
was approved by all Banks, and the Agent shall give written notice of such
extended Maturity Date to the Borrower, the Issuing Bank and the Banks.
Section 2.19 Agreements regarding Subsidiaries.
(a) Domestic Subsidiaries. The Borrower agrees that it shall
cause each Domestic Subsidiary to guarantee the payment and performance
of the Obligations pursuant
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to the Guaranty to be executed by such Subsidiary prior to or
substantially concurrent with the Borrower's execution of this
Agreement. Contemporaneously with the creation or acquisition of any
Domestic Subsidiary after the Closing Date, the Borrower shall (i)
cause such Domestic Subsidiary to guarantee the payment and performance
of the Obligations by executing and delivering to the Agent an
Accession Agreement, (ii) deliver a certificate covering the same
matters described in clause (iii) of Section 3.1(a) with respect to
such Domestic Subsidiary and (iii) deliver an opinion of Borrower's
counsel with respect thereto covering the matters previously opined on
with regard to each Guarantor.
(b) Foreign Subsidiaries. The Borrower agrees that it shall,
and shall cause each Subsidiary that owns any Capital Stock of a
Foreign Subsidiary to, pledge two-thirds of all issued and outstanding
shares of each class of Capital Stock of each Foreign Subsidiary (or,
in the event that the Borrower and its Subsidiaries own, in the
aggregate, less than two-thirds of the issued and outstanding shares of
any class of such Capital Stock, all of such issued and outstanding
shares owned by the Borrower and its Subsidiaries) to the Agent as
security for the payment and performance of the Obligations, each of
which pledges shall be pursuant to a pledge and security agreement in
form and substance satisfactory to the Agent (the "Foreign Stock Pledge
Agreements"); provided, however, that neither the Borrower nor any of
its Subsidiaries shall be required to pledge the Capital Stock of
Foreign Subsidiaries which, in the aggregate, contribute less than
12.5% of the EBITDA of the Borrower and its Subsidiaries on a
consolidated basis determined as of the most recent Calculation Day
based on the Calculation Period then ended; provided, further, however,
that if, for any subsequent Calculation Period, EBITDA of the Foreign
Stock Subsidiaries whose Capital Stock is not pledged pursuant to this
Section 2.19(b) equals 12.5% or more of the EBITDA of the Borrower and
its Subsidiaries on a consolidated basis, the Borrower and its
Subsidiaries shall promptly (and in any event within ten Business Days
after such determination is initially made) execute additional Foreign
Stock Pledge Agreements which pledge the Capital Stock of additional
Foreign Subsidiaries such that the EBITDA of the Foreign Stock
Subsidiaries whose Capital Stock is not pledged is less than 12.5% of
the EBITDA of the Borrower and its Subsidiaries on a consolidated
basis. Each of such pledges shall constitute a perfected, first
priority Lien in all such Capital Stock of each Foreign Subsidiary. In
addition to the foregoing and in connection with the Foreign Stock
Pledge Agreements, the Borrower and its applicable Subsidiaries shall
deliver to the Agent the original certificates evidencing all of the
Capital Stock so pledged, together with stock powers appropriately
executed in blank or other instruments of transfer in form and
substance satisfactory to the Agent.
ARTICLE III
CONDITIONS OF LENDING
Section 3.1 Conditions Precedent to Effectiveness of this Agreement.
This Agreement shall become effective upon the following conditions precedent
having been satisfied or, at the discretion of the Agent and the Banks, waived
by the Agent and the Banks:
(a) Documentation. The Agent shall have received counterparts
of this Agreement executed by the Borrower and the Banks, and the
following duly executed by all
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the parties thereto, in form and substance satisfactory to the Agent,
and in sufficient copies for each Bank:
(i) the Guaranty and the Foreign Stock Pledge
Agreements, if any are required hereunder, together with the
original certificates evidencing all of the Capital Stock
pledged pursuant to such Foreign Stock Pledge Agreements and
stock powers appropriately executed in blank or other
instruments of transfer in form and substance satisfactory to
the Agent;
(ii) a certificate from the chief executive officer,
president or chief financial officer of the Borrower dated as
of the Effective Date stating that as of the Effective Date
(A) all representations and warranties of the Borrower set
forth in this Agreement and the other Credit Documents are
true and correct in all material respects, (B) no Default has
occurred and is continuing, and (C) all of the conditions in
this Section 3.1 have been met;
(iii) a certificate of the Secretary or an Assistant
Secretary of the Borrower and each Guarantor dated as of the
date of this Agreement certifying (as of the date of this
Agreement) to (A) the names and true signatures of officers of
the Borrower and such Guarantor authorized to sign the Credit
Documents to which such Person is a party, (B) resolutions of
the Board of Directors of such Person with respect to the
transactions herein contemplated, (C) copies of the articles
or certificate of incorporation and bylaws of such Person, and
(D) copies of certificates of existence, good standing and
foreign qualification (if applicable) with respect to such
Person issued by the appropriate Governmental Authorities of
its jurisdiction of incorporation and the jurisdictions in
which it has its principal executive offices;
(iv) a favorable opinion of Xxxxxxx X. Xxxxxx,
General Counsel to the Borrower and Guarantors, dated as of
the Effective Date and in substantially the form of Exhibit K,
appropriately completed;
(v) the audited Consolidated and unaudited
consolidating balance sheet of the Borrower and its
Subsidiaries as at December 31, 2001, and the related
Consolidated and consolidating statements of operations,
shareholders' equity and cash flows, of the Borrower and its
Subsidiaries for the fiscal year then ended, duly certified by
the chief financial officer or treasurer of the Borrower;
(vi) a Borrowing Base Certificate dated as of April
30, 2002 duly completed and executed by the chief financial
officer or treasurer of the Borrower; and
(vii) such other documents, governmental
certificates, agreements and lien searches as the Agent may
reasonably request.
(b) Representations and Warranties. The representations and
warranties contained in Article IV hereof, in Section 7 of the Guaranty
and in the Foreign Stock Pledge
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Agreements, if any are required hereunder, and the other Credit
Documents shall be true and correct in all material respects.
(c) Certain Payments. The Borrower shall have paid the fees
required to be paid as of the Effective Date pursuant to the Agent's
Fee Letter.
(d) Termination of Existing
Credit Agreement. The Agent and
the Banks shall have received sufficient evidence indicating that,
contemporaneously with the making of the initial Advances, the
obligations of the Borrower under the Existing
Credit Agreement will be
repaid with the proceeds of such Advances and thereafter all
obligations of the Borrower and the lenders under the Existing
Credit
Agreement shall be terminated (including, without limitation, any
obligations of any Subsidiary of the Borrower in respect of guaranties,
security agreements executed in connection with such Existing
Credit
Agreement but excluding any obligations which expressly survive the
repayment of the amounts owing under the Existing Credit Agreement) and
all the collateral securing the indebtedness, liabilities and/or
obligations of the Borrower or any of its Subsidiaries under the
Existing Credit Agreement shall be released.
Section 3.2 Conditions Precedent for each Borrowing or Letter of
Credit. The obligation of each Bank to fund an Advance on the occasion of each
Borrowing (other than the Conversion or continuation of any existing Borrowing
and other than a Mandatory Revolving Borrowing) and of any Issuing Bank to issue
or increase or extend any Letter of Credit shall be subject to the further
conditions precedent that, on the date of such Borrowing or the issuance or
increase or extension of such Letter of Credit, the following statements shall
be true (and each of the giving of the applicable Notice of Borrowing and the
acceptance by the Borrower of the proceeds of such Borrowing or the issuance or
increase or extension of such Letter of Credit shall constitute a representation
and warranty by the Borrower that on the date of such Borrowing or the issuance
or increase or extension of such Letter of Credit such statements are true):
(a) the representations and warranties contained in Article IV
hereof, in Section 7 of the Guaranty and in the Foreign Stock Pledge
Agreements, if any are required hereunder, and the other Credit
Documents are correct in all material respects on and as of the date of
such Borrowing or the issuance or increase or extension of such Letter
of Credit, before and after giving effect to such Borrowing or to the
issuance or increase or extension of such Letter of Credit and to the
application of the proceeds from such Borrowing, as though made on and
as of such date;
(b) no Default has occurred and is continuing or would result
from such Borrowing or issuance or increase or extension or from the
application of the proceeds therefrom; and
(c) no Material Adverse Change shall have occurred.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Agent and the Banks as
follows, in each case (unless otherwise expressly stated in this Article IV
below) as of the Closing Date, as of the Effective Date, as of the date of each
Borrowing and as of the date of each issuance, renewal, extension or increase of
a Letter of Credit:
Section 4.1 Corporate Existence; Subsidiaries. The Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of Delaware and in good standing and qualified to do business in each
jurisdiction where its ownership or lease of property or conduct of its business
requires such qualification and where a failure to be qualified could reasonably
be expected to cause a Material Adverse Change. Each Subsidiary of the Borrower
is a corporation or a limited liability company duly organized, validly existing
and in good standing under the laws of its jurisdiction of incorporation or
organization and in good standing and qualified to do business in each
jurisdiction where its ownership or lease of property or conduct of its business
requires such qualification and where a failure to be qualified could reasonably
be expected to cause a Material Adverse Change. The Borrower has no Subsidiaries
on the date of this Agreement other than the Subsidiaries listed on the attached
Schedule 4.1, and Schedule 4.1 lists the jurisdiction of incorporation and the
address of the principal office of each such Subsidiary existing on the date of
this Agreement.
Section 4.2 Corporate Power. The execution, delivery and performance by
the Borrower and each Guarantor of the Credit Documents to which it is a party
and the consummation of the transactions contemplated hereby and thereby (a) are
within the Borrower's and the Guarantors' corporate or company (as applicable)
powers, (b) have been duly authorized by all necessary corporate or company (as
applicable) action, (c) do not contravene (i) the Borrower's or any Guarantor's
certificate or articles, as the case may be, of incorporation or by-laws or
other organizational documents or (ii) any law or any contractual restriction
binding on or affecting the Borrower or any Guarantor, the contravention of
which could reasonably be expected to cause a Material Adverse Change, and (d)
will not result in or require the creation or imposition of any Lien prohibited
by this Agreement. At the time of each Borrowing or the issuance, renewal,
extension or increase of each Letter of Credit, such Borrowing or issuance,
renewal, extension or increase (as applicable) and the use of the proceeds
thereof (A) will be within the Borrower's corporate or company (as applicable)
powers, (B) will have been duly authorized by all necessary corporate or company
(as applicable) action, (C) will not contravene (1) the Borrower's certificate
of incorporation or by-laws or other organizational documents or (2) any law or
any contractual restriction binding on or affecting the Borrower, the
contravention of which could reasonably be expected to cause a Material Adverse
Change, and (D) will not result in or require the creation or imposition of any
Lien prohibited by this Agreement.
Section 4.3 Authorization and Approvals. No authorization or approval
or other action by, and no notice to or filing with, any Governmental Authority
is required for the due execution, delivery and performance by the Borrower or
any Guarantor of the Credit Documents to which it is a party or the consummation
of the transactions contemplated thereby. At the time of each
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Borrowing or the issuance, renewal, extension or increase of each Letter of
Credit, no authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority will be required therefor or for the use
of the proceeds thereof.
Section 4.4 Enforceable Obligations. This Agreement, the Notes and the
other Credit Documents to which the Borrower is a party have been duly executed
and delivered by the Borrower and the Guaranty and the other Credit Documents to
which each Guarantor is a party have been duly executed and delivered by such
Guarantor. Each Credit Document is the legal, valid, and binding obligation of
the Borrower and each Guarantor which is a party to it enforceable against the
Borrower and each such Guarantor in accordance with its terms, except as such
enforceability may be limited by any applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting creditors' rights generally
and by general principles of equity (whether considered in a proceeding at law
or in equity).
Section 4.5 Financial Statements.
(a) The audited Consolidated and unaudited consolidating
balance sheet of the Borrower and its Subsidiaries as at December 31,
2001, and the related Consolidated and consolidating statements of
operations, shareholders' equity and cash flows of the Borrower and its
Subsidiaries for the fiscal year then ended, and the unaudited
Consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as at March 31, 2002 and the related Consolidated and
consolidating statements of operations, shareholders' equity and cash
flows of the Borrower and its Subsidiaries for the fiscal quarter then
ended, copies of which have been furnished to each Bank duly certified
by the chief financial officer or treasurer of the Borrower, fairly
present the financial condition of the Borrower and its Subsidiaries as
at such dates and the results of the operations of the Borrower and its
Subsidiaries for the year or quarter (as applicable) ended on such
dates, and such balance sheets and statements were prepared in
accordance with GAAP.
(b) No Material Adverse Change has occurred.
Section 4.6 True and Complete Disclosure. No representation, warranty
or other statement made by the Borrower (or on behalf of the Borrower) in this
Agreement or any other Credit Document contains any untrue statement of a
material fact or omits to state any material fact necessary to make the
statements contained therein not misleading in light of the circumstances in
which they were made as of the date of this Agreement. There is no fact known to
any Responsible Officer of the Borrower on the date of this Agreement and on the
Effective Date that has not been disclosed to the Agent which could reasonably
be expected to cause a Material Adverse Change. All projections, estimates and
pro forma financial information furnished by the Borrower or on behalf of the
Borrower were prepared on the basis of assumptions, data, information, tests or
conditions believed to be reasonable at the time such projections, estimates and
pro forma financial information were furnished.
Section 4.7 Litigation. Except as set forth in the attached Schedule
4.7, there is no pending or, to the best knowledge of the Borrower, threatened
action or proceeding affecting the Borrower or any of its Subsidiaries before
any court, Governmental Authority or arbitrator, which
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could reasonably be expected to cause a Material Adverse Change or which
purports to affect the legality, validity, binding effect or enforceability of
this Agreement, any Note or any other Credit Document.
Section 4.8 Use of Proceeds.
(a) Revolving Advances. The proceeds of the Revolving Advances
have been, and will be, used by the Borrower (i) to refinance existing
indebtedness of the Borrower owed by it under the Existing Credit
Agreement, (ii) to pay fees and expenses incurred in connection with
the transactions contemplated by this Agreement and (iii) for working
capital, general corporate purposes and other lawful purposes of the
Borrower and its Subsidiaries.
(b) Swingline Line Advances. The proceeds of the Swingline
Line Advances will be used by the Borrower for working capital, general
corporate purposes and other lawful purposes of the Borrower and its
Subsidiaries.
(c) Letter of Credit. The Letters of Credit will be used by
the Borrower to support the general corporate purposes of the Borrower
and its Subsidiaries.
(d) Regulations. No proceeds of Advances will be used to
purchase or carry any margin stock in violation of Regulation T, U or X
of the Federal Reserve Board, as the same is from time to time in
effect, or any official ruling or interpretation thereunder or thereof.
The Borrower is not engaged in the business of extending credit for the
purpose of purchasing or carrying margin stock (within the meaning of
Regulation U of the Federal Reserve Board).
Section 4.9 Investment Company Act. Neither the Borrower nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
Section 4.10 Taxes. Except as set forth on Schedule 4.10(a), all
federal, state, local and foreign tax returns, reports and statements required
to be filed (after giving effect to any extension granted in the time for
filing) by the Borrower, its Subsidiaries or any member of the Controlled Group
(hereafter collectively called the "Tax Group") have been filed with the
appropriate governmental agencies in all jurisdictions in which such returns,
reports and statements are required to be filed, and where the failure to file
could reasonably be expected to cause a Material Adverse Change, except where
contested in good faith and by appropriate proceedings and where adequate
reserves therefor have been established to the extent required by GAAP; and all
material taxes and other material impositions due and payable have been timely
paid prior to the date on which any material fine, penalty, interest, late
charge or loss may be added thereto for non-payment thereof except where
contested in good faith and by appropriate proceedings and where adequate
reserves therefor have been established to the extent required by GAAP. Except
as set forth on Schedule 4.10(b), neither the Borrower nor any other member of
the Tax Group has given, or been requested to give, a waiver of the statute of
limitations relating to the payment of any federal, state, local or foreign
taxes or other impositions. None of the property owned by the Borrower or any
other
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member of the Tax Group is property which the Borrower or any other member of
the Tax Group is required to treat as being owned by any other Person pursuant
to the provisions of Section 168(f)(8) of the Code. Proper and accurate amounts
have been withheld by the Borrower and all other members of the Tax Group from
their employees for all periods to comply in all material respects with the tax,
social security and unemployment withholding provisions of applicable federal,
state, local and foreign law. Timely payment of all material sales and use taxes
required by applicable law have been made by the Borrower and all other members
of the Tax Group, the failure to timely pay of which could reasonably be
expected to cause a Material Adverse Change. The amounts shown on all tax
returns to be due and payable have been paid in full or adequate provision
therefor is included on the books of the appropriate member of the Tax Group.
Section 4.11 Pension Plans. All Plans are in compliance in all material
respects with all applicable provisions of ERISA. No Termination Event (other
than a Termination Event resulting from the termination, if any such termination
has occurred, of the Treadco Pension Plan) has occurred with respect to any
Plan, and each Plan has complied with and been administered in all material
respects in accordance with applicable provisions of ERISA and the Code. No
"accumulated funding deficiency" (as defined in Section 302 of ERISA) has
occurred and there has been no excise tax imposed under Section 4971 of the
Code. To the knowledge of any Responsible Officer of the Borrower, no Reportable
Event has occurred with respect to any Multiemployer Plan, and each
Multiemployer Plan has complied with and been administered in all material
respects with applicable provisions of ERISA and the Code. To the knowledge of
any Responsible Officer of the Borrower, neither the Borrower nor any other
member of the Controlled Group has had a complete or partial withdrawal from any
Multiemployer Plan for which there is any material withdrawal liability. As of
the most recent valuation date applicable thereto, neither the Borrower nor any
other member of the Controlled Group has received notice that any Multiemployer
Plan is insolvent or in reorganization.
Section 4.12 Condition of Property; Casualties. The material Properties
used or to be used in the continuing operations of the Borrower and each of its
Subsidiaries, taken as a whole, are and will continue to be in good repair,
working order and condition, normal wear and tear excepted. Since the latest
quarterly financial statements provided by the Borrower to the Agent, neither
the business nor the material Properties of the Borrower and its Subsidiaries,
taken as a whole, has been materially and adversely affected as a result of any
fire, explosion, earthquake, flood, drought, windstorm, accident, strike or
other labor disturbance, embargo, requisition or taking of property or
cancellation of contracts, permits or concessions by a Governmental Authority,
riot, activities of armed forces or acts of God or of any public enemy.
Section 4.13 Insurance. The Borrower and each of its Subsidiaries carry
insurance with reputable insurers in respect of such of their respective
Properties, in such amounts and against such risks as is customarily maintained
by other Persons of similar size engaged in similar businesses, or self-insure
to the extent that is customary for Persons of similar size engaged in similar
businesses.
Section 4.14 No Burdensome Restrictions; No Defaults.
(a) Neither the Borrower nor any of its Subsidiaries is a
party to any indenture, loan or credit agreement or any lease or other
agreement, document or instrument or subject
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to any charter or corporate restriction or provision of applicable law
or governmental regulation which could reasonably be expected to cause
a Material Adverse Change. The Borrower and the Guarantors are not in
default under or with respect to any contract, agreement, lease or
other instrument to which the Borrower or any Guarantor is a party and
which could reasonably be expected to cause a Material Adverse Change.
As of the Effective Date, neither the Borrower nor any Guarantor has
received any notice of default under any material contract, agreement,
lease or other instrument to which the Borrower or such Guarantor is a
party which is continuing and which, if not cured, could reasonably be
expected to cause a Material Adverse Change.
(b) No Default has occurred and is continuing.
Section 4.15 Environmental Condition.
(a) The Borrower and its Subsidiaries, taken as a whole, (i)
have obtained all Environmental Permits necessary for the ownership and
operation of their respective material Properties and the conduct of
their respective businesses; (ii) have been and are in compliance with
all terms and conditions of such Environmental Permits and with all
other material requirements of applicable Environmental Laws of which
the failure to comply could reasonably be expected to cause a Material
Adverse Change; (iii) have not received notice of any violation or
alleged violation of any Environmental Law or Environmental Permit,
which violation could reasonably be expected to cause a Material
Adverse Change; and (iv) are not subject to any actual or contingent
material Environmental Claim, which Environmental Claim could
reasonably be expected to cause a Material Adverse Change.
(b) None of the present or previously owned or operated
Property of the Borrower or of any of its present or former
Subsidiaries, wherever located, (i) has been placed on or proposed to
be placed on the National Priorities List, the Comprehensive
Environmental Response Compensation Liability Information System list,
or their state or local analogs, or have been otherwise investigated,
designated, listed or identified as a potential site for removal,
remediation, cleanup, closure, restoration, reclamation or other
response activity under any Environmental Laws which could reasonably
be expected to cause a Material Adverse Change, (ii) is subject to a
Lien, arising under or in connection with any Environmental Laws, that
attaches to any revenues or to any Property owned or operated by the
Borrower or any of its Subsidiaries, wherever located, which Lien could
reasonably be expected to cause a Material Adverse Change, or (iii) has
been the site of any Release of Hazardous Substances or Hazardous
Wastes from present or past operations which has caused at the site or
at any third-party site any condition that has resulted in or could
reasonably be expected to result in the need for a Response that could
cause a Material Adverse Change.
(c) Without limiting the foregoing, as of the Effective Date,
the present and, to the best knowledge of any Responsible Officer of
the Borrower, future liability, if any, of the Borrower and its
Subsidiaries, taken as a whole, which could reasonably be expected to
arise in connection with requirements under Environmental Laws will not
result in a Material Adverse Change.
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Section 4.16 Permits, Licenses, Etc. Each of the Borrower and its
Subsidiaries possesses all certificates of public convenience, authorizations,
permits, licenses, patents, patent rights or licenses, trademarks, trademark
rights, trade names rights and copyrights which are material to the conduct of
its business. Each of the Borrower and its Subsidiaries manages and operates its
business in accordance with all applicable Legal Requirements which the failure
to so manage or operate could reasonably be expected to cause a Material Adverse
Change.
Section 4.17 Existing Mortgage Debt. All outstanding Indebtedness
secured by a Lien on real property of the Borrower or any Guarantor existing as
of the Effective Date is described on Schedule 6.1, and the amount of such
Indebtedness shown on such Schedule is the aggregate outstanding amount as of
the Effective Date. No "default" or "event of default", however defined, has
occurred and is continuing under any documentation evidencing such Indebtedness
or the Lien securing such Indebtedness.
Section 4.18 Property and Liens. As of the Effective Date, each of the
Borrower and its Subsidiaries has good title to or a valid leasehold interest in
its respective Property and none of such Property is subject to any Lien, except
as permitted by Section 6.1.
ARTICLE V
AFFIRMATIVE COVENANTS
So long as any Advance or any other Obligation or amount under any
Credit Document shall remain unpaid, any Letter of Credit shall remain
outstanding or any Bank shall have any Commitment, the Borrower agrees, unless
the Majority Banks shall otherwise consent in writing, to comply with each of
the following covenants:
Section 5.1 Compliance with Laws, Etc. The Borrower will comply, and
cause each of its Subsidiaries to comply, with all Legal Requirements of which
the failure to comply could reasonably be expected to cause a Material Adverse
Change; provided, however, that this Section 5.1 shall not prevent the Borrower,
or any of its Subsidiaries from, in good faith and with reasonable diligence,
contesting the validity or application of any such laws or regulations by
appropriate legal proceedings.
Section 5.2 Insurance. The Borrower will maintain, and cause each of
its Subsidiaries to maintain, insurance with responsible and reputable insurance
companies or associations in such amounts and covering such risks as are usually
carried by companies engaged in similar businesses and owning similar properties
in the same general areas in which the Borrower or such Subsidiary operates,
provided that the Borrower or such Subsidiary may self-insure to the extent and
in the manner normal for similarly situated companies of like size, type and
financial condition that are part of a group of companies under common control.
All policies shall expressly protect or recognize the Agent's interest (if any)
as required by the Agent. Upon request made by the Agent, the Borrower shall
deliver certificates evidencing such insurance and copies of the underlying
policies as they are available.
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Section 5.3 Preservation of Corporate Existence, Etc. The Borrower will
preserve and maintain, and cause each of the Guarantors to preserve and
maintain, its corporate existence, rights, franchises and privileges in the
jurisdiction of its incorporation or organization, and qualify and remain
qualified, and cause each such Guarantor to qualify and remain qualified, as a
foreign corporation in each jurisdiction in which qualification is necessary or
desirable in view of its business and operations or the ownership of its
properties, and, in each case, where failure to qualify or preserve and maintain
its existence, rights and franchises could reasonably be expected to cause a
Material Adverse Change or, in the case of preserving and maintaining the
existence of the Guarantors, where the net worth of such Guarantor would exceed
$50,000,000; provided, however, that (a) nothing contained in this Section 5.3
shall prevent any transaction permitted by Section 6.4, and (b) the Borrower
shall, in all events, preserve and maintain the existence of (i) ABF Freight
System, Inc. and (ii) all other Guarantors if, after giving effect to any
failure to do so, a Default would occur or the Borrower and its Subsidiaries
would not be in pro forma compliance with the covenants set forth in Sections
6.11, 6.12 and 6.13.
Section 5.4 Payment of Taxes, Etc. The Borrower will pay and discharge,
and cause each of its Subsidiaries to pay and discharge, before the same shall
become delinquent and which the failure to timely pay or discharge could
reasonably be expected to cause a Material Adverse Change, (a) all taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits or Property that are material in amount, prior to the date on
which penalties attach thereto and (b) all lawful claims that are material in
amount which, if unpaid, might by law become a Lien upon its Property; provided,
however, that neither the Borrower nor any such Subsidiary shall be required to
pay or discharge any such tax, assessment, charge, levy or claim which is being
contested in good faith and by appropriate proceedings, and with respect to
which reserves in conformity with GAAP have been provided.
Section 5.5 Visitation Rights. At any reasonable time and from time to
time and so long as any visit or inspection will not unreasonably interfere with
the Borrower's or any of its Subsidiaries operations, upon reasonable notice,
the Borrower will, and will cause its Subsidiaries to, permit the Agent and any
Bank, and any of its agents or representatives thereof, to examine and make
copies of and abstracts from the records and books of account of, and visit and
inspect at its reasonable discretion the properties of, the Borrower and any
such Subsidiary and to discuss the affairs, finances and accounts of the
Borrower and any such Subsidiary with any of their respective officers or
directors.
Section 5.6 Reporting Requirements. The Borrower will furnish to the
Agent and each Bank:
(a) Quarterly Financials. As soon as available and in any
event not later than 45 days after the end of each of the first three
fiscal quarters of each fiscal year of the Borrower and not later than
60 days after the end of the fourth fiscal quarter of each fiscal year
of the Borrower, the unaudited Consolidated and consolidating balance
sheets of the Borrower and its Subsidiaries as of the end of such
quarter and the related unaudited statements of income, shareholders'
equity and cash flows of the Borrower and its Subsidiaries for the
period commencing at the end of the previous year and ending with the
end of such quarter, and the corresponding figures as at the end of,
and for, the corresponding period in the preceding
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fiscal year, all in reasonable detail and duly certified with respect
to such statements (subject to year-end audit adjustments) by an
authorized financial officer of the Borrower as having been prepared in
accordance with GAAP, together with a Compliance Certificate duly
executed by a Responsible Officer;
(b) Annual Financials. As soon as available and in any event
not later than 90 days after the end of each fiscal year of the
Borrower, a copy of the annual audit report for such year for the
Borrower and its Subsidiaries, including therein audited Consolidated
balance sheets of the Borrower and its Consolidated Subsidiaries as of
the end of such fiscal year and the related Consolidated statements of
income, shareholders' equity and cash flows of the Borrower and its
Consolidated Subsidiaries for such fiscal year, and the corresponding
figures as at the end of, and for, the preceding fiscal year, in each
case containing the unqualified certification of Ernst & Young L.L.P.
or other independent certified public accountants of recognized
standing acceptable to the Agent and including, if requested by the
Agent, any management letters delivered by such accountants to the
Borrower in connection with such audit together with a certificate of
such accounting firm to the Banks stating that (i) no Default under
Section 6.11, 6.12, 6.13 or 6.14 has occurred and is continuing and
(ii) in the course of the regular audit of the business of the Borrower
and its Subsidiaries, which audit was conducted by such accounting firm
in accordance with generally accepted auditing standards, such
accounting firm has obtained no knowledge that a Default has occurred
and is continuing or, if, in the opinion of such accounting firm, any
Default has occurred and is continuing, a statement as to the nature
thereof, together with a Compliance Certificate;
(c) Annual Projections. As soon as available and in any event
not later than 30 days after the end of each fiscal year of the
Borrower, the Consolidated annual projections of the Borrower and its
Subsidiaries, including, but not limited to, annual projections of
condensed (consistent with past practices) Consolidated balance sheets
of the Borrower and its Subsidiaries and the related condensed
(consistent with past practices) Consolidated statements of income of
the Borrower and its Subsidiaries, for such year in reasonable detail
and duly certified by an authorized financial officer of the Borrower
as the projections presented or to be presented to the Borrower's Board
of Directors for their review;
(d) Securities Law Filings. Promptly and in any event within
15 days after the sending or filing thereof, copies of all proxy
material, reports and other information which the Borrower or any of
its Subsidiaries sends to or files with the U.S. Securities and
Exchange Commission or sends to the shareholders of the Borrower or of
any of its Subsidiaries;
(e) Defaults. As soon as possible and in any event within five
days after the occurrence of each Default known to a Responsible
Officer of the Borrower or any of its Subsidiaries, a statement of an
authorized financial officer of the Borrower setting forth the details
of such Default and the actions which the Borrower has taken and
proposes to take with respect thereto;
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(f) ERISA Notices. Except as to any matter which could not
reasonably be expected to cause a Material Adverse Change, as soon as
possible and in any event (i) within 30 days after the Borrower or any
of its Subsidiaries knows or has reason to know that any Termination
Event described in clause (a) of the definition of Termination Event
with respect to any Plan has occurred and within 10 days after the
Borrower or any of its Subsidiaries knows or has reason to know that
any other Termination Event with respect to any Plan has occurred, a
statement of the chief financial officer of the Borrower describing
such Termination Event and the action, if any, which the Borrower or
such Subsidiary proposes to take with respect thereto, (ii) within 10
days after receipt thereof by the Borrower or any of its Subsidiaries
from the PBGC, copies of each notice received by the Borrower or any
such Subsidiary of the PBGC's intention to terminate any Plan or to
have a trustee appointed to administer any Plan, and (iii) within 10
days after receipt thereof by the Borrower or any of its Subsidiaries
from a Multiemployer Plan sponsor, a copy of each notice received by
the Borrower or any of its Subsidiaries concerning the imposition or
amount of withdrawal liability pursuant to Section 4202 of ERISA;
(g) Environmental Notices. Promptly upon the knowledge of any
Responsible Officer of the Borrower of receipt thereof by the Borrower
or any of its Subsidiaries, a copy of any form of notice, summons or
citation received from the U.S. Environmental Protection Agency, or any
other Governmental Authority directly engaged in protection of the
Environment, concerning (i) material violations or alleged violations
of Environmental Laws, which seeks to impose liability therefor and
which, based upon information reasonably available to the Borrower at
the time or after such violation, could reasonably be expected to cause
a Material Adverse Change, (ii) any action or omission on the part of
the Borrower or any of its present or former Subsidiaries in connection
with Hazardous Waste or Hazardous Substances which, based upon
information reasonably available to the Borrower at the time of such
receipt, could reasonably be expected to cause a Material Adverse
Change, (iii) any notice of potential responsibility under CERCLA which
could reasonably be expected to cause a Material Adverse Change, or
(iv) the filing of a Lien other than a Permitted Lien upon, against or
in connection with the Borrower, its present or former Subsidiaries or
any of their leased or owned Property, wherever located;
(h) Other Governmental Notices or Actions. Promptly and in any
event within five Business Days after receipt thereof by the Borrower
or any of its Subsidiaries, and the knowledge of such receipt by a
Responsible Officer of the Borrower or any inside counsel of the
Borrower, (i) a copy of any notice, summons, citation or proceeding
seeking to adversely modify in any material respect, revoke or suspend
any license, permit or other authorization from the U.S. Department of
Transportation or any other Governmental Authority, which action could
reasonably be expected to cause a Material Adverse Change, and (ii) a
copy of any revocation or involuntary termination of any license,
permit or other authorization from the U.S. Department of
Transportation or any other Governmental Authority, which revocation or
termination could reasonably be expected to cause a Material Adverse
Change;
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(i) Borrowing Base Certificate. On or prior to the 25th day of
each calendar month, a completed Borrowing Base Certificate setting
forth the components of the Borrowing Base as of the last day of the
immediately preceding calendar month;
(j) Other Notices. Promptly following any merger or
dissolution of any Subsidiary of the Borrower which is permitted
hereunder, notice thereof;
(k) Material Litigation. As soon as possible and in any event
within five days of any Responsible Officer of the Borrower or any of
its Subsidiaries having knowledge thereof, notice of any litigation,
claim or any other event which could reasonably be expected to cause a
Material Adverse Change; and
(l) Other Information. Such other information respecting the
business or Properties, or the condition or operations, financial or
otherwise, of the Borrower or any of its Subsidiaries as any Bank
through the Agent may from time to time reasonably request.
Section 5.7 Maintenance of Property. The Borrower will, and will cause
each of its Subsidiaries to, (a) maintain their material owned, leased or
operated property, equipment, buildings and fixtures, taken as a whole in
substantially the same or better condition and repair as the condition and
repair thereof as of December 31, 2001, normal wear and tear excepted, and (b)
not knowingly or willfully permit the commission of waste or other injury, or
the occurrence of pollution, contamination or any other condition in, on or
about the owned or operated property involving the Environment that could
reasonably be expected to cause a Material Adverse Change.
Section 5.8 Ownership of ABF. The Borrower will maintain its ownership
of 100% of the common stock of ABF Freight System, Inc., a Delaware corporation
and wholly-owned Subsidiary of the Borrower.
Section 5.9 Further Assurances. The Borrower shall, and shall cause
each of its Subsidiaries to, execute and deliver pursuant to this Section 5.9
such further documentation and take such further actions as may be reasonably
requested by the Agent to carry out the provisions and purposes of the Credit
Documents. Without limiting the generality of the foregoing, the Borrower shall,
and shall cause each of it Subsidiaries (now or hereafter owned) to, at all
times, comply with Section 2.19.
ARTICLE VI
NEGATIVE COVENANTS
So long as any Advance or any other Obligation or amount under any
Credit Document shall remain unpaid, any Letter of Credit shall remain
outstanding or any Bank shall have any Commitment, the Borrower agrees, unless
the Majority Banks otherwise consent in writing, to comply with each of the
following covenants:
Section 6.1 Liens, Etc. The Borrower will not create, assume, incur or
suffer to exist, or permit any of its Subsidiaries to create, assume, incur or
suffer to exist, any Lien on or in respect of
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any of its Property whether now owned or hereafter acquired, or assign any right
to receive income, except that the Borrower and its Subsidiaries may create,
incur, assume or suffer to exist Liens:
(a) in favor of the Agent for the benefit of the Banks
securing the Obligations;
(b) for taxes, assessments or governmental charges or levies
on Property of the Borrower or any Guarantor to the extent not required
to be paid pursuant to Sections 5.1 and 5.4;
(c) imposed by law, such as landlords', carriers',
warehousemen's and mechanics' liens and other similar Liens arising in
the ordinary course of business securing obligations which are not
overdue for a period of more than 30 days or which are being contested
in good faith and by appropriate proceedings if adequate reserves with
respect thereto are maintained on the books of the Borrower and its
Subsidiaries in accordance with GAAP;
(d) arising in the ordinary course of business out of pledges
or deposits (i) under workers' compensation laws, unemployment
insurance, old age pensions or other social security or retirement
benefits, or similar legislation, bonds or letters of credit or (ii) to
secure public or statutory obligations of the Borrower or any of its
Subsidiaries;
(e) existing on Property acquired by the Borrower or any of
its Subsidiaries in the ordinary course of business, each of which
Liens (i) attached prior to the Borrower's or such Subsidiary's
acquisition of such Property, (ii) was not created in contemplation of
or in connection with such acquisition, and (iii) secures only the
Indebtedness of the owner of such Property at the time of the
attachment of such Lien, the aggregate of which Indebtedness at any
time outstanding secured by all such Liens, when aggregated with all
other Indebtedness referred to in Section 6.1(k) at any time
outstanding secured by the Liens referred to therein, shall not exceed
$40,000,000 at any time outstanding, exclusive of Liens affecting
Property which secure only Indebtedness which has remained outstanding
less than 180 days after the date of the acquisition of such Property
by the Borrower or any of its Subsidiaries;
(f) securing Indebtedness existing on the Effective Date and
listed on the attached Schedule 6.1; provided that the Indebtedness
secured by such Liens shall not be renewed, refinanced or extended if
the amount of such Indebtedness so renewed, refinanced or extended is
greater than the outstanding amount of such Indebtedness on the Closing
Date;
(g) constituting easements, rights-of-way, restrictions and
other similar encumbrances incurred in the ordinary course of business
and encumbrances consisting of zoning restrictions, easements,
licenses, restrictions on the use of Property or minor imperfections in
title thereto which, in the aggregate, are not material in amount, and
which do not in any case materially detract from the value of the
Property subject thereto or materially interfere with the ordinary
conduct of the business of the Borrower or any of its Subsidiaries;
(h) arising from litigation and which are effectively stayed
from execution and would not otherwise cause a Default to occur;
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(i) on real Property securing surety bonds in an amount not to
exceed $20,000,000;
(j) constituting purchase money Liens securing purchase money
Indebtedness (including, without limitation, Capital Leases) permitted
by Section 6.15(d), provided that (i) any Property subject to such
purchase money Lien is acquired by the Borrower or any of its
Subsidiaries, (ii) such Lien on such Property attaches concurrently
with or within 120 days after the acquisition of such Property and
(iii) such Lien shall attach solely to such Property so acquired and
the proceeds thereof;
(k) permitted by Section 6.15(c) existing on Property acquired
by the Borrower or any of its Subsidiaries in connection with an
Acquisition Expenditure permitted pursuant to Section 6.16, each of
which Liens (i) attached prior to the Borrower's or such Subsidiary's
acquisition of such Property, (ii) was not created in contemplation of
or in connection with such Person becoming a Subsidiary, and (iii)
secures only Indebtedness permitted by Section 6.15(c), the aggregate
of which Indebtedness at any time outstanding secured by all such
Liens, when aggregated with all other Indebtedness referred to in
Section 6.1(e) at any time outstanding secured by the Liens referred to
therein, shall not exceed $40,000,000 at any time outstanding,
exclusive of Liens affecting Property which secure only Indebtedness
which has remained outstanding less than 180 days after the date of the
acquisition of such Property by the Borrower or any of its
Subsidiaries; and
(l) on certain Receivables of any Intermodal Subsidiary, in
favor of any railroad company which secures the obligations of such
Intermodal Subsidiary to such railroad company in connection with rail
shipments with such railroad company contracted for by such Intermodal
Subsidiary for the benefit of the obligors of such Receivables which
Liens secure only Indebtedness described in this Section 6.1(l), the
aggregate of which Indebtedness at any time outstanding secured by all
such Liens shall not exceed $3,000,000.
Section 6.2 Amendment of Material Documents. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into any amendment of the
Subordinated Debt Documents without the approval of the Agent and the Majority
Banks.
Section 6.3 Agreements Restricting Distributions From Subsidiaries. The
Borrower will not, and will not permit any of its Subsidiaries to, enter into
any agreement (other than a Credit Document) which limits any dividends,
advances or other distributions by any of the Borrower's Subsidiaries to the
Borrower.
Section 6.4 Merger or Consolidation; Asset Sales. The Borrower will
not, and will not permit any of its Subsidiaries to:
(a) merge or consolidate with or into any other Person, unless
(i) the Borrower (in the case of any transaction involving the
Borrower) or such Subsidiary (unless such Subsidiary is merged into the
Borrower or another Subsidiary) is the surviving corporation, and (ii)
immediately before and after giving effect to any such proposed
transaction, no Default existed or would exist;
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(b) sell, transfer or otherwise dispose of any of the
Borrower's or such Subsidiary's Property (unless, in the case of a
Subsidiary, such assets are sold, leased, transferred or otherwise
conveyed to another Subsidiary which is a Guarantor) except for (i)
sales, transfers and dispositions in the ordinary course of business
for a fair consideration, (ii) sales, transfers or dispositions of
assets which are obsolete or are no longer in use and which are not
significant to the continuation of the Borrower's or any of its
Subsidiaries business; (iii) sales, transfers or dispositions of
assets, other than sales, transfer or dispositions otherwise permitted
by (i) or (ii) above, the Net Cash Proceeds of which do not exceed
$40,000,000 in the aggregate for all such sales, transfers or
dispositions of assets during any fiscal year; or (iv) sales, transfers
or other dispositions of (1) the Capital Stock or assets and
liabilities of Wingfoot pursuant to the Wingfoot Put and Call, (2) the
G.I. Leased Properties and/or (3) the Capital Stock or assets and
liabilities of the Subsidiaries identified on Schedule 1.1(c).
Section 6.5 Restricted Payments. The Borrower will not, and will not
permit any of its Subsidiaries to, make any Restricted Payment, except that
(a) a wholly-owned Subsidiary of the Borrower may make a
Restricted Payment to the Borrower or another wholly-owned Subsidiary
of the Borrower;
(b) provided no Default has occurred and is continuing or
would result therefrom, the Borrower may pay cash dividends to its
shareholders in an aggregate amount not to exceed, during any fiscal
year, the greater of (i) 25% of the Net Income of the Borrower and its
Consolidated Subsidiaries during the fiscal year immediately preceding
the date of payment of such dividends or (ii) $15,000,000; and
(c) provided no Default has occurred and is continuing or
would result therefrom and if the Leverage Ratio on a pro forma basis,
as then most recently determined based upon the Leverage Ratio
calculated as of the most recent Calculation Day for the applicable
Calculation Period in accordance with Section 6.13 but giving effect to
each contemplated stock repurchase, redemption or other reacquisition
under this Section 6.5(c), is less than 2.50 to 1.00, then the Borrower
may repurchase, redeem or otherwise reacquire shares of its Capital
Stock issued and outstanding in an aggregate amount from and after the
Closing Date not to exceed $50,000,000.
Section 6.6 Investments, Loans, Advances. The Borrower will not, and
will not permit any of its Subsidiaries to, make any loans, advances or capital
contributions to, or make any investment in, or purchase or commit to purchase
any stock or other securities or evidences of indebtedness of or interests in,
any Person, except the following (provided that before and after giving effect
thereto there shall exist no Default):
(a) the purchase of Liquid Investments;
(b) trade and customer accounts receivable which are for goods
furnished or services rendered in the ordinary course of business and
are payable in accordance with customary trade terms;
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(c) ordinary course of business contributions, loans or
advances to, or investments in, (i) a direct or indirect Subsidiary of
the Borrower or (ii) the Borrower;
(d) contributions to, or capital investments in a Person
which, prior to such contribution or investment, is not a Subsidiary
but which becomes a Subsidiary as a result of such contribution or
investment, provided that, the Borrower shall have caused such Person
to have executed and delivered to the Agent an Accession Agreement and
a certificate covering the same matters described in clause (iii) of
Section 3.1(a) with respect to such Person, and the Borrower's counsel
shall deliver an opinion with respect thereto covering the matters
previously opined on with regard to each Guarantor;
(e) loans and advances to officers, directors and employees of
the Borrower and its Subsidiaries so long as the aggregate principal
amount thereof outstanding at any time shall not exceed $2,000,000; and
(f) other capital investments not otherwise permitted by this
Section 6.6 in any Person which is not, and will not become, a
Subsidiary of the Borrower as a result of such capital investment,
provided that (i) the aggregate amount of such investments outstanding
at any time shall not exceed $10,000,000; (ii) such Person shall be in
the same or substantially similar line or lines of business as the
Borrower and its Subsidiaries or a line of business directly related to
providing services of the nature the Borrower and its Subsidiaries
provide on the date this Agreement is executed; and (iii) the
liabilities of such other Person shall be nonrecourse to the Borrower
and its Subsidiaries.
Section 6.7 Affiliate Transactions. Except as expressly permitted
elsewhere in this Agreement, the Borrower will not, and will not permit any of
its Subsidiaries to, make, directly or indirectly: (a) any transfer, sale,
lease, assignment or other disposal of any Property to any Affiliate of the
Borrower or any purchase or acquisition of Property from any such Affiliate; or
(b) any arrangement or other transaction directly or indirectly with or for the
benefit of any such Affiliate (including without limitation, guaranties and
assumptions of obligations of an Affiliate); provided, however, that the
Borrower and its Subsidiaries may (i) enter into any arrangement or other
transaction with any such Affiliate providing for the leasing of property, the
rendering or receipt of services or the purchase or sale of inventory and other
assets in the ordinary course of business if the monetary or business
consideration arising therefrom would be substantially as advantageous to the
Borrower and its Subsidiaries as the monetary or business consideration which it
would obtain in a comparable arm's length transaction with a Person not such an
Affiliate, (ii) guaranty or otherwise assume obligations of an Affiliate in
connection with an Acquisition Expenditure to the extent permitted under Section
6.16 if the monetary or business consideration arising therefrom would be
substantially as advantageous to the Borrower and its Subsidiaries as the
monetary or business consideration which it would obtain in a comparable arm's
length transaction with a Person not such an Affiliate, and (iii) maintain the
arrangements listed on the attached Schedule 6.7.
Section 6.8 Maintenance of Ownership of Subsidiaries. The Borrower will
not, and will not permit any of its Subsidiaries to, sell or otherwise dispose
of any shares of Capital Stock of any Foreign Subsidiary whose Capital Stock is
pledged to secure the Obligations in accordance with Section 2.19(b) or any
shares of Capital Stock of any Guarantor, in each case except as otherwise
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permitted by Section 6.4. Upon the sale or disposition of the Capital Stock of
any Guarantor to any Person other than the Borrower or any other Guarantor, the
Agent will, if such sale or disposition is permitted by clause (b) of Section
6.4 and at the Borrower's expense, execute and deliver to such Guarantor such
documents as such Guarantor shall reasonably require and take any other actions
reasonably required to evidence or effect the release of such Guarantor's
Guaranty.
Section 6.9 No Further Negative Pledges. Except as set forth in the
agreements and documentation governing Indebtedness of the Borrower or any of
its Subsidiaries existing on the Effective Date and described on the attached
Schedule 6.9, or with respect to prohibitions against other encumbrances on
specific Property encumbered to secure payment of particular Indebtedness (which
encumbrances and Indebtedness relate solely to such specific Property, and
improvements and accretions thereto, and are otherwise permitted by this
Agreement), the Borrower will not, and will not permit any of its Subsidiaries
to, enter into or suffer to exist any agreement (other than this Agreement and
the Credit Documents):
(a) prohibiting the creation or assumption of any Lien or
otherwise affecting its power, authority, right or ability to grant or
permit any Lien upon the Properties of the Borrower or any of its
Subsidiaries, whether now owned or hereafter acquired; or
(b) requiring an obligation to be secured if some other
obligation is or becomes secured;
provided, however, that the restrictions contained in this Section 6.9 shall not
apply to any agreements governing credit facilities which constitute senior,
unsecured Indebtedness which is permitted by this Agreement to be incurred,
which is publicly placed or sold to institutional investors and which is not
Indebtedness consisting of Subordinated Debt, Capital Leases or purchase money
Indebtedness.
Section 6.10 Other Businesses. The Borrower will not, and will not
permit any of the Guarantors to, substantially alter the character of their
respective businesses, taken as a whole, from that conducted as of the Closing
Date.
Section 6.11 Interest Coverage Ratio. The Borrower will not permit its
ratio, calculated as of each Calculation Day, commencing June 30, 2002 and
continuing thereafter through and including the Maturity Date, for the
Calculation Period then ended, of (a) Adjusted EBITDA for such Calculation
Period to (b) the positive remainder of (i) Consolidated Interest Expense for
such Calculation Period minus (ii) interest income for such Calculation Period,
to be less than 4.5 to 1.0.
Section 6.12 Net Worth. The Borrower will not permit its Consolidated
Net Worth, as of each Calculation Day, commencing June 30, 2002 and continuing
thereafter through and including the Maturity Date, to be less than an amount
equal to the sum of (a) $272,000,000, plus (b) 50% of the Cumulative Net Income
(as defined below), plus (c) 50% of the net cash proceeds of any issuance of
equity by the Borrower after the Closing Date. For purposes of determining the
Borrower's compliance with this Section 6.12, an amount equal to the lesser of
(i) the aggregate amount of cash then previously paid during the period from the
Closing Date to the earlier to occur of such
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Calculation Day or the date that is 18 months after the Closing Date by the
Borrower to its shareholders for repurchases or redemptions of its Capital
Stock, which payments have reduced the Borrower's Consolidated Net Worth by the
amount of such payments, permitted in accordance with Section 6.5 or (ii)
$25,000,000, shall be added as an adjustment to the Borrower's Consolidated Net
Worth.
For purposes of this Section 6.12, the following terms shall have the
following meanings:
"Cumulative Net Income" means the cumulative Consolidated Net
Income of the Borrower and its Subsidiaries for the period from April
1, 2002 through the applicable Calculation Day (the "subject period"),
exclusive of (i) any Net Losses (as defined below) during any completed
fiscal quarter during such subject period and (ii) positive
Consolidated Net Income of the Borrower and its Subsidiaries during any
completed fiscal quarter during the Recovery Period not to exceed, in
the aggregate, the aggregate amount of the Net Losses excluded pursuant
to clause (i) preceding.
"Net Losses" means, with respect to any fiscal quarter during
the subject period, the amount by which Consolidated Net Income of the
Borrower and its Subsidiaries during such fiscal quarter is negative.
"Recovery Period" means, with respect to each fiscal quarter
during the subject period in which there were Net Losses, the period of
up to four consecutive fiscal quarters which occur during the subject
period and which immediately succeed the fiscal quarter during which
such Net Losses occurred. In the case that there have been two or more
different fiscal quarters in which there have been Net Losses during
the subject period (resulting in two or more different Recovery
Periods) and positive Consolidated Net Income has occurred within each
Recovery Period, the positive Consolidated Net Income shall be first
applied to recovering the Net Losses that occurred first.
Section 6.13 Maximum Leverage Ratio. The Borrower will not permit its
Leverage Ratio, calculated as of each Calculation Day, commencing June 30, 2002
and continuing thereafter through and including the Maturity Date, for the
Calculation Period then ended, to be greater than 2.75 to 1.00.
Section 6.14 Capital Expenditures. The Borrower may make or permit any
of its Subsidiaries to make or commit to make any Capital Expenditure; provided,
however, if the Borrower's Senior Debt is not rated either BBB- or higher by S&P
or Baa3 or higher by Xxxxx'x (or, if either such rating agency shall cease to
rate the corporate debt obligations of the Borrower and the rating of the rating
agency that continues to rate the corporate debt obligations of the Borrower
falls below the applicable rating specified in this sentence), then Capital
Expenditures of the Borrower and its Subsidiaries may not exceed $100,000,000,
net of any Net Cash Proceeds received from the sale of any capital asset during
such period if such sale is permitted pursuant to Section 6.4, in an aggregate
amount during any fiscal year during which such circumstance has occurred. For
purposes of calculating "Capital Expenditures" pursuant to this Section 6.14,
all Acquisition Expenditures permitted pursuant to Section 6.16 shall be
excluded.
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Section 6.15 Indebtedness. The Borrower will not incur or permit to
exist, or permit any of its Subsidiaries to incur or permit to exist, any
Indebtedness other than the Obligations and the following:
(a) Indebtedness of the Borrower to any Subsidiary and of any
Subsidiary to the Borrower or another Subsidiary;
(b) Indebtedness outstanding on the Effective Date and listed
on Schedule 6.15;
(c) Indebtedness assumed by the Borrower or a Subsidiary of
the Borrower of an entity which becomes a Subsidiary after the Closing
Date pursuant to an acquisition of an entity not prohibited by Section
6.16, provided that (i) such Indebtedness existed prior to such
acquisition and was not created in anticipation thereof and (ii)
immediately after giving effect to such acquisition, no Default shall
have occurred and be continuing; provided, however, that such
Indebtedness referred to in this clause (c) above may not be secured by
any Property of the Borrower or any of its Subsidiaries other than the
Property acquired in connection with such acquisition in which a Lien
was granted prior to and not in anticipation of such acquisition and,
in the event that such Indebtedness is so secured, all Liens securing
such Indebtedness must be released within 180 days after the
consummation of such acquisition other than Liens securing such
Indebtedness in an aggregate amount not to exceed $40,000,000 (which
may continue in existence after such 180 day period);
(d) Subordinated Debt, other unsecured senior Indebtedness,
Capital Leases or purchase money Indebtedness, in each case incurred
after the Effective Date (other than Indebtedness permitted pursuant to
Sections 6.15(a), 6.15(b) and/or 6.15(c)) (such Indebtedness incurred
after the Effective Date pursuant to this Section 6.15(d) to be
referred to collectively herein as "Additional Permitted
Indebtedness"); provided, however, that:
(i) no Additional Permitted Indebtedness may be
incurred at any time if, after giving effect to such
incurrence, the aggregate outstanding principal amount of all
Additional Permitted Indebtedness (including, without
limitation, Additional Permitted Indebtedness previously
incurred) would then exceed the Adjusted EBITDA of the
Borrower and its Consolidated Subsidiaries as of the then most
recent Calculation Day based upon the Calculation Period then
ended;
(ii) no Additional Permitted Indebtedness may be
incurred at any time if a Default has then occurred and is
continuing or would result from such incurrence;
(iii) none of the financial covenants or similar
covenants contained in the agreements, documents and
instruments evidencing or governing such Additional Permitted
Indebtedness (the "Additional Permitted Indebtedness
Documents") may be more restrictive than those contained in
this Agreement or any other Credit Document;
(iv) no Additional Permitted Indebtedness Document
may be executed by the Borrower or any of its Subsidiaries,
and no Additional Permitted Indebtedness
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may be incurred thereunder, if (A) the execution, delivery and
performance of such Additional Permitted Indebtedness Document
conflicts with, or constitutes a violation of, this Agreement
or any other Credit Document or (B) the execution, delivery
and performance of this Agreement and the other Credit
Documents by the Borrower and its Subsidiaries conflicts with,
or constitutes a violation of, such Additional Permitted
Indebtedness Document;
(v) except for Capital Leases, the due date for the
payment or prepayment of all principal of the Additional
Permitted Indebtedness shall be at least 60 days after the
Maturity Date (exclusive of the effect of any acceleration of
the maturity thereof upon the occurrence of an event of
default thereunder);
(vi) all Additional Permitted Indebtedness must be
pari passu or subordinate in right of payment to the
Obligations; and
(vii) the aggregate principal amount of Additional
Permitted Indebtedness that constitutes purchase money
Indebtedness or Capital Leases shall not exceed $30,000,000 at
any time outstanding.
Notwithstanding any of the foregoing provisions, if the Borrower's
Senior Debt is not rated either BBB- or higher by S&P or Baa3 or higher by
Xxxxx'x (or, if either such rating agency shall cease to rate the corporate debt
obligations of the Borrower and the rating of the rating agency that continues
to rate the corporate debt obligations of the Borrower falls below the
applicable rating specified in this sentence), then the Borrower shall not, and
shall not permit any of its Subsidiaries to, incur any Additional Permitted
Indebtedness without the prior written consent of the Majority Banks; and
(e) extensions, renewals and refinancing of any of the
Indebtedness specified in Sections 6.15(a), 6.15(b), 6.15(c) and/or
6.15(d) so long as the principal amount of such Indebtedness is not
thereby increased.
Section 6.16 Acquisition Expenditures. The Borrower shall not, and
shall not permit any of its Subsidiaries to, make any Acquisition Expenditure
unless each of the following requirements is satisfied:
(a) such Acquisition Expenditure is made in substantially the
same or complementary lines of business of the Borrower and does not
violate any other provision of this Agreement;
(b) at the time of such Acquisition Expenditure, no Default
has occurred and is continuing or would occur upon the consummation of
such acquisition and the Agent shall have received a Compliance
Certificate demonstrating pro forma compliance with Sections 6.11,
6.12, 6.13, 6.14 and 6.15 based on combined pro forma operating results
of the Person to be acquired and the Borrower and its Subsidiaries,
provided, however, the Agent shall also have received, in the case of a
particular Acquisition Expenditure, or series of related Acquisition
Expenditures aggregating, in excess of $50,000,000, audited financial
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statements, including, but not limited to, the balance sheet and the
related statements of income, of the Person to be acquired that have
been prepared as of a date or for a period ended (as applicable) within
the 12 month period prior to such Acquisition Expenditure or series of
related Acquisition Expenditures or, to the extent that such audited
financial statements are not otherwise available, the Borrower shall
either cause such audited financial statements to be prepared or cause
the EBITDA of the Person to be acquired to be calculated and confirmed
by independent certified public accountants and deliver such
calculation and confirmation to the Agent; and
(c) at the time of such Acquisition Expenditure, the
Borrower's Senior Debt is rated BBB- or higher by S&P or Baa3 or higher
by Xxxxx'x. Notwithstanding this clause (c) preceding, if the
Borrower's Senior Debt is not rated either BBB- or higher by S&P or
Baa3 or higher by Xxxxx'x (or, if either such rating agency shall cease
to rate the corporate debt obligations of the Borrower and the rating
of the rating agency that continues to rate the corporate debt
obligations of the Borrower falls below the applicable rating specified
in this sentence), then the Borrower may make an Acquisition
Expenditure if (and only if) such Acquisition Expenditure is identified
on Schedule 6.16 and is not in excess of $50,000,000 in the aggregate.
ARTICLE VII
REMEDIES
Section 7.1 Events of Default. The occurrence of any of the following
events shall constitute an "Event of Default" under this Agreement and the other
Credit Documents:
(a) Payment. The Borrower shall fail to pay any principal of
any Advance or any Reimbursement Obligation when the same becomes due
and payable as set forth in this Agreement, or the Borrower shall fail
to pay any interest on any Advance or any fee or other amount or
Obligation payable hereunder or under any other Credit Document within
five days after due and payable as set forth in this Agreement or any
other Credit Document;
(b) Representation and Warranties. Any representation or
warranty made or deemed to be made (i) by the Borrower in this
Agreement or in any other Credit Document, (ii) by the Borrower (or any
of its officers) in connection with this Agreement or any other Credit
Document, or (iii) by any Subsidiary in any Credit Document shall prove
to have been incorrect in any material respect when made or deemed to
be made;
(c) Covenant Breaches. (i) The Borrower shall fail to perform
or observe any covenant contained in Section 5.3, 5.4 or 5.6(e),
5.6(f), 5.6(g), 5.6(h) or 5.6(i) or Article VI of this Agreement or
(ii) the Borrower, any Subsidiary of the Borrower or any Guarantor
shall fail to perform or observe any term or covenant set forth in any
Credit Document which is not covered by clause (i) preceding or any
other provision of this Section 7.1, if such failure shall remain
unremedied for 30 days after the earlier of the date written notice of
such default shall have been given to the Borrower or such Guarantor by
the Agent or any Bank or the date a Responsible Officer of the Borrower
has actual knowledge of such default;
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(d) Cross-Defaults. (i) The Borrower or any its Subsidiaries
shall fail to pay any principal of or premium or interest on its
Indebtedness which is outstanding in a principal amount of at least
$15,000,000 individually or when aggregated with all such Indebtedness
of the Borrower or its Subsidiaries so in default (but excluding
Indebtedness evidenced by the Notes) when the same becomes due and
payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement,
document or instrument relating to such Indebtedness; (ii) any other
event shall occur or condition shall exist under any agreement,
document or instrument relating to Indebtedness which is outstanding in
a principal amount of at least $15,000,000 individually or when
aggregated with all such Indebtedness of the Borrower or its
Subsidiaries so in default, and shall continue after the applicable
grace period, if any, specified in such agreement, document or
instrument, if the effect of such event or condition is to accelerate,
or to permit the acceleration of, the maturity of such Indebtedness; or
(iii) any such Indebtedness shall be declared to be due and payable, or
required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof;
(e) Insolvency. The Borrower or any of its Subsidiaries shall
generally not pay its debts as such debts become due, or shall admit in
writing its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors; or any proceeding
shall be instituted by or against the Borrower or any of its
Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief
of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee or other similar official for it or
for any substantial part of its Property and, in the case of any such
proceeding instituted against the Borrower or any such Subsidiary,
either such proceeding shall remain undismissed for a period of 30 days
or any of the actions sought in such proceeding shall occur; or the
Borrower or any of its Subsidiaries shall take any corporate action to
authorize any of the actions set forth above in this Section 7.1(e);
(f) Judgments. Any judgment or order for the payment of money
in excess of $15,000,000 (reduced for purposes of this Section 7.1(f)
by the amount in respect of such judgment or order that a reputable
insurer has acknowledged is payable under any valid and enforceable
insurance policy) shall be rendered against the Borrower or any of its
Subsidiaries which, within 30 days from the date such judgment is
entered, shall not have been discharged or execution thereof stayed
pending appeal;
(g) ERISA. (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the
Code) involving any Plan, (ii) any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, shall exist
with respect to any Plan, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee appointed,
or a trustee shall be appointed, to administer or to terminate, any
Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is likely to result in the termination of such
Plan for purposes of Title IV of ERISA, unless such Reportable Event,
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proceedings or appointment are being contested by the Borrower in good
faith and by appropriate proceedings, (iv) any Plan shall terminate for
purposes of Title IV of ERISA, (v) the Borrower or any member of the
Controlled Group shall incur any liability in connection with a
withdrawal from a Multiemployer Plan or the insolvency (within the
meaning of Section 4245 of ERISA) or reorganization (within the meaning
of Section 4241 of ERISA) of a Multiemployer Plan, unless such
liability is being contested by the Borrower in good faith and by
appropriate proceedings, or (vi) any other event or condition shall
occur or exist, with respect to a Plan; and in each case in clauses (i)
through (vi) above, such event or condition, together with all other
such events or conditions, if any, could subject the Borrower or any
Guarantor to any tax, penalty or other liabilities in the aggregate
exceeding $15,000,000; or
(h) Guaranty. Any provision of the Guaranty requiring the
payment of the Guaranteed Obligations (as defined in the Guaranty)
shall for any reason cease to be valid and binding on any Guarantor or
any Guarantor shall so state in writing.
Section 7.2 Optional Acceleration of Maturity. If any Event of Default
(other than an Event of Default pursuant to Section 7.1(e)) shall have occurred
and be continuing, then, and in any such event,
(a) the Agent (i) shall at the request, or may with the
consent, of the Majority Banks, by notice to the Borrower, declare the
obligation of each Bank to make Advances and the obligation of each
Issuing Bank to issue, increase or extend Letters of Credit to be
terminated, whereupon the same shall forthwith terminate, and (ii)
shall at the request, or may with the consent, of the Majority Banks,
by notice to the Borrower, declare the Advances, all interest thereon,
the Letter of Credit Obligations and all other amounts and Obligations
payable under this Agreement or any other Credit Document to be
forthwith due and payable, whereupon the Advances, all such interest,
all such Letter of Credit Obligations and all such amounts and
Obligations shall become and be forthwith due and payable in full,
without presentment, demand, protest or any notice of any kind
(including, without limitation, any notice of intent to accelerate or
notice of acceleration), all of which are hereby expressly waived by
the Borrower, and
(b) the Borrower shall, on demand of the Agent at the request
or with the consent of the Majority Banks, deposit with the Agent into
the Cash Collateral Account an amount of cash equal to the Letter of
Credit Exposure as security for the Obligations to the extent the
Letter of Credit Obligations are not otherwise paid at such time.
Section 7.3 Automatic Acceleration of Maturity. If any Event of Default
pursuant to Section 7.1(e) shall occur:
(a) the obligation of each Bank to make Advances and the
obligation of each Issuing Bank to issue, increase or extend Letters of
Credit shall immediately and automatically be terminated and the
Advances, all interest thereon, all Letter of Credit Obligations and
all other amounts and Obligations payable under this Agreement or any
other Credit Document shall immediately and automatically become and be
due and payable in
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full, without presentment, demand, protest or any notice of any kind
(including, without limitation, any notice of intent to accelerate or
notice of acceleration), all of which are hereby expressly waived by
the Borrower; and
(b) to the extent permitted by law or court order, the
Borrower shall deposit with the Agent into the Cash Collateral Account
an amount of cash equal to the outstanding Letter of Credit Exposure as
security for the Obligations to the extent the Letter of Credit
Obligations are not otherwise paid at such time.
Section 7.4 Cash Collateral Account.
(a) Pledge. The Borrower hereby pledges, and grants to the
Agent for the benefit of the Banks a Lien and security interest in, all
funds held in the Cash Collateral Account from time to time and all
proceeds thereof, as security for the payment of the Obligations,
including without limitation all Letter of Credit Obligations owing to
any Issuing Bank or any other Bank due and to become due from the
Borrower to any Issuing Bank or any other Bank under this Agreement in
connection with the Letters of Credit.
(b) Application against Letter of Credit Obligations. The
Agent may, at any time or from time to time, apply funds then held in
the Cash Collateral Account to the payment of any Letter of Credit
Obligations owing to any Issuing Bank, in such order as the Agent may
elect, as shall have become or shall become due and payable by the
Borrower to any Issuing Bank under this Agreement in connection with
the Letters of Credit.
(c) Duty of Care. The Agent shall exercise reasonable care in
the custody and preservation of any funds held in the Cash Collateral
Account and shall be deemed to have exercised such care if such funds
are accorded treatment substantially equivalent to that which the Agent
accords its own property, it being understood that the Agent shall not
have any responsibility for taking any necessary steps to preserve
rights against any parties with respect to any such funds.
Section 7.5 Non-exclusivity of Remedies. No remedy conferred upon the
Agent or the Banks is intended to be exclusive of any other remedy, and each
remedy shall be cumulative of all other remedies existing by contract, at law,
in equity, by statute or otherwise.
Section 7.6 Right of Set-off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent, if any, specified by Section 7.2 to authorize the Agent
to declare the Advances or any other amount or Obligation payable hereunder or
under the other Credit Documents due and payable pursuant to the provisions of
Section 7.2 or the automatic acceleration of the Advances or any such other
amounts or Obligations pursuant to Section 7.3, each Bank is hereby authorized
at any time and from time to time, to the fullest extent permitted by law, to
set off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by such Bank to or for the credit or the account of the Borrower against any and
all of the indebtedness, liabilities or obligations of the Borrower now or
hereafter existing under this Agreement, the Note held by such Bank and the
other Credit Documents, irrespective of whether or
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not such Bank shall have made any demand under this Agreement, such Note or such
other Credit Documents, and although such obligations may be unmatured. Each
Bank agrees to promptly notify the Borrower after any such set-off and
application made by such Bank, provided that the failure to give such notice
shall not affect the validity of such set-off and application. The rights of
each Bank under this Section 7.6 are in addition to any other rights and
remedies (including, without limitation, other rights of set-off) which such
Bank may have.
ARTICLE VIII
AGENCY AND ISSUING BANK PROVISIONS
Section 8.1 Authorization and Action. Each Bank hereby appoints and
authorizes the Agent to take such action as administrative agent under this
Agreement and the other Credit Documents on behalf of such Bank and to exercise
such powers under this Agreement and the other Credit Documents as are delegated
to the Agent by the terms hereof and of the other Credit Documents, together
with such powers as are reasonably incidental thereto. As to any matters not
expressly provided for by this Agreement or any other Credit Document
(including, without limitation, enforcement or collection of the Notes), the
Agent shall not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully protected
in so acting or refraining from acting) upon the instructions of the Majority
Banks, and such instructions shall be binding upon all Banks and all holders of
Notes; provided, however, that the Agent shall not be required to take any
action which exposes the Agent to personal liability or which is contrary to
this Agreement, any other Credit Document or applicable law.
Section 8.2 Agent's Reliance, Etc. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted to be taken (including the Agent's own negligence) by it or them under
or in connection with this Agreement or the other Credit Documents, except for
its or their own gross negligence or willful misconduct. Without limitation of
the generality of the foregoing, the Agent: (a) may treat the payee of any Note
as the holder thereof until the Agent receives written notice of the assignment
or transfer thereof signed by such payee and in form satisfactory to the Agent;
(b) may consult with legal counsel (including counsel for the Borrower),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (c) makes no
warranty or representation to any Bank and shall not be responsible to any Bank
for any statements, warranties or representations made in or in connection with
this Agreement or the other Credit Documents; (d) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the terms,
covenants or conditions of this Agreement or any other Credit Document on the
part of the Borrower or its Subsidiaries or to inspect the property (including
the books and records) of the Borrower or its Subsidiaries; (e) shall not be
responsible to any Bank for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
Credit Document; and (f) shall incur no liability under or in respect of this
Agreement or any other Credit Document by acting upon any notice, consent,
certificate or other instrument or writing (which may be by telecopier,
telegram, cable or telex) believed by it to be genuine and signed or sent by the
proper party or parties.
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Section 8.3 The Agent and Its Affiliates. With respect to its
Commitment, the Advances made by it and the Notes issued to it, the Agent shall
have the same rights and powers under this Agreement as any other Bank and may
exercise the same as though it were not the Agent. The term "Bank" or "Banks"
shall, unless otherwise expressly indicated, include the Agent in its individual
capacity. The Agent and its Affiliates may accept deposits from, lend money to,
act as trustee under indentures of, and generally engage in any kind of business
with, the Borrower or any of its Subsidiaries, and any Person who may do
business with or own securities of the Borrower or any such Subsidiary, all as
if the Agent were not an agent hereunder and without any duty to account
therefor to the Banks.
Section 8.4 Bank Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank and based on
the financial statements referred to in Section 4.5 and such other documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Bank also acknowledges that it will,
independently and without reliance upon the Agent or any other Bank and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement.
Section 8.5 Indemnification. The Banks severally agree to indemnify the
Agent and each Issuing Bank (to the extent not reimbursed by the Borrower),
according to their respective Pro Rata Shares from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against the Agent or such Issuing Bank in
any way relating to or arising out of this Agreement or any other Credit
Document or any action taken or omitted by the Agent or such Issuing Bank under
this Agreement or any other Credit Document (including the Agent's or such
Issuing Bank's own negligence), provided that no Bank shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the Agent's
and such Issuing Bank's gross negligence or willful misconduct. Without
limitation of the foregoing, each Bank agrees to reimburse the Agent promptly
upon demand for its ratable share of any out-of-pocket expenses (including
counsel fees) incurred by the Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement or any
other Credit Document, to the extent that the Agent is not reimbursed for such
expenses by the Borrower.
Section 8.6 Successor Agent and Issuing Banks. The Agent or any Issuing
Bank may resign at any time by giving written notice thereof to the Banks and
the Borrower and may be removed at any time with or without cause by the
Majority Banks upon receipt of written notice from the Majority Banks to such
effect. Upon receipt of notice of any such resignation or removal, the Majority
Banks shall have the right to appoint a successor Agent or Issuing Bank with, if
an Event of Default has not occurred and is not continuing, the consent of the
Borrower, which consent shall not be unreasonably withheld. If no successor
Agent or Issuing Bank shall have been so appointed, and shall have accepted such
appointment, within 30 days after the retiring Agent's or Issuing Bank's giving
of notice of resignation or the Majority Banks' removal of the retiring Agent or
Issuing Bank, then the retiring Agent or Issuing Bank may, on behalf of the
Banks and the Borrower, appoint a successor Agent or Issuing Bank, which shall
be a commercial bank meeting the financial
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requirements of an Eligible Assignee and, in the case of an Issuing Bank, a
Bank. Upon the acceptance of any appointment as Agent or Issuing Bank by a
successor Agent or Issuing Bank, such successor Agent or Issuing Bank shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent or Issuing Bank, and the retiring Agent or
Issuing Bank shall be discharged from its duties and obligations under this
Agreement and the other Credit Documents, except that the retiring Issuing Bank
shall remain an Issuing Bank with respect to any Letters of Credit issued by
such Issuing Bank and outstanding on the effective date of its resignation or
removal and the provisions affecting such Issuing Bank with respect to such
Letters of Credit shall inure to the benefit of the retiring Issuing Bank until
the termination of all such Letters of Credit. After any retiring Agent's or
Issuing Bank's resignation or removal hereunder as Agent or Issuing Bank, the
provisions of this Article VIII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent or Issuing Bank under this
Agreement and the other Credit Documents.
Section 8.7 Co-Syndication Agents. The Co-Syndication Agents shall not
have any duties, obligations or liabilities in their capacities as
Co-Syndication Agents.
Section 8.8 Documentation Agent. The Documentation Agent shall not have
any duties, obligations or liabilities in its capacities as Documentation Agent.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Amendments, Etc. No amendment or waiver of any provision of
this Agreement, the Notes or any other Credit Document, nor consent to any
departure by the Borrower or any Guarantor therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Majority Banks
(or, if specifically provided for in any Credit Document, the Agent with the
consent of the Majority Banks) and the Borrower, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided, however, that no amendment shall increase the
Commitment of any Bank without the written consent of such Bank, and no
amendment, waiver or consent shall, unless in writing and signed by all the
Banks, do any of the following: (a) increase the aggregate Commitments of the
Banks, except as permitted by Section 2.17, (b) reduce the principal of, or
interest on, the Advances or any fees or other amounts or Obligations payable
hereunder or under any other Credit Document, (c) postpone any date fixed for
any payment of principal of, or interest on, the Advances or any fees or other
amounts or Obligations payable hereunder or under any other Credit Document, (d)
amend Section 2.16 or this Section 9.1, (e) release any Guarantor from its
obligations under the Guaranty, other than the release of any Guarantor's
obligations under the Guaranty in accordance with Section 6.8, or (f) amend the
definition of "Majority Banks"; and provided, further, that (i) no amendment,
waiver or consent shall, unless in writing and signed by the Agent or any
Issuing Bank in addition to the Banks required above to take such action, affect
the rights or duties of the Agent or such Issuing Bank, as the case may be,
under this Agreement or any other Credit Document, and (ii) no waiver or consent
to departure from any of the conditions specified in Section 3.1 or 3.2 shall be
effective unless in writing and signed by the Majority Banks and the Agent.
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Section 9.2 Notices, Etc. All notices and other communications shall be
in writing (including telecopy or telex) and mailed, telecopied, telexed, hand
delivered or delivered by a nationally recognized overnight courier, if to the
Borrower, at its address at 0000 Xxx Xxxxxxxxx Xxxx, Xxxx Xxxxx, Xxxxxxxx 00000,
Attention: Chief Financial Officer, with a copy to the General Counsel
(telecopy: (000) 000-0000; telephone: (000) 000-0000); if to any Bank at its
address for notices specified opposite its name on Schedule 9.2; if to the Agent
or to Xxxxx Fargo in its capacity as Agent or as an Issuing Bank, at its address
at 0000 Xxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, Xxxxx 00000, Attention: Xxxxxxx X.
Xxxxxx, Assistant Vice President (telecopy: (000) 000-0000; telephone: (214)
000-0000); and if a Notice of Borrowing or a Notice of Conversion or
Continuation to the Agent, at the address for notices for the Agent specified
opposite its name on Schedule 9.2 or, as to each party, at such other address or
teletransmission number as shall be designated by such party in a written notice
to the other parties. All such notices and communications shall, when mailed,
telecopied, telexed or hand delivered or delivered by overnight courier, be
effective three days after deposited in the mails, when telecopy transmission is
completed, when confirmed by telex answer-back or when delivered, respectively,
except that notices and communications to the Agent pursuant to Article II or
VIII shall not be effective until received by the Agent.
Section 9.3 No Waiver; Remedies. No failure on the part of any Bank,
the Agent or any Issuing Bank to exercise, and no delay in exercising, any right
or remedy hereunder or under any Note shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right or remedy preclude any
other or further exercise thereof or the exercise of any other right or remedy.
The rights and remedies provided in this Agreement and the other Credit
Documents are cumulative and not exclusive of any rights or remedies provided by
law.
Section 9.4 Costs and Expenses. The Borrower agrees to pay on demand
all reasonable out-of-pocket costs and expenses of the Agent in connection with
the preparation, execution, delivery, administration, modification, amendment
and enforcement of this Agreement, the Notes and the other Credit Documents,
including, without limitation, (a) the fees set forth in the Agent's Fee Letter,
and (b) all reasonable out-of-pocket costs and expenses, if any, of the Agent,
each Issuing Bank and each Bank (including, without limitation, reasonable
counsel fees and expenses of the Agent, such Issuing Bank and each Bank) in
connection with the enforcement (whether through negotiations, legal proceedings
or otherwise) of this Agreement and the other Credit Documents after a Default
or an Event of Default has occurred and is continuing, and (c) to the extent not
included in the foregoing, the costs of any Uniform Commercial Code financing
statement or continuation statement, and any related Uniform Commercial Code
search conducted subsequent to such recordation.
Section 9.5 Binding Effect. This Agreement shall become effective when
it shall have been executed by the Borrower and the Agent, and when the Agent
shall have, as to each Bank, received a counterpart hereof executed by such
Bank, except that the Borrower shall not have the right to assign its rights or
delegate its duties under this Agreement or any interest in this Agreement
without the prior written consent of each Bank.
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Section 9.6 Bank Assignments and Participations.
(a) Assignments. Any Bank may assign to one or more banks or
other entities all or any portion of its rights and obligations under
this Agreement and the other Credit Documents (including, without
limitation, all or a portion of its Commitment, the Advances owing to
it, the Notes held by it and the participation interest in the Letter
of Credit Obligations held by it); provided, however, that (i) each
such assignment shall be of a constant, and not a varying, percentage
of all of such Bank's rights and obligations under this Agreement and
the other Credit Documents and shall involve a ratable assignment of
such Bank's Commitment and such Bank's Revolving Advances, (ii) the
amount of the resulting Commitment and Revolving Advances of the
assigning Bank (unless it is assigning all its Commitment) and the
assignee Bank pursuant to each such assignment (determined as of the
date of the Assignment and Acceptance with respect to such assignment)
shall in no event be less than $5,000,000 and shall be an integral
multiple of $1,000,000, (iii) each such assignment shall be to an
Eligible Assignee, (iv) the parties to each such assignment shall
execute and deliver to the Agent, for its acceptance and recording in
the Register, an Assignment and Acceptance, together with the Revolving
Note subject to such assignment, and (v) each Eligible Assignee (other
than the Eligible Assignee of the Agent or an Eligible Assignee which
is an Affiliate of the assigning Bank) shall pay to the Agent a $3,000
administrative fee. Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in each
Assignment and Acceptance, which effective date shall be at least three
Business Days after the execution thereof unless otherwise agreed by
the parties to such Assignment and Acceptance and the Agent, (A) the
assignee thereunder shall be a party hereto for all purposes and, to
the extent that rights and obligations hereunder have been assigned to
it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Bank hereunder and (B) such Bank thereunder shall, to
the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining
portion of such Bank's rights and obligations under this Agreement,
such Bank shall cease to be a party hereto). Notwithstanding anything
herein to the contrary, any Bank may assign, as collateral or
otherwise, any of its rights under the Credit Documents to any Federal
Reserve Bank.
(b) Term of Assignments. By executing and delivering an
Assignment and Acceptance, the Bank thereunder and the assignee
thereunder confirm to and agree with each other and the other parties
hereto as follows: (i) other than as provided in such Assignment and
Acceptance, such Bank makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or any
other Credit Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or
any other Credit Document or any other instrument or document furnished
pursuant hereto; (ii) such Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of
the Borrower or its Subsidiaries or the Guarantors or the performance
or observance by the Borrower or the Guarantors of any of their
obligations under this Agreement or any other Credit Document or any
other instrument or document furnished pursuant hereto; (iii) such
assignee confirms that it has received a copy of this Agreement,
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together with copies of the financial statements referred to in Section
4.5 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance; (iv) such assignee will, independently
and without reliance upon the Agent, such Bank or any other Bank and
based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not
taking action under this Agreement; (v) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the other Credit
Documents as are delegated to the Agent by the terms hereof or thereof,
together with such powers as are reasonably incidental thereto; and
(vi) such assignee agrees that it will perform in accordance with their
terms all of the obligations which by the terms of this Agreement are
required to be performed by it as a Bank.
(c) The Register. The Agent shall maintain at its address
referred to in Section 9.2 a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of
the names and addresses of the Banks and the Commitments of, and
principal amount of the Advances owing to, each Bank from time to time
(the "Register"). The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Borrower, the
Agent, the Issuing Banks and the Banks may treat each Person whose name
is recorded in the Register as a Bank hereunder for all purposes of
this Agreement. The Register shall be available for inspection by the
Borrower or any Bank at any reasonable time and from time to time upon
reasonable prior notice.
(d) Procedures. Upon its receipt of an Assignment and
Acceptance executed by a Bank and an Eligible Assignee, together with
the Revolving Note or, in the case of an assignment to another Bank,
Revolving Notes subject to such assignment, the Agent shall, if such
Assignment and Acceptance has been completed and is in substantially
the form of the attached Exhibit A, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the
Register, and (iii) give prompt notice thereof to the Borrower. Within
five Business Days after its receipt of such notice, the Borrower, at
its own expense, shall execute and deliver to the Agent in exchange for
such Note or Notes, a new Revolving Note payable to the order of such
Eligible Assignee in amount equal to the Commitment assumed by it
pursuant to such Assignment and Acceptance, and if the assigning Bank
has retained any Commitment hereunder, a new Revolving Note payable to
the order of such Bank in an amount equal to, respectively, the
Commitment retained by it hereunder. Such new Notes shall be dated the
effective date of such Assignment and Acceptance and shall otherwise be
in substantially the form of the attached Exhibit H.
(e) Participations. Each Bank may sell participations to one
or more banks or other entities in or to all or a portion of its rights
and obligations under this Agreement (including, without limitation,
all or a portion of its Commitment, the Advances owing to it, its
participation interest in the Letter of Credit Obligations and the
Revolving Note held by it); provided, however, that (i) such Bank's
obligations under this Agreement (including, without limitation, its
Commitment to the Borrower hereunder) shall remain unchanged, (ii) such
Bank shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) such Bank shall remain the
holder of any such Note for all purposes
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of this Agreement, (iv) the Borrower, the Agent, the Issuing Banks and
the other Banks shall continue to deal solely and directly with such
Bank in connection with such Bank's rights and obligations under this
Agreement, (v) such Bank shall not require the participant's consent to
any matter under this Agreement, except for change in the principal
amount of any Note in which the participant has an interest, reductions
in fees or interest or extending the Maturity Date, and (vi) such Bank
shall give prompt prior notice to the Borrower of each such
participation to be sold by such Bank. The Borrower hereby agrees that
participants shall have the same rights under Sections 2.8, 2.9,
2.11(c) and 9.7 hereof as the Bank to the extent of their respective
participations. Notwithstanding the foregoing, upon the receipt of
notice by the Borrower of the sale of a participation by any Bank to
one or more banks or other entities (other than an Affiliate of such
Bank) in or to all or a portion of its rights and obligations under
this Agreement (each such bank or other entity, a "Proposed
Participant"), the Borrower shall have the right, but not the
obligation, to select additional banks to replace such Proposed
Participant on the same terms and conditions as the Proposed
Participant upon prompt written notice from the Borrower to the Agent
and the Bank selling such participation. The Borrower shall have ten
days from the date of its receipt of notice of the proposed sale of
such participation to the Proposed Participant to select replacement
banks to replace such Proposed Participant. If the Borrower does not
select any replacement banks or does not elect to select any
replacement banks the applicable Bank may sell such participation to
the Proposed Participant.
(f) Confidentiality. Each Bank may furnish any information
concerning the Borrower and its Subsidiaries in the possession of such
Bank from time to time to assignees and participants (including
prospective assignees and participants); provided that, prior to any
such disclosure, the assignee or participant or proposed assignee or
participant shall agree in writing to preserve the confidentiality of
any confidential information relating to the Borrower and its
Subsidiaries received by it from such Bank. Such Bank shall promptly
deliver a signed copy of any such confidentiality agreement to the
Borrower.
Section 9.7 Indemnification. The Borrower shall indemnify the Agent,
the Banks (including any lender which was a Bank hereunder prior to any full
assignment of its Commitment), the Issuing Banks and each affiliate thereof and
their respective directors, officers, employees and agents from, and discharge,
release and hold each of them harmless against, any and all losses, liabilities,
claims or damages to which any of them may become subject, insofar as such
losses, liabilities, claims or damages arise out of or result from (a) any
actual or proposed use by the Borrower or any Affiliate of the Borrower of the
proceeds of any Advance, (b) any breach by the Borrower, any Subsidiary of the
Borrower or any Guarantor of any provision of this Agreement or any other Credit
Document, (c) any investigation, litigation or other proceeding (including any
threatened investigation or proceeding) relating to the foregoing, or (d) any
Environmental Claim or requirement of Environmental Laws concerning or relating
to the present or previously-owned or operated properties, or the operations or
business, of the Borrower or any of its Subsidiaries, and the Borrower shall
reimburse the Agent, each Issuing Bank, each Bank and each affiliate thereof and
their respective directors, officers, employees and agents, upon demand, for any
reasonable out-of-pocket expenses (including reasonable legal fees) incurred in
connection with any such investigation, litigation or other proceeding; and
EXPRESSLY INCLUDING ANY SUCH LOSSES, LIABILITIES, CLAIMS, DAMAGES OR EXPENSE
INCURRED BY REASON OF THE
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PERSON BEING INDEMNIFIED'S OWN NEGLIGENCE, BUT EXCLUDING ANY SUCH LOSSES,
LIABILITIES, CLAIMS, DAMAGES OR EXPENSES INCURRED BY REASON OF THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PERSON TO BE INDEMNIFIED.
Section 9.8 Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Section 9.9 Survival of Representations, Etc. All representations and
warranties contained in this Agreement or made in writing by or on behalf of the
Borrower in connection herewith shall survive the execution and delivery of this
Agreement and the Credit Documents, the making of the Advances and any
investigation made by or on behalf of the Banks, none of which investigations
shall diminish any Bank's right to rely on such representations and warranties.
All obligations of the Borrower provided for in Sections 2.8, 2.9, 2.11(c) and
9.7 shall survive any termination of this Agreement and repayment in full of the
Obligations.
Section 9.10 Severability. In case one or more provisions of this
Agreement or the other Credit Documents shall be invalid, illegal or
unenforceable in any respect under any applicable law, the validity, legality
and enforceability of the remaining provisions contained herein or therein shall
not be affected or impaired thereby.
Section 9.11 Commercial Loans. The Borrower represents and warrants
that the Advances are and shall be "Commercial Loans" as such term is used in
Chapter 306 of the Texas Finance Code. In the event that applicable law provides
for an interest ceiling under Chapter 303 of the Texas Finance Code, the ceiling
shall be the indicated (weekly) ceiling and shall be used when appropriate in
determining the Maximum Rate.
Section 9.12 Usury Not Intended. It is the intent of the Borrower and
each Bank in the execution and performance of this Agreement and the other
Credit Documents to contract in strict compliance with applicable usury laws,
including conflicts of law concepts, governing the Advances of each Bank
including such applicable laws of the State of Texas and the U.S. from time to
time in effect. In furtherance thereof, the Banks and the Borrower stipulate and
agree that none of the terms and provisions contained in this Agreement or the
other Credit Documents shall ever be construed to create a contract to pay, as
consideration for the use, forbearance or detention of money, interest at a rate
in excess of the Maximum Rate and that for purposes hereof "interest" shall
include the aggregate of all charges which constitute interest under such laws
that are contracted for, charged or received under this Agreement; and in the
event that, notwithstanding the foregoing, under any circumstances the aggregate
amounts taken, reserved, charged, received or paid on the Advances include
amounts which, by applicable law, are deemed interest which would exceed the
Maximum Rate, then such excess shall be deemed to be a mistake and each Bank
receiving same shall credit the same on the principal of its Advances (or if
such Advances shall have been paid in full, refund said excess to the Borrower).
In the event that the maturity of the Advances is accelerated by reason of any
election of the holder thereof resulting from any Event of Default under this
Agreement or otherwise, or in the event of any required or permitted prepayment,
then such consideration that
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constitutes interest may never include more than the Maximum Rate and excess
interest, if any, provided for in this Agreement or otherwise shall be canceled
automatically as of the date of such acceleration or prepayment and, if
theretofore paid, shall be credited on the applicable Advances (or, if the
applicable Advances shall have been paid in full, refunded to the Borrower). The
provisions of this Section 9.12 shall control over all other provisions of this
Agreement or the other Credit Documents which may be in apparent conflict
herewith.
Section 9.13 Governing Law. This Agreement, the Notes and the other
Credit Documents shall be governed by, and construed and enforced in accordance
with, the laws of the State of Texas.
Section 9.14 Consent to Jurisdiction. The Borrower hereby irrevocably
submits to the jurisdiction of any Texas state or federal court sitting in
Dallas, Texas in any action or proceeding arising out of or relating to this
Agreement, the Notes and the other Credit Documents, and the Borrower hereby
irrevocably agrees that all claims in respect of such action or proceeding may
be heard and determined in such court. The Borrower hereby irrevocably waives,
to the fullest extent it may effectively do so, any right it may have to the
defense of an inconvenient forum to the maintenance of such action or
proceeding. The Borrower hereby agrees that service of copies of the summons and
complaint and any other process which may be served in any such action or
proceeding may be made by mailing or delivering a copy of such process to the
Borrower at its address specified in Section 9.2. The Borrower agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Section 9.14 shall affect the rights of the
Agent, the Issuing Bank or any Bank to serve legal process in any other manner
permitted by law or affect the right of the Agent, the Issuing Bank or any Bank
to bring any action or proceeding against the Borrower or its Property in the
courts of any other jurisdiction.
Section 9.15 Banks not in Control. None of the covenants or other
provisions contained in the Credit Documents shall, or shall be deemed to, give
the Banks the right or power to exercise control over the affairs and/or
management of the Borrower, any of its Subsidiaries or any Guarantor, the power
of the Banks being limited to the right to exercise the rights and remedies
provided in the Credit Documents; provided, however, that if any Bank becomes
the owner of any stock, or other equity interest in, any Person whether through
foreclosure or otherwise, such Bank shall be entitled (subject to requirements
of law) to exercise such legal rights as it may have by being owner of such
stock, or other equity interest in, such Person.
Section 9.16 Headings Descriptive. The headings of the several
sections, clauses and paragraphs of the Agreement are inserted for convenience
only and shall not in any way affect the meaning or construction of any
provision of this Agreement.
Section 9.17 WAIVERS OF JURY TRIAL. THE BORROWER, THE AGENT AND THE
BANKS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL
PROCEEDING RELATING TO THIS AGREEMENT OR THE NOTES OR ANY OTHER CREDIT DOCUMENT
OR TO ANY COUNTERCLAIM THEREIN.
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Section 9.18 Binding Arbitration.
(a) Arbitration. The Borrower, the Agent, the Issuing Bank and
the Banks agree, upon demand, to submit to binding arbitration all
claims, disputes and controversies between or among them (and their
respective employees, officers, directors, attorneys, and other
agents), whether in tort, contract or otherwise arising out of or
relating to in any way (i) this Agreement or the Credit Documents and
their negotiation, execution, collateralization, administration,
repayment, modification, extension, substitution, formation,
inducement, enforcement, default or termination; or (ii) requests for
additional credit.
(b) Governing Rules. Any arbitration proceeding will (i)
proceed in a location in Texas selected by the American Arbitration
Association ("AAA"); (ii) be governed by the Federal Arbitration Act
(Title 9 of the United States Code), notwithstanding any conflicting
choice of law provision in any of the documents between the parties;
and (iii) be conducted by the AAA, or such other administrator as the
parties shall mutually agree upon, in accordance with the AAA's
commercial dispute resolution procedures, unless the claim or
counterclaim is at least $1,000,000.00 exclusive of claimed interest,
arbitration fees and costs in which case the arbitration shall be
conducted in accordance with the AAA's optional procedures for large,
complex commercial disputes (the commercial dispute resolution
procedures or the optional procedures for large, complex commercial
disputes to be referred to, as applicable, as the "Rules"). If there is
any inconsistency between the terms hereof and the Rules, the terms and
procedures set forth herein shall control. Any Person who fails or
refuses to submit to arbitration following a demand by any other Person
shall bear all costs and expenses incurred by such other Person in
compelling arbitration of any dispute. Nothing contained herein shall
be deemed to be a waiver by any Person that is a bank of the
protections afforded to it under 12 U.S.C. Section 91 or any similar
applicable state law.
(c) No Waiver of Provisional Remedies, Self-Help and
Foreclosure. The arbitration requirement does not limit the right of
any Person to (i) foreclose against real or personal property
collateral; (ii) exercise self-help remedies relating to collateral or
proceeds of collateral such as setoff or repossession; or (iii) obtain
provisional or ancillary remedies such as replevin, injunctive relief,
attachment or the appointment of a receiver, before during or after the
pendency of any arbitration proceeding. This exclusion does not
constitute a waiver of the right or obligation of any Person to submit
any dispute to arbitration or reference hereunder, including those
arising from the exercise of the actions detailed in clauses (i), (ii)
and (iii) of this Section 9.18(c).
(d) Arbitrator Qualifications and Powers. Any arbitration
proceeding in which the amount in controversy is $5,000,000.00 or less
will be decided by a single arbitrator selected according to the Rules,
and who shall not render an award of greater than $5,000,000.00. Any
dispute in which the amount in controversy exceeds $5,000,000.00 shall
be decided by majority vote of a panel of three arbitrators; provided
however, that all three arbitrators must actively participate in all
hearings and deliberations. The arbitrator will be a neutral attorney
licensed in the State of Texas with a minimum of ten years experience
in the substantive law applicable to the subject matter of the dispute
to be arbitrated. The
-79-
arbitrator will determine whether or not an issue is arbitratable and
will give effect to the statutes of limitation in determining any
claim. In any arbitration proceeding the arbitrator will decide (by
documents only or with a hearing at the arbitrator's discretion) any
pre-hearing motions which are similar to motions to dismiss for failure
to state a claim or motions for summary adjudication. The arbitrator
shall resolve all disputes in accordance with the substantive law of
Texas and may grant any remedy or relief that a court of such state
could order or grant within the scope hereof and such ancillary relief
as is necessary to make effective any award. The arbitrator shall also
have the power to award recovery of all costs and fees, to impose
sanctions and to take such other action as the arbitrator deems
necessary to the same extent a judge could pursuant to the Federal
Rules of Civil Procedure, the Texas Rules of Civil Procedure or other
applicable law. Judgment upon the award rendered by the arbitrator may
be entered in any court having jurisdiction. The institution and
maintenance of an action for judicial relief or pursuit of a
provisional or ancillary remedy shall not constitute a waiver of the
right of any Person, including the plaintiff, to submit the controversy
or claim to arbitration if any other Person contests such action for
judicial relief.
(e) Discovery. In any arbitration proceeding discovery will be
permitted in accordance with the Rules. All discovery shall be
expressly limited to matters directly relevant to the dispute being
arbitrated and must be completed no later than 20 days before the
hearing date and within 180 days of the filing of the dispute with the
AAA. Any requests for an extension of the discovery periods, or any
discovery disputes, will be subject to final determination by the
arbitrator upon a showing that the request for discovery is essential
for the such Person's presentation and that no alternative means for
obtaining information is available.
(f) Class Proceedings and Consolidations. The resolution of
any dispute arising pursuant to the terms of this Agreement shall be
determined by a separate arbitration proceeding and such dispute shall
not be consolidated with other disputes or included in any class
proceeding.
(g) Payment Of Arbitration Costs And Fees. The arbitrator
shall award all costs and expenses of the arbitration proceeding.
(h) Miscellaneous. To the maximum extent practicable, the AAA,
the arbitrators, the Borrower, the Agent, the Issuing Bank and the
Banks shall take all action required to conclude any arbitration
proceeding within 180 days of the filing of the dispute with the AAA.
No arbitrator or other Person that is a party to an arbitration
proceeding may disclose the existence, content or results thereof,
except for disclosures of information by a Person required in the
ordinary course of its business or by applicable law or regulation. If
more than one agreement for arbitration by or between the Borrower, the
Agent, the Issuing Bank and the Banks potentially applies to a dispute,
the arbitration provision most directly related to the Credit Documents
or the subject matter of the dispute shall control. This arbitration
provision shall survive termination, amendment or expiration of any of
the Credit Documents or any relationship between or among the Borrower,
the Agent, the Issuing Bank and the Banks.
-80-
Section 9.19 ENTIRE AGREEMENT. PURSUANT TO SECTION 26.02 OF THE TEXAS
BUSINESS AND COMMERCE CODE, A LOAN AGREEMENT IN WHICH THE AMOUNT INVOLVED IN THE
LOAN AGREEMENT EXCEEDS $50,000 IN VALUE IS NOT ENFORCEABLE UNLESS THE LOAN
AGREEMENT IS IN WRITING AND SIGNED BY THE PARTY TO BE BOUND OR THAT PARTY'S
AUTHORIZED REPRESENTATIVE.
THE RIGHTS AND OBLIGATIONS OF THE PARTIES TO AN AGREEMENT SUBJECT TO
THE PRECEDING PARAGRAPH SHALL BE DETERMINED SOLELY FROM THE WRITTEN LOAN
AGREEMENT, AND ANY PRIOR ORAL AGREEMENTS BETWEEN THE PARTIES ARE SUPERSEDED BY
AND MERGED INTO THE LOAN AGREEMENT. THIS WRITTEN AGREEMENT AND THE CREDIT
DOCUMENTS, AS DEFINED IN THIS AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE
PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES.
[Remainder of page left intentionally blank]
-81-
EXECUTED as of the date first referenced above.
BORROWER:
ARKANSAS BEST CORPORATION
By: /s/ XXXXX X. XXXXXXXX
-------------------------------
Name: Xxxxx X. Xxxxxxxx
-----------------------------
Title: Vice President
----------------------------
Chief Financial Officer
and Treasurer
-82-
AGENT:
XXXXX FARGO BANK TEXAS, NATIONAL
ASSOCIATION, as Agent
By: /s/ XXXXXXX X. XXXXXX
-----------------------------
Xxxxxxx X. Xxxxxx
Assistant Vice President
-83-
CO-SYNDICATION AGENTS:
FLEET NATIONAL BANK, as Co-Syndication
Agent
By: /s/ XXXXXX X. XXXXXXX, XX.
----------------------------------
Xxxxxx X. Xxxxxxx, Xx.
Managing Director
SUNTRUST BANK, as Co-Syndication Agent
By: /s/ XXXXX X. XXXXX
----------------------------------
Xxxxx X. Xxxxx
Vice President
DOCUMENTATION AGENT:
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Documentation Agent
By: /s/ XXX XXXXXXXX
----------------------------------
Xxx Xxxxxxxx
Assistant Vice President
-84-
BANKS:
XXXXX FARGO BANK TEXAS, NATIONAL
ASSOCIATION, as a Bank
By: /s/ XXXXXXX X. XXXXXX
-------------------------------------
Xxxxxxx X. Xxxxxx
Assistant Vice President
-85-
FLEET NATIONAL BANK, as a Bank
By: /s/ XXXXXX X. XXXXXXX, XX.
-------------------------------
Xxxxxx X. Xxxxxxx, Xx.
Managing Director
-86-
SUNTRUST BANK, as a Bank
By: /s/ XXXXX X. XXXXX
-------------------------------
Xxxxx X. Xxxxx
Vice President
-87-
WACHOVIA BANK, NATIONAL
ASSOCIATION, as a Bank
By: /s/ XXX XXXXXXXX
------------------------------
Xxx Xxxxxxxx
Assistant Vice President
-88-
THE BANK OF TOKYO-MITSUBISHI, LTD.
By: /s/ XXXXXXX X. XXXXXXX
------------------------------
Xxxxxxx X. Xxxxxxx
Vice President
By: /s/ X. XXXXXX
------------------------------
X. XXXXXX
VP AND MANAGER
-89-
U.S. BANK NATIONAL ASSOCIATION
By: /s/ XXXXX XXXXXX
-----------------------------
Xxxxx Xxxxxx
Vice President
-90-
COMERICA BANK
By: /s/ XXXXX XXXXXXXX
-----------------------------
Xxxxx Xxxxxxxx
Vice President
-00-
XXXXX XXXXXXXX XXXX XX XXXX XXXXX
By: /s/ XXXXX X. XXXXXX, XX. By [Illegible]
---------------------------------------
Xxxxx X. Xxxxxx, Xx.
Senior Vice President
-92-
EXHIBIT A
ASSIGNMENT AND ACCEPTANCE
Dated ________________, _____
Reference is made to that certain Credit Agreement dated as of May 15,
2002 (as the same may be amended, restated, supplemented, renewed, extended or
otherwise modified from time to time, the "Credit Agreement") among Arkansas
Best Corporation (the "Borrower"), the lenders parties thereto, Fleet National
Bank and SunTrust Bank, as Co-Syndication Agents, Wachovia Corporation, as
Documentation Agent, and Xxxxx Fargo Bank Texas, National Association, as
Administrative Agent (the "Agent"). Unless otherwise defined in this Assignment
and Acceptance, capitalized terms used herein shall have the same meanings
herein as defined in the Credit Agreement. This Assignment and Acceptance is
being executed pursuant to Section 9.6 of the Credit Agreement.
______________________ ( the "Assignor") and _____________________ (the
"Assignee") agree as follows:
1. As of the Effective Date (as defined below), the Assignor hereby
sells and assigns and delegates to the Assignee, and the Assignee hereby
purchases and assumes from the Assignor, without recourse to the Assignor and
without representation or warranty except for the representations and warranties
specifically set forth in clauses (i), (ii), and (iii) of Section 2, a ___%(1)
interest in and to all of the Assignor's rights and obligations under the Credit
Agreement in connection with its Commitment, including, without limitation, such
percentage interest in the Assignor's Commitment and the Revolving Advances
owing to the Assignor, the participation interest in the Letter of Credit
Obligations held by the Assignor and the Revolving Note held by the Assignor.
2. The Assignor (a) represents and warrants that, as of the date hereof
but immediately prior to giving effect to this Assignment and Acceptance, its
total Commitment is $__________, the aggregate outstanding principal amount of
Revolving Advances owed to it by the Borrower is $_____________, and its Pro
Rata Share of the Letter of Credit Exposure is $___________; (b) represents and
warrants that it is the legal and beneficial owner of the interest being
assigned by it hereunder and that such interest is free and clear of any Lien or
other adverse claim; (c) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Credit Document
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Agreement or any other Credit Document or any other
instrument or document furnished pursuant thereto; (d) makes no representation
or warranty and
--------
(1) Specify percentage in no more than 5 decimal points.
Exhibit A to Credit Agreement - Page 1
assumes no responsibility with respect to the financial condition or results of
operation of the Borrower, any Subsidiary of the Borrower or any Guarantor or
the performance or observance by the Borrower, any Subsidiary of the Borrower or
any Guarantor of any of its obligations under the Credit Agreement or any other
Credit Document or any other instrument or document furnished pursuant thereto;
and (e) attaches the Revolving Note referred to in paragraph 1 above and
requests that the Agent exchange such Revolving Note for a new Revolving Note
dated ____________, 200_ in the principal amount of $______________ payable to
the order of the Assignee [, and a new Revolving Note dated ___________, 200_ in
the principal amount of $__________, payable to the order of Assignor].
3. The Assignee (a) confirms that it has received a copy of the Credit
Agreement, together with, (i) in the event that the date of this Assignment and
Acceptance is prior to the date of delivery of the initial financial statements
required to be delivered pursuant to Section 5.6(b) of the Credit Agreement,
copies of the financial statements referred to in Section 4.5 of the Credit
Agreement or (ii) in the event that the date of this Assignment and Acceptance
is after the date of delivery of the initial financial statements required to be
delivered pursuant to Section 5.6(b) of the Credit Agreement, copies of the most
recent financial statements delivered pursuant to Section 5.6(b) of the Credit
Agreement, and such other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into this Assignment and
Acceptance; (b) agrees that it has, independently and without reliance upon the
Agent, the Co-Syndication Agents, the Assignor or any other Bank, and based on
such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement; (c) agrees that it will,
independently and without reliance upon the Agent, the Co-Syndication Agents,
the Assignor or any other Bank and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement or any other Credit
Document; (d) appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under the Credit Agreement and any other
Credit Document as are delegated to the Agent by the terms thereof, together
with such powers as are reasonably incidental thereto; (e) agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of the Credit Agreement or any other Credit Document are required to be
performed by it as a Bank; (f) specifies as its Domestic Lending Office (and
address for notices) and Eurodollar Lending Office the offices set forth beneath
its name on the signature pages hereof; (g) attaches the forms prescribed by the
Internal Revenue Service of the United States certifying as to the Assignee's
status for purposes of determining exemption from United States withholding
taxes with respect to all payments to be made to the Assignee under the Credit
Agreement and its Notes or such other documents as are necessary to indicate
that all such payments are subject to such rates at a rate reduced by an
applicable tax treaty(2) , and (h) represents that it is an Eligible Assignee.
4. Each party to this Assignment and Acceptance represents and warrants
to the other party hereto that it has full power and authority to enter into
this Assignment and Acceptance and to perform its obligations hereunder in
accordance with the provisions hereof,
----------
(2) If the Assignee is organized under the laws of a jurisdiction outside the
United States.
Exhibit A to Credit Agreement - Page 2
that this Assignment and Acceptance has been duly authorized, executed and
delivered by such party and that this Assignment and Acceptance constitutes a
legal, valid and binding obligation of such party, enforceable against such
party in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally and by general principles of equity.
5. The effective date for this Assignment and Acceptance shall be
________________ (the "Effective Date")(3) and following the execution of this
Assignment and Acceptance, the Agent will record it.
6. Upon such recording, and as of the Effective Date, (i) the Assignee
shall be a party to the Credit Agreement for all purposes, and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations of a
Bank thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights (other than rights against the
Borrower pursuant to Sections 2.8, 2.9, 2.11(c) and 9.7 of the Credit Agreement,
which shall survive this assignment) and be released from its obligations under
the Credit Agreement.
7. Upon such recording, from and after the Effective Date, the Agent
shall make all payments under the Credit Agreement and the Revolving Notes in
respect of the interest assigned hereby (including, without limitation, all
payments of principal, interest and facility fees) to the Assignee. The Assignor
and the Assignee shall make all appropriate adjustments in payments under the
Credit Agreement and the Revolving Notes for periods prior to the Effective Date
directly between themselves.
8. This Assignment and Acceptance shall be governed by, and construed
and enforced in accordance with, the laws of the State of Texas.
----------
(3) See Section 9.6 of the Credit Agreement. Such date shall be at least three
Business Days after the execution of this Assignment and Acceptance unless
otherwise agreed by the parties hereto and the Agent.
Exhibit A to Credit Agreement - Page 3
The parties hereto have caused this Assignment and Acceptance to be duly
executed as of the date first above written.
[ASSIGNOR]
By:
----------------------------------
Name:
-----------------------------
Title:
----------------------------
Address:
-----------------------------
-----------------------------
-----------------------------
Attention:
---------------------------
Telecopy:
----------------------------
Telephone:
---------------------------
[ASSIGNEE]
By:
----------------------------------
Name:
-----------------------------
Title:
----------------------------
Domestic Lending Office:
Address:
-----------------------------
----------------------------------
Attention:
---------------------------
Telecopy:
----------------------------
Telephone:
---------------------------
Eurodollar Lending Office:
Address:
-----------------------------
-----------------------------------
Attention:
---------------------------
Telecopy:
----------------------------
Telephone:
---------------------------
Exhibit A to Credit Agreement - Page 4
[APPROVED(4) AND] ACCEPTED BY:
XXXXX FARGO BANK TEXAS, NATIONAL
ASSOCIATION, as Administrative Agent
By:
----------------------
Name:
--------------------
Title:
--------------------
Date:
--------------------
[APPROVED(4) BY:]
,
--------------------------
as Issuing Bank
By:
----------------------
Name:
--------------------
Title:
-------------------
Date:
--------------------
[APPROVED(4) BY:]
ARKANSAS BEST CORPORATION
By:
----------------------
Name:
--------------------
Title:
-------------------
Date:
--------------------
----------
(4) Approval by the Administrative Agent, the Issuing Bank and/or the Borrower
may be required under the definition of "Eligible Assignee" contained in the
Credit Agreement.
Exhibit A to Credit Agreement - Page 5
EXHIBIT B
BORROWING BASE CERTIFICATE
Reference is made to that certain Credit Agreement dated as of May 15,
2002 (as the same may be amended, restated, supplemented, renewed, extended or
otherwise modified from time to time, the "Credit Agreement"), among Arkansas
Best Corporation (the "Borrower"), the lenders parties thereto, Fleet National
Bank and SunTrust Bank, as Co-Syndication Agents, Wachovia Corporation, as
Documentation Agent, and Xxxxx Fargo Bank Texas, National Association, as
Administrative Agent. Unless otherwise defined in this Borrowing Base
Certificate, capitalized terms used herein shall have the same meanings herein
as defined in the Credit Agreement.
Pursuant to Section 5.6(i) of the Credit Agreement, the Borrower does
hereby certify to the Agent and the Banks the following as of __________, ____
[last day of immediately preceding calendar month]:
1. Net Depreciated Value of Eligible Revenue Equipment $
-------------
2. Borrowing Base value of Eligible Revenue Equipment (75%) $
-------------
3. Aggregate outstanding Eligible Receivables $
-------------
4. Borrowing Base value of Eligible Receivables (85%) $
-------------
5. Net Depreciated Value of Eligible Other Equipment $
-------------
6. Borrowing Base value of Eligible Other Equipment (50%) $
-------------
7. Real Estate Value of Eligible Real Property $
-------------
8. Borrowing Base value of Eligible Real Property (65%) $
-------------
9. Aggregate outstanding principal amount of all unsecured Total Funded Debt
other than such Total Funded Debt which constitutes a part of the Obligations
$
-------------
10. TOTAL BORROWING BASE VALUE
(Remainder of (a) the sum of Lines 2, 4, 6 and 8 minus (b) Line 9) $
-------------
Exhibit B to Credit Agreement - Page 1
11. Total aggregate Commitments $
-------------
12. LESSER OF BORROWING BASE VALUE OR AGGREGATE COMMITMENTS
(Lesser of Line 10 or Line 11)
$
-------------
13. Aggregate amount of all outstanding Revolving Advances $
-------------
14. Aggregate outstanding amount of all outstanding Swingline Advances
$
-------------
15. Aggregate amount of Letter of Credit Exposure $
-------------
16. BORROWING BASE AVAILABILITY
(Remainder of (a) Line 12 minus (b) the sum of Lines 13,14 and 15)(1) $
-------------
----------
(1) If the Borrowing Base Availability calculated as shown in Line 16 above is
negative, the Borrower shall be required to prepay the Advances in accordance
with clause (ii) of Section 2.7(c) of the Credit Agreement.
Exhibit B to Credit Agreement - Page 2
The Borrower has caused this Borrowing Base Certificate to be executed
this ____ day of ______________, ____.
ARKANSAS BEST CORPORATION
By:
---------------------------
Name:
-------------------------
Title:
------------------------
Exhibit B to Credit Agreement - Page 3
EXHIBIT C
COMPLIANCE CERTIFICATE
FOR FISCAL QUARTER OR FISCAL YEAR ENDED ___________ (the "Subject Period")
This certificate dated as of __________, ____ is prepared pursuant to
Section 5.6(a) and Section 5.6(b) of the Credit Agreement dated as of May 15,
2002 (as the same may be amended, restated, supplemented, renewed, extended or
otherwise modified from time to time, the "Credit Agreement") among Arkansas
Best Corporation (the "Borrower"), the lenders parties thereto, Fleet National
Bank and SunTrust Bank, as Co-Syndication Agents, Wachovia Corporation, as
Documentation Agent, and Xxxxx Fargo Bank Texas, National Association, as
Administrative Agent. Unless otherwise defined in this certificate, capitalized
terms used herein shall have the same meanings herein as defined in the Credit
Agreement.
The Borrower hereby certifies (a) that no Default currently exists or
has occurred or is continuing, (b) that all of the representations and
warranties made by the Borrower and its Subsidiaries in the Credit Agreement, in
Section 7 of the Guaranty and in the other Credit Documents are true and correct
in all material respects as if made on this date and (c) that as of the last day
of the Subject Period the amounts and calculations attached hereto as Attachment
"A" are true and correct(1).
Executed this _____ day of __________, ____.
ARKANSAS BEST CORPORATION
By:
---------------------------------
Name:
------------------------------
Title: Chief Financial Officer
----------
(1) Attachment "A" is to contain amounts and calculations, in reasonable detail,
with respect to the Borrower's compliance with the following Sections of the
Credit Agreement: Section 6.11, Section 6.12 and Section 6.13.
Exhibit C to Credit Agreement - Page 1
ATTACHMENT A
to
COMPLIANCE CERTIFICATE
In Compliance as of
End of Subject Period
(Please Indicate)
1. Interest Coverage Ratio (Section 6.11 of the Credit Agreement)
(a) Adjusted EBITDA =
---------------
(b) Consolidated Interest Expense for Subject Period =
---------------
(c) Interest income for Subject Period =
---------------
(d) The amount entered on line (b) minus the amount
entered on line (c) =
---------------
(e) The ratio of the amount entered on line (a) to the
amount, if positive, entered on line (d) = to
------ -------
Is the ratio entered on line (e) greater than or equal to 4.5 to 1.0? Yes No
2. Consolidated Net Worth (Section 6.12 of the Credit Agreement)
(a) $272,000,000
(b) Cumulative Net Income from April 1, 2002 multiplied
by 50% =
---------------
(c) Net cash proceeds of any issuance of equity since
May 15, 2002 multiplied by 50% =
---------------
(d) The sum of the amounts entered on lines (a), (b) and (c) =
---------------
(e) The aggregate amount of cash paid, from the Closing Date to the
earlier of the date that is (i) the last day of the Subject
Period or (ii) November 15, 2003, by the Borrower to its
shareholders for repurchases or redemptions of Capital Stock =
---------------
(f) The lesser of the amount entered on line (e) or
$25,000,000 (the "Adjustment Amount") =
---------------
Is Consolidated Net Worth plus the Adjustment Amount greater than or Yes No
equal to the amount entered on line (d)?
3. Leverage Ratio. (Section 6.13 of the Credit Agreement)
(a) Total Funded Debt =
---------------
(b) Adjusted EBITDA =
---------------
(c) The ratio of the amount entered on line (a) to the
amount entered on line (b) = to
------- ------
Is the ratio entered on line (c) less than or equal to 2.75 to 1.00? Yes No
Exhibit C to Credit Agreement - Page 2
EXHIBIT D
SUBSIDIARY GUARANTY AND CONTRIBUTION AGREEMENT
This Subsidiary Guaranty and Contribution Agreement dated as of May 15,
2002 (this "Agreement") is executed by the parties signatory hereto or to an
Accession Agreement in favor of the Agent and the Banks party to the Credit
Agreement herein described.
INTRODUCTION
A. This Agreement is given in connection with the Credit Agreement
dated as of May 15, 2002 (as the same may be amended, restated, supplemented,
renewed, extended or otherwise modified from time to time, the "Credit
Agreement") among Arkansas Best Corporation, a Delaware corporation (the
"Borrower"), Xxxxx Fargo Bank Texas, National Association, as Administrative
Agent (the "Agent"), Fleet National Bank and SunTrust Bank, as Co-Syndication
Agents, Wachovia Corporation, as Documentation Agent, and the lenders parties
thereto.
B. The Borrower is the principal financing entity for all capital
requirements of its Subsidiaries, and from time to time the Borrower has made
and will continue to make capital contributions and advances to its
Subsidiaries, including each of the parties hereto (such parties herein called
individually a "Guarantor" and collectively the "Guarantors"). Each Guarantor is
a direct or indirect subsidiary of the Borrower and will derive substantial
direct and indirect benefit from the transactions contemplated by the Credit
Agreement.
C. Under the Credit Agreement, it is a condition to the making of the
Advances by the Banks and the issuance of the Letters of Credit by the Issuing
Bank that each Guarantor shall have executed and delivered this Agreement.
Therefore, in order to induce the Banks to make the Advances and the
Issuing Bank to issue the Letters of Credit, each Guarantor hereby agrees as
follows:
Section 1. Definitions. Unless otherwise defined in this Agreement,
capitalized terms used herein shall have the same meanings herein as defined in
the Credit Agreement.
Section 2. Guaranty. Each Guarantor hereby unconditionally guarantees
the punctual payment when due, whether at stated maturity, by acceleration or
otherwise, of all indebtedness, liabilities and/or obligations of the Borrower
now or hereafter existing under the Credit Agreement, the Notes and any other
Credit Document, whether for principal, Reimbursement Obligations, interest,
fees, expenses or otherwise (such indebtedness, liabilities and/or obligations
being hereinafter referred to as the "Guaranteed Obligations"), and any and all
expenses (including reasonable counsel fees and expenses) incurred by the Agent
or any Bank in enforcing any rights under this Agreement. Each Guarantor agrees
that its guaranty obligation under this Agreement is a guarantee of payment, not
of collection, and that such Guarantor is primarily liable for the payment of
the Guaranteed Obligations.
Exhibit D to Credit Agreement - Page 1
Section 3. Limit of Liability. Each Guarantor shall be liable under
this Agreement with respect to the Guaranteed Obligations only for amounts
aggregating up to the largest amount that would not render its guaranty
obligation hereunder subject to avoidance under Section 548 of the United States
Bankruptcy Code or any comparable provisions of any state law.
Section 4. Guaranty Absolute. Each Guarantor guarantees that the
Guaranteed Obligations will be paid strictly in accordance with the terms of the
Credit Agreement and the other Credit Documents, regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction affecting any
of such terms or the rights of the Agent or the Banks with respect thereto. The
liability of each Guarantor under this Agreement shall be absolute and
unconditional irrespective of:
(a) any lack of validity or enforceability of the Credit Agreement, any
other Credit Document or any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, any of the Guaranteed Obligations, or any other amendment or
waiver of or any consent to departure from the Credit Agreement or any Credit
Document;
(c) any release or amendment or waiver of or consent to departure from
the Credit Agreement, this Agreement or any other agreement or guaranty, for any
of the Guaranteed Obligations; or
(d) any other circumstances which might otherwise constitute a defense
available to, or a discharge of, the Borrower or a Guarantor.
Section 5. Continuation and Reinstatement, Etc. Each Guarantor agrees
that, to the extent that the Borrower makes payments to the Agent or any Bank
and such payments or any part thereof are subsequently invalidated, declared to
be fraudulent or preferential, set aside or otherwise required to be repaid,
then to the extent of such repayment the Guaranteed Obligations shall be
reinstated and continued in full force and effect as of the date such initial
payment occurred. The Guarantor shall defend and indemnify the Agent and each
Bank from and against any claim or loss under this Section 5 (including
reasonable attorneys' fees and expenses) in the defense of any such action or
suit.
Section 6. Certain Waivers.
6.01. Notice. Each Guarantor hereby waives promptness, diligence,
notice of acceptance, notice of acceleration, notice of intent to accelerate and
any other notice with respect to any of the Guaranteed Obligations and this
Agreement.
6.02. Other Remedies. Each Guarantor hereby waives any requirement that
the Agent or any Bank exhaust any right or take any action against the Borrower
or any other Person, including any action required by Chapter 34 of the Texas
Business and Commerce Code.
Exhibit D to Credit Agreement - Page 2
6.03. Waiver of Subrogation. (a) Each Guarantor hereby irrevocably
waives, until payment in full of all Guaranteed Obligations and termination of
all Commitments, any claim or other rights which it may acquire against the
Borrower that arise from such Guarantor's obligations under this Agreement or
any other Credit Document, including, without limitation, any right of
subrogation (including, without limitation, any statutory rights of subrogation
under Section 509 of the Bankruptcy Code, 11 U.S.C. 509, or otherwise),
reimbursement, exoneration, contribution, indemnification or any right to
participate in any claim or remedy of the Agent or any Bank against the Borrower
which the Agent or any Bank now has or acquires. If any amount shall be paid to
any Guarantor in violation of the preceding sentence and the Guaranteed
Obligations shall not have been paid in full and all of the Commitments
terminated, such amount shall be held in trust for the benefit of the Agent and
the Banks, and shall promptly be paid to the Agent for the benefit of the Agent
and the Banks to be applied to the Guaranteed Obligations, whether matured or
unmatured, as the Agent may elect. Each Guarantor acknowledges that it will
receive direct and indirect benefits from the financing arrangements
contemplated by the Credit Agreement and that the waiver set forth in this
Section 6.03(a) is knowingly made in contemplation of such benefits.
(b) Each Guarantor further agrees that it will not enter into any
agreement providing, directly or indirectly, for any contribution,
reimbursement, repayment or indemnity by the Borrower or any other Person on
account of any payment by such Guarantor to the Agent or the Banks under this
Agreement.
Section 7. Representations and Warranties. Each Guarantor hereby
represents and warrants as follows:
7.01. Corporate Authority. Such Guarantor is a corporation or a limited
liability company duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, which is set forth on Schedule
4.1 to the Credit Agreement. The execution, delivery and performance by such
Guarantor of this Agreement are within such Guarantor's corporate powers, have
been duly authorized by all necessary corporate action, and do not contravene or
violate (a) such Guarantor's charter or bylaws or (b) any law or material
contractual restriction affecting such Guarantor or its Property.
7.02. Government Approval. No authorization or approval or other action
by, and no notice to or filing with, any Governmental Authority is required for
the due execution, delivery and performance by such Guarantor of this Agreement.
7.03. Binding Obligations. This Agreement is the legal, valid and
binding obligation of such Guarantor enforceable against such Guarantor in
accordance with its terms, subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar law affecting creditors'
rights (whether considered in a proceeding at law or in equity).
Section 8. Covenants. Each Guarantor will comply with all covenant
provisions of Article V and Article VI of the Credit Agreement to the extent
such provisions are applicable to a Subsidiary of the Borrower.
Exhibit D to Credit Agreement - Page 3
Section 9. Contribution. As a result of the transactions contemplated
by the Credit Agreement, each of the Guarantors will benefit, directly and
indirectly, from the Obligations and in consideration thereof desire to enter
into a contribution agreement among themselves as set forth in this Section 9 to
allocate such benefits among themselves and to provide a fair and equitable
arrangement to make contributions in the event any payment is made by any
Guarantor hereunder to the Agent or the Banks (such payment being referred to
herein as a "Contribution"). The Guarantors hereby agree as follows:
9.01. Calculation of Contribution. In order to provide for just and
equitable contribution among the Guarantors in the event any Contribution is
made by a Guarantor (a "Funding Guarantor"), such Funding Guarantor shall be
entitled to a contribution from certain other Guarantors for all payments,
damages and expenses incurred by that Funding Guarantor in discharging any of
the Obligations, in the manner and to the extent set forth in this Section 9.01.
The amount of any Contribution under this Agreement shall be equal to the
payment made by the Funding Guarantor to the Agent or any other beneficiary
pursuant to this Agreement and shall be determined as of the date on which such
payment is made.
9.02. Benefit Amount Defined. For purposes of this Agreement, the
"Benefit Amount" of any Guarantor as of any date of determination shall be the
net value of the benefits to such Guarantor and all of its Subsidiaries
(including any Subsidiaries which may be Guarantors) from extensions of credit
made by the Banks to the Borrower under the Credit Agreement; provided, that in
determining the contribution liability of any Guarantor which is a Subsidiary to
its direct or indirect parent corporation or of any Guarantor to its direct or
indirect Subsidiary, the Benefit Amount of such Subsidiary and its Subsidiaries,
if any, shall be subtracted in determining the Benefit Amount of the parent
corporation. Such benefits shall include benefits of funds constituting proceeds
of Advances made to the Borrower by the Banks which are in turn advanced or
contributed by the Borrower to such Guarantor or its Subsidiaries and benefits
of Letters of Credit issued pursuant to the Credit Agreement on behalf of, or
the proceeds of which are advanced or contributed or otherwise benefit, directly
or indirectly, such Guarantor and its Subsidiaries (collectively, the
"Benefits"). In the case of any proceeds of Advances or Benefits advanced or
contributed to a Person of which any of the equity interests are owned directly
or indirectly by a Guarantor (an "Owned Entity"), the Benefit Amount of a
Guarantor with respect thereto shall be that portion of the net value of the
benefits attributable to Advances or Benefits equal to the direct or indirect
percentage ownership of such Guarantor in its Owned Entity.
9.03. Contribution Obligation. Each Guarantor shall be liable to a
Funding Guarantor in an amount equal to the greater of (a) (i) the ratio of the
Benefit Amount of such Guarantor to the total amount of Obligations, multiplied
by (ii) the amount of Obligations paid by such Funding Guarantor and (b) 95% of
the excess of the fair saleable value of the property of such Guarantor over the
total liabilities of such Guarantor (including the maximum amount reasonably
expected to become due in respect of contingent liabilities) determined as of
the date on which the payment made by a Funding Guarantor is deemed made for
purposes of this Agreement (giving effect to all payments made by other Funding
Guarantors as of such date in a manner to maximize the amount of such
contributions).
Exhibit D to Credit Agreement - Page 4
9.04. Allocation. In the event that at any time there exists more than
one Funding Guarantor with respect to any Contribution (in any such case, the
"Applicable Contribution"), then payment from other Guarantors pursuant to this
Agreement shall be allocated among such Funding Guarantors in proportion to the
total amount of the Contribution made for or on account of the Borrower by each
such Funding Guarantor pursuant to the Applicable Contribution. In the event
that at any time any Guarantor pays an amount under this Agreement in excess of
the amount calculated pursuant to clause (a) of Section 9.03, that Guarantor
shall be deemed to be a Funding Guarantor to the extent of such excess and shall
be entitled to contribution from the other Guarantors in accordance with the
provisions of this Section 9.04.
9.05. Subsidiary Payment. The amount of contribution payable under this
Section 9.05 by any Guarantor shall be reduced by the amount of any contribution
paid hereunder by a Subsidiary of such Guarantor.
9.06. Equitable Allocation. If as a result of any reorganization,
recapitalization or other corporate change in the Borrower or any of its
Subsidiaries, or as a result of any amendment, waiver or modification of the
terms and conditions of other Sections of this Agreement or the Obligations, or
for any other reason, the contributions under this Section 9.06 become
inequitable as among the Guarantors, the Guarantors shall promptly modify and
amend this Section 9.06 to provide for an equitable allocation of contributions.
Any of the foregoing modifications and amendments shall be in writing and signed
by all Guarantors.
9.07. Asset of Party to Which Contribution is Owing. The Guarantors
acknowledge that the right to contribution hereunder shall constitute an asset
in favor of the Guarantor to which such contribution is owing.
9.08. Subordination. No payments payable by a Guarantor pursuant to the
terms of this Section 9 shall be paid until all amounts then due and payable by
the Borrower to any Bank, pursuant to the terms of the Credit Documents, are
paid in full in cash. Nothing contained in this Section 9 shall affect the
indebtedness, liabilities or obligations of any Guarantor to the Agent or any
Bank under this Agreement, the Credit Agreement or any other Credit Documents.
Section 10. Miscellaneous.
10.01. Addresses for Notices. All notices and other communications
provided for hereunder shall be in writing, including telegraphic communication,
and delivered or teletransmitted to the Agent, as set forth in the Credit
Agreement, and to each Guarantor, at the address set forth beside such
Guarantor's name on Annex 1 hereto or in the Accession Agreement executed by
such Guarantor, or to such other address as shall be designated by any Guarantor
or the Agent in written notice to the other parties. All such notices and other
communications shall be effective when delivered or teletransmitted to the above
addresses.
10.02. Amendments, Etc. No waiver of any provision of this Agreement
nor consent to any departure by any Guarantor therefrom shall be effective
unless the same shall be in writing and signed by the Agent, the Majority Banks
and the Borrower, and no amendment of this Agreement shall be effective unless
the same shall be in writing and signed by each Guarantor and the Agent, with
the consent of the Majority Banks; provided, however, that any amendment
Exhibit D to Credit Agreement - Page 5
or waiver releasing any Guarantor from any liability hereunder shall be signed
by all the Banks; provided, further, however, that any waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given. Notwithstanding the foregoing, in the event that any Subsidiary of
the Borrower hereafter is required in a accordance with the terms of the Credit
Agreement or otherwise agrees to become a guarantor of the Borrower's
obligations under the Credit Documents, then such Subsidiary may become a party
to this Agreement by executing an Accession Agreement ("Accession Agreement") in
the form attached hereto as Annex 2, and each Guarantor and the Agent hereby
agrees that, upon such Subsidiary's execution of such Accession Agreement, this
Agreement shall be deemed to have been amended to make such Person a Guarantor
hereunder for all purposes and a party hereto and no signature is required on
behalf of the other Guarantors or the Agent to make such an amendment to this
Agreement effective.
10.03. No Waiver; Remedies. No failure on the part of the Agent or any
Bank to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any right
hereunder preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.
10.04. Right of Set-Off. Upon the occurrence and during the continuance
of any Event of Default, the Agent and the Banks are hereby authorized at any
time, to the fullest extent permitted by law, to set off and apply any deposits
(general or special, time or demand, provisional or final) and other
indebtedness owing by the Agent or the Banks to the account of any Guarantor
against any and all of the obligations of such Guarantor under this Agreement,
irrespective of whether or not the Agent or the Banks shall have made any demand
under this Agreement and although such obligations may be contingent and
unmatured. The Agent and the Banks agree promptly to notify each Guarantor
affected by any such set-off after any such set-off and application made by the
Agent or the Banks provided that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of the Agent and
the Banks under this Section 10.04 are in addition to other rights and remedies
(including, without limitation, other rights of set-off) which the Agent and the
Banks may have.
10.05. Continuing Guaranty; Transfer of Interest. This Agreement shall
create a continuing guaranty and shall (a) remain in full force and effect until
payment in full and termination of the Guaranteed Obligations, (b) be binding
upon each Guarantor, its successors, and assigns, and (c) inure, together with
the rights and remedies of the Agent hereunder, to the benefit of the Agent, the
Banks and their respective successors, transferees and assigns. Without limiting
the generality of the foregoing clause, when any Bank assigns or otherwise
transfers any interest held by it under the Credit Agreement or other Credit
Document to any other Person pursuant to the terms of the Credit Agreement or
other Credit Document, that other Person shall thereupon become vested with all
the benefits held by such Bank under this Agreement. Subject to Section 5, upon
the payment in full and termination of the Guaranteed Obligations, the
guaranties granted hereby shall terminate and all rights hereunder shall revert
to each Guarantor to the extent such rights have not been applied pursuant to
the terms hereof. Subject to Section 5, upon any such termination, the Agent
will, at each Guarantor's expense, execute and deliver to such Guarantor such
documents as such Guarantor shall reasonably request and take any other actions
reasonably requested to evidence or effect such termination.
Exhibit D to Credit Agreement - Page 6
10.06. Governing Law. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of Texas. Each
Guarantor hereby irrevocably submits to the jurisdiction of any Texas state or
federal court sitting in Dallas, Texas in any action or proceeding arising out
of or relating to this Agreement and the other Credit Documents, and such
Guarantor hereby irrevocably agrees that all claims in respect of such action or
proceeding may be heard and determined in such court. Each Guarantor hereby
irrevocably waives, to the fullest extent it may effectively do so, any right it
may have to the defense of an inconvenient forum to the maintenance of such
action or proceeding. Each Guarantor hereby agrees that service of copies of the
summons and complaint and any other process which may be served in any such
action or proceeding may be made by mailing or delivering a copy of such process
to such Guarantor at its address specified below. Each Guarantor agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Section 10.06 shall affect the rights of any
Bank or the Agent to serve legal process in any other manner permitted by the
law or affect the right of any Bank or the Agent to bring any action or
proceeding against any Guarantor or its Property in the courts of any other
jurisdiction.
10.07. WAIVERS OF JURY TRIAL. EACH GUARANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATING TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT TO WHICH IT IS A PARTY OR TO ANY
COUNTERCLAIM THEREIN.
10.08. Binding Arbitration.
(a) Arbitration. The Guarantors and the Agent agree, upon
demand, to submit to binding arbitration all claims, disputes and
controversies between or among them (and their respective employees,
officers, directors, attorneys and other agents), whether in tort,
contract or otherwise arising out of or relating to in any way this
Agreement or the Credit Documents and their negotiation, execution,
collateralization, administration, repayment, modification, extension,
substitution, formation, inducement, enforcement, default or
termination.
(b) Governing Rules. Any arbitration proceeding will (i)
proceed in a location in Texas selected by the American Arbitration
Association ("AAA"); (ii) be governed by the Federal Arbitration Act
(Title 9 of the United States Code), notwithstanding any conflicting
choice of law provision in any of the documents between the parties;
and (iii) be conducted by the AAA, or such other administrator as the
parties shall mutually agree upon, in accordance with the AAA's
commercial dispute resolution procedures, unless the claim or
counterclaim is at least $1,000,000.00 exclusive of claimed interest,
arbitration fees and costs in which case the arbitration shall be
conducted in accordance with the AAA's optional procedures for large,
complex commercial disputes (the commercial dispute resolution
procedures or the optional procedures for large, complex commercial
disputes to be referred to, as applicable, as the "Rules"). If there is
any
Exhibit D to Credit Agreement - Page 7
inconsistency between the terms hereof and the Rules, the terms and
procedures set forth herein shall control. Any Person who fails or
refuses to submit to arbitration following a demand by any other Person
shall bear all costs and expenses incurred by such other Person in
compelling arbitration of any dispute. Nothing contained herein shall
be deemed to be a waiver by any Person that is a bank of the
protections afforded to it under 12 U.S.C. Section 91 or any similar
applicable state law.
(c) No Waiver of Provisional Remedies, Self-Help and
Foreclosure. The arbitration requirement does not limit the right of
any Person to (i) foreclose against real or personal property
collateral; (ii) exercise self-help remedies relating to collateral or
proceeds of collateral such as setoff or repossession; or (iii) obtain
provisional or ancillary remedies such as replevin, injunctive relief,
attachment or the appointment of a receiver, before during or after the
pendency of any arbitration proceeding. This exclusion does not
constitute a waiver of the right or obligation of any Person to submit
any dispute to arbitration or reference hereunder, including those
arising from the exercise of the actions detailed in clauses (i), (ii)
and (iii) of this Section 10.08(c) .
(d) Arbitrator Qualifications and Powers. Any arbitration
proceeding in which the amount in controversy is $5,000,000.00 or less
will be decided by a single arbitrator selected according to the Rules,
and who shall not render an award of greater than $5,000,000.00. Any
dispute in which the amount in controversy exceeds $5,000,000.00 shall
be decided by majority vote of a panel of three arbitrators; provided
however, that all three arbitrators must actively participate in all
hearings and deliberations. The arbitrator will be a neutral attorney
licensed in the State of Texas with a minimum of ten years experience
in the substantive law applicable to the subject matter of the dispute
to be arbitrated. The arbitrator will determine whether or not an issue
is arbitratable and will give effect to the statutes of limitation in
determining any claim. In any arbitration proceeding the arbitrator
will decide (by documents only or with a hearing at the arbitrator's
discretion) any pre-hearing motions which are similar to motions to
dismiss for failure to state a claim or motions for summary
adjudication. The arbitrator shall resolve all disputes in accordance
with the substantive law of Texas and may grant any remedy or relief
that a court of such state could order or grant within the scope hereof
and such ancillary relief as is necessary to make effective any award.
The arbitrator shall also have the power to award recovery of all costs
and fees, to impose sanctions and to take such other action as the
arbitrator deems necessary to the same extent a judge could pursuant to
the Federal Rules of Civil Procedure, the Texas Rules of Civil
Procedure or other applicable law. Judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction. The
institution and maintenance of an action for judicial relief or pursuit
of a provisional or ancillary remedy shall not constitute a waiver of
the right of any Person, including the plaintiff, to submit the
controversy or claim to arbitration if any other Person contests such
action for judicial relief.
(e) Discovery. In any arbitration proceeding discovery will be
permitted in accordance with the Rules. All discovery shall be
expressly limited to matters directly relevant to the dispute being
arbitrated and must be completed no later than 20 days before the
hearing date and within 180 days of the filing of the dispute with the
AAA.
Exhibit D to Credit Agreement - Page 8
Any requests for an extension of the discovery periods, or any
discovery disputes, will be subject to final determination by the
arbitrator upon a showing that the request for discovery is essential
for the such Person's presentation and that no alternative means for
obtaining information is available.
(f) Class Proceedings and Consolidations. The resolution of
any dispute arising pursuant to the terms of this Agreement shall be
determined by a separate arbitration proceeding and such dispute shall
not be consolidated with other disputes or included in any class
proceeding.
(g) Payment Of Arbitration Costs And Fees. The arbitrator
shall award all costs and expenses of the arbitration proceeding.
(h) Miscellaneous. To the maximum extent practicable, the AAA,
the arbitrators, the Guarantors and the Agent shall take all action
required to conclude any arbitration proceeding within 180 days of the
filing of the dispute with the AAA. No arbitrator or other Person that
is a party to an arbitration proceeding may disclose the existence,
content or results thereof, except for disclosures of information by a
Person required in the ordinary course of its business or by applicable
law or regulation. If more than one agreement for arbitration by or
between the Guarantors and the Agent potentially applies to a dispute,
the arbitration provision most directly related to this Agreement or
the Credit Documents or the subject matter of the dispute shall
control. This arbitration provision shall survive termination,
amendment or expiration of any of the Credit Documents or any
relationship between or among the Borrower, the Guarantors, the Agent,
the Issuing Bank and/or the Banks.
10.09 ENTIRE AGREEMENT. PURSUANT TO SECTION 26.02 OF THE TEXAS BUSINESS
AND COMMERCE CODE, A LOAN AGREEMENT IN WHICH THE AMOUNT INVOLVED IN THE LOAN
AGREEMENT EXCEEDS $50,000 IN VALUE IS NOT ENFORCEABLE UNLESS THE LOAN AGREEMENT
IS IN WRITING AND SIGNED BY THE PARTY TO BE BOUND OR THAT PARTY'S AUTHORIZED
REPRESENTATIVE.
THE RIGHTS AND OBLIGATIONS OF THE PARTIES TO AN AGREEMENT SUBJECT TO
THE PRECEDING PARAGRAPH SHALL BE DETERMINED SOLELY FROM THE WRITTEN LOAN
AGREEMENT, AND ANY PRIOR ORAL AGREEMENTS BETWEEN THE PARTIES ARE SUPERSEDED BY
AND MERGED INTO THE LOAN AGREEMENT. THIS WRITTEN AGREEMENT AND THE CREDIT
DOCUMENTS, AS DEFINED IN THIS AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
10.10 Subordination of Indebtedness and Liens. In connection with this
Agreement, each Guarantor hereby agrees as follows:
Exhibit D to Credit Agreement - Page 9
(a) The payment of any and all principal of and interest on the
Subordinated Indebtedness (as defined below) shall in all respects be
subordinate and junior in right of payment and enforcement to the prior payment
and enforcement in full of all Guaranteed Obligations as provided in this
Section 10.10. The Subordinated Indebtedness shall not be payable, and no
payment of principal, interest or other amounts on account thereof, and no
property or guaranty of any nature to secure, guarantee or pay the Subordinated
Indebtedness shall be made or given, directly or indirectly by or on behalf of
any Debtor (hereafter defined) or received, accepted, retained or applied by any
Guarantor unless and until the Guaranteed Obligations shall have been
irrevocably paid and performed in full. If any sums shall be paid to any
Guarantor or any Affiliate of a Guarantor by any Debtor or any other Person on
account of the Subordinated Indebtedness when such payment is not permitted
hereunder, such sums shall be held in trust by such Guarantor or such Affiliate
of a Guarantor for the benefit of the Agent and the Banks and shall forthwith be
delivered to the Agent without affecting the liability of such Guarantor or such
Affiliate of a Guarantor under this Agreement and may be applied by the Agent
against the Guaranteed Obligations in accordance with the Credit Agreement. Upon
the request of the Agent, each Guarantor shall execute, deliver and endorse to
the Agent such documentation as the Agent may request to perfect, preserve and
enforce its rights hereunder. For purposes of this Agreement and with respect to
each Guarantor, the term "Subordinated Indebtedness" means all indebtedness,
liabilities and obligations of the Borrower or any Subsidiary of the Borrower
other than such Guarantor (the Borrower and such Subsidiaries of the Borrower
hereinafter called the "Debtors") to such Guarantor, whether such indebtedness,
liabilities and obligations now exist or are hereafter incurred or arise, or are
primary, absolute, secondary, direct, indirect, fixed, contingent, liquidated,
unliquidated, secured or unsecured, matured or unmatured, joint, several, joint
and several, or otherwise, and irrespective of whether such indebtedness,
liabilities or obligations are evidenced by a note, contract, open account or
otherwise, and irrespective of the Person or Persons in whose favor such
indebtedness, obligations or liabilities may, at their inception, have been, or
may hereafter be created, or the manner in which they have been or may hereafter
be acquired by such Guarantor;
(b) Any and all Liens (including any judgment Liens) upon any Debtor's
property or assets securing payment of any Subordinated Indebtedness (the
"Subordinated Liens") shall be and remain inferior and subordinate to any and
all Liens, if any exist, upon any Debtor's assets securing payment of the
Guaranteed Obligations or any part thereof, regardless of whether such
Subordinated Liens presently exist or are hereafter created or when such
Subordinated Liens were created, perfected, filed or recorded. Each Guarantor
shall not exercise or enforce any creditors' rights or remedies that it may have
against any Debtor or foreclose, repossess, sequester or otherwise institute any
action or proceeding (whether judicial or otherwise, including, without
limitation, the commencement of, or joinder in, any bankruptcy, insolvency,
reorganization, liquidation, receivership or other debtor relief law) to enforce
any Subordinated Lien on any property or assets of any Debtor unless and until
the Guaranteed Obligations shall have been irrevocably paid and performed in
full;
(c) In the event of any receivership, bankruptcy, reorganization,
rearrangement, debtor's relief or other insolvency proceeding involving any
Debtor as debtor, the Agent shall have the right to prove and vote any claim
under the Subordinated Indebtedness and to receive directly from the receiver,
trustee or other court custodian all dividends, distributions and
Exhibit D to Credit Agreement - Page 10
payments made in respect of the Subordinated Indebtedness until the Guaranteed
Obligations have been irrevocably paid and performed in full. The Agent may
apply any such dividends, distributions and payments against the Guaranteed
Obligations in accordance with the Credit Agreement;
(d) All promissory notes, accounts receivable, ledgers, records or any
other evidence of Subordinated Indebtedness, and all mortgages, deeds of trust,
security agreements, assignments and other security documents evidencing the
Subordinated Liens, shall contain a specific written notice thereon that the
indebtedness and Liens evidenced thereby are subordinated under the terms of
this Agreement; and
(e) The terms and provisions of this Section 10.10 are given by each
Guarantor as additional rights, remedies and benefits to any and all other
subordination agreements heretofore, concurrently herewith or hereafter executed
by such Guarantor to or in favor of the Agent or any Bank, and nothing in this
Agreement shall ever be deemed to in any way negate or replace any other such
previous, concurrent or subsequent subordination agreements.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
Exhibit D to Credit Agreement - Page 11
Each Guarantor has caused this Agreement to be duly executed as of the
date first above written.
GUARANTORS:
ABF CARTAGE, INC.
ABF FARMS, INC.
ABF FREIGHT SYSTEM, INC.
ABF FREIGHT SYSTEM DE MEXICO, INC.
ADVERTISING COUNSELORS, INC.
AGRICULTURAL EXPRESS OF AMERICA, INC.
ARKANSAS UNDERWRITERS CORPORATION
BEST SERVICE CORP.
CLIPPER EXXPRESS COMPANY
CLIPPER FREIGHT MANAGEMENT, INC.
CLIPPER GLOBAL AIR, INC.
DATA-TRONICS CORP.
FLEETNET AMERICA LLC
LAND-MARINE CARGO, INC.
TRANSPORT REALTY, INC.
TREAD-ARK CORPORATION
FREIGHTVALUE, INC.
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Exhibit D to Credit Agreement - Page 12
ANNEX 1
to Subsidiary Guaranty and Contribution Agreement
ADDRESSES OF GUARANTORS FOR NOTICES
Name of Jurisdiction Address of
Subsidiary of Incorporation Principal Office
---------- ---------------- ----------------
ABF Cartage, Inc. Delaware 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
ABF Farms, Inc. Arkansas 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
ABF Freight System, Inc. Delaware 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
ABF Freight System De Mexico, Inc. Delaware 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
Advertising Counselors, Inc. Arkansas 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
Agricultural Express of America, Inc. Delaware 00000 Xxxx 000xx Xxxxxx
Xxxxxx, XX 00000
Arkansas Underwriters Corporation Arkansas 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
Best Service Corp. Delaware 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
Clipper Exxpress Company Delaware 00000 Xxxx 000xx Xxxxxx
Xxxxxx, XX 00000
Clipper Freight Management, Inc. Arkansas 00000 Xxxx 000xx Xxxxxx
Xxxxxx, XX 00000
Clipper Global Air, Inc. Arkansas 00000 Xxxx 000xx Xxxxxx
Xxxxxx, XX 00000
Data-Tronics Corp. Arkansas 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
FleetNet America LLC Delaware X.X. Xxx 000
Xxxxxxxxxxx, XX 00000
Land-Marine Cargo, Inc. Puerto Rico 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
Transport Realty, Inc. Arkansas 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
Tread-Ark Corporation Delaware 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
Freightvalue, Inc. Arkansas 0000 Xxx Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX 00000
Exhibit D to Credit Agreement - Page 13
ANNEX 2
to Subsidiary Guaranty and Contribution Agreement
ACCESSION AGREEMENT
___________[NAME OF SUBSIDIARY], a ________________ [corporation]
[limited liability company] (the "Company"), hereby agrees with (i) Xxxxx Fargo
Bank Texas, National Association, as Administrative Agent (the "Agent") under
the Credit Agreement dated as of _______ __, 2002 among Arkansas Best
Corporation, a Delaware corporation which is the direct or indirect shareholder
of the Company, the lenders party thereto (as the same may be amended, restated
or otherwise modified from time to time, the "Credit Agreement"; unless
otherwise defined in this Accession Agreement, capitalized terms used herein
shall have the same meanings herein as defined in the Credit Agreement), and
(ii) the parties to the Subsidiary Guaranty and Contribution Agreement dated as
of _______ __, 2002 (as the same may be amended, restated or otherwise modified
from time to time, the "Guaranty Agreement") executed in connection with the
Credit Agreement, as follows:
The Company hereby agrees and confirms that, as of the date hereof, it
(a) intends to be a party to the Guaranty Agreement and undertakes to guaranty
payment of the Guaranteed Obligations in accordance with the Guaranty Agreement
and to pay and perform all the indebtedness, liabilities and obligations
expressed therein of a Guarantor (as defined in the Guaranty Agreement), (b)
agrees to be bound by all of the provisions of the Guaranty as if it had been an
original party to such Guaranty, and (c) confirms that the representations and
warranties set forth in the Guaranty with respect to the Company, a party
thereto, are true and correct in all material respects as of the date of this
Accession Agreement.
For purposes of notices under the Guaranty, the address for the Company
is as follows:
Attention:
------------------------
Telephone:
------------------------
Telecopy:
-------------------------
This Accession Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
IN WITNESS WHEREOF this Accession Agreement was executed and delivered
as of the ___ day of _________, ____.
[NAME OF SUBSIDIARY]
By:
----------------------------
Name:
--------------------------
Title:
-------------------------
Exhibit D to Credit Agreement - Page 14
EXHIBIT E
FORM OF INCREASED COMMITMENT AGREEMENT
This INCREASED COMMITMENT AGREEMENT (this "Agreement") is dated as of
____________, ___ and entered into by and among Arkansas Best Corporation, a
Delaware corporation (the "Borrower"), each of the banks or other lending
institutions which is a signatory hereto (individually a "Supplementing Bank"
and collectively the "Supplementing Banks"), and Xxxxx Fargo Bank Texas,
National Association, as Administrative Agent for itself and the Banks (in such
capacity, together with its successors in such capacity, the "Agent"); and is
made with reference to that certain Credit Agreement dated as of May 15, 2002
(as the same may be amended, restated, supplemented, renewed, extended or
otherwise modified, the "Credit Agreement"), by and among the Borrower, the
lenders parties thereto, Fleet National Bank and SunTrust Bank, as
Co-Syndication Agents, Wachovia Corporation, as Documentation Agent, and the
Agent, as Administrative Agent. Unless otherwise defined in this Agreement,
capitalized terms used herein shall have the same meanings herein as defined in
the Credit Agreement.
RECITALS
WHEREAS, pursuant to Section 2.17 of the Credit Agreement, the Borrower
and the Supplementing Banks are entering into this Increased Commitment
Agreement to provide for the increase of the aggregate Commitments;
WHEREAS, the Borrower desires to increase the aggregate Commitments and
the Supplementing Banks agree to provide such increase as set forth in this
Agreement;
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto hereby agree as
follows:
Section 1. Increase in Commitments. Subject to the terms and conditions
hereof, each Supplementing Bank severally agrees (a) to increase it Commitment
by the amount set forth opposite its name on its signature page hereto under the
heading "Increase in Commitment" and (b) that, after giving effect to this
Agreement, its total Commitment shall be the amount set forth opposite its name
on its signature page hereto under the heading "Total Commitment."
Section 2. Conditions to Effectiveness. Section 1 of this Agreement
shall become effective only upon the satisfaction of the following conditions
precedent:
(i) receipt by the Agent of an opinion of counsel to the
Borrower as to such of the matters referred to in Exhibit K to the
Credit Agreement as such matters relate to this Agreement or are
otherwise relevant hereto in the judgment of the Agent, dated the date
hereof and satisfactory in form and substance to the Agent;
(ii) receipt by the Agent of certified copies of all corporate
action taken by the Borrower to authorize the execution, delivery and
performance of this Agreement; and
Exhibit E to Credit Agreement - Page 1
(iii) receipt by the Agent of a certificate of the Secretary
or an Assistant Secretary of the Borrower certifying the names and true
signatures of the officers of the Borrower authorized to sign this
Agreement and the other documents to be delivered hereunder.
Section 3. Supplementing Banks Representations and Warranties. Each
Supplementing Bank that is not currently a Bank party to the Credit Agreement
hereby (a) confirms that it has received a copy of the Credit Agreement,
together with, (i) in the event that the date of this Agreement is prior to the
date of delivery of the initial financial statements required to be delivered
pursuant to Section 5.6(b) of the Credit Agreement, copies of the financial
statements referred to in Section 4.5 of the Credit Agreement or (ii) in the
event that the date of this Agreement is after the date of delivery of the
initial financial statements required to be delivered pursuant to Section 5.6(b)
of the Credit Agreement, copies of the most recent financial statements
delivered pursuant to Section 5.6(b) of the Credit Agreement, and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Agreement; (b) agrees that it has,
independently and without reliance upon the Agent, the Co-Syndication Agents or
any other Bank and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement; (c) agrees that it will, independently and without reliance upon the
Agent, the Co-Syndication Agents or any other Bank and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Credit Agreement
or any other Credit Document; (d) appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers and discretion under
the Credit Agreement as are delegated to the Agent by the terms thereof,
together with such powers and discretion as are reasonably incidental thereto;
(e) agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Credit Agreement or any other Credit
Document are required to be performed by it as a Bank; (f) specifies as its
Domestic Lending Office (and address for notices) and Eurodollar Lending Office
the offices set forth beneath its name on the signature pages hereof; (g)
attaches the forms prescribed by the Internal Revenue Service of the United
States certifying as to such Supplementing Bank's status for purposes of
determining exemption from United States withholding taxes with respect to all
payments to be made to such Supplementing Bank under the Credit Agreement and
its Notes or such other documents as are necessary to indicate that all such
payments are subject to such rates at a rate reduced by an applicable tax
treaty(1); and (h) represents that it is an Eligible Assignee.
Section 4. Borrower Representations and Warranties. In order to induce
the Supplementing Banks to enter into this Agreement and to supplement the
Credit Agreement in the manner provided herein, the Borrower represents and
warrants to Agent and each Supplementing Bank that (a) the representations and
warranties contained in Article IV of the Credit Agreement are and will be true,
correct and complete in all material respects on and as of the date hereof and
(b) no Default or Event of Default has occurred and is continuing or will result
from the consummation of the transactions contemplated by this Agreement.
----------
(1) If such Supplementing Bank is organized under the laws of a jurisdiction
outside the United States.
Exhibit E to Credit Agreement - Page 2
Section 5. Effect of Supplement. The terms and provisions set forth in
this Agreement shall modify and supersede all inconsistent terms and provisions
set forth in the Credit Agreement and except, as expressly modified and
superseded by this Agreement, the terms and provisions of the Credit Agreement
are ratified and confirmed and shall continue in full force and effect. The
Borrower, the Agent and the Supplementing Banks hereby agree that the Credit
Agreement, as supplemented hereby, shall continue to be legal, valid, binding
and enforceable in accordance with its terms. Any and all agreements, documents
or instruments now or hereafter executed and delivered pursuant to the terms
hereof or pursuant to the terms of the Credit Agreement, as supplemented hereby,
are hereby amended so that any reference therein to the Credit Agreement shall
mean a reference to the Credit Agreement as supplemented hereby.
Section 6. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Texas.
Section 7. Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed an original and all
of which taken together shall constitute one and the same agreement.
Section 8. ENTIRE AGREEMENT. THIS WRITTEN AGREEMENT AND THE CREDIT
DOCUMENTS, AS DEFINED IN THE CREDIT AGREEMENT, REPRESENT THE FINAL AGREEMENT
AMONG THE PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Exhibit E to Credit Agreement - Page 3
BORROWER:
ARKANSAS BEST CORPORATION
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
SUPPLEMENTING BANKS:
Increase in Commitment: -----------------------------
$
----------------------
Total Commitment: By
---------------------------------
$ Name:
---------------------- -------------------------------
Title:
------------------------------
Domestic Lending Office:
Address:
---------------------------
------------------------------------
------------------------------------
Attention:
--------------------------
Telecopy:
---------------------------
Telephone:
--------------------------
Eurodollar Lending Office:
Address:
---------------------------
------------------------------------
------------------------------------
Attention:
--------------------------
Telecopy:
---------------------------
Telephone:
--------------------------
Exhibit E to Credit Agreement - Page 4
Increase in Commitment: ------------------------------------
$
----------------------
Total Commitment: By
---------------------------------
$ Name:
---------------------- -------------------------------
Title:
------------------------------
Domestic Lending Office:
Address:
---------------------------
------------------------------------
------------------------------------
Attention:
--------------------------
Telecopy:
---------------------------
Telephone:
--------------------------
Eurodollar Lending Office:
Address:
---------------------------
------------------------------------
------------------------------------
Attention:
--------------------------
Telecopy:
---------------------------
Telephone:
--------------------------
Exhibit E to Credit Agreement - Page 5
Increase in Commitment: ------------------------------------
$
---------------------
Total Commitment: By
---------------------------------
$ Name:
---------------------- -------------------------------
Title:
------------------------------
Domestic Lending Office:
Address:
---------------------------
------------------------------------
------------------------------------
Attention:
--------------------------
Telecopy:
---------------------------
Telephone:
--------------------------
Eurodollar Lending Office:
Address:
---------------------------
------------------------------------
------------------------------------
Attention:
--------------------------
Telecopy:
---------------------------
Telephone:
--------------------------
Exhibit E to Credit Agreement - Page 6
AGENT:
XXXXX FARGO BANK TEXAS,
NATIONAL ASSOCIATION, AS THE AGENT
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Exhibit E to Credit Agreement - Page 7
ACKNOWLEDGEMENT
Each Guarantor hereby: (a) consents and agrees to this Agreement; (b)
agrees that the Subsidiary Guaranty and Contribution Agreement (i.e., the
"Guaranty" as such term is defined in the Credit Agreement referred to in this
Agreement) previously executed by the undersigned is in full force and effect
and continues to be its legal, valid and binding obligation enforceable in
accordance with its terms; and (c) agrees that the indebtedness, liabilities and
obligations of the Borrower arising as a result of the increase in the aggregate
Commitments contemplated by this Agreement are "Guaranteed Obligations" as
defined in such Subsidiary Guaranty and Contribution Agreement.
GUARANTORS:
[LIST ALL GUARANTORS]
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
Exhibit E to Credit Agreement - Page 8
EXHIBIT F
NOTICE OF BORROWING
As of _________ __, ____
Xxxxx Fargo Bank Texas, National Association,
as Administrative Agent under the Credit Agreement herein described
0000 Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxxx
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of May 15,
2002 (as the same may be amended, restated, supplemented, renewed, extended or
otherwise modified from time to time, the "Credit Agreement"), among Arkansas
Best Corporation (the "Borrower"), the lenders parties thereto, Fleet National
Bank and SunTrust Bank, as Co-Syndication Agents, Wachovia Corporation, as
Documentation Agent, and Xxxxx Fargo Bank Texas, National Association, as
Administrative Agent. Unless otherwise defined in this Notice of Borrowing,
capitalized terms used herein shall have the same meanings herein as defined in
the Credit Agreement.
The Borrower hereby gives you this Notice of Borrowing irrevocably,
pursuant to Section 2.2(a) of the Credit Agreement. The Borrower hereby requests
a Borrowing, and in connection with that request sets forth below the
information relating to such Borrowing (the "Proposed Borrowing") as required by
Section 2.2(a) of the Credit Agreement:
(a) The Business Day of the Proposed Borrowing is
_____________, 200__.
(b) The Proposed Borrowing will be a [Revolving Borrowing]
[Swingline Advance]. If such Proposed Borrowing is a Revolving
Borrowing, such Borrowing will be composed of [Base Rate Advances]
[Eurodollar Rate Advances].
(c) The aggregate amount of the Proposed Borrowing is
$____________.
(d) The Interest Period for each Eurodollar Rate Advance made
as part of the Proposed Borrowing is [28 days] [_____ month[s]].
Exhibit F to Credit Agreement - Page 1
(e) The Proposed Borrowing will be made available to the
Borrower in the following bank account:
Bank Name:
-----------------------
ABA or Routing #:
-----------------------
Account Name:
-----------------------
Account Number:
-----------------------
The undersigned hereby certifies that the following statements are true
and correct on the date hereof, and will be true on the date of the Proposed
Borrowing:
(i) in the representations and warranties contained in the
Credit Agreement, in Section 7 of the Guaranty, in the Foreign Stock
Pledge Agreement, if any have been previously executed, and in the
other Credit Documents are correct in all material respects, before and
after giving effect to the Proposed Borrowing and the application of
the proceeds therefrom, as though made on the date of the Proposed
Borrowing;
(ii) no Default has occurred and is continuing or would result
from such Proposed Borrowing or from the application of the proceeds
therefrom; and
(iii) no Material Adverse Change has occurred.
Very truly yours,
ARKANSAS BEST CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title: Chief Financial Officer
Exhibit F to Credit Agreement - Page 2
EXHIBIT G
NOTICE OF CONVERSION OR CONTINUATION
As of ___________ __, 200_
Xxxxx Fargo Bank Texas, National Association,
as Administrative Agent under the Credit Agreement herein described
0000 Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxxx
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of May 15,
2002 (as the same may be amended, restated, supplemented, renewed, extended or
otherwise modified from time to time, the "Credit Agreement"), among the
Arkansas Best Corporation (the "Borrower"), the lenders parties thereto, Fleet
National Bank and SunTrust Bank, as Co-Syndication Agents, Wachovia Corporation,
as Documentation Agent, and Xxxxx Fargo Bank Texas, National Association, as
Administrative Agent. Unless otherwise defined in this notice, capitalized terms
used herein shall have the same meanings herein as defined in the Credit
Agreement.
The Borrower hereby gives you this Notice of Conversion or Continuation
(the "Notice") irrevocably, pursuant to Section 2.2(b) of the Credit Agreement.
The Borrower hereby requests a Conversion or continuation of an outstanding
Borrowing, and in connection with that request sets forth below the information
relating to such Conversion or continuation (the "Proposed Action") as required
by Section 2.2(b) of the Credit Agreement:
(a) The Business Day of the Proposed Action is ___________,
____.
(b) After giving effect to the Proposed Action, the
outstanding Borrowing will be a composed of [Base Rate Advances]
[Eurodollar Rate Advances].
(c) The aggregate amount of the outstanding Borrowing to be
Converted or continued is $ _______ and presently consists of [Base
Rate Advances] [Eurodollar Rate Advances].
Exhibit G to Credit Agreement - Page 1
(d) The Proposed Action consists of [a Conversion to [Base
Rate Advances] [Eurodollar Rate Advances]] [a continuation of [Base
Rate Advances] [Eurodollar Rate Advances]].
(e) The Interest Period for each Eurodollar Rate Advance made
as part of the Proposed Action is [28 days][____ month[s]].
Very truly yours,
ARKANSAS BEST CORPORATION
By:
--------------------------
Name:
-------------------------
Title: Chief Financial Officer
Exhibit G to Credit Agreement - Page 2
EXHIBIT H
FORM OF REVOLVING NOTE
$ May 15, 2002
------------------------
For value received, the undersigned Arkansas Best Corporation, a
Delaware corporation (the "Borrower"), hereby promises to pay to the order of
_________________________ (the "Bank") the principal amount of _______________
and ____/100 Dollars ($ ) or, if less, the aggregate outstanding principal
amount of each Revolving Advance (as defined in the Credit Agreement referred to
below) made or deemed to be made by the Bank to the Borrower, together with
interest on the unpaid principal amount of each such Revolving Advance from the
date of such Revolving Advance until such principal amount is paid in full, at
such interest rates, and at such times, as are specified in the Credit
Agreement.
This Note is one of the Revolving Notes referred to in, and is entitled
to the benefits of, and is subject to the terms of, the Credit Agreement dated
as of May 15, 2002 (as the same may be amended, restated, supplemented, renewed,
extended or otherwise modified from time to time, the "Credit Agreement"), among
the Borrower, the lenders parties thereto, Fleet National Bank and SunTrust
Bank, as Co-Syndication Agents, Wachovia Corporation, as Documentation Agent,
and Xxxxx Fargo Bank Texas, National Association, as Administrative Agent.
Unless otherwise defined in this Note, capitalized terms used herein shall have
the same meanings herein as defined in the Credit Agreement. The holder of this
Note shall be entitled to, without limitation, the benefits provided in the
Credit Agreement as set forth herein. The Credit Agreement, among other things,
(a) provides for the making of Revolving Advances by the Bank to the Borrower
from time to time in an aggregate amount not to exceed at any time outstanding
the Dollar amount first above mentioned, the indebtedness of the Borrower
resulting from each such Revolving Advance being evidenced by this Note, and (b)
contains provisions for acceleration of the maturity of this Note upon the
happening of certain events stated in the Credit Agreement and for prepayments
of principal prior to the maturity of this Note upon the terms and conditions
specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to the Agent at 0000 Xxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, Xxxxx
00000 (or at such other location or address as may be specified by the Agent to
the Borrower) in same day funds. The Agent and/or the Bank shall record all
Revolving Advances and payments of principal made under this Note, but no
failure of the Agent and/or the Bank to make such recordings shall affect the
Borrower's repayment obligations under this Note.
Except as specifically provided in the Credit Agreement, the Borrower
and each surety, guarantor, endorser and other party liable for payment of any
sums of money payable on this Note hereby jointly and severally waive notice,
presentment, demand for payment, protest, notice of protest and non-payment or
dishonor, notice of intent to accelerate, notice of acceleration,
Exhibit H to Credit Agreement - Page 1
notice of intent to demand, any other notice of any kind, diligence in
collecting, grace and all other formalities of any kind, and consent to all
extensions without notice for any period or periods of time and partial
payments, before or after maturity, and any impairment of any collateral
securing this Note, all without prejudice to the holder of this Note. No failure
to exercise, and no delay in exercising, any rights hereunder on the part of the
holder of this Note shall operate as a waiver of such rights.
THIS NOTE, TOGETHER WITH THE OTHER CREDIT DOCUMENTS, REPRESENT
THE FINAL AGREEMENT OF THE PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND
THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES.
This Note shall be governed by, and construed and enforced in
accordance with, the laws of the state of Texas (except that Tex. Finance Code,
Chapter 346, which regulates certain revolving credit loan accounts shall not
apply to this Note).
ARKANSAS BEST CORPORATION
By:
---------------------------
Name:
-------------------------
Title:
------------------------
Exhibit H to Credit Agreement - Page 2
EXHIBIT I
FORM OF SWINGLINE NOTE
$15,000,000 May 15, 2002
For value received, the undersigned Arkansas Best Corporation, a
Delaware corporation (the "Borrower"), hereby promises to pay to the order of
Xxxxx Fargo Bank Texas, National Association (the "Bank") the principal amount
of Fifteen Million and No/100 Dollars ($15,000,000) or, if less, the aggregate
outstanding principal amount of each Swingline Advance (as defined in the Credit
Agreement referred to below) made by the Bank to the Borrower, together with
interest on the unpaid principal amount of each such Swingline Advance from the
date of such Swingline Advance until such principal amount is paid in full, at
such interest rates, and at such times, as are specified in the Credit
Agreement.
This Note is the Swingline Note referred to in, and is entitled to the
benefits of, and is subject to the terms of, the Credit Agreement dated as of
May 15, 2002 (as the same may be amended, restated, supplemented, renewed,
extended or otherwise modified from time to time, the "Credit Agreement"), among
the Borrower, the lenders parties thereto, Fleet National Bank and SunTrust
Bank, as Co-Syndication Agents, Wachovia Corporation, as Documentation Agent,
and Xxxxx Fargo Bank Texas, National Association, as Administrative Agent.
Unless otherwise defined in this Note, capitalized terms used herein shall have
the same meanings herein as defined in the Credit Agreement. The holder of this
Note shall be entitled to, without limitation, the benefits provided in the
Credit Agreement as set forth herein. The Credit Agreement, among other things,
(a) provides for the making of Swingline Advances by the Bank to the Borrower
from time to time at the discretion of the Bank in an aggregate amount not to
exceed at any time outstanding the Dollar amount first above mentioned, the
indebtedness of the Borrower resulting from each such Swingline Advance being
evidenced by this Note, and (b) contains provisions for acceleration of the
maturity of this Note upon the happening of certain events stated in the Credit
Agreement and for prepayments of principal prior to the maturity of this Note
upon the terms and conditions specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to the Bank at 0000 Xxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, Xxxxx
00000 (or at such other location or address as may be specified by the Agent to
the Borrower) in same day funds. The Bank shall record all Swingline Advances
and payments of principal made under this Note, but no failure of the Bank to
make such recordings shall affect the Borrower's repayment obligations under
this Note.
Exhibit I to Credit Agreement - Page 1
Except as specifically provided in the Credit Agreement, the Borrower
and each surety, guarantor, endorser and other party liable for payment of any
sums of money payable on this Note hereby jointly and severally waive notice,
presentment, demand for payment, protest, notice of protest and non-payment or
dishonor, notice of intent to accelerate, notice of acceleration, notice of
intent to demand, any other notice of any kind, diligence in collecting, grace
and all other formalities of any kind, and consent to all extensions without
notice for any period or periods of time and partial payments, before or after
maturity, and any impairment of any collateral securing this Note, all without
prejudice to the holder of this Note. No failure to exercise, and no delay in
exercising, any rights hereunder on the part of the holder of this Note shall
operate as a waiver of such rights.
THIS NOTE, TOGETHER WITH THE OTHER CREDIT DOCUMENTS, REPRESENT THE
FINAL AGREEMENT OF THE PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE
PARTIES.
This Note shall be governed by, and construed and enforced in
accordance with, the laws of the state of Texas (except that Tex. Finance Code,
Chapter 346, which regulates certain revolving credit loan accounts shall not
apply to this Note).
ARKANSAS BEST CORPORATION
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
Exhibit I to Credit Agreement - Page 2
EXHIBIT J
WITHHOLDING TAX CERTIFICATE
Reference is made to that certain Credit Agreement dated as of May 15,
2002, among Arkansas Best Corporation (the "Borrower"), the lenders parties
thereto (the "Banks"), Fleet National Bank and SunTrust Bank, as Co-Syndication
Agents, Wachovia Corporation, as Documentation Agent, and Xxxxx Fargo Bank
Texas, National Association, as administrative agent for the Banks (the "Agent")
(as the same may be amended, restated, supplemented, renewed, extended or
otherwise modified from time to time, the "Credit Agreement"). Unless otherwise
defined herein, capitalized terms used herein shall have the meanings herein as
defined in the Credit Agreement. ______________________ (the "Non-U.S. Bank") is
providing this certificate pursuant to Section 2.11(e) of the Credit Agreement.
The Non-U.S. Bank hereby represents and warrants that:
1. The Non-U.S. Bank is the sole record and beneficial owner of the
Commitment and Advances in respect of which it is providing this certificate.
2. The Non-U.S. Bank is not a "bank" for purposes of Section
881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the "Code"). In
this regard, the Non-U.S. Bank further represents and warrants that:
(a) the Non-U.S. Bank is not subject to regulatory or other
legal requirements as a bank in any jurisdiction; and
(b) the Non-U.S. Bank has not been treated as a bank for
purposes of any tax, securities law or other filing or submission made
to any Governmental Authority, any application made to a rating agency
or qualification for any exemption from tax, securities law or other
legal requirements.
3. The Non-U.S. Bank is not a 10-percent shareholder of the Borrower
within the meaning of Section 881(c)(3)(B) of the Code.
4. The Non-U.S. Bank is not a controlled foreign corporation receiving
interest from a related person within the meaning of Section 881(c)(3)(C) of the
Code.
IN WITNESS WHEREOF, the undersigned has duly executed this certificate.
[NAME OF NON-U.S. BANK]
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
Date:
--------------------
EXHIBIT J to Credit Agreement
EXHIBIT K
FORM OF BORROWER'S/GUARANTORS' COUNSEL OPINION
May 15, 2002
To Each of the Banks Party to the Credit
Agreement and Xxxxx Fargo Bank Texas,
National Association, as administrative
agent for the Banks
Ladies and Gentlemen:
I have acted as counsel to Arkansas Best Corporation, a Delaware
corporation (the "Borrower"), and the Guarantors in connection with the Credit
Agreement dated as of May 15, 2002 (the "Credit Agreement"), among the Borrower,
the lending institutions party thereto (the "Banks"), Fleet National Bank and
SunTrust Bank, as Co-Syndication Agents, Wachovia Corporation, as Documentation
Agent, and Xxxxx Fargo Bank Texas, National Association, as administrative agent
for the Banks (the "Agent"). I have been requested to render this opinion
pursuant to Section 3.1(a)(iv) of the Credit Agreement. Unless otherwise defined
herein, capitalized terms used herein shall have the same meanings herein as
defined in the Credit Agreement. For purposes of this opinion, the Borrower and
the Guarantors are collectively referred to as the "Loan Parties".
In connection with this opinion, I have examined and relied upon the
originals, or copies certified or otherwise identified to my satisfaction, of
such corporate documents and records of the Loan Parties and have received such
information from officers and representatives of the Loan Parties as I have
deemed necessary or appropriate to enable me to express the opinions expressed
below. I have also relied on certificates of officers of the Loan Parties and
certificates of public officials as to certain factual matters. For purposes of
this opinion, I have also examined each of the Credit Documents.
In rendering my opinion, I have assumed (a) the genuineness of all
signatures, (b) the authenticity of all documents submitted to me as originals,
(c) the conformity to authentic original documents of all documents submitted to
me as certified, conformed or photostatic copies, and (d) the due authorization,
execution and delivery of all documents referred to herein by the parties
thereto other than the Loan Parties.
Based on the foregoing and subject to the further assumptions,
qualifications and limitations set forth below, and as may be disclosed in the
Credit Documents, I am of the opinion that:
1. Each of the Loan Parties is a corporation duly incorporated or limited
liability company duly organized, validly existing and in good standing
under the laws of the jurisdictions of its incorporation or
organization (as applicable).
2. Each of the Loan Parties has the requisite power to own or hold under
lease its assets and to carry on its businesses as now being conducted
and as proposed to be conducted.
3. Each of the Loan Parties is duly qualified as a foreign entity and is
authorized to do business in each jurisdiction where the character of
the properties owned or held under lease by it or the nature of the
business transacted by it makes such qualification necessary and where
failure to so qualify would have a material adverse effect on the
business, operations or financial condition of any of the Loan Parties.
4. To my knowledge after due inquiry, there are no legal or arbitral
proceedings or any proceedings by or before any governmental or
regulatory authority or agency, now pending or threatened against or
affecting any of the Loan Parties or the rights of any of the Loan
Parties which could reasonably be expected to have a material adverse
effect on the financial condition, operations or business of any of the
Loan Parties or the ability of any of the Loan Parties to perform its
respective obligations under the Credit Documents.
5. None of (a) the execution and delivery of the Credit Documents, (b) the
consummation of the transactions therein contemplated, or (c)
compliance with the terms and provisions thereof will (i) violate or
result in a breach of, or require any consent under, the certificate or
articles, as the case may be, of incorporation or organization or
bylaws or other constitutional document of any of the Loan Parties, or
any law or regulation applicable to any of the Loan Parties, or any of
their respective properties, or any order, writ, injunction or decree
of any court or Governmental Authority or agency known to us after due
inquiry, (ii) violate or result in a breach of or a default under any
material agreement, document or instrument to which any of the Loan
Parties is a party or by which any of the Loan Parties or their
respective properties are bound, known to us after due inquiry (a
"Material Contract"), or (iii) except for the Liens permitted by the
Agreement, result in the creation or imposition of any Lien upon any of
the revenues or assets of any of the Loan Parties pursuant to the terms
of any such Material Contract.
6. Each of the Loan Parties has all necessary power and authority to
execute, deliver and perform its respective obligations under the
Credit Documents to which it is a party, and the execution, delivery
and performance by each of the Loan Parties of the Credit
Documents to which it is a party and the obligations thereunder have
been duly authorized by all necessary action.
7. Each of the Credit Documents to which any Loan Party is a party have
been duly and validly executed and delivered by such Loan Party and
constitutes the legal, valid and binding obligations of such Loan Party
enforceable against it in accordance with their respective terms,
except that the enforceability thereof may be limited (a) by
bankruptcy, insolvency, reorganization, fraudulent conveyance or
moratorium or other similar laws relating to the enforcement of
creditors' rights generally and (b) by general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law).
8. No authorizations, approvals or consents of, or filings or
registrations with, any governmental or regulatory authority or agency
are necessary for the execution, delivery or performance by any of the
Loan Parties of the Credit Documents to which it is a party, except for
authorizations, consents and approvals that have already been obtained
and filings which have already been made.
9. Neither the Borrower nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying margin stock
(within the meaning of Regulation U or X of the Board of Governors of
the Federal Reserve System).
10. Neither the Borrower nor any of its Subsidiaries is an "investment
company" or a company "controlled" by an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
11. Neither the Borrower nor any of its Subsidiaries is a "holding company"
or a "subsidiary of a holding company" or an "affiliate" of a "holding
company" or a "public utility" within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
The opinions expressed herein are as of the date hereof only, and I
assume no obligation to update or supplement such opinions to reflect any fact
or circumstance that may hereafter come to my attention or any change in law
that may occur or become effective.
The foregoing opinion is, with your concurrence, predicated upon and
qualified in its entirety by the following:
I am a member of the Bar of the State of Arkansas, and I express no
opinion as to the laws of any jurisdiction, other than the Federal Laws
of the United States of America, the Laws of the State of Arkansas, and
the Delaware General Corporation Law. Insofar as the foregoing opinion
involves agreements that purport to be governed by Texas or other
states' laws, I have assumed that such law is the same as the Law of
the State of Arkansas.
This opinion is solely for your benefit and may not be relied upon by
any person other than you and your counsel and any of your assignees and
participants.
Very truly yours,
Xxxxxxx X. Xxxxxx
