1
EXHIBIT 10.8
UNICCO SERVICE COMPANY
USC, INC.
UNICCO SECURITY SERVICES, INC.
(f/k/a XXXXX ALLIED SECURITY SERVICES, INC.)
UNICCO GOVERNMENT SERVICES, INC.
(f/k/a XXXXX ALLIED EASTERN STATES MAINTENANCE CORPORATION)
NOTE PURCHASE AGREEMENT
DATED AS OF JUNE 28, 1996
2
NOTE PURCHASE AGREEMENT
DATED AS OF JUNE 28, 1996
INDEX
Page
ARTICLE I .............................................................. 1
PURCHASE, SALE AND TERMS OF NOTES ...................................... 1
1.01. The Notes .................................................... 1
1.02. Purchase and Sale of Notes ................................... 1
(a) The Closing .................................................. 1
(b) Commitment Fee ............................................... 2
(c) Use of Proceeds .............................................. 2
1.03. Payments and Endorsements .................................... 2
1.04. Redemptions .................................................. 2
(a) Required Redemptions ......................................... 2
(b) Optional Redemptions Without Premium ......................... 2
(c) Optional Redemptions With Premium ............................ 2
(d) Notice of Redemptions; Pro Rata Redemptions .................. 3
1.05. Payment on Non-Business Days ................................. 3
1.06. Registration, etc ............................................ 3
1.07. Transfer and Exchange of Notes ............................... 3
1.08. Replacement of Notes ......................................... 4
1.09. Subordination ................................................ 4
(a) Payment of Senior Debt ....................................... 4
(b) No Payment on Notes Under Certain Conditions ................. 5
(c) Payments Held in Trust ....................................... 5
(d) Subrogation .................................................. 5
(e) Scope of Section ............................................. 5
(f) Survival of Rights ........................................... 6
(g) Amendment or Waiver .......................................... 6
(h) Senior Debt Defined .......................................... 6
(i) Subordination Agreement ...................................... 6
1.10. Representations by the Purchaser ............................. 7
1.11. Disclosure of Information by the Purchaser ................... 7
ARTICLE II ............................................................. 7
CONDITIONS TO PURCHASER'S OBLIGATION ................................... 7
2.01. Representations and Warranties ............................... 7
2.02. Documentation at Closing ..................................... 7
2.03. Other Transactions ........................................... 9
(i)
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Page
ARTICLE III ............................................................ 9
REPRESENTATIONS AND WARRANTIES ......................................... 9
3.01. Organization and Standing .................................... 9
3.02. Corporate Action ............................................. 10
3.03. Governmental Approvals ....................................... 10
3.04. Litigation ................................................... 10
3.05. Compliance with Other Instruments ............................ 11
3.06. Federal Reserve Regulations .................................. 11
3.07. Title to Assets, Patents ..................................... 11
3.08. Financial Information ........................................ 12
3.09. Taxes ........................................................ 12
3.10. ERISA ........................................................ 13
3.11. Transactions with Affiliates ................................. 13
3.12. Assumptions or Guaranties of Indebtedness of Other Persons ... 13
3.13. Investments in Other Persons ................................. 13
3.14. Equal Employment Opportunity ................................. 13
3.15. Status of Notes as Qualified Investments ..................... 14
3.16. Securities Act ............................................... 14
3.17. Disclosure ................................................... 14
3.18. No Brokers or Finders ........................................ 15
3.19. Other Agreements of Officers ................................. 15
3.20. Capitalization; Status of Capital Stock ...................... 15
3.21. Labor Relations .............................................. 15
3.22. Insurance .................................................... 15
3.23. Books and Records ............................................ 15
3.24. Foreign Corrupt Practices Act ................................ 16
3.25. Assets Acquisition ........................................... 16
3.26. Solvency, Etc ................................................ 16
3.27. Interdependence of the Companies ............................. 16
ARTICLE IV ............................................................. 17
COVENANTS OF THE COMPANIES ............................................. 17
4.01. Affirmative Covenants Other Than Reporting Requirements ...... 17
(a) Punctual Payment ............................................. 17
(b) Payment of Taxes and Trade Debt .............................. 17
(c) Maintenance of Insurance ..................................... 17
(d) Preservation of Corporate Existence .......................... 17
(e) Compliance with Laws ......................................... 18
(f) Visitation Rights ............................................ 18
(g) Keeping of Records and Books of Account ...................... 18
(h) Maintenance of Properties, etc ............................... 18
(i) Compliance with ERISA ........................................ 18
(j) Maintenance of Indebtedness Ratio ............................ 18
(ii)
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Page
(k) Maintenance of Fixed Charge Ratio ............................ 19
(l) Foreign Corrupt Practices Act ................................ 19
(m) Equal Employment Opportunity ................................. 19
(n) Status of Notes as Qualified Investments ..................... 20
(o) Compensation ................................................. 20
4.02. Negative Covenants ........................................... 20
(a) Liens ........................................................ 20
(b) Indebtedness ................................................. 21
(c) Lease Obligations ............................................ 21
(d) Assumptions or Guaranties of Indebtedness of Other Persons ... 22
(e) Mergers, Sale of Assets, etc ................................. 22
(f) Investments in Other Persons ................................. 22
(g) Distributions ................................................ 23
(h) Dealings with Affiliates ..................................... 24
(i) Maintenance of Ownership of Subsidiaries ..................... 24
(j) Change in Nature of Business ................................. 24
(k) Junior Subordinated Notes .................................... 24
4.03. Reporting Requirements ....................................... 24
ARTICLE V .............................................................. 26
EVENTS OF DEFAULT ...................................................... 26
5.01. Events of Default ............................................ 26
5.02. Annulment of Defaults ........................................ 27
ARTICLE VI ............................................................. 28
DEFINITIONS AND ACCOUNTING TERMS ....................................... 28
6.01. Certain Defined Terms ........................................ 28
6.02. Accounting Terms ............................................. 31
ARTICLE VII ............................................................ 31
MISCELLANEOUS .......................................................... 31
7.01. No Waiver; Cumulative Remedies ............................... 31
7.02. Amendments, Waivers and Consents ............................. 32
7.03. Addresses for Notices, etc ................................... 32
7.04. Costs, Expenses and Taxes .................................... 33
7.05. Binding Effect; Assignment ................................... 33
7.06. Survival of Representations and Warranties ................... 33
7.07. Prior Agreements ............................................. 33
7.08. Severability ................................................. 33
7.09. Governing Law ................................................ 34
7.10. Headings ..................................................... 34
(iii)
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Page
7.11. Sealed Instrument ............................................ 34
7.12. Counterparts ................................................. 34
7.13. Further Assurances ........................................... 34
EXHIBITS
1.01 Form of Promissory Notes
3.01 Schedule of Affiliates
3.04 Schedule of Litigation
3.05 Schedule of Indebtedness
3.07 Schedule of Mortgages, Pledges, etc.
3.11 Schedule of Transactions with Affiliates
3.15 Certificate re "Qualified Investments"
3.20 Schedule of Capital Stock, Options and Other Rights
(iv)
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UNICCO SERVICE COMPANY
USC, INC.
UNICCO SECURITY SERVICES, INC.
(f/k/a OGDEN ALLIED SECURITY SERVICES, INC.)
UNICCO GOVERNMENT SERVICES, INC.
(f/k/a OGDEN ALLIED EASTERN STATES MAINTENANCE CORPORATION)
0 XXXXXX XXXXX
XXXXXX, XXXXXXXXXXXXX 00000
AS OF JUNE 28, 1996
MASSACHUSETTS CAPITAL RESOURCE COMPANY
000 XXXXXXXX XXXXXX
XXXXXX, XXXXXXXXXXXXX 00000
RE: PROMISSORY NOTES DUE 2001
GENTLEMEN:
Unicco Service Company ("Unicco"), a Massachusetts business trust
organized under the laws of the Commonwealth of Massachusetts, USC, Inc., a
Massachusetts corporation, Unicco Security Services, Inc. (f/k/a Ogden Allied
Security Services, Inc.), a Delaware corporation, and Unicco Government
Services, Inc. (f/k/a Ogden Allied Eastern States Maintenance Corporation), a
Delaware corporation(individually, a "Company" and collectively, the
"Companies"), hereby, jointly and severally, agree with Massachusetts Capital
Resource Company, a Massachusetts special purpose limited partnership (the
"Purchaser") as follows:
ARTICLE I
PURCHASE, SALE AND TERMS OF NOTES
1.01. THE NOTES. The Companies have authorized the issuance and sale to
the Purchaser of the Companies' Promissory Notes, due September 30, 2001, in the
original principal amount of $5,000,000. The Promissory Notes shall be
substantially in the form set forth in Exhibit 1.01 hereto and are herein
referred to individually as a "Note" and collectively as the "Notes", which
terms shall also include any notes delivered in exchange or replacement
therefor.
1.02. PURCHASE AND SALE OF NOTES.
(a) THE CLOSING. The Companies agree to issue and sell to the
Purchaser, and, subject to and in reliance upon the representations, warranties,
terms and conditions of this Agreement, the Purchaser agrees to purchase, the
Notes for an aggregate purchase price of $5,000,000. Such purchase and sale
shall take place at a closing (the "Closing") to be held at the office of Xxxxx,
Xxxxxxx & Xxxxxxxxx, LLP, High Street Tower, 000 Xxxx Xxxxxx, Xxxxxx,
0
Xxxxxxxxxxxxx, 00000, on June 28, 1996 at 1:00 P.M., or on such other date and
at such time and place as may be mutually agreed upon. At the Closing the
Companies will initially issue one Note, payable to the order of the Purchaser,
in the principal amount of $5,000,000, against receipt by the Companies (or such
payee as the Companies may direct) of a wire transfer in the amount of
$5,000,000, in payment of the full purchase price for the Notes.
(b) COMMITMENT FEE. At the Closing, the Companies will pay to the
Purchaser, by check or wire transfer, a non-refundable commitment fee of Fifty
Thousand Dollars ($50,000).
(c) USE OF PROCEEDS. The Companies agree to use the full proceeds
from the sale of the Notes solely to help fund the acquisition of assets
referred to in Section 3.26 and for working capital and agree that full proceeds
from the sale of the Notes will be utilized for purposes which increase or
maintain equal opportunity employment in the Commonwealth of Massachusetts.
1.03. PAYMENTS AND ENDORSEMENTS. Payments of principal, interest and
premium, if any, on the Notes, shall be made directly by check duly mailed or
delivered to the Purchaser at its address referred to in Section 7.03 hereof,
without any presentment or notation of payment, except that prior to any
transfer of any Note, the holder of record shall endorse on such Note a record
of the date to which interest has been paid and all payments made on account of
principal of such Note.
1.04. REDEMPTIONS.
(a) REQUIRED REDEMPTIONS. On the stated or accelerated maturity
date of the Notes, the Companies will redeem, without premium, the entire
principal amount of the Notes then outstanding, together with all accrued and
unpaid interest then due thereon. No optional redemption of less than all of the
Notes shall affect the obligation of the Companies to make the redemption
required by this subsection.
(b) OPTIONAL REDEMPTIONS WITHOUT PREMIUM. The Companies may, at
any time and from time to time, on and after July 1, 1999 (no optional
redemptions being permitted prior to that date), redeem, without premium, up to
$250,000 in principal amount of the Notes (in integral multiples of $50,000) in
each calendar quarter, together with interest due on the amount so redeemed
through the date of redemption. The right of redemption under this subsection
1.04(b) shall not be cumulative.
(c) OPTIONAL REDEMPTIONS WITH PREMIUM. In addition to the
redemptions of the Notes permitted under subsection 1.04(b), the Companies may
at any time and from time to time, on and after July 1, 1999 (no redemptions
under this subsection being permitted prior to that date), redeem all or any
portion of the Notes not redeemed pursuant to subsection 1.04(b), in whole or in
part, (in integral multiples of $50,000), together with interest due on the
amount so redeemed through the date of redemption, and a premium equal to ten
percent (10%) of the principal amount of the Notes so redeemed.
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(d) NOTICE OF REDEMPTIONS; PRO RATA REDEMPTIONS. Notice of any
optional redemptions pursuant to subsections 1.04(b) or (c) shall be given to
all registered holders of the Notes at least ten (10) business days prior to the
date of such redemption. Each redemption of Notes pursuant to subsections
1.04(a), (b) or (c) shall be made so that the Notes then held by each holder
shall be redeemed in a principal amount which shall bear the same ratio to the
total principal amount of Notes being redeemed as the principal amount of Notes
then held by such holder bears to the aggregate principal amount of the Notes
then outstanding.
1.05. PAYMENT ON NON-BUSINESS DAYS. Whenever any payment to be made
shall be due on a Saturday, Sunday or a public holiday under the laws of the
Commonwealth of Massachusetts, such payment may 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 due.
1.06. REGISTRATION, ETC. Unicco, on behalf of itself and each of the
other Companies shall maintain at its principal office a register of the Notes
and shall record therein the names and addresses of the registered holders of
the Notes, the address to which notices are to be sent and the address to which
payments are to be made as designated by the registered holder if other than the
address of the holder, and the particulars of all transfers, exchanges and
replacements of Notes. No transfer of a Note shall be valid unless made on such
register for the registered holder or his executors or administrators or his or
their duly appointed attorney, upon surrender therefor for exchange as
hereinafter provided, accompanied by an instrument in writing, in form and
execution reasonably satisfactory to Unicco. Each Note issued hereunder, whether
originally or upon transfer, exchange or replacement of a Note or Notes, shall
be registered on the date of execution thereof by the Companies and shall be
dated the date to which interest has been paid on such Notes or Note. The
registered holder of a Note shall be that Person in whose name the Note has been
so registered by Unicco. A registered holder shall be deemed the owner of a Note
for all purposes of this Agreement and, subject to the provisions hereof, shall
be entitled to the principal, premium, if any, and interest evidenced by such
Note free from all equities or rights of setoff or counterclaim between the
Companies, or any of them, and the transferor of such registered holder or any
previous registered holder of such Note.
1.07. TRANSFER AND EXCHANGE OF NOTES. Subject to compliance with
federal and applicable state securities laws, the registered holder of any Note
or Notes may, prior to maturity or prepayment thereof, surrender such Note or
Notes at the principal office of Unicco for transfer or exchange. Within a
reasonable time after notice to Unicco from a registered holder of its intention
to make such exchange and without expense (other than transfer taxes, if any) to
such registered holder, the Companies shall issue in exchange therefor another
Note or Notes, in such denominations as requested by the registered holder, for
the same aggregate principal amount as the unpaid principal amount of the Note
or Notes so surrendered and having the same maturity and rate of interest,
containing the same provisions and subject to the same terms and conditions as
the Note or Notes so surrendered. Each new Note shall be made payable to such
Person or Persons, or registered assigns, as the registered holder of such
surrendered Note or Notes may designate, and such transfer or exchange shall be
made in such a manner that no gain or loss of principal or interest shall result
therefrom.
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1.08. REPLACEMENT OF NOTES. Upon receipt of evidence satisfactory to
Unicco of the loss, theft, destruction or mutilation of any Note and, if
requested in the case of any such loss, theft or destruction, upon delivery of
an indemnity bond or other agreement or security reasonably satisfactory to
Unicco, or, in the case of any such mutilation, upon surrender and cancellation
of such Note, the Companies will issue a new Note, of like tenor and amount and
dated the date to which interest has been paid, in lieu of such lost, stolen,
destroyed or mutilated Note; provided, however, if any Note of which
Massachusetts Capital Resource Company, its nominee, or any of its partners is
the registered holder is lost, stolen or destroyed, the affidavit of the
President, Treasurer or any Assistant Treasurer of the registered holder setting
forth the circumstances with respect to such loss, theft or destruction shall be
accepted as satisfactory evidence thereof, and no indemnification bond or other
security shall be required as a condition to the execution and delivery by the
Companies of a new Note in replacement of such lost, stolen or destroyed Note
other than the registered holder's written agreement to indemnify the Companies.
1.09. SUBORDINATION. Each Company, for itself, its successors and
assigns, covenants and agrees, and the Purchaser and each successor holder of
the Notes by his or its acceptance thereof, likewise covenants and agrees, that
notwithstanding any other provision of this Agreement or the Notes, the payment
of the principal of and interest on each and all of the Notes shall be
subordinated in right of payment, to the extent and in the manner hereinafter
set forth, to the prior payment in full of all Senior Debt (as hereinafter
defined) at any time outstanding. The provisions of this Section 1.09 shall
constitute a continuing representation to all Persons who, in reliance upon such
provisions, become the holders of or continue to hold Senior Debt, and such
provisions are made for the benefit of the holders of Senior Debt, and such
holders are hereby made obligees hereunder the same as if their names were
written herein as such, and they or any of them may proceed to enforce such
provisions against any Company or against the holder of any Note without the
necessity of joining any Company as a party.
(a) PAYMENT OF SENIOR DEBT. In the event of any insolvency or
bankruptcy proceedings, or any receivership, liquidation, reorganization or
other similar proceedings in connection therewith, relative to the Companies or
to their property, or, in the event of any proceedings for voluntary
liquidation, dissolution or other winding up of the Companies or distribution or
marshaling of its assets or any composition with creditors of the Companies,
whether or not involving insolvency or bankruptcy, then and in any such event
all Senior Debt shall be paid in full before any payment or distribution of any
character, whether in cash, securities or other property, shall be made on
account of the Notes; and any such payment or distribution, except securities
which are subordinated and junior in right of payment to the payment of all
Senior Debt then outstanding on terms of substantially the same tenor as this
Section 1.09, which would, but for the provisions hereof, be payable or
deliverable in respect of the Notes shall be paid or delivered directly to the
holders of Senior Debt (or their duly authorized representatives), in the
proportions in which they hold the same, until all Senior Debt shall have been
paid in full, and every holder of the Notes by becoming a holder thereof shall
have designated and appointed the holder or holders of Senior Debt (and their
duly authorized representatives) as his or its agents and attorney-in-fact to
demand, xxx for, collect and receive such Senior Debt holder's ratable share of
all such payments and distributions and to file any
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necessary proof of claim therefor and to take all such other action in the name
of the holders of the Notes or otherwise, as such Senior Debt holders (or their
authorized representatives) may determine to be necessary or appropriate for the
enforcement of this Section 1.09. The Purchaser and each successor holder of the
Notes by its or his acceptance thereof agrees to execute, at the request of the
Companies, a separate agreement with any holder of Senior Debt on the terms set
forth in this Section 1.09, and to take all such other action as such holder or
such holder's representative may request in order to enable such holder to
enforce all claims upon or in respect of such holder's ratable share of the
Notes.
(b) NO PAYMENT ON NOTES UNDER CERTAIN CONDITIONS. In the event
that any default occurs in the payment of the principal of or interest on any
Senior Debt (whether as a result of the acceleration thereof by the holders of
such Senior Debt or otherwise) and during the continuance of such default for a
period up to ninety (90) days and thereafter if judicial proceedings shall have
been instituted with respect to such defaulted payment, or (if a shorter period)
until such payment has been made or such default has been cured or waived in
writing by such holder of Senior Debt then and during the continuance of such
event no payment of principal or interest on the Notes shall be made by the
Companies or accepted by any holder of the Notes who has received notice from
the Companies or from a holder of Senior Debt of such events.
(c) PAYMENTS HELD IN TRUST. In case any payment or distribution
shall be paid or delivered to any holder of the Notes before all Senior Debt
shall have been paid in full, despite or in violation or contravention of the
terms of this subordination, such payment or distribution shall be held in trust
for and paid and delivered ratably to the holders of Senior Debt (or their duly
authorized representatives), until all Senior Debt shall have been paid in full.
(d) SUBROGATION. Subject to the payment in full of all Senior
Debt and until the Notes shall be paid in full, the holders of the Notes shall
be subrogated to the rights of the holders of Senior Debt (to the extent of
payments or distributions previously made to such holders of Senior Debt
pursuant to the provisions of subsections (a) and (c) of this Section 1.09) to
receive payments or distributions of assets of the Companies applicable to the
Senior Debt. No such payments or distributions applicable to the Senior Debt
shall, as between the Companies and their creditors, other than the holders of
Senior Debt and the holders of the Notes, be deemed to be a payment by the
Companies to or on account of the Notes; and for the purposes of such
subrogation, no payments or distributions to the holders of Senior Debt to which
the holders of the Notes would be entitled except for the provisions of this
Section 1.09 shall, as between the Companies and their creditors, other than the
holders of Senior Debt and the holders of the Notes, be deemed to be a payment
by the Companies to or on account of the Senior Debt.
(e) SCOPE OF SECTION. The provisions of this Section 1.09 are
intended solely for the purpose of defining the relative rights of the holders
of the Notes, on the one hand, and the holders of the Senior Debt, on the other
hand. Nothing contained in this Section 1.09 or elsewhere in this Agreement or
the Notes is intended to or shall impair, as between the Companies, their
creditors other than the holders of Senior Debt, and the holders of the Notes,
the obligation of the Companies, which is unconditional and absolute, to pay to
the holders of the
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Notes the principal of and interest on the Notes as and when the same shall
become due and payable in accordance with the terms thereof, or to affect the
relative rights of the holders of the Notes and creditors of the Companies other
than the holders of the Senior Debt, nor shall anything herein or therein
prevent the holder of any Note from accepting any payment with respect to such
Note or exercising all remedies otherwise permitted by applicable law upon
default under such Note, subject to the rights, if any, under this Section 1.09
of the holders of Senior Debt in respect of cash, property or securities of the
Companies received by the holders of the Notes.
(f) SURVIVAL OF RIGHTS. The right of any present or future holder
of Senior Debt to enforce subordination of the Notes pursuant to the provisions
of this Section 1.09 shall not at any time be prejudiced or impaired by any act
or failure to act on the part of the Companies or any such holder of Senior
Debt, including, without limitation, any forbearance, waiver, consent,
compromise, amendment, extension, renewal, or taking or release of security of
or in respect of any Senior Debt or by noncompliance by the Companies with the
terms of such subordination regardless of any knowledge thereof such holder may
have or otherwise be charged with.
(g) AMENDMENT OR WAIVER. The provisions of this Section 1.09 may
not be amended or waived in any manner which is detrimental to any Senior Debt
without the consent of the holders of all then existing Senior Debt.
(h) SENIOR DEBT DEFINED. The term "Senior Debt" shall mean (i)
all Indebtedness of the Companies for money borrowed from banks or other
institutional lenders, including any extension or renewals or refinancings
thereof, whether outstanding on the date hereof or thereafter created or
incurred, which is not by its terms subordinate and junior to or on a parity
with the Notes and which is permitted hereby at the time it is created or
incurred, and (ii) all guaranties by the Companies which are not by their terms
subordinate and junior to or on a parity with the Notes and which are permitted
hereby at the time they are made, of Indebtedness of any Affiliate if such
Indebtedness would have been Senior Debt pursuant to the provisions of clause
(i) of this sentence had it been Indebtedness of the Companies; provided,
however, that the sum of all such Senior Debt under clauses (i) and (ii) shall
not exceed the principal amount of $110,000,000 at any one time outstanding . In
making any loans which are (or the guaranties of which are) intended to be
Senior Debt, the lenders or purchasers shall be entitled to rely as to the fact
that such Indebtedness or guaranty is permitted hereby upon a certificate by the
Companies' chief financial officers purporting to show such Indebtedness or
guaranty will not result in the Companies' failure to comply with the provisions
of Article IV hereof as of the date of the loan or guarantee.
(i) SUBORDINATION AGREEMENT Notwithstanding this Section 1.09,
the terms and conditions of that certain Subordination Agreement of even date
herewith by and among the Purchaser, the Companies, The First National Bank of
Boston and Fleet National Bank shall be deemed to supersede and replace all of
the provisions of this Section 1.09 for as long as such Subordination Agreement
shall be in full force and effect.
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1.10. REPRESENTATIONS BY THE PURCHASER. The Purchaser represents that:
(i) it is its present intention to acquire the Notes for its own account and
that the Notes are being and will be acquired for the purpose of investment and
not with a view to distribution or resale thereof; subject, nevertheless, to the
condition that the disposition of the property of the Purchaser shall at all
times be within its control; and (ii) the Purchaser has taken all necessary
partnership action to authorize the acquisition by it of the Notes. The
acquisition by the Purchaser of the Notes shall constitute a confirmation of
this representation.
1.11. DISCLOSURE OF INFORMATION BY THE PURCHASER. Each Company
understands that the Purchaser is a special purpose limited partnership
organized under Chapter 109 of the General Laws of the Commonwealth of
Massachusetts and Chapter 816 of the Acts and Resolves of 1977 of the
Commonwealth of Massachusetts (the "Capital Resource Company Act"), and as such,
in accordance with such provisions, the Purchaser, in order to obtain certain
benefits for itself and its partners, is required to file certain reports and
otherwise disclose information relating to the business, financial affairs, and
future prospects of the Companies and their affiliates (as defined in the
aforesaid legislation) with the Clerk of the Senate and the Clerk of the House
of Representatives of the General Court of the Commonwealth of Massachusetts,
the Secretary of Manpower Affairs, the Commissioner of Insurance and the
Department of Revenue of the Commonwealth of Massachusetts, and that such
reports and other information may constitute "public records" within the purview
of Section 7 of Chapter 4 of the General Laws of the Commonwealth of
Massachusetts. In addition, information relating to the business, financial
affairs and future prospects of the Companies and their affiliates must be
disclosed to others in order to obtain independent confirmation that financing
on substantially similar terms to financing provided pursuant to this Agreement
was not elsewhere available to the Companies. Each Company hereby authorizes the
Purchaser to disclose all such information relating to the business, financial
affairs and future prospects of the Companies and their affiliates as has been
or may in the future be presented to the Purchaser to all such persons as the
Purchaser in good xxxxx xxxxx necessary or appropriate in order to fulfill its
obligations under the Capital Resource Company Act.
ARTICLE II
CONDITIONS TO PURCHASER'S OBLIGATION
The obligation of the Purchaser to purchase and pay for the Notes at
the Closing is subject to the following conditions:
2.01. REPRESENTATIONS AND WARRANTIES. Each of the representations and
warranties of the Company set forth in Article III hereof shall be true on the
date of the Closing.
2.02. DOCUMENTATION AT CLOSING. The Purchaser shall have received prior
to or at the Closing all of the following, each in form and substance
satisfactory to the Purchaser and its counsel:
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(a) A Limited Recourse Guarantee, in favor of the Purchaser,
shall have been executed and delivered to the Purchaser by each of Xxxxxx X.
Xxxxxxxx and Unicco Facility Services Canada Company, a Nova Scotia unlimited
liability company ("U-Canada"), each such Limited Recourse Guarantee to be in
form and substance acceptable to the Purchaser.
(b) A Pledge Agreement between the Purchaser and Xxxxxx X.
Xxxxxxxx granting the Purchaser a second priority and recourse pledge in all of
the shares of any class of capital stock of Ashmont Insurance Company Limited, a
Bermuda exempted company ("Ashmont"), now or hereafter owned by Xxxxxx X.
Xxxxxxxx, shall have been executed and delivered to the Purchaser, such Pledge
Agreement to be in form and substance acceptable to the Purchaser.
(c) A certified copy of all charter documents of each Company; a
certified copy of the resolutions of the Trustees or directors, as the case may
be, and, to the extent required, the stockholders of each Company evidencing
approval of this Agreement, the Notes and other matters contemplated hereby; a
certified copy of the By-laws, if any, of each Company; and certified copies of
all documents evidencing other necessary corporate or other action and
governmental approvals, if any, with respect to this Agreement and the Notes.
(d) A favorable opinion of Posternak, Xxxxxxxxxx & Xxxx, L.L.P.,
counsel for each Company and for Xxxxxx X. Xxxxxxxx, in form and substance
satisfactory to the Purchaser, and a favorable opinion of counsel for U-Canada,
in form and substance satisfactory to the Purchaser..
(e) A certificate of the Secretary or Clerk or an Assistant
Secretary or Assistant Clerk of each Company which shall certify the names of
the officers of such Company, authorized to sign this Agreement, the Notes and
the other documents or certificates to be delivered pursuant to this Agreement
by such Company, or any of its officers, together with the true signatures of
such officers. The Purchaser may conclusively rely on such certificates until it
shall receive a further certificate of the Secretary or Clerk or an Assistant
Secretary or Assistant Clerk of such Company canceling or amending the prior
certificate and submitting the signatures of the officers named in such further
certificate.
(f) A certificate from a duly authorized officer of each Company
stating that: (i) the representations and warranties of the Companies contained
in Article III hereof and otherwise made by the Companies in writing in
connection with the transactions contemplated hereby are true and correct, (ii)
all of the transactions set forth in Section 2.03 have been consummated and
(iii) no condition or event has occurred or is continuing or will result from
execution and delivery of this Agreement or the Notes which constitute an Event
of Default or would constitute an Event of Default but for the requirement that
notice be given or time elapse or both.
(g) A certificate, in the form attached as Exhibit 3.15 hereto,
shall have been executed and delivered by a duly authorized officer of each
Company.
(h) Payment for the costs, expenses, taxes and filing fees
identified in Section 7.04 as to which the Purchaser gives Unicco notice prior
to the Closing.
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2.03. OTHER TRANSACTIONS. On or prior to the Closing, each of the
following transactions shall have been consummated:
(a) The closing under the Asset Purchase Agreement described in
Section 3.26 shall have been consummated and the Companies shall have acquired
all of the rights, title and interest in and to all of the assets to be acquired
by them in accordance with the Asset Purchase Agreement as described therein.
(b) The Companies shall have:
(i) consummated a revolving line of credit with The First
National Bank of Boston and Fleet National Bank for a sum of not less
than an aggregate of $48,000,000, such line of credit to be in form and
substance reasonably satisfactory to the Purchaser; and
(ii) consummated term loans with The First National Bank of
Boston and Fleet National Bank for a sum of not less than an aggregate
of $42,000,000, such term loans to be in form and substance reasonably
satisfactory to the Purchaser; and
(iii) received a sum of not less than $3,000,000 by way of a
capital contribution or Shareholder Subordinated Debt (which is
subordinated, on terms and conditions acceptable to the Purchaser, to
the Notes) from the existing shareholders of Unicco and/or Ashmont.
(c) Unicco and each seller under the Asset Purchase Agreement
described in Section 3.26 who receives a promissory note of Unicco in connection
with the payment of the purchase price thereunder (collectively, the "Junior
Subordinated Notes") shall have entered into a Subordination Agreement with the
Purchaser, such Subordination Agreement to be in form and substance satisfactory
to the Purchaser and the original aggregate principal of such Junior
Subordinated Notes to be in a sum of not less than $12,000,000, as may be
reduced pursuant to the adjustment mechanism provided by Section 1.03(b) of such
Asset Purchase Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Companies, jointly and severally, represent and warrant (which
representations and warranties give effect to the consummation of the
transactions described in Section 2.03 hereof) as follows:
3.01. ORGANIZATION AND STANDING. Each Company is a duly organized and
validly existing business trust or corporation in good standing under the laws
of the jurisdiction of its incorporation or formation and has all requisite
power and authority for the ownership and operation of its properties and for
the carrying on of its business as now conducted and as now proposed to be
conducted. Unicco has no Subsidiaries, other than a seventy nine percent (79%)
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equity interest in U-Canada. Each Company is duly licensed or qualified and in
good standing as a foreign trust or corporation, as the case may be, authorized
to do business in all jurisdictions wherein the character of the property owned
or leased, or the nature of the activities conducted, by it makes such licensing
or qualification necessary, except where the failure to be so licensed or
qualified would not have a material adverse effect on the Companies as a whole.
Attached hereto as Exhibit 3.01 is a schedule which correctly identifies the
Affiliates of the Companies as of the date hereof and shows with respect to each
Affiliate its jurisdiction of incorporation. All of the outstanding capital
stock of each Affiliate has been duly authorized and validly issued, is fully
paid and nonassessable, and is owned beneficially and of record by the Persons
indicated in Exhibit 3.01, free and clear of any lien, right, encumbrance or
restriction of any nature, including, without limitation, any lien, right,
encumbrance or restriction on transfer.
3.02. CORPORATE ACTION. Each Company has all necessary power and has
taken all action required to make all the provisions of this Agreement, the
Notes and any other agreements and instruments executed in connection herewith
and therewith the valid and enforceable obligations they purport to be. The
issuance of the Notes is not subject to preemptive or other similar statutory or
contractual rights and will not conflict with any provisions of any agreement or
instrument to which any Company or any Affiliate is a party or by which it is
bound.
3.03. GOVERNMENTAL APPROVALS. No authorization, consent, approval,
license, exemption of or filing or registration with any court or governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, is or will be necessary for, or in connection with, the offer,
issuance, sale, execution or delivery by any Company of, or for the performance
by it of its obligations under, this Agreement or the Notes, except as shall be
obtained on or prior to the Closing.
3.04. LITIGATION. Except as set forth in Exhibit 3.04, there is no
litigation or governmental proceeding or investigation pending or, to the best
of the knowledge of any Company, threatened against any Company or any Affiliate
affecting any of its properties or assets, or against any officer, key employee
or principal stockholder of any Company or any Affiliate where such litigation,
proceeding or investigation, either individually or in the aggregate, would have
a material adverse effect on the Companies and the Affiliates taken as a whole,
nor, to the best of the knowledge of any Company, has there occurred any event
or does there exist any condition on the basis of which any litigation,
proceeding or investigation might properly be instituted. No Company or
Affiliate, nor, to the best of the knowledge of any Company, any officer or key
employee of any Company or any Affiliate, or principal stockholder of any
Company or any Affiliate, is in default with respect to any material order,
writ, injunction, decree, ruling or decision of any court, commission, board or
other government agency known to any Company to be affecting any Company or any
Affiliate. There are no actions or proceedings pending or threatened (or any
basis therefor known to any Company) which might result, either in any case or
in the aggregate, in any material adverse change in the business, operations,
affairs or condition of the Companies and the Affiliates as a whole or in any of
their properties or assets, or which might call into question the validity of
this Agreement or the Notes or any action taken or to be taken pursuant hereto
or thereto.
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3.05. COMPLIANCE WITH OTHER INSTRUMENTS. Each Company and each
Affiliate is in compliance in all respects with the terms and provisions of this
Agreement and of its charter and by-laws and in all material respects with the
terms and provisions of the mortgages, indentures, leases, agreements and other
instruments and, to the knowledge of each Company, of all judgments, decrees,
governmental orders, statutes, rules and regulations by which it is bound or to
which its properties or assets are subject. There is no term or provision in any
of the foregoing documents and instruments which materially adversely affects
the business, assets or financial condition of any Company or any Affiliate.
Neither the execution and delivery of this Agreement or the Notes, nor the
consummation of any transactions contemplated hereby or thereby has constituted
or resulted in or will constitute or result in a default or violation of any
term or provision in any of the foregoing documents or instruments. A schedule
of Indebtedness of the Companies and each Affiliate for borrowed money
(including lease obligations required to be capitalized in accordance with
applicable Statements of Financial Accounting Standards) is attached as Exhibit
3.05.
3.06. FEDERAL RESERVE REGULATIONS. No Company or Affiliate is engaged
in the business of extending credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulation G of the Board of Governors of
the Federal Reserve System), and no part of the proceeds of the Notes will be
used to purchase or carry any margin security or to extend credit to others for
the purpose of purchasing or carrying any margin security or in any other manner
which would involve a violation of any of the regulations of the Board of
Governors of the Federal Reserve System.
3.07. TITLE TO ASSETS, PATENTS. Except as is set forth in Exhibit 3.07,
each Company and each Affiliate has good and clear record and marketable title
in fee to such of its fixed assets as are owned real property, and good and
merchantable title to all of its other assets, now carried on its books
including those reflected in the most recent combined/consolidated balance sheet
of each Company and its Affiliates delivered to the Purchaser pursuant to
Section 3.08 since the date of such balance sheet (except personal property
disposed of since said date in the ordinary course of business) free of any
mortgages, pledges, charges, liens, security interests or other encumbrances,
except as would not have a material adverse effect on the Companies and the
Affiliates as a whole. Except as set forth on Exhibit 3.07, each Company and
each Affiliate enjoys peaceful and undisturbed possession under all leases under
which it is operating, and all said leases are valid and subsisting and in full
force and effect. Each Company and each Affiliate owns or has a valid right to
use the patents, patent rights, licenses, permits, trade secrets, trademarks,
trademark rights, trade names or trade name rights or franchises, copyrights,
inventions and intellectual property rights being used to conduct its business
as now operated and as now proposed to be operated; and the conduct of its
business as now operated and as now proposed to be operated does not and will
not conflict in any material way with valid patents, patent rights, licenses,
permits, trade secrets, trademarks, trademark rights, trade names or trade name
rights or franchises, copyrights, inventions and intellectual property rights of
others. No Company or Affiliate has any obligation to compensate any Person for
the use of any such patents or such rights nor has any Company or any Affiliate
granted to any Person any license or other rights to use in any manner any of
such patents or such rights of any Company or any Affiliate.
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3.08. FINANCIAL INFORMATION. The Companies have furnished to the
Purchaser Unicco's financial statements for the two years ended June 26, 1994
and June 25, 1995, certified by Xxxxxx Xxxxxxxx LLP and for the ten-month period
ended April 30, 1996, being unaudited and subject to year-end adjustments
consisting of normal recurring items which will not be material in the
aggregate. The financial statements of Unicco so delivered present fairly the
financial position of Unicco as at the dates thereof and its results of
operations for the periods covered thereby and have been prepared in accordance
with generally accepted accounting principles consistently applied Since the
date of said Unicco certified financial statements, (i) there has been no
material adverse change in the business, assets or condition, financial or
otherwise, operations or prospects, of Unicco; (ii) neither the business,
condition, operations or prospects of Unicco nor any of its properties or assets
has been materially adversely affected as a result of any legislative or
regulatory change, any revocation or change in any franchise, license or right
to do business, or any other event or occurrence, whether or not insured
against; and (iii) Unicco has not entered into any material transaction or made
any distribution on its capital stock. The Companies have also furnished to the
Purchaser the consolidated and consolidating balance sheet of the Asset Sellers
as of December 31, 1995 and the consolidated and consolidating statements of
income, changes in stockholders' equity and cash flow of such Asset Sellers for
the fiscal year then ended and related footnotes, reviewed by Xxxxxx Xxxxxxxx in
a separate due diligence report provided to the Purchaser. The Companies have
also furnished to the Purchaser the consolidated and consolidating balance sheet
of the Asset Sellers as of March 31, 1996 and the consolidated and consolidating
statements of income, changes in stockholders' equity and cash flow of such
Asset Sellers for the fiscal quarter then ended, certified by the principal
financial officer of such Asset Sellers, but subject, however, to normal,
recurring year-end adjustments that shall not in the aggregate be material in
amount. The Companies have also furnished to the Purchaser the unaudited pro
forma consolidated and consolidating balance sheet of the Companies as at the
date of the Closing and its related unaudited consolidated and consolidating
statements of income, changes in stockholders' equity and cash flow for the
period ending on the date of the Closing, prepared as if this Agreement and all
of the transactions set forth in Section 2.03 had occurred as of the date of the
Closing. All such financial statements were prepared in accordance with
generally accepted accounting principles consistently applied and present fairly
the financial position of each Company and the Asset Sellers as of such dates
and the results of the operations of each Company and the Asset Sellers for such
periods. There are no liabilities, contingent or otherwise, not disclosed in any
of the foregoing financial statements or in the notes thereto that could,
together with all such other liabilities, materially adversely effect the
financial condition of the Companies as a whole, nor do the Companies have any
reasonable grounds to know of any such liability.
3.09. TAXES. Except as would not have a material adverse effect on the
Companies and the Affiliates as a whole, or as to taxes being contested in good
faith, each Company and each Affiliate has accurately prepared and timely filed
all federal, state and other tax returns required by law to be filed by it, and
all taxes shown to be due and all additional assessments have been paid or
provision made therefor. No Company knows of any additional assessments or
adjustments pending or threatened against any Company or any Affiliate for any
period, or of any basis for any such assessment or adjustment.
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3.10. ERISA. No employee benefit plan established or maintained, or to
which contributions have been made, by any Company or any Affiliate, which is
subject to part 3 of Subtitle B of Title I of The Employee Retirement Income
Security Act of 1974, as amended ("ERISA") had an accumulated funding deficiency
(as such term is defined in Section 302 of ERISA) as of the last day of the most
recent fiscal year of such plan ended prior to the date hereof, and no material
liability to the Pension Benefit Guaranty Corporation has been incurred with
respect to any such plan by any Company or any of its Subsidiaries.
3.11. TRANSACTIONS WITH AFFILIATES. Except as set forth in Exhibit
3.11, there are no loans, leases, royalty agreements or other continuing
transactions between any Company or any Affiliate and any Person owning five
percent (5%) or more of any class of capital stock of any Company or any
Affiliate or other entity controlled by such stockholder or a member of such
stockholder's family.
3.12. ASSUMPTIONS OR GUARANTIES OF INDEBTEDNESS OF OTHER PERSONS.
Except as contemplated under the Senior Debt, this Agreement or the Junior
Subordinated Notes, no Company or Affiliate has assumed, guaranteed, endorsed or
otherwise become directly or contingently liable on (including, without
limitation, liability by way of agreement, contingent or otherwise, to purchase,
to provide funds for payment, to supply funds to or otherwise invest in the
debtor or otherwise to assure the creditor against loss) any Indebtedness of any
other Person.
3.13. INVESTMENTS IN OTHER PERSONS. No Company or Affiliate has made
any loan for money borrowed to any Person which is outstanding on the date of
this Agreement, nor is any Company or any Affiliate obligated or committed to
make any such loan, nor does any Company or any Affiliate own any capital stock
or assets comprising the business of, obligations of, or any interest in, any
Person, except as is described or referenced in this Agreement.
3.14. EQUAL EMPLOYMENT OPPORTUNITY. Each Company has reviewed its
employment practices and policies and those of each Affiliate and, to the best
of its knowledge, each Company and each Affiliate is in full compliance with (a)
all applicable laws of the United States, of the Commonwealth of Massachusetts
and of each other applicable jurisdiction, relating to equal employment
opportunity (including, without limitation, Title VII of the Civil Rights Act of
1964, as amended (42 U.S.C. Section 000e-17), the Age Discrimination in
Employment Act of 1967, as amended (29 U.S.C. Sections 621-634), the Equal Pay
Act of 1963 (29 U.S.C. Section 206(d)), and any rules, regulations and
administrative orders and Executive Orders relating thereto; Mass. Gen. Laws. c.
151B, Mass. Gen. Laws c. 149 Section 24A et seq. and Section 105A et seq., and
any rules or regulations relating thereto; and (b) the applicable terms,
relating to equal employment opportunity, of any contract, agreement or grant
any Company or any Affiliate has with, from, or relating (by way of subcontract
or otherwise) to any other contract, agreement or grant of, any federal or state
governmental unit ("Government Contract"), including, without limitation, any
terms required pursuant to Federal Executive Order No. 11246 and Massachusetts
Executive Order No. 74 (both as amended). To the best of each Company's
knowledge, it and each Affiliate has kept all records required to be kept, and
has filed all reports, affirmative action plans and forms (including, without
limitation and where applicable, Form EEO-1) required to be filed pursuant to
any such applicable law or the terms of any such Government Contract. No
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Company or Affiliate has been subject to any adverse final determination or
order, with respect to any charge of employment discrimination made against it,
by the United States Equal Employment Opportunity Commission, the Massachusetts
Commission Against Discrimination or any other governmental unit (including,
without limitation, any such governmental unit with which it has a Government
Contract), and no Company or Affiliate is presently, to the best of the
Companies' knowledge, subject to any formal proceedings before, or
investigations by, such commissions or governmental units, except as is set
forth in Exhibit 3.04 or as would not have a material adverse effect on the
Companies and the Affiliates as a whole.
3.15. STATUS OF NOTES AS QUALIFIED INVESTMENTS. Each Company has duly
authorized the execution and delivery to the Purchaser, by Unicco, on its behalf
and on behalf of all of the other Companies, of the certificate attached as
Exhibit 3.15 hereto, setting forth such statements, information and related data
as are necessary to permit the Purchaser to determine and demonstrate that the
Notes issued pursuant to this Agreement will constitute "qualified investments"
within the meaning of that term as set forth in the Capital Resource Company Act
and that the full proceeds of the Notes will be used for purposes which will
materially increase or maintain equal opportunity employment in the Commonwealth
of Massachusetts. All such statements, information and related data presented in
such certificate as are not based on estimates and projections of future events
are true and correct as of the date of such certificate and all such statements,
information and related data based upon estimates or projections of future
events have been carefully considered and prepared on behalf of each Company.
3.16. SECURITIES ACT. No Company nor anyone acting on their behalf has
offered any of the Notes or similar securities, or solicited any offers to
purchase or made any attempt by preliminary conversation or negotiations to
dispose of the Notes or similar securities, to any Person, other than the
Purchaser or the institutions described in Exhibit 3.15. No Company nor anyone
acting on their behalf has offered or will offer to sell the Notes or similar
securities to, or solicit offers with respect thereto from, or enter into any
preliminary conversations or negotiations relating thereto with, any Person, so
as to bring the issuance and sale of the Notes under the registration provisions
of the Securities Act.
3.17. DISCLOSURE. Neither this Agreement, the financial statements
referred to in Section 3.08, the Certificate set forth as Exhibit 3.15 hereof,
nor any other agreement, document, certificate or written statement furnished to
the Purchaser or its counsel by or on behalf of any Company or any Affiliate in
connection with the transactions contemplated hereby contains any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements contained herein or therein not misleading. There
is no fact within the knowledge of any Company or any of its executive officers
which has not been disclosed herein or in writing by them to the Purchaser and
which materially adversely affects, or in the future in their opinion may,
insofar as they can now foresee, materially adversely affect the business,
properties, assets or condition, financial or otherwise, of the Companies and
the Affiliates as a whole, except for general economic or industry conditions
known to the public. Without limiting the foregoing, no Company has any
knowledge or belief that there exists, or there is pending or planned, any
patent, invention, device, application or principle or any statute, rule, law,
regulation, standard or
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code which would materially adversely affect the condition, financial or
otherwise, or the operations of any Company or any Affiliate.
3.18. NO BROKERS OR FINDERS. No Person has or will have, as a result of
the transactions contemplated by this Agreement, any right, interest or valid
claim against or upon any Company or any Affiliate for any commission, fee or
other compensation as a finder or broker because of any act or omission by any
Company or any Affiliate or any agent of any Company or any Affiliate.
3.19. OTHER AGREEMENTS OF OFFICERS. To the best of the knowledge of
each Company, no officer or key employee of any Company or any Affiliate is a
party to or bound by any agreement, contract or commitment, or subject to any
restrictions, particularly but without limitation in connection with any
previous employment of any such person, which materially and adversely affects,
or in the future may (so far as any Company can reasonably foresee) materially
and adversely affect, the business or operations of any Company or any Affiliate
or the right of any such person to participate in the affairs of any Company or
any Affiliate. To the best of the knowledge of any Company, no officer or key
employee has any present intention of terminating his employment with any
Company or any Affiliate and no Company or Affiliate has any present intention
of terminating any such agreement, except that officers and key employees of the
Asset Sellers are under no obligation to Unicco and Unicco makes no
representation herein as to their continued employment.
3.20. CAPITALIZATION; STATUS OF CAPITAL STOCK. Unicco has a total
authorized, issued and outstanding capitalization consisting of 1,093 common
shares of beneficial interest, of which 1,054 are issued and outstanding and 39
are held as Treasury shares. A complete list of the outstanding common shares of
Unicco and the names in which such common shares are registered is set forth in
Exhibit 3.20 hereto. All the outstanding common shares of Unicco have been duly
authorized, are validly issued and are fully paid and nonassessable. The
ownership of the outstanding capital stock of the each Company, other than
Unicco, is set forth on Exhibit 3.01 hereto.
3.21. LABOR RELATIONS. Except as is set forth on Exhibit 3.04, there
are no unfair labor practice charges, pending trials with respect to unfair
labor practice charges, pending material grievance proceedings or adverse
decisions of a Trial Examiner of the National Labor Relations Board against any
Company or any Affiliate which would have a material adverse effect on the
Companies and the Affiliates as whole. Furthermore, to the best of the knowledge
of each Company, relations with employees of each Company and each Affiliate are
good and there is no reason to believe that any labor difficulties will arise in
the foreseeable future.
3.22. INSURANCE. Each Company and each Affiliate carries insurance
covering its properties and business adequate and customary for the type and
scope of the properties and business, but in any event in amounts sufficient to
prevent any Company or any Affiliate from becoming a co-insurer.
3.23. BOOKS AND RECORDS. The books of account, ledgers, order books,
records and documents of each Company and each Affiliate accurately and
completely reflect all material
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information relating to the business of each Company and each Affiliate, the
nature, acquisition, maintenance, location and collection of the assets of each
Company and each Affiliate, and the nature of all transactions giving rise to
the obligations or accounts receivable of each Company and each Affiliate.
3.24. FOREIGN CORRUPT PRACTICES ACT. The Companies have reviewed their
practices and policies and that of each Affiliate and to the best of their
knowledge and belief neither they nor any Affiliate is engaged, nor has any
officer, director, employee or agent of any Company or any Affiliate engaged, in
any act or practice which would constitute a violation of the Foreign Corrupt
Practices Act of 1977, or any rules or regulations promulgated thereunder.
3.25. ASSETS ACQUISITION. The Purchase Agreement, dated as of May 3,
1996, as amended, among Xxxxx Entertainment Services, Inc., Xxxxx Facility
Services, Inc. and the other related entities named therein (collectively, the
"Asset Sellers") and Unicco (the "Asset Purchase Agreement") has been duly
authorized, executed and delivered by Unicco and the Asset Sellers and
constitutes the legal, valid and binding obligation of Unicco and the Asset
Sellers, enforceable in accordance with its terms, and the closing pursuant to
the Asset Purchase Agreement has occurred or will occur concurrently with the
Closing, and the Companies have acquired all of the rights, title and interest
in and to all of the assets to be acquired by them in accordance with the Asset
Purchase Agreement. All of the conditions provided for in the Asset Purchase
Agreement to occur prior to or simultaneously with the closing thereunder have
occurred or been waived. All of the representations and warranties of Unicco
and, to the best of the knowledge of Unicco, of the Asset Sellers, contained in
the Asset Purchase Agreement, including the schedules and exhibits thereto,
were, at the time of the closing, true and correct in all material respects.
Unicco has delivered to the Purchaser a true, correct and complete copy of the
Asset Purchase Agreement and any and all amendments, exhibits and schedules
thereto.
3.26. SOLVENCY, ETC. After giving effect to the consummation of all of
the transactions contemplated in this Agreement, including, without limitation,
all of the transactions contemplated by Section 2.03, the Companies (a) will be
able to pay their debts as they become due and (b) will have funds and capital
sufficient to carry on their business and all businesses in which they are about
to engage; and (c) will have assets (both tangible and intangible) having a
present fair salable value in excess of the amount required to pay the probable
liability on their then existing debts (whether matured or unmatured, liquidated
or unliquidated, absolute fixed or contingent).The Companies will not be
rendered insolvent by the execution and delivery of this Agreement, the
borrowing hereunder and/or the consummation of any transactions contemplated
herein, including the consummation of each of the transactions contemplated by
Section 2.03.
3.27. INTERDEPENDENCE OF THE COMPANIES. In order to induce the
Purchaser to enter into this Agreement and purchase the Notes, each Company
represents and warrants as follows:
(a) the business of each Company shall benefit from the
successful performance of the business of each other Company and the Companies
as a whole;
(b) each Company has cooperated to the extent necessary and shall
continue to cooperate with each other Company to the extent necessary in the
development and conduct of
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each other Company's business and shall, to the extent necessary, share and
participate in the formulation of methods of operation, distribution, leasing,
inventory control and other similar business matters essential to each such
Company's business; and
(c) the failure of any Company to cooperate with all other
Companies in the conduct of their respective businesses shall have an adverse
impact on the business of each other Company, and the failure of such Company to
associate or cooperate with all other Companies is reasonably likely to impair
the goodwill of such Company and all other Companies as a group.
ARTICLE IV
COVENANTS OF THE COMPANIES
4.01. AFFIRMATIVE COVENANTS OTHER THAN REPORTING REQUIREMENTS. Without
limiting any other covenants and provisions hereof, the Companies, jointly and
severally, covenant and agree that, as long as any of the Notes are outstanding,
they will perform and observe the following covenants and provisions and will
cause each Affiliate to perform and observe such of the following covenants and
provisions as are applicable to such Affiliate:
(a) PUNCTUAL PAYMENT. Pay the principal of, premium, if any, and
interest on each of the Notes at the times and place and in the manner provided
in the Notes and herein.
(b) PAYMENT OF TAXES AND TRADE DEBT. Pay and discharge, and cause
each Affiliate to pay and discharge, all taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits or business, or
upon any properties belonging to it, prior to the date on which penalties attach
thereto which, if unpaid, might become a lien or charge upon any properties of
any Company or any Affiliate, provided that no Company or Affiliate shall be
required to pay any such tax, assessment, charge, levy or claim which is being
contested in good faith and by appropriate proceedings if such Company or
Affiliate concerned shall have set aside on its books adequate reserves with
respect thereto. Pay and cause each Affiliate to pay, when due, or in conformity
with customary trade terms, all lease obligations, all trade debt, and all other
Indebtedness incident to the operations of any Company or any Affiliates, in the
ordinary course, except such as are being contested in good faith and by
appropriate proceedings if such Company or Affiliate concerned shall have set
aside on its books adequate reserves with respect thereto.
(c) MAINTENANCE OF INSURANCE. Maintain, and cause each Affiliate
to maintain, insurance with responsible and reputable insurance companies or
associations in such amounts, with such deductibles and exclusions, and covering
such risks as is usually carried by companies engaged in similar businesses and
owning similar properties in the same general areas in which such Company or
such Affiliate operates, but in any event in amounts sufficient to prevent such
Company or such Affiliate from becoming a co-insurer.
(d) PRESERVATION OF CORPORATE EXISTENCE. Preserve and maintain,
and cause each Affiliate to preserve and maintain, its corporate existence,
rights, franchises and privileges
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in the jurisdiction of its incorporation, and qualify and remain qualified, and
cause each Affiliate to qualify and remain qualified, as a foreign corporation
in each jurisdiction in which such qualification is necessary or desirable in
view of its business and operations or the ownership of its properties;
provided, however, that nothing herein contained shall prevent any merger,
consolidation or transfer of assets permitted by subsection 4.02(e). Preserve
and maintain, and cause each Affiliate to preserve and maintain, all licenses
and other rights to use patents, processes, licenses, trademarks, trade names,
inventions, intellectual property rights or copyrights owned or possessed by it
and necessary to the conduct of its business.
(e) COMPLIANCE WITH LAWS. Comply, and cause each Affiliate to
comply, with all applicable laws, rules, regulations and orders of any
governmental authority, noncompliance with which could materially adversely
affect their business or condition, financial or other, taken as a whole.
(f) VISITATION RIGHTS. At any reasonable time and from time to
time, and upon prior notice, permit the Purchaser or any agents or
representatives thereof, to examine and make copies of and extracts from the
records and books of account of, and visit and inspect the properties of, any
Company and any Affiliate, and to discuss the affairs, finances and accounts of
any Company and any Affiliate with any of their officers or directors and
independent accountants.
(g) KEEPING OF RECORDS AND BOOKS OF ACCOUNT. Keep, and cause each
Affiliate to keep, adequate records and books of account, in which complete
entries will be made in accordance with generally accepted accounting principles
consistently applied, reflecting all financial transactions of such Company and
such Affiliate, and in which, for each fiscal year, all proper reserves for
depreciation, depletion, obsolescence, amortization, taxes, bad debts and other
purposes in connection with its business shall be made.
(h) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and
cause each Affiliate to maintain and preserve, all of its properties, necessary
or useful in the proper conduct of its business, in good repair, working order
and condition, ordinary wear and tear excepted, except for insured casualty
losses beyond the Companies' control.
(i) COMPLIANCE WITH ERISA. Comply, and cause each Affiliate to
comply, with all minimum funding requirements applicable to any pension or other
employee benefit or employee contribution plans which are subject to ERISA or to
the Internal Revenue Code of 1986, as amended (the "Code"), and comply, and
cause each Affiliate to comply, in all other material respects with the
provisions of ERISA and the Code, and the rules and regulations thereunder,
which are applicable to any such plan. No Company or Affiliate will permit any
event or condition to exist which could permit any such plan to be terminated
under circumstances which would cause the lien provided for in Section 4068 of
ERISA to attach to the assets of any Company or any Affiliate.
(j) MAINTENANCE OF FUNDED DEBT RATIO. Maintain a ratio of Funded
Debt to EBITDA of not more than the ratio set forth below for the period
indicated:
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PERIOD
---------------------------------------------
Ratio Commencing On Through
----- ------------- -------
5.0 to 1 July 1, 1996 September 30, 1996
5.0 to 1 July 1, 1996 December 31, 1996
4.75 to 1 July 1, 1996 March 31, 1997
4.75 to 1 July 1, 1996 June 30, 1997
4.5 to 1 July 1, 1997 September 30, 1997
4.5 to 1 July 1, 1997 December 31, 1997
4.25 to 1 January 1, 1998 March 31, 1998
4.25 to 1 January 1, 1998 June 30, 1998;
and not more that 4.0 to 1 for each period of one, two, three and four
consecutive fiscal quarters thereafter.
For the purposes of determining the Funded Debt ratio, EBITDA for any period
above through and including the period ending June 30, 1997 which consists of:
(i) one (1) fiscal quarter shall be determined by multiplying EBITDA for the
fiscal quarter then ended by four (4); (ii) two (2) fiscal quarters shall be
determined by multiplying EBITDA for the two fiscal quarters then ended by two
(2); (iii) three (3) fiscal quarters shall be determined by multiplying EBITDA
for the three fiscal quarters then ended by 1.33; and (iv) four (4) fiscal
quarters shall be determined by multiplying EBITDA for the four fiscal quarters
then ended by 1. For any period above ending on or after September 30, 1997, the
Funded Debt ratio shall be based upon the EBITDA for the four (4) consecutive
fiscal quarters then ended.
(k) MAINTENANCE OF CASH FLOW RATIO. Maintain a Cash Flow Ratio of
not less than 1.0 to 1 for the period of July 1, 1996 through the fiscal quarter
ended September 30, 1996; for the period of July 1, 1996 through the fiscal
quarter ended December 31, 1996; for the period of July 1, 1996 through the
fiscal quarter ended March 31, 1997 and for the period of July 1, 1996 through
the fiscal quarter ended June 30, 1997; such ratio to be measured at the end of
each such fiscal quarter of the Companies, and thereafter to maintain a Cash
Flow Ratio of not less than 1.1 to 1, such ratio to be measured thereafter at
the end of each fiscal quarter of the Companies as an average of the four (4)
most recent fiscal quarters of the Companies.
(l) FOREIGN CORRUPT PRACTICES ACT. Comply, and cause each
Affiliate to comply, and cause each officer, director, employee and agent of
each Company and each Affiliate to comply, at all times with the prohibitions on
certain acts and practices set forth in the Foreign Corrupt Practices Act of
1977, and any rules or regulations promulgated thereunder.
(m) EQUAL EMPLOYMENT OPPORTUNITY. Comply, and cause each
Affiliate to comply, with all applicable laws of the United States, the
Commonwealth of Massachusetts, and of each other applicable jurisdiction
relating to equal employment opportunity, any rules, regulations, administrative
orders and Executive Orders relating thereto and the applicable terms, relating
to equal employment opportunity, of any Government Contract; and keep, and cause
each Affiliate to file, all reports, affirmative action plans and forms required
to be filed, pursuant to any such applicable law or the terms of any such
Government Contract; provided, however,
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any Company or any Affiliate shall not be considered to have failed to comply
with the foregoing during any period that any matter relating to such Company's
or such Affiliate's employment practices is being contested by such Company or
such Affiliate in appropriate proceedings, or thereafter, if such Company or
such Affiliate complies with any final determination issued in such proceedings.
(n) STATUS OF NOTES AS QUALIFIED INVESTMENTS. In the event that
any of the statements, information and related data provided by or on behalf of
any Company or any Affiliate and relied upon by the Purchaser in determining
that the Notes constitute "qualified investments" within the meaning of that
term in the Capital Resource Company Act shall be put in issue in any formal or
informal proceedings initiated or conducted by or on behalf of the Commonwealth
of Massachusetts, each Company shall, upon reasonable notice and at its expense,
provide, and, cause each Affiliate to provide, such additional information,
witnesses and related data as may be reasonably necessary or appropriate to
support the representations and warranties set forth in Article III.
(o) COMPENSATION. Each Company shall pay to its management or
management of any Affiliate compensation at a rate of compensation which is not
in excess of that commonly paid to management in companies of similar size, of
similar maturity and in similar businesses.
4.02. NEGATIVE COVENANTS. Without limiting any other covenants and
provisions hereof, the Companies, jointly and severally, covenant and agree
that, as long as any of the Notes are outstanding, they will comply with and
observe the following covenants and provisions, and will cause each Affiliate to
comply with and observe such of the following covenants and provisions as are
applicable to such Affiliate, and will not:
(a) LIENS. Create, incur, assume or suffer to exist, or permit
any Affiliate to create, incur, assume or suffer to exist, any mortgage, deed of
trust, pledge, lien, security interest or other charge or encumbrance (including
the lien or retained security title of a conditional vendor) of any nature, upon
or with respect to any of its properties, now owned or hereinafter acquired, or
assign or otherwise convey any right to receive income, except that the
foregoing restrictions shall not apply to mortgages, deeds of trust, pledges,
liens, security interests or other charges or encumbrances:
(i) for taxes, assessments or governmental charges or levies
on property of any Company or any Affiliate if the same shall not at
the time be delinquent or thereafter can be paid without penalty, or
are being contested in good faith and by appropriate proceedings;
(ii) imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the ordinary course
of business;
(iii) arising out of pledges or deposits under workmen's
compensation laws, unemployment insurance, old age pensions, or other
social security or retirement benefits, or similar legislation;
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(iv) securing the performance of bids, tenders, contracts
(other than for the repayment of borrowed money), statutory obligations
and surety bonds;
(v) in the nature of zoning restrictions, easements and
rights or restrictions of record on the use of real property which do
not materially detract from its value or impair its use;
(vi) arising by operation of law in favor of the owner or
sublessor of leased premises and confined to the property rented;
(vii) arising from any litigation or proceeding which is
being contested in good faith by appropriate proceedings, provided,
however, that no execution or levy has been made;
(viii) described in Exhibit 3.07 which secure the
Indebtedness set forth in Exhibit 3.05 and any extensions, renewals or
refinancings of such Indebtedness, provided that no such lien is
extended to cover other or different property of any Company or any
Affiliate;
(ix) securing Senior Debt; and
(x) arising out of a purchase money mortgage or security
interest or capital lease on personal property to secure the purchase
price of such property (or to secure Indebtedness incurred solely for
the purpose of financing the acquisition of any such property),
provided that such purchase money mortgage or security interest does
not extend to any other or different property of any Company or any
Affiliate.
(b) INDEBTEDNESS. Create, incur, assume or suffer to exist, or
permit any Affiliate to create, incur, assume or suffer to exist, any liability
with respect to Indebtedness except for:
(i) the Notes;
(ii) Indebtedness for money borrowed, provided that such
Indebtedness for money borrowed does not result in the Companies'
failure to comply with all of the provisions of Article IV hereof;
(iii) Current Liabilities, other than for borrowed money,
which are incurred in the ordinary course of business; and
(iv) Indebtedness with respect to lease obligations, provided
that such lease obligations do not violate subsection 4.02(c).
(c) LEASE OBLIGATIONS. Create, incur, assume or suffer to exist,
or permit any Affiliate to create, incur, assume or suffer to exist, any
obligations as lessee for the rental or hire of real or personal property in
connection with any sale and leaseback transaction.
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(d) ASSUMPTIONS OR GUARANTIES OF INDEBTEDNESS OF OTHER PERSONS.
Except as contemplated under the Senior Debt, this Agreement or the Junior
Subordinated Notes, assume, guarantee, endorse or otherwise become directly or
contingently liable on, or permit any Affiliate to assume, guarantee, endorse or
otherwise become directly or contingently liable on (including, without
limitation, liability by way of agreement, contingent or otherwise, to purchase,
to provide funds for payment, to supply funds to or otherwise invest in the
debtor or otherwise to assure the creditor against loss) any Indebtedness of any
other Person, except for guaranties by endorsement of negotiable instruments for
deposit or collection in the ordinary course of business.
(e) MERGERS, SALE OF ASSETS, ETC. Merge or consolidate with, or
sell, assign, lease or otherwise dispose of or voluntarily part with the control
of (whether in one transaction or in a series of transactions) a material
portion of its assets (whether now owned or hereinafter acquired) or sell,
assign or otherwise dispose of (whether in one transaction or in a series of
transactions) any of its accounts receivable (whether now in existence or
hereinafter created) at a discount or with recourse, to, any Person, or permit
any Affiliate to do any of the foregoing, except for sales or other dispositions
of assets in the ordinary course of business and except that (1) any Affiliate
may merge into or consolidate with or transfer assets to any other Affiliate,
(2) any Affiliate may merge into or transfer assets to any Company, (3) any
Company may merge any Person into it or otherwise acquire such Person as long as
such Company is the surviving entity, such merger or acquisition does not result
in the violation of any of the provisions of this Agreement and no such
violation exists at the time of such merger or acquisition, and, provided that
such merger or acquisition does not result in the issuance (in one or more
transactions) of common shares of in such Company representing, in the
aggregate, more than twenty percent (20%) of the total outstanding common shares
in such Company, on a fully diluted basis, immediately following the issuance
thereof, (4) the Companies may sell assets not in the ordinary course of
business in an aggregate amount not to exceed $250,000 in any fiscal year; and
(5) to the extent that there is any outstanding Senior Debt (as that term is
defined in the Subordination Agreement referred to in subsection 1.09(i)), the
Companies may sell, in a bona fide sale to one or more unaffiliated third
parties, all of the capital stock or all or substantially all of the assets of
U-Canada, Unicco Government Services, Inc. and/or Unicco Securities Services,
Inc.; provided that the full net proceeds thereof are used solely to reduce the
outstanding Senior Debt.
(f) INVESTMENTS IN OTHER PERSONS. Make or permit any Affiliate to
make, any loan or advance to any person (other than trade debt and advances to
employees in the ordinary course of business), or purchase, otherwise acquire,
or permit any Affiliate to purchase or otherwise acquire, the capital stock,
assets comprising the business of, obligations of, or any interest in, any
Person, except:
(i) investments by any Company or any Affiliate in evidences
of indebtedness issued or fully guaranteed by the United States of
America and having a maturity of not more than one year from the date
of acquisition;
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(ii) investments by any Company or any Affiliate in
certificates of deposit, notes, acceptances and repurchase agreements
having a maturity of not more than one year from the date of
acquisition issued by a bank organized in the United States having
capital, surplus and undivided profits of at least $100,000,000 and
whose parent holding company has long-term debt rated Aa1 or higher,
and whose commercial paper (if rated) is rated Prime 1, by Xxxxx'x
Investors Service, Inc.;
(iii) investments by any Company or any Affiliate in the
highest-rated commercial paper having a maturity of not more than one
year from the date of acquisition; and
(iv) loans or advances from any Affiliate to any Company.
(g) DISTRIBUTIONS. Declare or pay any dividends, purchase,
redeem, retire, or otherwise acquire for value any of its capital stock (or
rights, options or warrants to purchase such shares) now or hereafter
outstanding, return any capital to its stockholders as such, or make any
distribution of assets to its stockholders as such, or permit any Affiliate to
do any of the foregoing (such transactions being hereinafter referred to as
"Distributions"), except that the Affiliates may declare and make payment of
cash and stock dividends, return capital and make distributions of assets to any
Company; and, except that nothing herein contained shall prevent:
(i) any Company from redeeming any stock of a deceased
stockholder out of insurance held by such Company on that stockholder's
life, or
(ii) Unicco from distributing a Tax Distribution Amount to
its stockholders to the extent and at the times necessary for them to
pay their federal, state and local income taxes arising from their
respective allocable shares of Unicco's income for periods when Unicco
constitutes an "S corporation" for federal tax purposes, or
(iii) Unicco, USC, Inc. and Ashmont from making annual
distributions to their shareholders in an amount not to exceed, in the
aggregate for Unicco, USC, Inc. and Ashmont, the lesser of (x) $800,000
for the fiscal year ending June 1997, $900,000 for the fiscal year
ended June 1998 and $1,000,000 for each fiscal year thereafter or (y)
twenty-five percent (25%) of Excess Cash Flow for such fiscal year
(based upon the financial statements delivered to the Purchaser
pursuant to Section 4.03), or
(iv) Unicco or USC, Inc. from repurchasing shares of its
capital stock owned by Xxxx X. Xxxxxx in accordance with Unicco's or
USC, Inc.'s obligations to him to purchase such shares at a price not
in excess of book value upon termination of his employment,
if in the case of any such transaction there does not exist at the time of such
Distribution an Event of Default or an event which, but for the requirement that
notice be given or time elapse or both, would constitute an Event of Default and
provided that such Distribution can be made in compliance with the other terms
of this Agreement.
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(h) DEALINGS WITH AFFILIATES. Except as set forth on Exhibit
3.11, enter or permit any Affiliate to enter into any transaction with any
holder of 5% or more of any class of capital stock of any Company, or any member
of their families or any corporation or other entity in which any one or more of
such stockholders or members of their immediate families directly or indirectly
holds five percent (5%) or more of any class of capital stock except in the
ordinary course of business and on terms not less favorable to such Company or
such Affiliate than it would obtain in a transaction between unrelated parties.
(i) MAINTENANCE OF OWNERSHIP OF SUBSIDIARIES. Sell or otherwise
dispose of any shares of capital stock of any Affiliate, except to such Company
or another Affiliate, or permit any Affiliate to issue, sell or otherwise
dispose of any shares of its capital stock or the capital stock of any
Affiliate, except to such Company or another Affiliate, provided, however, that
nothing herein contained shall prevent any merger, consolidation or transfer of
assets permitted by subsection 4.02(e).
(j) CHANGE IN NATURE OF BUSINESS. Make, or permit any Affiliate
to make, any material change in the nature of its business as carried on at the
date hereof.
(k) JUNIOR SUBORDINATED NOTES. Consent to, allow or permit any
amendment, modification or waiver of any of the terms or conditions of the
Junior Subordinated Notes or the subordination agreement relating thereto, nor
make or permit to be made any payment of principal, interest or premium (if any)
on the Junior Subordinated Notes in violation of said subordination agreement.
4.03. REPORTING REQUIREMENTS. The Companies will furnish to each
registered holder of any Note.
(a) as soon as possible and in any event within five (5) days
after the occurrence of each Event of Default or each event which, with the
giving of notice or lapse of time or both, would constitute an Event of Default,
the statement of the chief financial officer of each Company setting forth
details of such Event of Default or event and the action which the Companies
propose to take with respect thereto;
(b) as soon as available and in any event within thirty (30) days
after the end of each fiscal month of each fiscal year of each Company,
consolidated balance sheets of such Company and its Affiliates as of the end of
such fiscal month and consolidated statements of income and retained earnings
and of changes in financial position of such Company and its Affiliates for the
period commencing at the end of the previous fiscal year and ending with the end
of such fiscal month, setting forth in each case in comparative form the
corresponding figures for the corresponding period of the preceding fiscal year,
all in reasonable detail and duly certified (subject to year-end audit
adjustments) by the chief financial officer of such Company as having been
prepared in accordance with generally accepted accounting principles
consistently applied (excluding footnotes);
(c) as soon as available and in any event within forty-five (45)
days after the end of each of the first three quarters of each fiscal year of
each Company, consolidated balance
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sheets of such Company and its Affiliates as of the end of such quarter and
consolidated statements of income and retained earnings and of changes in
financial position of such Company and its Affiliates for the period commencing
at the end of the previous fiscal year and ending with the end of such quarter,
setting forth in each case in comparative form the corresponding figures for the
corresponding period of the preceding fiscal year, all in reasonable detail and
duly certified (subject to year-end audit adjustments) by the chief financial
officer of such Company as having been prepared in accordance with generally
accepted accounting principles consistently applied;
(d) as soon as available and in any event within ninety (90) days
after the end of each fiscal year of each Company, a copy of the annual audit
report for such year for such Company and its Affiliates, including therein
consolidated balance sheets of such Company and its Affiliates as of the end of
such fiscal year and consolidated statements of income and retained earnings and
of changes in financial position of such Company and its Affiliates for such
fiscal year, setting forth in each case in comparative form the corresponding
figures for the preceding fiscal year, all duly certified by independent public
accountants of recognized standing reasonably acceptable to the Purchaser;
(e) at the time of delivery of each monthly, quarterly and annual
statement, a certificate, executed by the chief financial officer of each
Company in the case of monthly and quarterly statements and each Company's
independent public accountants in the case of annual statements, stating that
such officer or accountants, as the case may be, has caused this Agreement and
the Notes to be reviewed and has no knowledge of any default by any Company or
any Affiliate in the performance or observance of any of the provisions of this
Agreement or the Notes or, if such officer or accountant has such knowledge,
specifying such default and the nature thereof. Each such certificate shall set
forth computations in reasonable detail demonstrating compliance with the
provisions of subsections 4.01(j) and (k) and subsection 4.02(b), provided that
nothing in the paragraph shall be deemed to require any Companies' accountants
to perform any review beyond the normal scope of their audit;
(f) promptly upon receipt thereof, any written report submitted
to any Company by independent public accountants in connection with an annual or
interim audit of the books of such Company and its Affiliates made by such
accountants;
(g) prior to the start of each fiscal year, consolidated capital
and operating expense budgets, cash flow projections and income and loss
projections for each Company and its Affiliates in respect of such fiscal year,
all itemized in reasonable detail and prepared on a monthly basis, and, promptly
after preparation, any revisions to any of the foregoing;
(h) promptly after the commencement thereof, notice of all
material actions, suits and proceedings before any court or governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, affecting any Company or any Affiliate of the type described in Section
3.04; and
(i) promptly after sending, making available, or filing the same,
such reports and financial statements as any Company or any Affiliate shall send
or make available to the
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stockholders of any Company or any Affiliate or the Securities and Exchange
Commission and such other information respecting the business, properties or the
condition or operations, financial or otherwise, of any Company or any of its
Affiliates as the Purchaser may from time to time reasonably request.
ARTICLE V
EVENTS OF DEFAULT
5.01. EVENTS OF DEFAULT. If any of the following events ("Events of
Default") shall occur and be continuing:
(a) The Companies shall fail to pay any installment of principal
of any of the Notes when due; or
(b) The Companies shall fail to pay any interest or premium on
any of the Notes when due and such failure shall continue for five (5) business
days; or
(c) The Companies shall default in the performance of any
covenant contained in subsections 4.01(j) or (k) or shall default for twenty
(20) days in the performance of any covenant contained in Section 4.02; or
(d) Any representation or warranty made by any Company or any
Affiliate in this Agreement or by any Company or any Affiliate (or any officers
of any Company or any Affiliate) in any certificate, instrument or written
statement contemplated by or made or delivered pursuant to or in connection with
this Agreement, shall prove to have been incorrect when made in any material
respect; or
(e) Any Company or any Affiliate shall fail to perform or observe
any other term, covenant or agreement contained in this Agreement or the Notes
on its part to be performed or observed and any such failure remains unremedied
for twenty (20) business days after written notice thereof shall have been given
to Unicco by any registered holder of the Notes; or
(f) Any Company or any Affiliate shall fail to pay any
Indebtedness for borrowed money (other than as evidenced by the Notes) owing by
any Company or any Affiliate (as the case may be), or any interest or premium
thereon, in an amount exceeding $100,000, in the aggregate, when due (or, if
permitted by the terms of the relevant document, within any applicable grace
period), whether such Indebtedness shall become due by scheduled maturity, by
required prepayment, by acceleration, by demand or otherwise, or shall fail to
perform any term, covenant or agreement on its part to be performed under any
agreement or instrument (other than this Agreement or the Notes) evidencing or
securing or relating to any Indebtedness owing by any Company or any Affiliate,
as the case may be, when required to be performed (or, if permitted by the terms
of the relevant document, within any applicable grace period), if the effect of
such failure to pay or perform is to accelerate, or to permit the holder or
holders of such Indebtedness, or the trustee or trustees under any such
agreement or instrument to accelerate, the
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maturity of such Indebtedness, unless such failure to pay or perform shall be
waived by the holder or holders of such Indebtedness or such trustee or
trustees; or
(g) Any Company or any Affiliate shall be involved in financial
difficulties as evidenced (i) by its admitting in writing its inability to pay
its debts generally as they become due; (ii) by its commencement of a voluntary
case under Title 11 of the United States Code as from time to time in effect, or
by its authorizing, by appropriate proceedings of its Board of Directors or
other governing body, the commencement of such a voluntary case; (iii) by its
filing an answer or other pleading admitting or failing to deny the material
allegations of a petition filed against it commencing an involuntary case under
said Title 11, or seeking, consenting to or acquiescing in the relief therein
provided, or by its failing to controvert timely the material allegations of any
such petition; (iv) by the entry of an order for relief in any involuntary case
commenced under said Title 11; (v) by its seeking relief as a debtor under any
applicable law, other than said Title 11, of any jurisdiction relating to the
liquidation or reorganization of debtors or to the modification or alteration of
the rights of creditors, or by its consenting to or acquiescing in such relief;
(vi) by the entry of an order by a court of competent jurisdiction (a) finding
it to be bankrupt or insolvent, (b) ordering or approving its liquidation,
reorganization or any modification or alteration of the rights of its creditors,
or (c) assuming custody of, or appointing a receiver or other custodian for, all
or a substantial part of its property; or (vii) by its making an assignment for
the benefit of, or entering into a composition with, its creditors, or
appointing or consenting to the appointment of a receiver or other custodian for
all or a substantial part of its property; or
(h) Any final, non-appealable judgment, writ, warrant of
attachment or execution or similar process shall be issued or levied against a
substantial part of the property of any Company or any Affiliate in excess of
$250,000, in the aggregate, and such judgment, writ, or similar process shall
not be released, vacated or fully bonded or satisfied within sixty (60) days
after its issue or levy;
then, and in any such event, the Purchaser or any other holder of the Notes may,
by notice to Unicco, declare the entire unpaid principal amount of the Notes,
all interest accrued and unpaid thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Notes, all such accrued
interest and all such amounts shall become and be forthwith due and payable
(unless there shall have occurred an Event of Default under subsection 5.01(g)
in which case all such amounts shall automatically become due and payable),
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by each Company.
5.02. ANNULMENT OF DEFAULTS. Section 5.01 is subject to the condition
that, if at any time after the principal of any of the Notes shall have become
due and payable, and before any judgment or decree for the payment of the moneys
so due, or any thereof, shall have been entered, all arrears of interest upon
all the Notes and all other sums payable under the Notes and under this
Agreement (except the principal of the Notes which by such declaration shall
have become payable) shall have been duly paid, and every other default and
Event of Default shall have been made good or cured, then and in every such case
the holders of seventy-five percent
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(75%) or more in principal amount of all Notes then outstanding may, by written
instrument filed with Unicco, rescind and annul such declaration and its
consequences; but no such rescission or annulment shall extend to or affect any
subsequent default or Event of Default or impair any right consequent thereon.
ARTICLE VI
DEFINITIONS AND ACCOUNTING TERMS
6.01. CERTAIN DEFINED TERMS. As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Affiliate" means each of the Companies and "Affiliate" or "Subsidiary"
means any corporation, association, joint stock company, business trust or other
similar organization of which fifty percent (50%) or more of the ordinary voting
power for the election of a majority of the members of the board of directors or
other governing body of such entity is held or controlled by any Company or
Affiliate of such Company; or any other such organization the management of
which is directly or indirectly controlled by a Company or Affiliate of such
Company through the exercise of voting power or otherwise; or any joint venture,
whether incorporated or not, in which a person has a fifty percent (50%)
ownership interest.
"Agreement" means this Note Purchase Agreement as from time to time
amended and in effect between the parties.
"Asset Purchase Agreement" shall have the meaning assigned to that term
in Section 3.26.
"Asset Sellers" shall have the meaning assigned to that term in Section
3.26.
"Capital Expenditures" means any expenditure for fixed assets,
including assets being constructed (whether or not completed), leasehold
improvements, capital leases under generally accepted accounting principles
consistently applied, installment purchases of machinery and equipment,
acquisitions of real estate and other similar expenditures, including (i) in the
case of a purchase, the entire purchase price, whether or not paid during the
fiscal period in question, (ii) in the case of a capital lease, the amount
required to be capitalized in accordance with generally accepted accounting
principles consistently applied for the fiscal period in question and (iii)
without duplication, expenditures in or from any construction-in-process account
of any Company for which such measurement is being made during the fiscal period
in question.
"Capital Resource Company Act" shall have the meaning assigned to that
term in Section 1.11.
"Cash Flow Ratio" means, for any period, Combined/Consolidated Net
Income for such period plus (a) interest paid by the Companies and their
Affiliates with respect to all
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Indebtedness for such period, plus (b) all depreciation and amortization
properly charged in such period, less (c) all capital expenditures for such
period, divided by Fixed Costs for such period.
"Code" shall have the meaning assigned to that term in Section 4.01(i).
"Combined," "Consolidated" and "consolidating" when used with reference
to any term defined herein mean that term as applied to the accounts of the
Companies and their Affiliates combined or consolidated in accordance with
generally accepted accounting principles.
"Company" and "Companies" means and shall include Unicco Service
Company USC, Inc., Ogden Allied Security Services, Inc. (whose name will be
changed to Unicco Security Services, Inc.), Ogden Allied Eastern States
Maintenance Corporation (whose name will be changed to Unicco Government
Services, Inc.) and their successors and assigns.
"Current Liabilities" means all liabilities of any corporation which
would, in accordance with generally accepted accounting principles consistently
applied, be classified as current liabilities of a corporation conducting a
business the same as or similar to that of such corporation, including, without
limitation, all rental payments due under leases required to be capitalized in
accordance with applicable Statements of Financial Accounting Standards and
fixed prepayments of, and sinking fund payments with respect to, Indebtedness
(including Indebtedness evidenced by the Notes), which payments are required to
be made within one year from the date of determination.
"Distribution" shall have the meaning assigned to that term in Section
4.02(g).
"EBITDA" means, for any period, Consolidated Net Income for such period
plus (a) interest paid or accrued by the Companies and their Affiliates with
respect to all Indebtedness for such period, (b) income and excess profit taxes
for such period and all other taxes for such period which are imposed on or
measured by income after deduction of interest charges and (c) all depreciation
and amortization properly charged in such period.
"ERISA" shall have the meaning assigned to that term in Section 3.10.
"Events of Default" shall have the meaning assigned to that term in
Section 5.01.
"Excess Cash Flow" means, in relation to any of the Companies for which
such amount is being determined, the amount of combined Operating Cash Flow for
such period (i) minus Interest Charges paid by such Companies in such period and
(ii) minus regularly scheduled principal payments made by such Companies in such
period on or in respect of any Indebtedness for borrowed money or capital lease
obligations.
"Fixed Cost" means, for any period, the sum of all regularly scheduled
payments of principal and interest for such period for Indebtedness for money
borrowed by the Companies and their Affiliates.
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"Funded Debt" means, for any period, the sum of all outstanding
Indebtedness for money borrowed (including, without limitation, the Indebtedness
represented by the Notes) and capital lease obligations incurred by the
Companies and their Affiliates, less the Shareholder Subordinated Debt.
"Government Contract" shall have the meaning assigned to that term in
Section 3.14.
"Indebtedness" means all obligations, contingent and otherwise, which
should, in accordance with generally accepted accounting principles consistently
applied, be classified upon the obligor's balance sheet as liabilities, but in
any event including, without limitation, liabilities secured by any mortgage on
property owned or acquired subject to such mortgage, whether or not the
liability secured thereby shall have been assumed, and also including, without
limitation, (i) all guaranties, endorsements and other contingent obligations,
in respect of Indebtedness of others, whether or not the same are or should be
so reflected in said balance sheet, except guaranties by endorsement of
negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business and (ii) the present value of any lease payments due
under leases required to be capitalized in accordance with applicable Statements
of Financial Accounting Standards, determined in accordance with applicable
Statements of Financial Accounting Standards.
"Interest Charges" means, for any period, without duplication, all
interest and all amortization of debt discount and expense (including commitment
fees, balance deficiency fees and similar expenses) on any particular
Indebtedness for which such calculations are being made, all as determined in
accordance with generally accepted accounting principles consistently applied.
Computations of Interest Charges on a pro forma basis for Indebtedness having a
variable interest rate shall be calculated at the rate in effect on the date of
any determination.
"Junior Subordinated Notes" shall have the meaning assigned to that
term in Section 2.03(c).
"Limited Recourse Guarantee" shall have the meaning assigned to that
term in Section 2.02(a).
"Net Income" means, for any period, the net income (or net deficit) of
the Companies and their Affiliates for such period, after all expenses, taxes
and other proper charges, determined in accordance with generally accepted
accounting principles eliminating (i) all intercompany items, (ii) all earnings
attributable to equity interests in Persons that are not Affiliates unless
actually received by the Companies or their Affiliates, (iii) all income arising
from the forgiveness, adjustment or negotiated settlement of any Indebtedness,
and (iv) any increase or decrease of income arising from any change in the
method of accounting for any item from that employed in the preparation of the
financial statements attached hereto as Exhibit 3.08.
"Notes" shall have the meaning assigned to that term in Section 1.01.
"Operating Cash Flow" means, for any period, an amount equal to EBITDA
for such period (i) minus all Capital Expenditures made by the Companies for
which such measurement is
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being made during such period and (ii) minus, without double counting, the sum
of (a) cash taxes on income paid by the Companies for which such measurement is
being made during such period and (b) the aggregate Tax Distribution Amounts
distributed by Unicco during such period.
"Person" means an individual, corporation, partnership, joint venture,
trust, or unincorporated organization, or a government or any agency or
political subdivision thereof.
"Pledge Agreement" shall have the meaning assigned to that term in
Section 2.02(b).
"Purchaser" means and shall include not only the Massachusetts Capital
Resource Company but also any other holder or holders of any of the Notes.
"Securities Act" means the Securities Act of 1933 or any similar
Federal statute, and the rules and regulations of the Securities and Exchange
Commission (or of any other Federal agency then administering the Securities
Act) thereunder, all as the same shall be in effect at the time.
"Senior Debt" shall have the meaning assigned to that term in Section
1.09(h).
"Shareholder Subordinated Debt" means the separate Subordinated
Promissory Notes in the aggregate original principal amount of $3,000,000 and
bearing interest at fifteen percent (15%) per annum, with no scheduled cash
interest or principal payments due until October 1, 2001, issued by Unicco to
each of the shareholders pursuant to Section 2.03(a)(iii).
"Tax Distribution Amount" means, for any period, an amount equal to the
minimum amount sufficient to cover payment of the expected federal, state and
local income taxes attributable to the ownership of Unicco's capital stock,
based on the highest federal, state and local income tax rates that could be
applicable to any holder of such capital stock for such period, and taking into
consideration the deduction of any income tax in computing another income tax
that could be applicable to any holder of such capital stock, as determined
through the end of the period in question.
6.02. ACCOUNTING TERMS. All accounting terms not specifically defined
herein shall be construed in accordance with generally accepted accounting
principles consistent with those applied in preparation of the financial
statements delivered to the Purchaser pursuant to Section 3.08, and all
financial data submitted pursuant to this Agreement and all financial tests to
be calculated in accordance with this Agreement shall be prepared and calculated
in accordance with such principles.
ARTICLE VII
MISCELLANEOUS
7.01. NO WAIVER; CUMULATIVE REMEDIES. No failure or delay on the part
of the Purchaser, or any other holder of the Notes in exercising any right,
power or remedy hereunder
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37
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right, power or remedy preclude any other or further exercise thereof
or the exercise of any other right, power or remedy hereunder. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law.
7.02. AMENDMENTS, WAIVERS AND CONSENTS. Any provision in this Agreement
the Notes to the contrary notwithstanding, changes in or additions to this
Agreement may be made, and compliance with any covenant or provision herein or
therein set forth may be omitted or waived, if the Companies shall obtain
consent thereto in writing from the holder or holders of at least seventy-five
percent (75%) in principal amount of all Notes then outstanding; provided that
no such consent shall be effective to reduce or to postpone the date fixed for
the payment of the principal (including any required redemption) or interest
payable on any Note, without the consent of the holder thereof, or to reduce the
percentage of the Notes the consent of the holders of which is required under
this Section. Any waiver or consent may be given subject to satisfaction of
conditions stated therein and any waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given. Written
notice of any waiver or consent effected under this subsection shall promptly be
delivered by the Companies to any holders who did not execute the same.
7.03. ADDRESSES FOR NOTICES, ETC. All notices, requests, demands and
other communications provided for hereunder shall be in writing (including
telegraphic communication) and mailed or telegraphed or delivered to the
applicable party at the addresses indicated below:
If to the Companies or any one of them:
c/o Unicco Service Company
0 Xxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Chairman and Chief Executive Officer
With a copy to:
Posternak, Xxxxxxxxxx & Xxxx, L.L.P.
000 Xxxxxxx Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxx, P.C.
If to the Purchaser:
Payments should be mailed to:
Massachusetts Capital Resource Company
P. O. Box 3707
Xxxxxx, Xxxxxxxxxxxxx 00000
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38
and all other deliveries and other communications made at or
sent to:
Massachusetts Capital Resource Company
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: President
If to any other holder of the Notes: at such holder's address for
notice as set forth in the register maintained by Unicco, or, as to each of the
foregoing, at such other address as shall be designated by such Person in a
written notice to the other party complying as to delivery with the terms of
this Section. All such notices, requests, demands and other communications
shall, when mailed or telegraphed, respectively, be effective (i) three (3) days
after mailing, (ii) one (1) day after delivery to Federal Express or other
recognized courier and (iii) on receipt after faxing, addressed as aforesaid.
7.04. COSTS, EXPENSES AND TAXES. The Companies agrees to pay on demand
all costs and expenses of the Purchaser in connection with the preparation,
execution and delivery of this Agreement, the Notes and other instruments and
documents to be delivered hereunder, including the reasonable fees and
out-of-pocket expenses of Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP, counsel for the
Purchaser, with respect thereto, as well as the reasonable fees and
out-of-pocket expenses of legal counsel, independent public accountants and
other outside experts reasonably retained by the Purchaser in connection with
the amendment or enforcement of this Agreement, the Notes and other instruments
and documents to be delivered hereunder or thereunder. In addition, the
Companies shall pay any and all stamp and other taxes payable or determined to
be payable in connection with the execution and delivery of this Agreement, the
Notes and the other instruments and documents to be delivered hereunder or
thereunder and agrees to save the Purchaser harmless from and against any and
all liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes and filing fees.
7.05. BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding upon
and inure to the benefit of the Companies and the Purchaser and their respective
successors and assigns, except that no Company shall have the right to assign
its rights hereunder or any interest herein without the prior written consent of
the Purchaser.
7.06. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made in this Agreement, the Notes, or any other instrument or
document delivered in connection herewith or therewith, shall survive the
execution and delivery hereof or thereof and the making of the loans.
7.07. PRIOR AGREEMENTS. This Agreement constitutes the entire agreement
between the parties and supersedes any prior understandings or agreements
concerning the subject matter hereof.
7.08. SEVERABILITY. The invalidity or unenforceability of any provision
hereof shall in no way affect the validity or enforceability of any other
provision.
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7.09. GOVERNING LAW. This Agreement shall be governed by, and construed
in accordance with, the laws of the Commonwealth of Massachusetts.
7.10. HEADINGS. Article, Section and subsection headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
7.11. SEALED INSTRUMENT. This Agreement is executed as an instrument
under seal.
7.12. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and each of the parties hereto may execute this Agreement by signing
any such counterpart.
7.13. FURTHER ASSURANCES. From and after the date of this Agreement,
upon the request of the Purchaser, each Company and each Affiliate shall execute
and deliver such instruments, documents and other writings as may be reasonably
necessary or desirable to confirm and carry out and to effectuate fully the
intent and purposes of this Agreement and the Notes.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
UNICCO SERVICE COMPANY
By /s/ Xxxxxx X. Xxxxxxxx
--------------------------------------------------
Xxxxxx X. Xxxxxxxx, Chairman and Chief Executive
Officer
USC, INC.
By /s/ Xxxxxx X. Xxxxxxxx
--------------------------------------------------
Title: President
UNICCO SECURITY SERVICES, INC.
By /s/ Xxxxxx X. Xxxxxxxx
--------------------------------------------------
Title: authorized signatory
UNICCO GOVERNMENT SERVICES, INC.
By /s/ Xxxxxx X. Xxxxxxxx
--------------------------------------------------
Title: President
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EXHIBIT 10.8
FIRST AMENDMENT TO
NOTE PURCHASE AGREEMENT
This Amendment (the "Amendment") is made on this 17th day of October,
1997, by and between UNICCO SERVICE COMPANY, a Massachusetts business trust
("UNICCO"), USC, INC., a Massachusetts corporation, UNICCO SECURITY SERVICES,
INC., a Delaware corporation, and UNICCO GOVERNMENT SERVICES, INC., a Delaware
corporation, with their principal place of business at Four Xxxxxx Xxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000 (individually a "Company" and collectively the
"Companies") and MASSACHUSETTS CAPITAL RESOURCE COMPANY, a Massachusetts special
purpose limited partnership with a principal place of business at 000 Xxxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the "Purchaser").
WHEREAS, the Companies and the Purchaser are parties to a Note Purchase
Agreement dated as of June 28, 1996 (the "Agreement"), pursuant to which the
Companies issued to the Purchaser and the Purchaser acquired the Companies'
Promissory Note due September 30, 2001 in the original principal amount of
$5,000,000 (the "Note");
WHEREAS, the Companies are in the process of refinancing their existing
senior indebtedness and desire to amend the Agreement to modify certain
covenants set forth in the Agreement and to make other changes required in
conjunction with such refinancing, all as more particularly hereinafter set
forth;
WHEREAS, the Purchaser, which has been and continues to be the holder of
the Note, is agreeable to amending the Agreement on the terms and conditions
hereinafter set forth;
NOW, THEREFORE, the Companies, jointly and severally, and the Purchaser,
hereby agree as follows:
A. Amendments to the Agreement. The Agreement is hereby amended
as follows:
1. Section 1.09. of the Agreement is hereby amended by deleting
subsection (i) in its entirety and inserting the following in lieu
thereof:
"(i) SUBORDINATION AGREEMENT. Notwithstanding this Section 1.09, the
terms and conditions of that certain Subordination Agreement dated
as of June 28, 1996, as amended, by and among the Purchaser, the
Companies and BankBoston, N.A., shall be deemed to supersede and
replace all the provisions of this Section 1.09 for long as such
Subordination Agreement shall be in full force and effect."
41
2. Section 4.01. of the Agreement is hereby amended by deleting
subsections (j) and (k) thereof in their entirety.
3. Section 4.02. of the Agreement is hereby amended by deleting
subsection (b) thereof in its entirety and inserting the following
in lieu thereof:
"(b) INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
(i) Directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or
otherwise, with respect to (collectively, "incur") or permit any Affiliate
which is a Restricted Subsidiary to incur any Indebtedness (including
Acquired Debt) and that UNICCO will not permit any of its Restricted
Subsidiaries to issue any shares of preferred stock (other than to UNICCO
or to another Restricted Subsidiary) provided, however, that the Companies
and their Restricted Subsidiaries may incur Indebtedness (including
Acquired Debt) and the Companies and their Restricted Subsidiaries may
issue preferred stock if the Fixed Charge Coverage Ratio for UNICCO's most
recently ended four full fiscal quarters for which such additional
Indebtedness is incurred or such preferred stock is issued would have been
at least 2.0 to 1.0, determined on a pro forma basis (including a pro
forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred or the preferred stock had been issued at
the beginning of such four-quarter period.
(ii) The provisions of Section 4.02.(b)(i) will not apply to the
incurrence of any of the following (collectively, "Permitted Debt"):
(A) the incurrence by the Companies or their Restricted
Subsidiaries of Indebtedness under the Credit Facility; in an aggregate
amount not to exceed at any time outstanding the greater of (a) $45.0
million, less the aggregate amount of all Net Proceeds of Asset Sales
applied to repay any such Indebtedness (and to correspondingly reduce
commitments with respect thereto in the case of revolving borrowings), and
(b) 60% of the Companies' and their Restricted Subsidiaries' accounts
receivable (net of reserves), as shown on the Companies' most recent
consolidated balance sheets;
(B) the incurrence by UNICCO of Indebtedness represented by
the Senior Subordinated Notes and the Senior Subordinated Note Indenture;
(C) the incurrence by the Companies of the Existing
Indebtedness;
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(D) the incurrence by the Companies or any of their Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the
proceeds of which are used to refund, refinance or replace Indebtedness
that was permitted to be incurred by Section 4.02.(b)(i), or by clauses
(B) through (I) of this Section 4.02.(b)(ii).
(E) the incurrence of Indebtedness between or among the
Companies and any of their Wholly Owned Restricted Subsidiaries; provided,
however, that (a) if any of the Companies is the obligor on such
Indebtedness, such Indebtedness is expressly subordinated to the prior
payment in full of all Obligations with respect to the Senior Subordinated
Notes, and (b) any subsequent issuance or transfer of Equity Interests
that results in any such Indebtedness being held by a Person other than
the Companies or a Wholly Owned Restricted Subsidiary, and any sale or
other transfer of any such Indebtedness to a Person that is not a Company
or a Wholly Owned Restricted Subsidiary, shall be deemed, in each case, to
constitute an incurrence of such Indebtedness by a Company or such
Restricted Subsidiary, as the case may be;
(F) the incurrence by the Companies or any of their Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose of
fixing or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Agreement, as amended,
to be outstanding;
(G) the incurrence by the Companies or any of their Restricted
Subsidiaries of additional Indebtedness in an aggregate amount not exceed
$10 million at any time outstanding;
(H) the guarantee by the Companies or any of their Restricted
Subsidiaries of Indebtedness that was permitted to be incurred by another
provision of this covenant; and
(I) Indebtedness of a Receivables Subsidiary that is not
recourse to the Companies or any of their Restricted Subsidiaries (other
than Standard Securitization Undertakings) incurred in connection with a
Qualified Receivables Transaction.
For purposes of determining compliance with this Section 4.02.(b),
in the event that an item of Indebtedness meets the criteria of more than
one of the categories of Permitted Debt described in subsections (A)
through (I) above or is entitled to be incurred pursuant to Section
4.02.(b)(i), the Companies shall, in their sole discretion, classify such
item of Indebtedness in any manner that
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43
complies with this Section 4.02.(b) and such item of Indebtedness will be
treated as having been incurred pursuant to only one of such subsections.
Accrual of interest, the accretion of accreted value and the payment of
interest in the form of additional Indebtedness will not be deemed to be
an incurrence of Indebtedness for purposes of this covenant."
4. Section 4.02.(g) of the Agreement is hereby amended by deleting
subclauses (iii) and (iv) thereof in their entirety, and inserting
in lieu thereof the following:
"(iii) making any other Restricted Payment as defined in and
permitted pursuant to the terms and provisions of the Senior
Subordinated Note Indenture as in effect on the date of the
Amendment."
5. Section 4.02.(i) of the Agreement is hereby amended by adding at the
end thereof the following:
"nor prevent or restrict UNICCO from selling or issuing Equity
Interests in UNICCO."
6. Section 4.02. of the Agreement is hereby amended by deleting
subsection (k) in its entirety.
7. Section 6.01. of the Agreement is hereby amended by deleting in its
entirety the following definitions therefrom: Cash Flow Ratio,
Current Liabilities, EBITDA, Excess Cash Flow, Fixed Costs, Funded
Debt, Indebtedness, Interest Charges, Junior Subordinated Notes, Net
Income, Operating Cash Flow and Shareholder Subordinated Debt and by
inserting the following definitions in the appropriate alphabetical
order in such subsection:
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such
specified Person, including, without limitation, Indebtedness
incurred in connection with, or in contemplation of, such other
Person merging with or into or becoming a Subsidiary of such
specified Person, and (ii) Indebtedness secured by a lien
encumbering any asset acquired by such specified Person.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition of any assets or rights (including, without limitation,
by way of a sale and leaseback), excluding sales of services and
ancillary products in the ordinary course of business consistent
with past practices, and (ii) the issue or sale by UNICCO or
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any of its Subsidiaries of Equity Interests of any of UNICCO's
Subsidiaries, in the case of either clause (i) or (ii), whether in a
single transaction or a series of related transactions (a) that have
a fair market value in excess of $1.0 million or (b) for net
proceeds in excess of $1.0 million. Notwithstanding the foregoing:
(i) a transfer of assets by UNICCO to a Wholly Owned Restricted
Subsidiary or by a Wholly Owned Restricted Subsidiary to UNICCO or
to another Wholly Owned Restricted Subsidiary, (ii) an issuance of
Equity Interests by a Wholly Owned Restricted Subsidiary to UNICCO
or to another Wholly Owned Restricted Subsidiary, (iii) a Restricted
Payment that is permitted by Section 4.02(g) hereof, and (iv) the
sale of accounts receivable and related assets customarily
transferred in an asset securitization transaction involving
accounts receivable to a Receivables Subsidiary or by a Receivables
Subsidiary in connection with a Qualified Receivables Transaction
will not be deemed to be Asset Sales.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be required to be capitalized
on a balance sheet in accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any
and all shares, interests, participations, rights or other
equivalents (however designated) of corporate stock, (iii) in the
case of a partnership or limited liability company, partnership or
membership interests (whether general or limited) and (iv) any other
interest or participation that confers on a Person the right to
receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period
plus, to the extent deducted in computing such Consolidated Net
Income, (i) an amount equal to any extraordinary loss plus any net
loss realized in connection with an Asset Sale, (ii) provision for
taxes based on income or profits and, without duplication, the Tax
Distribution Amount for such period, (iii) consolidated interest
expense whether paid or accrued and whether or not capitalized
(including, without limitation, original issue discount, non-cash
interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with
Capital Lease Obligations, commissions, discounts and other fees and
charges incurred in respect of letter of credit or bankers'
acceptance financings, and net payments (if any) pursuant to Hedging
Obligations), excluding, however, amortization or write-off of debt
issuance costs, (iv) depreciation and amortization (including
amortization of goodwill and other intangibles but excluding
amortization of prepaid cash expenses that
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45
were paid in a prior period), and (v) any non-cash compensation
expense resulting from compensation paid in Equity Interests of the
Companies, in each case, on a consolidated basis and determined in
accordance with GAAP. Notwithstanding the foregoing, the provision
for taxes based on the income or profits of, and the depreciation
and amortization of, a Restricted Subsidiary of a Person shall be
added to Consolidated Net Income to compute Consolidated Cash Flow
only to the extent (and in the same proportion) that the Net Income
of such Restricted Subsidiary was included in calculating the
Consolidated Net Income of such Person and only if a corresponding
amount would be permitted at the date of determination to be
dividended by such Restricted Subsidiary without prior approval
(that has not been obtained) pursuant to the terms of its charter
and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to such
Restricted Subsidiary or its stockholders.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis,
determined in accordance with GAAP; provided that (i) the Net Income
(but not loss) of any Person that is not a Restricted Subsidiary or
that is accounted for by the equity method of accounting shall be
included only to the extent of the amount of dividends or
distributions paid in cash to the referent Person or a Wholly Owned
Restricted Subsidiary thereof, (ii) the Net Income of any Restricted
Subsidiary shall be excluded to the extent that the declaration or
payment of dividends or similar distributions by that Restricted
Subsidiary of that Net Income is not at the date of determination
permitted without any prior governmental approval (that has not been
obtained) or, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders, (iii) the Net Income of
any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition shall be excluded, (iv)
the cumulative effect of a change in accounting principles shall be
excluded and (v) the Net Income (but not loss) of any Unrestricted
Subsidiary shall be excluded, whether or not distributed to the
Companies or any of their Restricted Subsidiaries.
"Credit Facility" means the Amended and Restated Revolving Credit
Agreement of UNICCO and certain of its subsidiaries dated the date
hereof, including any guarantees and security therefor, as amended,
restated, modified, renewed, refunded, replaced, substituted,
restructured or refinanced in whole or in part from time to time
(including, without limitation, any successive amendments,
restatements, extensions, modifications, renewals, refundings,
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46
replacements, substitutions, restructurings or refinancings of the
foregoing), whether with the Companies or with one or more of their
Subsidiaries, and whether with the present lenders or any other
lenders.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital
Stock).
"Existing Indebtedness" means Indebtedness in existence on the date
of the Amendment, until such Indebtedness is repaid.
"Fixed Charges" means, with respect to any Person for any period,
the sum, without duplication, of (i) the consolidated interest
expense of such Person and its Restricted Subsidiaries for such
period, whether paid or accrued (including, without limitation,
original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations,
commissions, discounts and other fees and charges incurred in
respect of letter of credit or bankers' acceptance financings and
net payments (if any) pursuant to Hedging Obligations), excluding,
however, amortization or write-off of debt issuance costs, (ii) the
consolidated interest expense of such Person and its Restricted
Subsidiaries that was capitalized during such period, (iii) any
interest expense on Indebtedness of another Person that is
Guaranteed by such Person or one of its Restricted Subsidiaries or
secured by a lien on assets of such Person or one of its Restricted
Subsidiaries (whether or not such Guarantee or lien is called upon),
and (iv) the product of (a) all dividend payments, whether or not in
cash, on any series of preferred equity of such Person or any of its
Restricted Subsidiaries, other than dividend payments on Equity
Interests payable solely in Equity Interests of UNICCO or to UNICCO
or any Restricted Subsidiary, times (b) a fraction, the numerator of
which is one and the denominator of which is one minus the then
current combined federal, state and local statutory tax rate of such
Person (or, in the case of UNICCO for so long as it is treated as an
"S corporation" or a partnership for federal income tax purposes,
the combined federal, state and local statutory tax rate used to
calculate the Tax Distribution Amount), expressed as a decimal, in
each case, on a consolidated basis and in accordance with GAAP.
"Fixed Charge Coverage Ratio" means with respect to any Person for
any period, the ratio of the Consolidated Cash Flow of such Person
for such period to the Fixed Charges of such Person and its
Restricted Subsidiaries for such period. In the event that UNICCO or
any of its Restricted Subsidiaries incurs, assumes, Guarantees,
repays or redeems any Indebtedness (other than revolving credit
borrowings) or issues or redeems preferred equity subsequent to the
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commencement of the period for which the Fixed Charge Coverage Ratio
is being calculated but prior to the date on which the event for
which the calculation of the Fixed Charge Coverage Ratio is made
(the "Calculation Date"), then the Fixed Charge Coverage Ratio shall
be calculated giving pro forma effect to such incurrence,
assumption, Guarantee, repayment or redemption of Indebtedness, or
such issuance or redemption of preferred equity, as if the same had
occurred at the beginning of the applicable four-quarter reference
period. In addition, for purposes of making the computation referred
to above, (i) acquisitions that have been made by UNICCO or any of
its Restricted Subsidiaries, including through mergers or
consolidations and including any related financing transactions,
during the four-quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date shall be
deemed to have occurred on the first day of the four-quarter
reference period (giving effect to any pro forma expense and cost
reductions) and Consolidated Cash Flow for such reference period
shall be calculated without giving effect to clause (iii) of the
proviso set forth in the definition of Consolidated Net Income, (ii)
the Consolidated Cash Flow attributable to discontinued operations,
as determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, shall be excluded, and
(iii) the Fixed Charges attributable to discontinued operations, as
determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, shall be excluded, but
only to the extent that the obligations giving rise to such Fixed
Charges will not be obligations of the referenced Person or any of
its Restricted Subsidiaries following the Calculation Date.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board
of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards
Board or in such other statements by such other entity as have been
approved by a significant segment of the accounting profession,
which are in effect from time to time.
"Guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of
business), direct or indirect, in any manner (including, without
limitation, letters of credit and reimbursement agreements in
respect thereof), of all or any part of any Indebtedness.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements and
(ii) other agreements or arrangements designed to protect such
Person against fluctuations in interest rates.
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"Indebtedness" means, with respect to any Person, (i) any
indebtedness of such Person, whether or not contingent, in respect
of borrowed money or evidenced by bonds, notes, debentures or
similar instruments or letters of credit (or reimbursement
agreements in respect thereof) or banker's acceptances or
representing Capital Lease Obligations or the balance deferred and
unpaid of the purchase price of any property or representing any
Hedging Obligations, except any such balance that constitutes an
accrued expense or trade payable, if and to the extent any of the
foregoing indebtedness (other than letters of credit and Hedging
Obligations) would appear as a liability upon a balance sheet of
such Person prepared in accordance with GAAP, (ii) all indebtedness
of others secured by a lien on any asset of such Person (whether or
not such indebtedness is assumed by such Person) up to the value of
the collateral and (iii) to the extent not otherwise included, the
Guarantee by such Person of any indebtedness of any other Person.
Notwithstanding the foregoing, Indebtedness shall not include
payment, performance or surety bonds or standby letters of credit
issued in the ordinary course of business.
"Net Income" means, with respect to any Person, (i) the net income
(loss) of such Person, determined in accordance with GAAP and before
any reduction in respect of dividends on preferred equity,
excluding, however, (a) any gain (but not loss), together with any
related provision for taxes on such gain (but not loss), realized in
connection with (1) any Asset Sale (including, without limitation,
dispositions pursuant to sale and leaseback transactions) or (2) the
disposition of any securities by such Person or any of its
Restricted Subsidiaries or the extinguishment of any Indebtedness of
such Person or any of its Restricted Subsidiaries and (b) any
extraordinary or nonrecurring gain (but not loss), together with any
related provision for taxes on such extraordinary or nonrecurring
gain (but not loss), minus (ii) in the case of UNICCO for so long as
it is treated as an "S corporation" or a partnership for federal
income tax purposes, the Tax Distribution Amount for such period,
excluding, however, any Tax Distribution Amount attributable to any
gain referred to in clause (i)(a) or (b) above.
"Net Proceeds" means the aggregate cash proceeds received by the
Companies or any of their Restricted Subsidiaries in respect of any
Asset Sale (including, without limitation, any cash received upon
the sale or other disposition of any non-cash consideration received
in any Asset Sale), net of the direct costs relating to such Asset
Sale (including, without limitation, legal, accounting and
investment banking fees, and sales commissions) and any severance,
termination, closing or relocation or similar expenses incurred as a
result thereof, taxes or Tax Distribution Amounts paid or payable as
a result thereof
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(after taking into account any available tax credits or deductions
and any tax sharing arrangements), amounts required to be applied to
the repayment of Indebtedness secured by a lien on the asset or
assets that were the subject of such Asset Sale and any reserve for
adjustment in respect of the sale price of such asset or assets
established in accordance with GAAP.
"Non-Recourse Debt" means Indebtedness: (i) as to which neither the
Companies nor any of their Restricted Subsidiaries (a) provides
credit support of any kind (including any undertaking, agreement or
instrument that would constitute Indebtedness), (b) is directly or
indirectly liable (as a guarantor or otherwise) or (c) constitutes
the lender; (ii) no default with respect to which (including any
rights that the holders thereof may have to take enforcement action
against an Unrestricted Subsidiary) would permit (upon notice, lapse
of time or both) any holder of any other Indebtedness (other than
the Senior Subordinated Notes) of the Companies or any of their
Restricted Subsidiaries to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or
payable prior to its stated maturity; and (iii) as to which the
lenders have been notified in writing that they will not have any
recourse to the stock or assets of the Companies or any of their
Restricted Subsidiaries.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Purchase Money Note" means a promissory note evidencing a line of
credit, which may be irrevocable, from, or evidencing other
Indebtedness owed to, the Companies or any Subsidiary of the
Companies in connection with a Qualified Receivables Transaction.
"Qualified Receivables Transaction" means any transaction or series
of transactions that may be entered into by the Companies or any
Subsidiary of the Companies pursuant to which the Companies or any
Subsidiary of the Companies may sell, convey or otherwise transfer
to (i) a Receivables Subsidiary (in the case of a transfer by the
Companies or any Subsidiary of the Companies) and (ii) any other
person (in the case of a transfer by a Receivables Subsidiary), or
may grant a security interest in, any accounts receivable (whether
now existing or arising in the future) of the Companies or any
Subsidiary of the Companies, and any assets related thereto
including, without limitation, all collateral securing such accounts
receivable, all contracts and all guarantees or other obligations in
respect of such accounts receivable, proceeds of such accounts
receivable and other assets which are customarily transferred or in
respect of which security interests are customarily granted in
connection with asset securitization transactions involving accounts
receivable.
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"Receivables Subsidiary" means a Wholly Owned Restricted Subsidiary
of the Companies, which engages in no activities other than in
connection with the financing of accounts receivable and which is
designated by the Board of Directors of UNICCO as a Receivables
Subsidiary (i) no portion of the Indebtedness or any other
Obligations of which (a) is guaranteed by the Companies or any other
Restricted Subsidiary of the Companies (excluding guarantees of
Obligations (other than the principal of, and interest on,
Indebtedness)) pursuant to Standard Securitization Undertakings, (b)
is recourse to or obligates the Companies or any other Restricted
Subsidiary of the Companies in any way other than pursuant to
Standard Securitization Undertakings or (c) subjects any property or
asset of the Companies or any other Restricted Subsidiary of the
Companies, directly or indirectly, contingently or otherwise, to the
satisfaction thereof, other than pursuant to Standard Securitization
Undertakings, (ii) with which neither the Companies nor any other
Restricted Subsidiary of the Companies has any material contract,
agreement, arrangement or understanding (except in connection with a
Purchase Money Note or Qualified Receivables Transaction) other than
on terms no less favorable to the Companies or such other Restricted
Subsidiary of the Companies than those that might be obtained at the
time from persons that are not Affiliates of the Companies, other
than fees payable in the ordinary course of business in connection
with servicing accounts receivable, and (iii) to which neither the
Companies nor any other Restricted Subsidiary of the Companies has
any obligation to maintain or preserve such entity's financial
condition or cause such entity to achieve certain levels of
operating results.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referenced Person, other than UNICCO Finance Corp., that is not an
Unrestricted Subsidiary.
"Senior Subordinated Notes" means notes in the aggregate principal
amount of $105 million, maturing on October 15, 2007 and issued on
the date hereof pursuant to the Senior Subordinated Note Indenture.
"Senior Subordinated Note Indenture" means the Senior Subordinated
Note Indenture dated as of the date hereof by and between UNICCO,
UNICCO Finance Corp., the guarantors party thereto and State Street
Bank and Trust Company as Trustee, providing for the issuance of the
Senior Subordinated Notes.
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"Standard Securitization Undertakings" means representations,
warranties, covenants and indemnities entered into by the Companies
or any Subsidiary of the Companies which are reasonably customary in
an accounts receivable transaction.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election
of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by such Person or one or more of
the other Subsidiaries of that Person (or a combination thereof) and
(ii) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such
Person or (b) the only general partners of which are such Person or
of one or more Subsidiaries of such Person (or any combination
thereof).
"Unrestricted Subsidiary" means (i) any Subsidiary that is
designated by the Board of Directors or Board of Trustees as an
Unrestricted Subsidiary pursuant to a board resolution, but only to
the extent that such Subsidiary: (a) has no Indebtedness other than
Non-Recourse Debt; (b) is not party to any agreement, contract,
arrangement or understanding with the Companies or any Restricted
Subsidiary of the Companies unless the terms of any such agreement,
contract, arrangement or understanding are no less favorable to the
Companies or such Restricted Subsidiary than those that might be
obtained at the time from Persons who are not Affiliates of the
Companies; (c) is a Person with respect to which neither the
Companies nor any of their Restricted Subsidiaries has any direct or
indirect obligation (1) to subscribe for additional Equity Interests
or (2) to maintain or preserve such Person's financial condition or
to cause such Person to achieve any specified levels of operating
results; (d) has not guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Companies or any
of their Restricted Subsidiaries; and (e) has at least one director
on its board of directors that is not a director or executive
officer of the Companies or any of their Restricted Subsidiaries.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital
Stock or other ownership interests of which (other than directors'
qualifying shares) shall at the time be owned by such Person or by
one or more Wholly Owned Restricted Subsidiaries of such Person and
one or more Wholly Owned Restricted Subsidiaries of such Person.
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B. Representations and Warranties. Each of the Companies jointly and
severally represent and warrant to the Purchaser as follows:
1. Representations and Warranties. The representations and
warranties of the Companies contained in Article III of the Agreement were
true and correct in all material respects when made. Except (i) to the
extent that such representations and warranties expressly relate to a
specific date or were based on facts which have changed in the ordinary
course of business, which changes either singly or in the aggregate, have
not been materially adverse, and (ii) as set forth in Exhibit I hereto,
the representations and warranties contained in Article III of the
Agreement, after giving effect to the Amendment, are true and correct on
the date hereof.
2. Enforceability. The execution and delivery by each of the
Companies of the Amendment, and the performance by each of the Companies
of the Amendment and the Agreement, as amended hereby, are within the
authority of such Person and have been duly authorized by all necessary
proceedings. The Amendment and the Agreement, as amended hereby, are valid
and legally binding obligations of each of the Companies, enforceable in
accordance with their terms, except as limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to the enforcement of
creditors' rights in general.
3. No Default. No Default or Event of Default has occurred and is
continuing, and no Default or Event of Default will exist after the
execution and delivery of the Amendment.
4. Other Agreements. The execution and delivery by each of the
Companies of the Amendment, and the performance by each of the Companies
of the Amendment and the Agreement, as amended hereby, will not conflict
with, or result in a breach of any term, condition or provision of, or
constitute a default under, such Company's trust agreement, charter or
by-laws as presently in effect or any other agreement, trust, deed,
indenture, mortgage or other instrument to which such Person is a party or
by which such Person or any of the property of such Person is bound or
affected.
C. Ancillary Matters.
1. Notwithstanding anything to contrary set forth in the Agreement,
or in any Subordination Agreement to which the Companies and the Purchaser
are parties, the Purchaser hereby consents and agrees to, and hereby
authorizes the Companies to, pay or redeem in full the Junior Subordinated
Notes and the Shareholder Subordinated Debt out of the proceeds of the
Credit Facility, as amended this date, and the Senior Subordinated Notes.
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2. The Purchaser hereby consents and agrees to the issuance and
guarantee of the Senior Subordinated Notes, the reorganization of the
Companies pursuant to which the shareholders of USC, Inc. will contribute
their shares of capital stock of USC, Inc. to UNICCO, and the amendment of
the Credit Facility, all on the terms proposed to the Purchaser on or
prior to the date hereof.
3. The Purchaser hereby agrees to terminate (i) the Limited Recourse
Guaranty by Xxxxxx X. Xxxxxxxx dated as of June 28, 1996 (the "Kletjian
Guaranty"), and (ii) the Pledge Agreement with Xxxxxx X. Xxxxxxxx dated as
of June 28, 1996, relating to a second priority pledge and recourse in
certain stock of Ashmont Insurance Company, Limited (the "Ashmont
Shares"), and the Purchaser consents to the return of the original
Kletjian Guaranty and the release of any pledge of the Ashmont Shares.
4. The Companies hereby agree to pay, or reimburse the Purchaser
for, the Purchaser's reasonable legal fees and expenses incurred in
connection with the drafting and negotiation of the Amendment.
D. Miscellaneous Provisions.
1. Except as otherwise expressly provided by the Amendment, all of
the terms, conditions and provisions of the Agreement shall remain the
same. It is declared and agreed by each of the parties hereto that the
Agreement, as amended hereby, is and shall continue in full force and
effect, and that the Amendment and Agreement shall be read and construed
as one instrument.
2. The Amendment is intended to take effect as an agreement under
seal and shall be construed according to and governed by the laws of the
Commonwealth of Massachusetts.
3. The Amendment may be executed in any number of counterparts, but
all such counterparts shall together constitute but one instrument. In
making proof of the Amendment it shall not be necessary to produce or
account for more than one counterpart singed by each party hereto by and
against which enforcement hereof is sought.
4. BankBoston, N.A. in its capacity as Agent and lender under the
Credit Facility, shall be entitled to rely on the Amendment as a third
party beneficiary hereof.
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IN WITNESS WHEREOF, the parties have executed the Amendment as of
the date first above written.
UNICCO SERVICE COMPANY
BY /S/ XXXXXX X. XXXXXX
----------------------------
TITLE CFO and Treasurer
USC, INC.
BY /s/ Xxxxxx X. Xxxxxx
----------------------------
TITLE Treasurer
UNICCO SECURITY SERVICES, INC.
BY /s/ Xxxxxx X. Xxxxxx
----------------------------
TITLE Authorized Signatory
UNICCO GOVERNMENT SERVICES, INC.
BY /s/ Xxxxxx X. Xxxxxx
----------------------------
TITLE Treasurer
MASSACHUSETTS CAPITAL RESOURCE COMPANY
BY /s/ Xxxxxxx Xxxxxxxx
----------------------------
TITLE Senior Vice President
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