CREDIT AGREEMENT
among
UNIDIGITAL INC.
as Borrower,
THE BANKS, FINANCIAL INSTITUTIONS AND
OTHER INSTITUTIONAL LENDERS NAMED HEREIN,
as Initial Lenders,
and
BANK AUSTRIA CREDITANSTALT CORPORATE FINANCE, INC.,
as Documentation Agent
and
FLEET BANK, N.A.,
as Initial Issuing Bank, Swing Line Bank and Administrative Agent
Dated as of May 12, 1999
TABLE OF CONTENTS
Page
PRELIMINARY STATEMENTS.........................................................1
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS..........................................3
Section 1.01. Certain Defined Terms.................................3
Section 1.02. Computation of Time Periods..........................43
Section 1.03. Accounting Terms.....................................43
ARTICLE II
AMOUNTS AND TERMS OF
THE ADVANCES AND THE LETTERS OF CREDIT...................................43
Section 2.01. The Advances.........................................43
(a) The Revolving Credit Advances...................43
(b) The Swing Line Advances.........................44
(c) Letters of Credit...............................44
Section 2.02. Making the Advances..................................45
Section 2.03. Issuance of and Drawings and
Reimbursement Under Letters of Credit................49
(a) Request for Issuance............................49
(b) Letter of Credit Reports........................50
(c) Drawing and Reimbursement.......................50
(d) Failure to Make Letter of Credit Advances.......51
Section 2.04. Repayment of Advances................................52
(a) Revolving Credit Advances.......................52
(b) Swing Line Advances.............................52
(c) Letter of Credit Advances.......................52
Section 2.05. Termination or Reduction of the Commitments;
Increase in the Commitments..........................53
(a) Optional Termination or Reduction
of the Commitments..............................53
(b) Mandatory Termination or Reduction
of the Commitments..............................54
(c) Increase in the Commitment......................55
Section 2.06. Prepayments and Repayments...........................56
(a) Optional........................................56
(b) Mandatory.......................................57
(c) Application of Prepayments and Repayments.......58
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(d) Miscellaneous Provisions Relating to Prepayments,
Termination or Reduction of Commitments and
Maintenance of L/C Cash Collateral Account......58
Section 2.07. Interest.............................................60
(a) Scheduled Interest..............................60
(b) Default Interest................................61
(c) Notice of Interest Rate.........................61
Section 2.08. Fees.................................................61
(a) Commitment Fees.................................61
(b) Letter of Credit Fees...........................62
(c) Administrative Agent's Fees.....................63
Section 2.09. Conversion of Advances...............................63
(a) Optional........................................63
(b) Mandatory.......................................64
Section 2.10. Increased Costs, Etc.................................65
Section 2.11. Payments and Computations............................67
Section 2.12. Taxes................................................69
Section 2.13. Sharing of Payments, Etc.............................73
Section 2.14. Use of Proceeds......................................74
Section 2.15. Defaulting Lenders...................................74
Section 2.16. Regulation U.........................................78
ARTICLE III
CONDITIONS OF LENDING....................................................78
Section 3.01. Conditions Precedent to the Initial Funding Date.....78
(a) Credit Agreement................................78
(b) Resolutions; Incumbency.........................78
(c) Organization Documents; Good Standing...........79
(d) Legal Opinions..................................79
(e) Certificate.....................................79
(f) Pro Forma Balance Sheet; Projections; and
Financials......................................80
(g) Solvency Certificates...........................80
(h) [Intentionally Omitted].........................80
(i) Notes...........................................80
(j) Lender Release Letters..........................81
(k) Collateral Documents............................81
(l) Payment of Fees.................................83
(n) Other Documents.................................84
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Section 3.02. Conditions Precedent to All Credit Extensions........84
(a) Notice, Application; Continuation of
Representations and Warranties..................84
(b) Permitted Acquisitions..........................85
(c) Other Approvals.................................85
Section 3.03. Determinations Under Sections 3.01 and 3.02..........85
ARTICLE IV
REPRESENTATIONS AND WARRANTIES...........................................86
Section 4.01. Representations and Warranties.......................86
ARTICLE V
COVENANTS OF THE BORROWER AND THE SUBSIDIARIES...........................93
Section 5.01. Affirmative Covenants................................93
(a) Compliance with Law.............................93
(b) Payment of Taxes, Etc...........................93
(c) Compliance with Environmental Laws..............93
(d) Maintenance of Insurance........................94
(e) Preservation of Corporate Existence, Etc........94
(f) Visitation Rights...............................94
(g) Keeping of Books................................95
(h) Maintenance of Properties, Etc..................95
(i) Performance of Material Contracts...............95
(j) Transactions with Affiliates....................95
(k) Interest Rate Protection........................95
(l) Year 2000 Compatibility.........................96
(m) Agreement to Grant Additional Security..........96
(n) Foreign Subsidiaries Security...................99
Section 5.02. Negative Covenants..................................100
(a) Liens, Etc.....................................100
(b) Debt...........................................101
(c) Fundamental Changes............................104
(d) Sales, Etc. of Assets.........................104
(e) Investments in Other Persons...................105
(f) Dividends Etc..................................106
(g) Leases.........................................106
(h) Change in Nature of Business...................106
(i) Charter Amendments.............................107
(j) Accounting Changes.............................107
(k) Prepayments, Etc. of Debt.....................107
(l) Amendment, Etc. of Material Contracts.........107
(m) Negative Pledge................................107
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(n) Partnerships, New Subsidiaries.................108
(o) Speculative Transactions.......................108
(p) Capital Expenditures...........................108
(q) Issuance of Stock..............................109
(r) Sale and Leasebacks............................110
Section 5.03. Reporting Requirements..............................110
(a) Default Notice.................................110
(b) Annual Financials..............................110
(c) Quarterly Financials...........................110
(d) Monthly Reports................................111
(e) Certificate of Independent Certified
Accountants....................................111
(f) Certificate of Responsible Officer.............111
(g) Annual Forecasts...............................112
(h) Insurance......................................112
(i) ERISA Events and ERISA Reports.................112
(j) Plan Terminations..............................112
(k) Litigation.....................................112
(l) Securities Reports.............................113
(m) Agreement Notices..............................113
(n) Environmental Conditions.......................113
(o) Management Letters.............................113
(p) Permitted Acquisition Documents................113
(q) Other Information..............................114
Section 5.04. Financial Covenants.................................114
(a) Consolidated Total Funded Debt to
Pro Forma EBITDA Ratio.........................114
(b) Consolidated Senior Debt to
Pro Forma EBITDA Ratio.........................114
(c) Fixed Charge Coverage Ratio....................115
(d) Minimum Net Worth..............................115
ARTICLE VI
EVENTS OF DEFAULT.......................................................115
Section 6.01. Events of Default...................................116
Section 6.02. Actions in Respect of the Letters of Credit
upon Default........................................120
ARTICLE VII
THE ADMINISTRATIVE AGENT AND DOCUMENTATION AGENT........................120
Section 7.01. Authorization and Action............................120
Section 7.02. Agent's Reliance, Etc...............................121
Section 7.03. Fleet and Affiliates................................122
Section 7.04. Lender Party Credit Decision........................122
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Section 7.05. Indemnification.....................................122
Section 7.06. Successor Administrative Agents.....................124
Section 7.07. Documentation Agent.................................125
ARTICLE VIII
MISCELLANEOUS...........................................................126
Section 8.01. Amendments, Etc.....................................126
Section 8.02. Notices Etc.........................................127
Section 8.03. No Waiver; Remedies.................................129
Section 8.04. Costs and Expenses..................................129
Section 8.05. Right of Set-off....................................132
Section 8.06. Binding Effect......................................133
Section 8.07. Assignments and Participations......................134
Section 8.08. Execution in Counterparts; Severability.............140
Section 8.09. No Liability of the Issuing Bank....................140
Section 8.10. Confidentiality.....................................141
Section 8.11. Jurisdiction, Etc...................................141
Section 8.12. Governing Law.......................................143
Section 8.13. Waiver of Jury Trial................................143
Section 8.14. Replacement of Items................................143
Section 8.15. Certain Payments....................................144
EXHIBITS
Exhibit A - Form of Assignment and Acceptance
Exhibit B - Form of Revolving Credit Note
Exhibit C - Form of Swing Line Note
Exhibit D - Form of Notice of Borrowing
SCHEDULES
Schedule I Commitments and Applicable Lending Offices
Schedule 2.14(a) Foreign Subsidiary Debt
Schedule 4.01(b) Subsidiaries
Schedule 4.01(d) Required Authorizations and Approvals
Schedule 4.01(i) Disclosed Litigation
Schedule 4.01(k) Welfare Plans
Schedule 4.01(o) Certain Agreements
Schedule 4.01(t) Surviving Debt
Schedule 5.02(a)(iii) Liens
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CREDIT AGREEMENT
----------------
CREDIT AGREEMENT, dated as of May 12, 1999, by and among UNIDIGITAL INC., a
Delaware corporation (together with its successors or assigns, the "Borrower"),
the banks, financial institutions and other institutional lenders listed on the
signature pages hereof as the Initial Lenders (the "Initial Lenders"), any
Lender Party hereto (as hereinafter defined), FLEET BANK N.A., as Initial
Issuing Bank (the "Initial Issuing Bank"), FLEET BANK, N.A., as Swing Line Bank
(as hereinafter defined), BANK AUSTRIA CREDITANSTALT CORPORATE FINANCE, INC., as
Documentation Agent, and FLEET BANK, N.A., as administrative agent (together
with any successor appointed pursuant to Article VII, the "Administrative
Agent") for the Lender Parties and the Hedge Banks (as hereinafter defined).
PRELIMINARY STATEMENTS:
----------------------
The Borrower has requested that the Lender Parties make loans to the
Borrower and issue letters of credit having an aggregate principal and face
amount at any one time outstanding of up to Sixty-Five Million Dollars
($65,000,000), which amount may be increased to Eighty Million Dollars
($80,000,000) in the event Borrower raises subordinated debt with net proceeds
of at least Twenty Million Dollars ($20,000,000) on terms and conditions
acceptable to the Administrative Agent as provided for in this Agreement, (i) to
repay all outstanding Debt pursuant to the Existing Credit Facility, (ii) to
finance future acquisitions by the Borrower or any of its Subsidiaries, (iii) to
provide for working capital and other general corporate purposes of the Borrower
and its Subsidiaries, and (iv) to pay fees and expenses relating to the
financing set forth in this Agreement and the other Loan Documents and the
Lender Parties have agreed to make such loans and issue such letters of credit
all on and subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
--------------------------------
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"Accounts" means all Accounts referred to in Section 1.1 of the Security
Agreement.
"Additional Collateral Documents" has the meaning specified in section
5.01(n)(v).
"Acquisition Rights Assignment" has the meaning specified in section
3.01(k)(iii).
"Administrative Agent" has the meaning specified in the recital of parties
to this Agreement.
"Administrative Agent's Account" means the account of the Administrative
Agent maintained by the Administrative Agent at its office at Fleet Bank, N.A.,
1185 Avenue of the Americas, New York, new York 10036, Account No.
0000000-03102, Attention: Loan Administration.
"Advance" means a Revolving Credit Advance, a Swing Line Advance or a
Letter of Credit Advance.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling," "controlled
by" and "under common control with") of a Person means the possession, direct or
indirect, of the power to vote 50% or more of the Voting Stock of such Person or
to direct or cause the direction of the
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management and policies of such Person, whether through the ownership of Voting
Stock, by contract or otherwise.
"Applicable Lending Office" means, with respect to each Lender Party, such
Lender Party's Domestic Lending Office in the case of a Prime Rate Advance and
such Lender Party's Eurodollar Lending Office in the case of a Eurodollar Rate
Advance.
"Applicable Margin" means at any date of determination thereof, the
applicable percentage set forth below opposite the applicable ratio of
Consolidated Total Funded Debt to Pro Forma EBITDA determined as set forth
below:
APPLICABLE MARGIN FOR REVOLVING CREDIT ADVANCES
-----------------------------------------------
Ratio of Consolidated Total Applicable Margin for Applicable Margin for
Funded Debt/Pro Forma EBITDA Eurodollar Rate Advances Prime Rate Advances
---------------------------- ------------------------ -------------------
Equal to or greater than 3.50
to 1.00 3.25% 2.00%
Equal to or greater than 3.00
to 1.00, but less than 3.50 to 1.00 3.00% 1.75%
Equal to or greater than 2.50 to
1.00, but less than 3.00 to 1.00 2.75% 1.50%
Equal to or greater than 2.00 to
1.00, but less than 2.50 to 1.00 2.50% 1.25%
Less than 2.00 to 1.00 2.25% 1.00%
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The Applicable Margin for each Advance shall be determined on a quarterly basis
by reference to the ratio of Consolidated Total Funded Debt to Pro Forma EBITDA
for the preceding four (4) full fiscal quarters, as reflected on the financial
statements provided to the Administrative Agent pursuant to Section 5.03(c) or
(d), three (3) Business Days after the date on which the Administrative Agent
receives the foregoing financial statements, together with a certificate of a
Responsible Officer of the Borrower demonstrating the ratio of Consolidated
Total Funded Debt to Pro Forma EBITDA. If the Borrower has not submitted to the
Administrative Agent the information described above as and when required under
Section 5.03(b) or (c), as the case may be, the Applicable Margin in effect for
the period commencing on such date shall be one (1) tier higher than the
Applicable Margin in effect during the preceding calendar quarter, until such
time as the Borrower submits to the Administrative Agent the information so
required, and within three (3) Business Days after receipt thereof the
Applicable Margin shall be adjusted retroactively for the relevant period.
Notwithstanding the above, for the first six (6) months from the Initial
Facility Date, the Applicable Margin for a Revolving Credit Advance shall be
3.25% for a Eurodollar Advance and 2.00% for a Prime Rate Advance.
"Asset Disposition" has the meaning specified in Section 2.06(b).
"Assignment and Acceptance" means an assignment and acceptance entered into
by a Lender Party and an Eligible Assignee, and accepted by the Administrative
Agent, in accordance with Section 8.07, substantially in the form of Exhibit A
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hereto.
"Available Amount" of any Letter of Credit means, at any time, the maximum
amount available to be drawn under such Letter of Credit at such time (assuming
compliance at such time with all conditions to drawing).
"Bank Hedge Agreement" means any Hedge Agreement required or permitted
under this Agreement that is entered into by and between the Borrower and any
Hedge Bank, as the same now
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exists or may hereinafter be amended, modified, supplemented, extended, renewed,
restated or replaced.
"Borrower" has the meaning specified in the recital of parties to this
Agreement.
"Borrower's Account" means an account of the Borrower maintained by the
Borrower with Fleet Bank, N.A.
"Borrowing" means a Revolving Credit Borrowing or a Swing Line Borrowing.
"Business Day" means a day of the year on which banks are not required or
authorized by law to close in New York, New York and, if the applicable Business
Day relates to any Eurodollar Rate Advances, on which dealings in U.S. dollars
are carried on in the London interbank market.
"Capital Expenditures" means, for any Person for any period, the sum of all
expenditures made, directly or indirectly, by such Person or any of its
Subsidiaries during such period for equipment, fixed assets, real property or
improvements, or for replacements or substitutions therefor or additions
thereto, that have been or should be, in accordance with GAAP, reflected as
additions to property, plant or equipment on a Consolidated balance sheet of
such Person.
"Capital Stock" means any and all shares, interests, participation or other
equivalents (however designated) of capital stock of a corporation, any and all
similar ownership interests in a Person (other than a corporation) and any and
all warrants or options to purchase any of the foregoing.
"Capitalized Leases" means all leases that have been or should be, in
accordance with GAAP, recorded as capitalized leases.
5
"Cash Equivalents" means any of the following, to the extent owned by the
Borrower or any of its Subsidiaries free and clear of all Liens other than Liens
created under the Collateral Documents:
(i) readily marketable direct obligations of the government of the
United States or any agency or instrumentality thereof or obligations
unconditionally guaranteed by the full faith and credit of the Government of the
United States or any agency or instrumentality thereof having a maturity of not
greater than twelve (12) months from the date of issuance thereof;
(ii) insured certificates of deposit, bankers' acceptances or time
deposits (including, without limitation, Eurodollar denominated and Yankee
issues) having a maturity of not greater than twelve (12) months from the date
of issuance thereof with any commercial bank or financial institution having
combined capital and surplus of at least $1 billion and either located in the
U.S. or with respect to Foreign Subsidiaries organized under the laws of an
Approved Country (as defined in clause (ix) below) and a rating of at least
"P-1" (or the then equivalent grade) by Xxxxx'x Investors Service, Inc. or "A-1"
(or the then equivalent grade) by Standard & Poor's Ratings Group, or with
respect to banks located in an Approved Country, the equivalent thereof;
(iii) corporate securities and commercial paper having a maturity of
not greater than twelve (12) months from the date of issuance and rated at least
"P-1" (or the then equivalent grade) by Xxxxx'x Investors Service, Inc. or "A-1"
(or the then equivalent grade) by Standard & Poor's Ratings Group;
(iv) short-term tax exempt securities including municipal notes,
commercial paper, auction rate floaters, and floating rate notes rated at least
"P-1" (or the then equivalent grade) by Xxxxx'x Investors Service, Inc. or "A-1"
(or the then equivalent grade) by Standard & Poor's Ratings Group, and bonds
rated at least "AA" (or the then equivalent grade) by Standard & Poor's Ratings
Group;
6
(v) pre-refunded municipal bonds escrowed to maturity and backed by
U.S. Treasury securities;
(vi) repurchase agreements covering U.S. Treasury or U.S. government
agency securities valued at not less favorably than 102% of market value with a
term of not more than seven (7) days with major banks and dealers that are
recognized as "primary dealers" by the Federal Reserve Bank of New York;
(vii) tax exempt preferred stock or bonds issued with a rate-reset
mechanism and a maximum term of 180 days and rated at least "AAA" (or the then
equivalent grade) by Xxxxx'x Investors Service, Inc.;
(viii) money market mutual funds that offer daily purchase and
redemption, maintain a constant share price, are 'no-load' funds and have a
constant $1.00 net asset value; or
(ix) with respect to Foreign Subsidiaries, government obligations
of (A) the United Kingdom, (B) the country in which such Foreign Subsidiary
maintains its chief executive office, (C) any other country approved by the
Administrative Agent, or (D) any other country whose debt securities are rated
by Standard & Poor's Ratings Group and Xxxxx'x Investors Service, Inc. A-1 or
P-1, respectively, or the equivalent thereof (if a short-term debt rating is
provided by either) or at least AA or AA2, respectively, or the equivalent
thereof (if a long-term unsecured debt rating is provided by either) (each such
country, an "Approved Country"), in each case with maturities of less than 12
months.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, 42 U.S.C. Section 9601 et seq., as amended from time to
time.
"CERCLIS" means the Comprehensive Environmental Response, Compensation and
Liability Information System maintained by the U.S. Environmental Protection
Agency.
7
"Collateral" means all "Collateral" referred to in the Collateral Documents
and all other property that is or is intended to be subject to any Lien in favor
of the Administrative Agent for the benefit of the Secured Parties.
"Collateral Documents" means each Security Agreement, each Pledge Agreement
and any other agreement that creates or purports to create a Lien in favor of
the Administrative Agent for the benefit of the Secured Parties as the same now
exists or may hereinafter be amended, modified, supplemented, extended, renewed,
restated or replaced.
"Commitment" means a Revolving Credit Commitment or a Letter of Credit
Commitment.
"Confidential Information" means information that the Borrower furnishes to
the Administrative Agent or any Lender Party in a writing designated as
confidential, but does not include any such information that is or becomes
generally available to the public other than as a result of a breach by the
Administrative Agent or any Lender Party of its obligations hereunder or that is
or becomes available to the Administrative Agent or such Lender Party from a
source other than the Borrower that is not, to the best of the Administrative
Agent's or such Lender Party's knowledge, acting in violation of a
confidentiality agreement with the Borrower.
"Consolidated" refers to the consolidation of accounts, in accordance with
GAAP, of the Borrower and all of its Subsidiaries.
"Consolidated Lease Expense" means, for any period, the aggregate amount of
fixed or contingent rentals payable by the Borrower and its Subsidiaries,
determined on a consolidated basis, in accordance with GAAP, for such period
with respect to leases of personal property.
"Conversion", "Convert" and "Converted" each refer to a conversion of
Advances of one Type into Advances of the other Type pursuant to Section 2.09 or
2.10.
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"Credit Extension" means (i) the making of any Advances hereunder, and (ii)
the issuance of any Letters of Credit hereunder.
"Current Assets" of any Person means all assets of such Person that would,
in accordance with GAAP, be classified as current assets of a company conducting
a business the same as or similar to that of such Person, after deducting
adequate reserves in each case in which a reserve is proper in accordance with
GAAP.
"Current Liabilities" of any Person means (a) Debt of such Person, except
Total Funded Debt, that by its terms is payable on demand or matures within one
year after the date of determination (excluding any Debt renewable or
extendible, at the option of such Person, to a date more than one year from such
date or arising under a revolving credit or similar agreement that obligates the
lender or lenders to extend credit during a period of more than one year from
such date), (b) all amounts of Total Funded Debt of such Person required to be
paid or prepaid within one year after the date of determination and (c) all
other items (including taxes accrued as estimated) that in accordance with GAAP
would be classified as current liabilities of such Person.
"Debt" of any Person means, without duplication,
(i) all indebtedness of such Person for borrowed money,
(ii) all Obligations of such Person for the deferred purchase price
of property or services,
(iii) all Obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments,
(iv) all Obligations of such Person created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property),
9
(v) all Obligations of such Person as lessee under Capitalized
Leases,
(vi) all Obligations, contingent or otherwise, of such Person in
respect of letters of credit or similar facilities,
(vii) all Obligations of such Person to purchase, redeem, retire,
defease or otherwise make any payment in respect of any capital stock of or
other ownership or profit interest in such Person or any other Person or any
warrants, rights or options to acquire such capital stock,
(viii) all Debt of others referred to in clauses (i) through (vii)
above or clause (ix) below guaranteed directly or indirectly in any manner by
such Person, or in effect guaranteed directly or indirectly by such Person
through an agreement (A) to pay or purchase such Debt or to advance or supply
funds for the payment or purchase of such Debt, (B) to purchase, sell or lease
(as lessee or lessor) property, or to purchase or sell services, primarily for
the purpose of enabling the debtor to make payment of such Debt or to assure the
holder of such Debt against loss, (C) to supply funds to or in any other manner
invest in the debtor (including any agreement to pay for property or services
irrespective of whether such property is received or such services are rendered)
or (D) otherwise to assure a creditor against loss, and
(ix) all Debt referred to in clauses (i) through (viii) above of
another Person secured by (or for which the holder of such Debt has an existing
right, contingent or otherwise, to be secured by) any Lien on property
(including, without limitation, accounts, contract rights or inventory) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such Debt.
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"Debt Issuance" means any issuance or sale or other incurrence by the
Borrower or any of its Subsidiaries of any Debt; provided, however, that for
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purposes of determination of Net Cash Proceeds under Section 2.06(b), the term
"Debt Issuance" shall not include any Debt Issuance, the proceeds of which are
used to prepay or refinance the Existing Subordinated Debt.
"Default" means any Event of Default or any event that would constitute an
Event of Default but for the requirement that notice be given or time elapse or
both.
"Defaulted Advance" means, with respect to any Lender Party at any time,
the portion of any Advance required to be made by such Lender Party to the
Borrower pursuant to Section 2.02 at or prior to such time which has not been
made by such Lender Party or by the Administrative Agent for the account of such
Lender Party pursuant to Section 2.02(e) as of such time. In the event that a
portion of a Defaulted Advance shall be deemed made pursuant to Section 2.15(a),
the remaining portion of such Defaulted Advance shall be considered a Defaulted
Advance originally required to be made pursuant to Section 2.02 on the same date
as the Defaulted Advance so deemed made in part.
"Defaulted Amount" means, with respect to any Lender Party at any time, any
amount required to be paid by such Lender Party to the Administrative Agent or
any other Lender Party hereunder or under any other Loan Document at or prior to
such time which has not been so paid as of such time, including, without
limitation, any amount required to be paid by such Lender Party to (i) the Swing
Line Bank pursuant to Section 2.02(b) to repay a portion of a Swing Line Advance
made by the Swing Line Bank, (ii) the Issuing Bank pursuant to Section 2.03(c)
to purchase a portion of a Letter of Credit Advance made by the Issuing Bank,
(iii) the Administrative Agent pursuant to Section 2.02(e) to reimburse the
Administrative Agent for the amount of any Advance made by the Administrative
Agent for the account of such Lender Party, (iv) any other Lender Party pursuant
to Section 2.13 to purchase any participation in Advances owing to such other
Lender Party and (v) the Administrative Agent or the Issuing Bank pursuant to
Section 7.05 to reimburse the Administrative Agent or the Issuing Bank for such
Lender Party's ratable share of any amount required to be paid
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by the Lender Parties to the Administrative Agent or the Issuing Bank as
provided therein. In the event that a portion of a Defaulted Amount shall be
deemed paid pursuant to Section 2.15(b), the remaining portion of such Defaulted
Amount shall be considered a Defaulted Amount originally required to be paid
hereunder or under any other Loan Document on the same date as the Defaulted
Amount so deemed paid in part.
"Defaulting Lender" means, at any time, any Lender Party that, at such
time, (i) owes a Defaulted Advance or a Defaulted Amount or (ii) shall take any
action or be the subject of any action or proceeding of a type described in
Section 6.01(f).
"Disclosed Litigation" has the meaning specified in Section 4.01(i).
"Disposal" means the discharge, deposit, injection, dumping, spilling,
leaking or placing of any solid waste or hazardous waste, as those terms are
defined by any federal, state, local or foreign law, into or on any land or
water so that such solid waste or hazardous waste or any constituents thereof
may enter the environment or be emitted into the air or discharged into any
waters, including ground waters.
"Dollars", "dollars" and the symbol "$" each mean the lawful currency of
the United States.
"Domestic Lending Office" means, with respect to any Lender Party or Hedge
Bank, the office of such Lender Party (or, in the case of a Hedge Bank, the
office of the corresponding Lender Party) specified as its "Domestic Lending
Office" opposite such Lender Party's name on Schedule I hereto or in the
----------
Assignment and Acceptance pursuant to which it became a Lender Party, as the
case may be, or such other office of such Lender Party or Hedge Bank as such
Lender Party or Hedge Bank may from time to time specify to the Borrower and the
Administrative Agent.
"Domestic Subsidiary" means any Subsidiary organized under the laws of the
United States of America or any State thereof and any successor or assign
thereof.
12
"EBITDA" means, for any period, the sum, determined on a Consolidated basis
without duplication, of (a) net income (or net loss), (b) interest expense, (c)
income tax expense, (d) depreciation expense, (e) amortization expense, (f)
non-cash charges, (g) the legal and accounting costs and other reasonable
expenses incurred in connection with any Permitted Acquisition completed after
the date of this Agreement, in each case determined in accordance with GAAP for
such period and (h) other non-recurring, non-operating expenses, including,
without limitation, restructuring expenses; provided, however, that net income
-------- -------
(or net loss) shall be computed without giving effect to extraordinary losses or
gains; provided, further, that EBITDA shall in any event exclude from the
-------- -------
Initial Funding Date, the amount of any non-cash income recognized during any
period for which EBITDA is determined.
"Eligible Assignee" means with respect to the rights and obligations
related to any Facility (other than the Letter of Credit Facility) and all of
the other rights and obligations under this Agreement, (A) a Lender; (B) an
Affiliate of a Lender; and (C) subject to the prior approval of the
Administrative Agent and, so long as no Default or Event of Default shall have
occurred and be continuing, the Borrower, such approval not to be unreasonably
withheld or delayed, (i) a commercial bank organized under the laws of the
United States, or any State thereof, and having total assets in excess of
$500,000,000; (ii) a savings and loan association or savings bank organized
under the laws of the United States, or any State thereof, and having total
assets in excess of $500,000,000; (iii) a commercial bank organized under the
laws of any other country that is a member of the OECD or has concluded special
lending arrangements with the International Monetary Fund associated with its
general arrangements to borrow or of the Cayman Islands, or a political
subdivision of any such country, and having total assets in excess of
$500,000,000, so long as such bank is acting through a branch or agency located
in the United States; (iv) the central bank of any country that is a member of
the OECD; and (v) a finance company, insurance company or other financial
institution or fund (whether a corporation, partnership, trust or other entity)
located in the United States that is engaged in making, purchasing or otherwise
investing in commercial loans in the ordinary course of its business and having
total assets in excess of $500,000,000; and,
13
with respect to the rights and obligations related to the Letter of Credit
Facility, a Person that is an Eligible Assignee under subclause (i) or (iii) of
clause (C) of this definition and is approved by the Administrative Agent and
the Borrower, such approval not to be unreasonably withheld or delayed (and
provided that no such approval shall be necessary if an Eligible Assignee is an
Affiliate of the Assignor); provided, however, that neither the Borrower, any of
-------- -------
its Subsidiaries nor any Affiliate of the Borrower or any of its Subsidiaries
shall qualify as an Eligible Assignee under this definition.
"Environmental Action" means any action, suit, demand, demand letter,
claim, notice of non-compliance or violation, notice of liability or potential
liability, investigation, proceeding, consent order or consent agreement
relating in any way to any Environmental Law, any Environmental Permit or
Hazardous Material or arising from alleged injury or threat to public health and
safety or the environment, including, without limitation, (i) by any
governmental or regulatory authority or third party for enforcement, cleanup,
Removal, Response, Remedial or other actions or damages and (ii) by any
governmental or regulatory authority or third party for damages, contribution,
indemnification, cost recovery, compensation or injunctive relief.
"Environmental Law" means any international or transnational law, federal,
state, local or foreign statute, law, ordinance, rule, regulation, code, order,
writ, judgment, injunction, decree or judicial or agency interpretation, policy
or guidelines relating to pollution or protection of the environment or natural
resources, including, without limitation, those relating to the use, handling,
transportation, treatment, storage, disposal, threatened release, release or
discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval, identification number,
license or other authorization required under any Environmental Law.
"Equity Issuance" means any issuance or sale by the Borrower or any of its
Subsidiaries of any of its capital stock or other equity securities or any
obligations convertible into or exchangeable for, or giving any Person a right,
option or warrant to acquire such securities or such convertible or
14
exchangeable obligations; provided, however, that for purposes of determination
-------- -------
of Net Cash Proceeds under Section 2.06(b), the term "Equity Issuance" shall not
include any issuance or sale of (a) capital stock of the Borrower to any Person
as consideration paid in connection with any Permitted Acquisition; (b) capital
stock to qualify any director of the Borrower or any of its Subsidiaries if
required by applicable law; (c) capital stock or other equity securities to
directors, management and employees and other eligible participants of the
Borrower or any of its Subsidiaries, pursuant to a stock purchase, stock option
or similar incentive plan of the Borrower or any of its Subsidiaries, or any
exercise of options issued pursuant thereto; (d) capital stock of any Subsidiary
of the Borrower to the Borrower or any other Wholly-Owned Subsidiary of the
Borrower; (e) capital stock of the Borrower to any Person for cash, if, and only
if, in respect of this clause (e); such Net Cash Proceeds are applied towards
the payment of the Permitted Acquisition Purchase Price as follows: if the
offering documents for such issuance or sale identify a specific acquisition
transaction, within ten (10) days after the consummation of such acquisition
transaction; (f) capital stock of the Borrower issued in connection with the
exercise of warrants granted prior to the date hereof; and (g) capital stock of
the Borrower or other equity securities or any obligations converted into or
exchangeable for capital stock of the Borrower issued in connection with the
Subordinated Issuance.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV of ERISA
is a member of the controlled group of any Loan Party, or under common control
with any Loan Party, within the meaning of Section 414 of the Internal Revenue
Code.
"ERISA Event" means (i) (y) the occurrence of a reportable event, within
the meaning of Section 4043 of ERISA, with respect to any Plan unless the 30-day
notice requirement with respect to such event has been waived by the PBGC, or
(z) the requirements of subsection (1) of Section 4043(b) of ERISA (without
regard to subsection (2) of such Section) are met with respect to a
15
contributing sponsor, as defined in Section 4001 (a)(13) of ERISA, of a Plan,
and an event described in paragraph (9), (10), (11), (12) or (13) of
Section 4043(c) of ERISA is reasonably expected to occur with respect to such
Plan within the following 30 days; (ii) the application for a minimum funding
waiver with respect to a Plan; (iii) the provision by the administrator of any
Plan of a notice of intent to terminate such Plan under ERISA Section 4041(c),
pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect
to a plan amendment referred to in Section 4041(e) of ERISA); (iv) the cessation
of operations at a facility of any Loan Party or any ERISA Affiliate in the
circumstances described in Section 4062(e) of ERISA; (v) the withdrawal by any
Loan Party or any ERISA Affiliate from a Multiple Employer Plan during a plan
year for which it was a substantial employer, as defined in Section 4001(a)(2)
of ERISA; (vi) the conditions for imposition of a lien under Section 302(f) of
ERISA shall have been met with respect to any Plan; (vii) the adoption of an
amendment to a Plan requiring the provision of security to such Plan pursuant to
Section 307 of ERISA; or (viii) the institution by the PBGC of proceedings to
terminate a Plan pursuant to Section 4042 of ERISA, or the occurrence of any
event or condition described in Section 4042 of ERISA that constitutes grounds
for the termination of, or the appointment of a trustee to administer, such
Plan.
"Eurocurrency Liabilities" has the meaning specified in Regulation D of the
Board of Governors of the Federal Reserve System, as in effect from time to
time.
"Eurodollar Lending Office" means, with respect to any Lender Party, the
office of such Lender Party specified as its "Eurodollar Lending Office"
opposite its name on Schedule I hereto or in the Assignment and Acceptance
----------
pursuant to which it became a Lender Party (or, if no such office is specified,
its Domestic Lending Office), or such other office of such Lender Party as such
Lender Party may from time to time specify to the Borrower and the
Administrative Agent.
"Eurodollar Rate" means, for any Interest Period for all Eurodollar Rate
Advances comprising part of the same Borrowing, an interest rate per annum
(rounded upward, if necessary, to the nearest 1/32 of one percent) as determined
on the basis of the offered rates for deposits in U.S. dollars, for a period of
time comparable to such Interest Period which appears on the Telerate Page
16
3750 as of 11:00 a.m. (New York time) two Business Days before the first day of
such Interest Period; provided, however, that if the rate described above does
-------- -------
not appear on the Telerate System on any applicable interest determination date,
the Eurodollar Rate shall be the rate (rounded upward as described above, if
necessary) for deposits in U.S. dollars for a period substantially equal to the
interest period on the Reuters Page "LIBO" (or such other page as may replace
the LIBO page on that service for the purpose of displaying such rates), as of
11:00 a.m. (New York time) two Business Days before the first day of such
Interest Period.
If both the Telerate and Reuters system are unavailable, then the rate for
that date will be determined on the basis of the offered rates for deposits in
U.S. dollars for a period of time comparable to such Interest Period which are
offered by four major banks in the London interbank market at approximately
11:00 a.m. (New York time) two Business Days before the first day of such
Interest Period as selected by the Administrative Agent. The principal London
office of each of the four major London banks will be requested to provide a
quotation of its U.S. dollar deposit offered rate. If at least two such
quotations are provided, the rate for that date will be the arithmetic mean of
the quotations. If fewer than two quotations are provided as requested, the rate
for that date will be determined on the basis of the rates quoted for loans in
U.S. dollars to leading European banks for a period of time comparable to such
Interest Period offered by major banks in New York City at approximately 11:00
a.m. (New York time) two Business Days before the first day of such Interest
Period. In the event that the Administrative Agent is unable to obtain any such
quotation as provided above, it will be deemed that the Eurodollar Rate for such
Interest Period cannot be determined.
In the event that the Board of Governors, of the Federal Reserve System
shall impose a Eurodollar Rate Reserve Percentage with respect to Eurocurrency
Liabilities, the Eurodollar Rate for an Interest Period shall be equal to the
amount determined above for such Interest Period divided by a percentage equal
to 100% minus the Eurodollar Rate Reserve Percentage for such Interest Period.
17
"Eurodollar Rate Advance" means an Advance that bears interest as provided
in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, the reserve
percentage applicable two Business Days before the first day of such Interest
Period under regulations issued from time to time by the Board of Governors of
the Federal Reserve System (or any successor) for determining the maximum
reserve requirement (including, without limitation, any emergency, supplemental
or other marginal reserve requirement) for a member bank of the Federal Reserve
System in New York City with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (or with respect to any other category of
liabilities that includes deposits by reference to which the interest rate on
Eurodollar Rate Advances is determined) having a term equal to such Interest
Period.
"Events of Default" has the meaning specified in Section 6.01.
"Excess Cash Flow" means for any period the sum of (a) EBITDA of the
Borrower and its Subsidiaries for such period plus (b) the aggregate amount of
----
all non-cash charges deducted from Consolidated net income for such period, but
not added back in arriving at EBITDA less (c) the aggregate amount of mandatory
----
and optional prepayments or repayments of principal made by the Borrower and its
Subsidiaries on any Total Funded Debt of the Borrower and its Subsidiaries
during such period; provided, however, that, with respect to any optional
-------- -------
prepayment of the Revolving Credit Advances, the amount of such prepayment shall
be expressly excluded from the determination of the amount in this clause (c) if
the Revolving Credit Facility is not, upon such repayment, permanently reduced
by the amount of such prepayment less (d) Capital Expenditures of the Borrower
----
and its Subsidiaries during such period less (e) the aggregate amount of all
----
federal, state, local and foreign taxes paid by the Borrower and its
Subsidiaries during such period less (f) the aggregate amount of interest paid
----
on any Debt of the Borrower and its Subsidiaries during such period less (g) the
----
aggregate amount of the cash portion of all non-recurring charges included in
arriving at such EBITDA less (h) dividends paid by the Borrower to the holders
----
of its common stock
18
during such period to the extent that the Borrower is expressly permitted to pay
such dividends under this Agreement less (i) all cash paid as part of the cost
----
of any Permitted Acquisition.
"Existing Credit Facility" means the credit facilities pursuant to a Credit
Agreement, dated as of March 24, 1998, by and among the Borrower, lenders from
time parties to such agreement and Canadian Imperial Bank of Commerce, as
administrative agent for such lenders and each other agreement, document and/or
interest related thereto, in each case as the same exists or may hereinafter be
amended, modified, supplemented, extended, renewed, restated or replaced.
"Existing Subordinated Debt" means the Subordinated Debt of the Borrower
existing on the date hereof pursuant to the Securities Purchase Agreement, dated
November 25, 1998, among the Borrower, certain Subsidiaries of the Borrower and
CIBC Wood Gundy Capital Corp. and any agreements, documents and instruments
related thereto, in each case, as the same now exists or may hereinafter be
amended, modified, supplemented, extended, renewed, restated or replaced.
"Extraordinary Receipt" means any cash received by or paid to or for the
account of any Person not in the ordinary course of business, including, without
limitation, pension plan reversions, proceeds of casualty insurance and
condemnation awards (and payments in lieu thereof), excluding proceeds of any
other insurance; provided, however, that an Extraordinary Receipt shall not
-------- -------
include cash receipts received from proceeds of casualty insurance, condemnation
awards (or payments in lieu thereof) or indemnity payments to the extent that
such proceeds, awards or payments (i) in respect of loss or damage to equipment,
fixed assets, inventory or real property, are applied (or in respect of which
expenditures were previously incurred) to replace or repair such equipment,
fixed assets, inventory or real property so long as such application is made or
committed to be made within one hundred twenty (120) days (or such longer time
as may be commercially reasonable in the circumstances) after such Person's
receipt of such proceeds, awards or payments; or (ii) are received by any Person
in respect of any third party claim against such Person and applied to pay (or
to reimburse such Person for its prior payment of) such claim and the costs and
expenses of such Person with respect thereto.
19
"Facility" means the Revolving Credit Facility, Swing Line Facility or the
Letter of Credit Facility.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Fee Letter" has the meaning specified in Section 2.08(c).
"Financing Lease" means any lease of personal property, the obligations of
the lessee in respect of which are required in accordance with GAAP to be
capitalized on a balance sheet of the lessee.
"Fiscal Year" means a fiscal year of the Borrower and its Consolidated
Subsidiaries ending on August 31 in any calendar year.
"Fleet" means Fleet Bank, N.A. in its capacity as a Lender or Issuing Bank.
"Fleet Base Rate" has the meaning specified in the definition of "Prime
Rate" herein.
"Foreign Guarantor" means, collectively, each active Foreign Subsidiary, on
the Initial Funding Date and each Foreign Subsidiary created or acquired after
the Initial Funding Date, and, in each case, its respective successors and
assigns.
"Foreign Guaranty" has the meaning specified in Section 3.02(k)(vi).
20
"Foreign Subsidiary" means any Subsidiary organized under the laws of any
jurisdiction other than the United States of America or any State thereof and,
in each case, successors and assigns thereof.
"GAAP" has the meaning specified in Section 1.03.
"Governmental Authority" means any nation or government, any state or other
political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guaranteed Obligations" has the meaning specified in the Subsidiary
Guaranty and the Foreign Guaranty.
"Hazardous Materials" means (i) petroleum or petroleum products,
by-products or breakdown products, radioactive materials, asbestos-containing
materials, polychlorinated biophenyls and radon gas and (ii) any other
chemicals, materials or substances designated, classified or regulated as
hazardous or toxic or as a pollutant or contaminant under any Environmental Law.
"Hedge Agreements" means interest rate swap, cap or collar agreements,
interest rate future or option contracts, currency swap agreements, currency
future or option contracts and other similar agreements.
"Hedge Bank" means any Lender Party or any Affiliate thereof, in its
capacity as a party to a Bank Hedge Agreement and each Eligible Assignee to
which rights and obligations hereunder and other the other Loan Documents, as
applicable, have been assigned pursuant to Section 8.07.
21
"Indemnified Party" has the meaning specified in Section 8.04(b).
"Initial Extension of Credit" means the earlier to occur of the initial
Borrowing and the initial issuance of a Letter of Credit.
"Initial Funding Date" means the date on which all of the conditions
precedent set forth in Section 3.01 are satisfied or waived by the Required
Lenders and the initial Advances are made by the Lender Parties hereto to the
Borrower.
"Initial Issuing Bank" has the meaning specified in the recital of parties
to this Agreement.
"Initial Lenders" has the meaning specified in the recital of parties to
this Agreement.
"Insufficiency" means, with respect to any Plan, the amount, if any, of its
unfunded benefit liabilities, as defined in Section 4001(a)(18) of ERISA.
"Interest Expense" means, with respect to any Person for any period,
interest expense on all Debt of such Person for such period net of interest
income for such period, whether paid or accrued, determined on a Consolidated
basis for such Person and its Subsidiaries and in accordance with GAAP, and
including, without limitation, (i) in the case of the Borrower, interest expense
in respect of Debt resulting from Advances, (ii) the interest component of all
obligations under Capitalized Leases, (iii) commissions, discounts and other
fees and charges payable in connection with letters of credit (including,
without limitation, Letters of Credit), (iv) the net payment, if any, payable in
connection with Hedge Agreements less the net credit, if any, received in
connection with Hedge Agreements and (v) all fees paid by the Borrower pursuant
to Section 2.08(a) (other than non-cash amortization related thereto).
"Interest Period" means, for each Eurodollar Rate Advance comprising part
of the same Borrowing, the period commencing on the date of such Eurodollar Rate
Advance or the date of the
22
Conversion of any Advance into such Eurodollar Rate Advance, and ending on the
last day of the period selected by the Borrower pursuant to the provisions below
and, thereafter, each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the last day of the period
selected by the Borrower pursuant to the provisions below. The duration of each
such Interest Period shall be one, two, three or six months, as the Borrower
may, upon notice received by the Administrative Agent not later than 1:00 p.m.
(New York time) on the third Business Day prior to the first day of such
Interest Period, select; provided, however, that:
-------- -------
(a) The Borrower may not select any Interest Period with respect to
any Eurodollar Rate Advance under a Facility that ends after any principal
repayment installment date for such Facility unless, after giving effect to such
selection, the aggregate principal amount of Eurodollar Rate Advances having
Interest Periods that end on or prior to such principal repayment installment
date for such Facility shall be at least equal to the aggregate principal amount
of Advances under such Facility due and payable on or prior to such date;
(b) Whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such Interest Period
shall be extended to occur on the next succeeding Business Day; provided,
--------
however, that, if such extension would cause the last day of such Interest
-------
Period to occur in the next following calendar month, the last day of such
Interest Period shall occur on the next preceding Business Day;
(c) Whenever the first day of any Interest Period occurs on a day
of an initial calendar month for which there is no numerically corresponding day
in the calendar month that succeeds such initial calendar month by the number of
months equal to the number of months in such Interest Period, such Interest
Period shall end on the last Business Day of such succeeding calendar month; and
23
(d) Until the date on which the Administrative Agent notifies the
Borrower that the syndication of the Facilities has been completed, only
Interest Periods with a duration of seven days shall be available to the
Borrower for Eurodollar Rate Advances.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder.
"Inventory" of any Person means all of such Person's now owned and
hereafter acquired inventory, goods, merchandise, and other personal property,
wherever located, to be furnished under any contract of service or held for sale
or lease, all returned goods, raw materials, other materials and supplies of any
kind, nature or description which are or might be consumed in such Person's
business or used in connection with the packing, shipping, advertising, selling
or finishing of such goods, merchandise and such other personal property, and
all documents of title or other documents representing them.
"Investment" in any Person means any loan or advance to such Person, any
purchase or other acquisition of any capital stock or other ownership or profit
interest, warrants, rights, options, obligations or other securities of such
Person, any capital contribution to such Person or any other investment in such
Person.
"Issuing Bank" means the Initial Issuing Bank and each Eligible Assignee to
which the Letter of Credit Commitment hereunder and other rights and
obligations, as applicably have been assigned pursuant to Section 8.07.
"L/C Cash Collateral Account" has the meaning specified in the Security
Agreement.
"L/C Related Documents" has the meaning specified in
Section 2.04(d)(ii)(A).
24
"Lender Party" means any Lender, Swing Line Bank, the Issuing Bank and each
Eligible Assignee to which rights and obligations hereunder and under the other
Loan Documents, as applicable, have been assigned pursuant to Section 8.07. The
term "Lender Party" shall include such party in its capacity as a Hedge Bank
unless the surrounding text (a) indicates otherwise or (b) indicates that such
term relates solely to the "Lending Party" in its capacity as a lender or issuer
of letters of credit.
"Lender(s)" means the Initial Lender(s) and each Person that shall become a
Lender hereunder pursuant to Section 8.07.
"Letter of Credit" means any Letter of Credit issued hereunder (as
specified in Section 2.03(a)), as the same now exists or may hereinafter be
amended, modified, supplemented, expanded, renewed, restated or replaced.
"Letter of Credit Advance" means an advance made by the Issuing Bank or any
Revolving Credit Lender pursuant to Section 2.03(c).
"Letter of Credit Agreement" has the meaning specified in Section 2.03(a).
"Letter of Credit Commitment" means, with respect to the Issuing Bank, the
amount set forth opposite the Issuing Bank's name on Schedule I hereto under the
----------
caption "Letter of Credit Commitment" or, if the Issuing Bank has entered into
one or more Assignments and Acceptances, set forth for the Issuing Bank in the
Register maintained by the Administrative Agent pursuant to Section 8.07(d) as
the Issuing Bank's "Letter of Credit Commitment," as such amount may be reduced
pursuant to Section 2.05.
"Letter of Credit Facility" means, at any time, an amount equal to the
amount of the Issuing Bank's Letter of Credit Commitment at such time, as such
amount may be reduced at or prior to such time pursuant to Section 2.05.
25
"Lien" means any lien, security interest or other charge or encumbrance of
any kind, or any other type of preferential arrangement, including, without
limitation, the lien or retained security title of a conditional vendor and any
easement, right of way or other encumbrance on title to real property.
"Loan Documents" means (i) this Agreement, (ii) the Notes, (iii) the
Collateral Documents, (iv) each Subsidiary Guaranty, (v) each Foreign Guaranty,
(vi) each Subsidiary Guaranty and Foreign Guaranty delivered pursuant to
Section 5.01(m)(ii) hereof, (vii) each Letter of Credit Agreement, (viii) each
Bank Hedge Agreement, and (ix) all other agreements, instruments and documents
executed in connection with the foregoing, in each case as the same may at any
time be amended, supplemented, restated or otherwise modified and in effect.
"Loan Party" means each of the Borrower and the Subsidiary Guarantors.
"Margin Stock" has the meaning specified in Regulations T, U and X.
"Material Adverse Effect" means any fact of circumstance which (a)
materially and adversely affects the business or financial condition of the
Borrower and its Subsidiaries, taken as a whole, or (b) materially and adversely
affects the ability of the Borrower and the Subsidiary Guarantors, taken as a
whole, to perform their collective obligations under the Loan Documents.
"Material Contract" means, with respect to any Person, each written
contract which would create a monetary obligation of such Person, or a right to
receive funds by such Person, and each other written contract to which such
Person is a party which is material to the business and operations of such
Person, the termination of which could reasonably be expected to result in a
Material Adverse Effect.
"Mortgages" means, individually and collectively, each mortgage, deed to
secure debt or deed of trust or other instrument at any time granting the
Administrative Agent, for itself and ratably for
26
the benefit of the Lender Parties and the Hedge Banks, a lien upon any Real
Property of the Borrower or any of its Subsidiaries.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (i) is maintained for employees of any Loan
Party or any ERISA Affiliate and at least one Person other than the Loan Parties
and the ERISA Affiliates or (ii) was so maintained and in respect of which any
Loan Party or any ERISA Affiliate could have liability under Section 4064 or
4069 of ERISA in the event such plan has been or were to be terminated.
"Net Cash Proceeds" means, with respect to any Asset Disposition, Debt
Issuance or the Subordinated Issuance or Equity Issuance by any Person, or any
Extraordinary Receipt, the aggregate amount of cash received from time to time
(whether as initial consideration or through payment or disposition of deferred
consideration) in connection with such transaction after deducting therefrom
only (without duplication) (i) reasonable and customary brokerage commissions,
underwriting fees and discounts, legal fees, finder's fees and other similar
fees and commissions and all other reasonable costs and expenses incurred in
connection with any such Asset Disposition, Debt Issuance, Subordinated
Issuance, Equity Issuance or Extraordinary Receipt, (ii) the amount of taxes
payable in connection with or as a result of such transaction, (iii) the amount
of any Debt secured by a Lien on such asset that is required to be repaid upon
such disposition, in each case to the extent, but only to the extent, that the
amounts so deducted are, at the time of receipt of such cash, actually paid to a
Person that is not an Affiliate of such Person or the Borrower or any of its
Subsidiaries or any Affiliate of any Borrower or any of its Subsidiaries and are
properly attributable to such transaction or to the asset that is the subject
thereof and (iv) the amount to be used to replace any such asset.
27
"Note" means a Revolving Credit Note or a Swing Line Note, and
collectively, the "Notes".
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
"Notice of Issuance" has the meaning specified in Section 2.03(a).
"Notice of Swing Line Borrowing" has the meaning specified in
Section 2.02(b).
"Notice of Termination" has the meaning specified in Section 2.01(d).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment, performance or
other obligation of such Person of any kind, including, without limitation, any
liability of such Person on any claim, whether or not the right of any creditor
to payment in respect of such claim is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, disputed, undisputed, legal, is
equitable, secured or unsecured, and whether or not such claim is discharged,
stayed or otherwise affected by any proceeding referred to in Section 6.01(f).
Without limiting the generality of the foregoing, the Obligations of the Loan
Parties under the Loan Documents include (i) the obligation to pay principal,
interest, Letter of Credit commissions, charges, expenses, fees, attorneys' fees
and disbursements, indemnities and other amounts payable by any Loan Party under
any Loan Document (ii) the obligation of any Loan Party to reimburse any amount
in respect of any of the foregoing that any Lender Party, in its sole
discretion, may elect to pay or advance on behalf of such Loan Party.
"OECD" means the Organization for Economic Cooperation and Development (or
any successor).
"Other Taxes" has the meaning specified in Section 2.12(b).
28
"PBGC" means the Pension Benefit Guaranty Corporation (or any successor).
"Permitted Acquisition" means the acquisition by the Borrower or any of its
Subsidiaries of Interface Graphics Ltd., a corporation organized under the laws
of Scotland, (ii) Jevons Xxxxx Limited, a corporation organized under the laws
of the United Kingdom and (iii) any Person or of any division or line of
business of any Person or of any Person with (or without) its Subsidiaries (any
such acquired Person, division or line or business, or Person and Subsidiaries
being herein called a "Proposed Business") either by merger, consolidation,
purchase of the majority of the Voting Stock, or purchase of all or any portion
of the assets of such Proposed Business, provided that each of the conditions to
any such acquisition set forth below shall have been satisfied as of the
consummation of such acquisition:
(a) such Proposed Business is principally engaged in substantially
the same or similar line of business as the Borrower or any of its Subsidiaries;
(b) in the event that the total consideration paid by the Borrower
and its Subsidiaries (whether in cash, by the assumption or incurrence of Debt
(including seller notes and other liabilities otherwise permitted to be incurred
under this Agreement), by the transfer of any other assets or properties by the
Borrower or any of its Subsidiaries to the seller in connection with such
acquisition), shall equal or exceed (and including in the computation of
consideration the amount of any contingent, earnout and deferred cash payments
reasonably likely to be paid in the next succeeding 12 months) (i) Ten Million
Dollars ($10,000,000) in respect of any single acquisition (or series of related
acquisitions that may reasonably be deemed to constitute a single transaction)
or (ii) Twenty-Five Million Dollars ($25,000,000) in respect of all acquisitions
in any twelve (12) month period ending on the last day of the calendar month
immediately preceding the closing of the proposed acquisition the Required
Lenders shall have consented to the acquisition (such consent not to be
unreasonably withheld);
29
(c) after giving effect to any such acquisition, there shall be not
less than Two Million Five Hundred Thousand Dollars ($2,500,000) in the
aggregate, of Unused Revolving Credit Commitments and cash on hand;
(d) no Event of Default shall exist or be continuing or would exist
after giving effect to such acquisition;
(e) all assets and properties acquired in connection with such
proposed acquisition shall be free and clear of all Liens, except as otherwise
permitted in this Agreement;
(f) concurrently with the making of such an acquisition consisting
of assets, the Borrower shall, as additional collateral security for the
Obligations, grant to the Administrative Agent for staff and ratably for the
benefit of the Lender, Parties and the Hedge Banks, first priority liens on and
first priority security interests in any of the acquired assets of the type
previously granted to the Administrative Agent (subject only to Permitted Liens)
by the execution and delivery to the Administrative Agent of such agreements,
instruments and documents as shall be satisfactory in form and substance to the
Administrative Agent;
(g) each of the Administrative Agent and each of the Lender Parties
shall receive for its review the full text of the financial statements of the
Proposed Business, which demonstrates that the Proposed Business has a positive
Pro Forma EBITDA and all core documentation (or other documentation requested by
the Administrative Agent) with respect to the proposed acquisition; and
(h) subject to Section 5.01(n) below, if applicable, concurrently
with the making of such acquisition, the Borrower shall, as additional
collateral security for the Obligations, deliver to the Administrative Agent an
Acquisition Rights Assignment, in form and substance satisfactory to the
Administrative Agent at least five (5) Business Days prior to the consummation
of an acquisition.
30
Notwithstanding the foregoing, in no event shall a Permitted Acquisition be
deemed to include an unsolicited tender offer or other takeover (other than a
tender offer) which does not have the approval of the board of directors of the
Proposed Business prior to the time the Borrower has taken control of the
Proposed Business.
"Permitted Acquisition Documents" means, in respect of a Permitted
Acquisition, the final executed copy of the asset or stock purchase agreement or
the merger agreement, as the case may be, and all other material agreements,
documents or instruments to be executed and/or delivered by the Borrower or any
of its Subsidiaries in connection with such Permitted Acquisition.
"Permitted Acquisition Purchase Price" means, with respect to any Permitted
Acquisition, the cash purchase price (including related reasonable and customary
fees and costs with respect to such acquisition) paid by the Borrower or its
Subsidiary making such purchase in respect thereof.
"Permitted Liens" means any of the following: (i) Liens for taxes,
assessments and governmental charges or levies (x) not yet due and payable or
(y) due and payable that are being contested in good faith and by appropriate
proceedings diligently conducted, provided that in the case of Liens under this
--------
clause (y), reserves or other appropriate provisions shall have been established
therefor in accordance with GAAP; (ii) Liens imposed by law, such as
materialmen's, mechanics', carriers', workmen's and repairmen's Liens and other
similar Liens arising in the ordinary course of business securing obligations
that are not overdue for a period of more than sixty (60) days or which are
being contested in good faith and by appropriate proceedings diligently
conducted, provided that reserves or other appropriate provisions shall have
--------
been established therefor in accordance with GAAP; (iii) pledges or deposits to
secure obligations under workers' compensation laws or similar legislation or to
secure public or statutory obligations; and (iv) Permitted Real Property
Encumbrances.
"Permitted Real Property Encumbrances" means, with respect to any
particular real property, easements, zoning restrictions or other restrictions,
rights-of-way, encroachments, covenants or
31
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not materially detract from the value of the affected
property or interfere with the ordinary conduct of business of the Borrower or
any of its Subsidiaries or materially impair the use thereof to the Borrower or
any Subsidiary.
"Person" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Pledge Agreement" has the meaning specified in Section 3.01(l)(ii).
"Pledged Collateral" means the "Pledged Securities" as defined in the
relevant Collateral Document.
"Prime Rate" means a fluctuating interest rate per annum in effect from
time to time, which rate per annum shall at all times be equal to the higher of:
(a) the rate of interest announced publicly by Fleet in Boston,
Massachusetts from time to time, as Fleet's prime rate, which is not necessarily
the lowest or best rate made available by Fleet (the "Fleet Base Rate"); or
(b) one-half (1/2) of one percent per annum above the Federal Funds
Rate.
"Prime Rate Advance" means an Advance that bears interest as provided in
Section 2.07(a)(i).
32
"Pro Forma EBITDA" means, for any period, the sum, determined on a
Consolidated basis without duplication, of (A)(i) net income (or net loss), (ii)
interest expense, (iii) income tax expense, (iv) depreciation expense, (v)
amortization expense, (vi) non-cash charges, (vii) the legal and accounting
costs and other reasonable expenses incurred in connection with any Permitted
Acquisition completed after the date of this Agreement, in each case determined
in accordance with GAAP for such period and (viii) other non-recurring,
non-operating expenses, including, without limitation, restructuring expenses;
provided, however, that net income (or net loss) shall be computed without
-------- -------
giving effect to extraordinary losses or gains; provided, further, that Pro
-------- -------
Forma EBITDA shall in any event exclude from the Initial Funding Date the amount
of any non-cash income recognized during any period for which Pro Forma EBITDA
is determined,(B) the pro forma effect on EBITDA for such period of any
Permitted Acquisition consummated by the Borrower or any of its Subsidiaries
during the most recent twelve month period preceding the date of determination,
but solely for the number of months immediately preceding the consummation of
the applicable Permitted Acquisition, which number equals twelve (12) less the
number of months following the consummation of the applicable Permitted
Acquisition to such date of determination, plus (C) the amount by which
Compensation to owners, employees or agents of a Proposed Business will be
reduced following a Permitted Acquisition, as set forth in a certificate of the
Borrower which is reasonably acceptable to the Administrative Agent.
"Proposed Business" has the meaning specified in the definition of
"Permitted Acquisition".
"Pro Rata Share" of any amount means, with respect to any Revolving Credit
Lender at any time, the product of such amount times a fraction the numerator of
which is the amount of such Lender's Revolving Credit Commitment at such time
and the denominator of which is the Revolving Credit Facility at such time.
"Reduction Amount" has the meaning specified in Section 2.06(d)(iii).
33
"Real Property" means all now owned and hereafter acquired real property of
the Borrower and its Subsidiaries, including leasehold interests, together with
all buildings, structures, and other improvements located thereon and all
licenses, easements and appurtenances relating thereto, wherever located,
including without limitation, the real property and related assets more
particularly described in the Mortgages.
"Register" has the meaning specified in Section 8.07(d).
"Regulation T" means Regulation T of the Board of Governors of the Federal
Reserve System, as the same may be modified and supplemented and in effect from
time to time.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System, as the same may be modified and supplemented and in effect from
time to time.
"Regulation X" means Regulation X of the Board of Governors of the Federal
Reserve System, as the same may be modified and supplemented and in effect from
time to time.
"Release" means any release, spill, emission, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping or
disposing into the environment (including the abandonment or discarding of
barrels, containers and other closed receptacles containing any Hazardous
Materials) or into or from any property, including, without limitation, the
movement of any Hazardous Materials through the air, soil, surface waters or
ground water.
"Remedial" shall have the meaning as set forth in CERCLA at 42 U.S.C.
Section 9601(24) and/or any other applicable Environmental Laws.
"Removal" shall have the meaning as set forth in CERCLA at 42 U.S.C.
Section 9601(23) and/or any other applicable Environmental Laws.
34
"Required Lenders" means at any time Lenders owed or holding greater than
51% of the sum of (i) the aggregate principal amount of the Advances outstanding
at such time and (ii) the aggregate Available Amount of all Letters of Credit
outstanding at such time, or, if no such principal amount and no Letters of
Credit are outstanding at such time, Lenders holding greater than 51% of the
Revolving Credit Commitments; provided, however, that if any Lender shall be a
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Defaulting Lender at such time, there shall be excluded from the determination
of Required Lenders at such time (i) the aggregate principal amount of the
Advances owing to such Lender (in its capacity as a Lender) and outstanding at
such time, and (ii) the Revolving Credit Commitment of such Lender at such time.
For purposes of this definition, the aggregate principal amount of Swing Line
Advances owing to the Swing Line Bank, Letter of Credit Advances owing to the
Issuing Bank and the Available Amount of each Letter of Credit shall be
considered to be owed to the Revolving Credit Lenders ratably in accordance with
their respective Revolving Credit Commitments.
"Response" shall have the meaning as set forth in CERCLA at 42 U.S.C.
Section 9601(25) and/or any other applicable Environmental Laws.
"Responsible Officer" means, in the case of any Loan Party, the chief
executive officer, chief financial officer or the treasurer of such Loan Party.
"Revolving Credit Advance" has the meaning specified in Sections 2.01(a)
and 2.01(b).
"Revolving Credit Availability" means the amount (if any) by which, at any
time, the Revolving Credit Facility exceeds the aggregate amount of the Unused
Revolving Credit Commitments of the Revolving Credit Lenders at such time.
"Revolving Credit Borrowing" means a borrowing consisting of simultaneous
Revolving Credit Advances of the same Type made by the Revolving Credit Lenders.
35
"Revolving Credit Commitment" means, with respect to any Revolving Credit
Lender at any time, the amount set forth opposite such Lender's name on
Schedule I hereto under the caption "Revolving Credit Commitment" or, if such
----------
Lender has entered into one or more Assignments and Acceptances, set forth for
such Lender in the Register maintained by the Administrative Agent pursuant to
Section 8.07(d) as such Lender's "Revolving Credit Commitment," as such amount
may be reduced at or prior to such time pursuant to Sections 2.05 (a) or (b).
The initial aggregate amount of the Lenders' Revolving Credit Commitments is
$65,000,000. Notwithstanding the foregoing, upon the satisfaction of the
conditions set forth in Section 2.05(c), the Revolving Credit Commitment shall
increase to $80,000,000 and, with respect to any Revolving Credit Lender at any
time, the amount set forth opposite such Lender's name on Schedule I hereto
----------
under the caption "Revolving Credit Commitment (as increased)" or, if such
Lender has entered into one or more Assignments and Acceptances, set forth for
such Lender in the Register maintained by the Administrative Agent pursuant to
Section 8.07(d) as such Lender's "Revolving Credit Commitment (as increased)",
as such amount may be reduced at or prior to such time pursuant to Sections
2.05(a)and/or (b).
"Revolving Credit Facility" means, at any time, the aggregate amount of the
Revolving Credit Lenders' Revolving Credit Commitments at such time.
"Revolving Credit Increase" means the increase in the Revolving Credit
Facility in the amount of $15,000,000.
"Revolving Credit Lender" means any Lender that has a Revolving Credit
Commitment.
"Revolving Credit Note" means a promissory note of the Borrower payable to
the order of any Revolving Credit Lender, in substantially the form of Exhibit B
---------
hereto, evidencing the aggregate indebtedness of the Borrower to such Lender
resulting from the Revolving Credit Advances made by such Lender, as each may
hereafter be amended, restated, supplemented, replaced or otherwise modified
from time to time.
36
"Revolving Credit Termination Date" means the earlier of (x) the fifth
anniversary of the Initial Funding Date and (y) the Termination Date.
"Secured Obligations" has the meaning of the term "Obligations" as
specified in the Security Agreement.
"Secured Parties" means the Administrative Agent, the Lender Parties, and
the Hedge Banks and the other Persons whose Obligations are or are purported to
be secured by the Collateral under the terms of the Collateral Documents.
"Security Agreement" has the meaning specified in Section 3.02(l)(i).
"Senior Debt" means, as at any date of determination thereof, the aggregate
outstanding principal balance of (a) all Revolving Credit Advances and Swing
Line Advances, (b) all Debt of the Borrower and its Subsidiaries, if any,
secured by purchase money security interests, conditional sale arrangements or
other similar security interests, (c) obligations of the Borrower and its
Subsidiaries, if any, with respect to Capitalized Leases and (d) other Debt of
the Borrower and its Subsidiaries, if any, which is not subordinated to other
debt in the priority of payment.
"Single Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (i) is maintained for employees of any Loan
Party or any ERISA Affiliate and no Person other than the Loan Parties and the
ERISA Affiliates or (ii) was so maintained and in respect of which any Loan
Party or any ERISA Affiliate could have liability under Section 4069 of ERISA in
the event such plan has been or were to be terminated.
"Solvent" and "Solvency" mean, that on a particular date (a) with respect
to any Person (other than a Person subject to clause (b) below) on such date,
(i) the fair value of the assets of such Person is greater than the total amount
of liabilities, including, without limitation, contingent liabilities, of such
Person, (ii) the present fair saleable value of the assets of such Person is not
less than the
37
amount that will be required to pay the probable liability of such Person on its
debts as they become absolute and matured, (iii) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay such debts and liabilities as they mature and (iv) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's assets would constitute an
unreasonably small capital; and (b) with respect to any Person incorporated in
England, on such date such Person has the ability to pay its debts as and when
they fall due and could not be deemed to be insolvent for the purposes of the
Insolvency Xxx 0000 of the United Kingdom. The amount of contingent liabilities
at any time shall be computed as the amount that, in the light of all the facts
and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
"Standby Letter of Credit" means any Letter of Credit other than a Trade
Letter of Credit.
"Subordinated Issuance" means the issuance or sale by Borrower of any Debt,
the Net Cash Proceeds of which equal or exceed $20,000,000, a portion of which
shall prepay the Existing Subordinated Debt.
"Subordinated Debt" means any Debt of the Borrower or any of its
Subsidiaries that is subordinated to the Obligations of the Borrower under the
Loan Documents on, and that otherwise contains, terms and conditions reasonably
satisfactory to the Administrative Agent and Required Lenders.
"Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate (a) of which (or in which)
more than 50% of (i) the issued and outstanding capital stock having ordinary
voting power to elect a majority of the Board of Directors of such corporation
(irrespective of whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency), (ii) the interest in the capital or profits of such partnership,
joint venture or limited liability company or (iii) the beneficial interest in
such trust or estate is at the time directly or indirectly owned or controlled
38
by such Person, by such Person and one or more of its other Subsidiaries or by
one or more of such Person's other Subsidiaries; and (b) with respect to any
Person incorporated in England, a subsidiary within the meaning of Section 736
of the Companies Act or, unless the context otherwise requires, a subsidiary
undertaking within the meaning of Section 258 of the Companies Act.
"Subsidiary Guarantor" means, collectively, each Subsidiary on the Initial
Funding Date providing a Subsidiary Guaranty or a Foreign Guaranty and each
Subsidiary created or acquired after the Initial Funding Date, which is
obligated to provide a Subsidiary Guaranty or a Foreign Guaranty pursuant to
Section 5.01(m)(iii), and, in each case, its respective successors and assigns.
"Subsidiary Guaranty" has the meaning specified in Section 3.02(k)(vi).
"Surviving Debt" shall mean the Debt which shall remain outstanding from
and after the date hereof.
"Swing Line Advance" means an advance made by the Swing Line Bank pursuant
to Section 2.01(c).
"Swing Line Advance Outstanding" means the aggregate amount of all Swing
Line Advances outstanding as at the close of business on the day immediately
preceding each Swing Line Rollover Date.
"Swing Line Bank" means Fleet.
"Swing Line Borrowing" means a borrowing consisting of a Swing Line Advance
made by the Swing Line Bank.
"Swing Line Facility" has the meaning specified in Section 2.01(b).
39
"Swing Line Note" means a promissory note of the Borrower payable to the
order of the Swing Line Bank, in substantially the form of Exhibit C hereto,
---------
evidencing the indebtedness of the Borrower to such Swing Line Bank resulting
from the Swing Line Advances made by such Swing Line Bank, as it may hereafter,
be amended, restated, supplemented, replaced or otherwise modified from time to
time.
"Swing Line Rate" has the meaning specified in Section 2.01(b).
"Swing Line Rollover Date" means the calendar day Wednesday or, if such
Wednesday is not a Business Day, the next succeeding Business Day.
"Taxes" has the meaning specified in Section 2.12(a).
"Termination Date" means the date of termination in whole of the
Commitments pursuant to Section 2.05 or 6.01.
"Trade Letter of Credit" means any Letter of Credit that is issued for the
benefit of a supplier of Inventory to the Borrower or any of its Subsidiaries to
effect payment for such Inventory, the conditions to drawing under which include
the presentation to the Issuing Bank of negotiable bills of lading, invoices and
related documents sufficient, in the judgment of the Issuing Bank, to create a
valid and perfected lien on or security interest in such Inventory, bills of
lading, invoices and related documents in favor of the Issuing Bank.
"Total Funded Debt" means, at any date of determination thereof, the
aggregate outstanding balance of all Debt of the Borrower and its Subsidiaries
(other than (a) Debt arising from Hedge Agreements, (b) guaranties of any such
Debt as described in clauses (viii) and (ix) of the definition "Debt" and (c)
Debt described in Section 5.02(b)(iii)(F)).
40
"Type" refers to the distinction between Advances bearing interest at the
Prime Rate and Advances bearing interest at the Eurodollar Rate.
"Unused Revolving Credit Commitment" means, with respect to any Revolving
Credit Lender, at any time, (a) such Lender's Revolving Credit Commitment at
such time minus (b) the sum of (1) the aggregate principal amount of all
-----
Revolving Credit Advances and Letter of Credit Advances made by such Lender (in
its capacity as a Lender) and outstanding at such time, plus (2) such Lender's
----
Pro Rata Share of (A) the aggregate Available Amount of all Letters of Credit
outstanding at such time and (B) the aggregate principal amount of all Letter of
Credit Advances made by the Issuing Bank pursuant to Section 2.03(c) and
outstanding at such time.
"Voting Stock" means capital stock issued by a corporation, or equivalent
interests in any other Person, including, without limitation, partnership
interests and membership interests issued by a limited liability company, the
holders of which are ordinarily, in the absence of contingencies, entitled to
vote for the election of directors (or persons performing similar functions) of
such Person, even if the right so to vote has been suspended by the happening of
such a contingency.
"Welfare Plan" means a welfare plan, as defined in Section 3(l) of ERISA,
that is maintained for employees of any Loan Party or in respect of which any
Loan Party could have liability.
"Wholly-Owned Subsidiary" means with respect to any Person, any Subsidiary,
all of the shares of capital stock or other ownership interests of which (except
directors' qualifying shares) are at the time directly or indirectly owned by
such Person.
"Withdrawal Liabilities" has the meaning specified in Part I of Subtitle E
of Title IV of ERISA.
41
SECTION 1.02. COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding".
SECTION 1.03. ACCOUNTING TERMS. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of the
financial statements referred to in Sections 4.01(f) and (g) ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF
THE ADVANCES AND THE LETTERS OF CREDIT
--------------------------------------
SECTION 2.01. THE ADVANCES.
(a) The Revolving Credit Advances. Each Revolving Credit Lender
--------------------------------
severally agrees, on the terms and conditions hereinafter set forth, to make
advances (each a "Revolving Credit Advance") to the Borrower from time to time
on any Business Day during the period from the Initial Funding Date until the
Revolving Credit Termination Date in an amount for each such Advance not to
exceed such Lender's Unused Revolving Credit Commitment at such time. Each
Revolving Credit Borrowing shall be in an aggregate amount of $500,000 or an
integral multiple of $100,000 in excess thereof in the case of Prime Rate
Advances and in an aggregate amount of $500,000 or an integral multiple of
$100,000 in excess thereof in the case of Eurodollar Rate Advances (other than a
Borrowing the proceeds of which shall be used solely to repay or prepay in full
outstanding Swing Line Advances or outstanding Letter of Credit Advances) and
shall consist of Revolving Credit Advances made simultaneously by the Revolving
Credit Lenders ratably according to their Revolving Credit Commitments. Within
the limits of the Unused Revolving Credit Commitments in effect from time to
time, the Borrower may borrow, repay and reborrow.
42
(b) The Swing Line Advances. The Borrower may request the Swing Line
-----------------------
Bank to make, and the Swing Line Bank shall make, on the terms and conditions
hereinafter set forth, Swing Line Advances to the Borrower from time to time on
any Business Day during the period from the Initial Funding Date until the
Revolving Credit Termination Date in a aggregate amount not to exceed at any
time outstanding the lesser of (i)(x) $3,000,000 (the "Swing Line Facility"),
minus (y) the aggregate Swing Line Advances outstanding at such time, and (ii)
an amount equal to the aggregate of the Unused Revolving Credit Commitments of
the Revolving Credit Lenders at such time. Each Swing Line Advance shall be in
integral multiples of $50,000. No Swing Line Advance shall be used for the
purpose of funding the payment of principal of any other Swing Line Advance.
Each Swing Line Borrowering shall bear interest at the rate established pursuant
to the Fee Letter (the "Swing Line Rate"). Within the limits of the Swing Line
Facility and within the limits referred to in this Section 2.01(c), the Borrower
may borrow and reborrow under this Section 2.01(c) and may repay or prepay the
Swing Line Advances at such time prior to the Revolving Credit Termination Date,
and in such integral multiples, as the Borrower may elect.
(c) Letters of Credit. The Issuing Bank agrees, on the terms and
-----------------
conditions hereinafter set forth, to issue Letters of Credit for the account of
the Borrower from time to time on any Business Day during the period from the
Initial Funding Date until sixty (60) days before the Revolving Credit
Termination Date (A) in an aggregate Available Amount for all Letters of Credit
not to exceed at any time the Issuing Bank's Letter of Credit Commitment at such
time and (B) in an Available Amount for each such Letter of Credit not to exceed
an amount equal to (x) the Unused Revolving Credit Commitments of the Revolving
Credit Lenders at such time minus (y) the aggregate Swing Line Advances
-----
outstanding at such time. No Letter of Credit shall have an expiration date
(excluding all rights of the Borrower or the beneficiary to require renewal)
later than the earlier of (A) sixty (60) days before the fifth anniversary of
the Initial Funding Date, (B) in the case of Standby Letters of Credit, 365 days
after the date of issuance thereof and (C) in the case of a Trade Letter of
Credit 180 days after the date of issuance thereof. The foregoing
notwithstanding any Standby Letter of Credit may, by its terms, be automatically
renewable annually unless such Issuing Bank shall have notified the Borrower
(with a copy to the Administrative Agent) on or prior
43
to the date for notice of termination set forth in such Letter of Credit (but in
any event at least thirty (30) Business Days prior to the date of automatic
renewal) of its election not to renew such Standby Letter of Credit (a "Notice
of Termination"); provided that the terms of each Standby Letter of Credit that
--------
is automatically renewable annually shall not permit the expiration date (after
giving effect to any renewal) of such Standby Letter of Credit in any event to
be extended to a date later than sixty (60) days before the Revolving Credit
Termination Date. If a Notice of Termination is given by the Issuing Bank
pursuant to the immediately preceding sentence, such Standby Letter of Credit
shall expire on the date on which it otherwise would have been automatically
renewed.
SECTION 2.02. MAKING THE ADVANCES.
(a) Except as otherwise provided in Section 2.03 or, with respect to
Swing Line Advances in Section 2.02(b) below, each Borrowing shall be made on
notice, given not later than 1:00 p.m. (New York time) on the third Business Day
prior to the date of the proposed Borrowing in the case of Eurodollar Rate
Advances and on the Business Day prior to the date of the proposed Borrowing in
the case of Prime Rate Advances by the Borrower to the Administrative Agent,
which shall give to each appropriate Lender same day notice thereof by telex or
telecopier. Each such notice of a Borrowing (a "Notice of Borrowing") may be by
telephone, confirmed immediately in writing, or telex or telecopier in
substantially the form of Exhibit D hereto, specifying therein the requested (i)
---------
date of such Borrowing, (ii) Facility under which such Borrowing is to be made,
(iii) Type of Advances comprising such Borrowing, (iv) aggregate amount of such
Borrowing and (v) in the case of a Borrowing consisting of Eurodollar Rate
Advances, initial Interest Period for each such Advance. Each appropriate Lender
shall, (x) before 1:00 p.m. (New York time) on the date of such Borrowing in the
case of Eurodollar Rate Advances and (y) before 3:00 p.m. (New York time) on the
date of such Borrowing in the case of Prime Rate Advances, make available for
the account of its Applicable Lending Office to the Administrative Agent at the
Administrative Agent's Account, in same day funds, such Lender's ratable portion
of such Borrowing in accordance with the respective Commitments under the
applicable Facility of such Lender and the other appropriate Lenders. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
44
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the Borrower by crediting the Borrower's Account;
provided, however, that in the case of any Revolving Credit Borrowing, the
-------- -------
Administrative Agent shall first make a portion of such funds equal to the
aggregate principal amount of any Swing Line Advances and Letter of Credit
Advances made by the Swing Line Bank, the Issuing Bank and by any other
Revolving Credit Lender and outstanding on the date of such Revolving Credit
Borrowing in accordance with the terms of this Agreement, plus interest accrued
----
and unpaid thereon to and as of such date, available to the Swing Line Bank, the
Issuing Bank and such other Revolving Credit Lenders for repayment of such Swing
Line Advances and Letter of Credit Advances.
(b) Each Swing Line Borrowing shall be made either (x) on notice,
given not later than 1:00 p.m. (New York time) on the Business Day of the
proposed Swing Line Borrowing, by the Borrower to the Swing Line Bank and the
Administrative Agent or (y) pursuant to other arrangements, including, by way of
example and not of limitation, arrangements for daily repayments and borrowings
on each Business Day, which are satisfactory in form and substance to the Swing
Line Bank, the Administrative Agent and the Borrower. Each notice of a Swing
Line Borrowing pursuant to clause (x) in the immediately preceding sentence (a
"Notice of Swing Line Borrowing") shall be by telephone, confirmed immediately
in writing, or telex or telecopier, specifying therein the requested (i) date of
such Borrowing and (ii) amount of such Borrowing. The Swing Line Bank shall make
the amount of the Swing Line Advance available to the Administrative Agent at
the Administrative Agent's Account, in same day funds. After the Administrative
Agent's receipt of such funds and upon fulfillment of the applicable conditions
set forth in Article III, the Administrative Agent will make such funds
available to the Borrower by crediting the Borrower's Account. If, and to the
extent, any Swing Line Advance shall be outstanding on the date of any Revolving
Credit Borrowing, such Swing Line Advance shall first be repaid from the
proceeds of such Revolving Credit Borrowing prior to disbursement to the
Borrower pursuant to the proviso in Section 2.02(a) above. In addition, (x) the
Swing Line Bank may, at any time, in its sole discretion by written notice to
the Borrower and the Administrative Agent, demand repayment of its Swing Line
Advances or, (y) in the event the Swing Line Advance Outstanding exceeds
$1,000,000, on
45
each Swing Line Rollover Date such Swing Line Advance Outstanding shall be
automatically rolled over into the Revolving Credit Facility, and in either case
the Borrower shall be deemed to have requested a Revolving Credit Advance
hereunder comprised entirely of a Prime Rate Advance in the amount of such Swing
Line Advances from all the Revolving Credit Lenders based on each such Lender's
Pro Rata Share and the Revolving Credit Lenders shall make a Revolving Credit
Advance (comprised entirely of a Prime Rate Advance and based on each such
Lender's Pro Rata Share) in an amount equal to (i) all outstanding Swing Line
Advances as of the date of such demand in the case of clause (x) above or (ii)
the Swing Line Advance Outstanding in the case of clause (y) above, by deposit
to the Administrative Agent's Account, in same day funds, an amount equal to
such Lender's Pro Rata Share thereof, without regard to whether or not the
conditions set forth in Section 3.02 have otherwise been satisfied. The proceeds
from such Revolving Credit Advance shall be applied directly to the Swing Line
Bank to repay the Swing Line Bank for such outstanding Swing Line Advances. The
Borrower hereby agrees to each such automatic rollover into the Revolving Credit
Facility and to each such Revolving Credit Advance. Each Revolving Credit Lender
agrees to each such automatic rollover into the Revolving Credit Facility and to
make each such Revolving Credit Advance based on its Pro Rata Share on (i) the
Swing Line Rollover Date or such other Business Day on which demand therefor is
made by the Swing Line Bank; provided that notice of such demand is given not
--------
later than 3:00 P.M. (New York time) on such Business Day, or (ii) the first
Business Day next succeeding such demand if notice of such demand is given after
such time. If and to the extent that any Revolving Credit Lender shall not have
so made the amount of such Lender's Pro Rata Share of such Revolving Credit
Advance available to the Administrative Agent, such Revolving Credit Lender
agrees to pay to the Administrative Agent, for the account of the Swing Line
Bank, forthwith on demand such amount together with interest thereon, for each
day from the date of demand by the Swing Line Bank until the date such amount is
paid to the Administrative Agent, at the Federal Funds Rate. If such Lender
shall pay to the Administrative Agent such amount for the account of the Swing
Line Bank on any Business Day, such amount so paid in respect of principal shall
constitute a Revolving Credit Advance made by such Lender on such Business Day
for purposes of this Agreement, and the outstanding principal amount of the
46
Swing Line Advance made by the Swing Line Bank shall be reduced by such amount
on such Business Day.
(c) Anything in subsection (a) above to the contrary notwithstanding,
(i) the Borrower may not select Eurodollar Rate Advances if the obligation of
the appropriate Lenders to make Eurodollar Rate Advances shall then be suspended
pursuant to Section 2.09 or Section 2.10, and (ii) Eurodollar Rate Advances may
not be outstanding as part of more than ten (10) separate Borrowings.
(d) Each Notice of Borrowing and Notice of Swing Line Borrowing shall
be irrevocable and binding on the Borrower. In the case of any Borrowing that
the related Notice of Borrowing specifies is to be comprised of Eurodollar Rate
Advances, the Borrower shall indemnify each appropriate Lender against any loss,
cost or expense incurred by such Lender as a result of any failure to fulfill on
or before the date specified in such Notice of Borrowing for such Borrowing the
applicable conditions set forth in Article III, including, without limitation,
any loss (including loss of anticipated profits as reasonably determined by such
Lender), cost or expense incurred by reason of the liquidation or redeployment
of deposits or other funds acquired by such Lender to fund the Advance to be
made by such Lender as part of such Borrowing when such Advance, as a result of
such failure, is not made on such date.
(e) Unless the Administrative Agent shall have received notice from
an appropriate Lender prior to the date of any Borrowing under a Facility under
which such Lender has a Commitment that such Lender will not make available to
the Administrative Agent such Lender's ratable portion of such Borrowing, the
Administrative Agent may assume that such Lender has made such portion available
to the Administrative Agent on the date of such Borrowing in accordance with
subsection (a) or (b) of this Section 2.02 and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such ratable portion available to the Administrative Agent, such Lender and
the Borrower severally agree to repay or pay to the Administrative Agent
47
forthwith on demand such corresponding amount and to pay interest thereon, for
each day from the date such amount is made available to the Borrower until the
date such amount is repaid or paid to the Administrative Agent, at (i) in the
case of the Borrower, the interest rate applicable at such time under
Section 2.07 to Advances comprising such Borrowing and (ii) in the case of such
Lender, the Federal Funds Rate. If such Lender shall pay to the Administrative
Agent such corresponding amount, such amount so paid shall constitute such
Lender's Advance as part of such Borrowing for all purposes.
(f) The failure of any Lender to make the Advance to be made by
it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03. ISSUANCE OF AN DRAWINGS AND REIMBURSEMENT UNDER LETTERS OF
CREDIT.
(a) Request for Issuance. Each Letter of Credit shall be issued upon
--------------------
notice, given not later than 1:00 p.m. (New York time) on the fifth Business Day
prior to the date of the proposed issuance of such Letter of Credit, by the
Borrower to the Issuing Bank, which shall give to the Administrative Agent and
each Revolving Credit Lender prompt notice thereof by telex or telecopier. Each
such notice of issuance of a Letter of Credit (a "Notice of Issuance") may be by
telephone, confirmed immediately in writing, or telex or telecopier, specifying
therein the requested (i) date of such issuance (which shall be a Business Day),
(ii) Available Amount of such Letter of Credit, (iii) expiration date of such
Letter of Credit, (iv) name and address of the beneficiary of such Letter of
Credit and (v) form of such Letter of Credit, and shall be accompanied by such
customary application and agreement for letter of credit as the Issuing Bank may
specify to the Borrower for use in connection with such requested Letter of
Credit (as the same now exists or may thereafter be amended, modified,
supplemented, extended, renewed, restated or replaced, a "Letter of Credit
Agreement"). If the requested form of such Letter of Credit is acceptable to the
Issuing Bank, in its reasonable discretion, the Issuing Bank will, upon
fulfillment of the applicable conditions set forth
48
in Article III, make such Letter of Credit available to the Borrower or as
otherwise directed by the Borrower in connection with such issuance. In the
event and to the extent that the provisions of any such Letter of Credit
Agreement shall conflict with this Agreement, the provisions of this Agreement
shall govern.
(b) Letter of Credit Reports. The Issuing Bank shall furnish (i) to
------------------------
the Administrative Agent on the first Business Day of each week a written report
summarizing issuance and expiration dates of Letters of Credit issued during the
previous week and drawings during such week under all Letters of Credit, (ii) to
the Administrative Agent, the Borrower and each Revolving Credit Lender on the
first Business Day of each month a written report summarizing issuance and
expiration dates of Letters of Credit issued during the preceding month and
drawings during such month under all Letters of Credit and (iii) to the
Administrative Agent, the Borrower and each Revolving Credit Lender on the first
Business Day of each calendar quarter a written report setting forth the average
daily aggregate Available Amount during the preceding calendar quarter of all
Letters of Credit.
(c) Drawing and Reimbursement. The Borrower shall be obligated
---------------------------
pursuant to each Letter of Credit Agreement to reimburse the Issuing Bank within
two (2) Business Days after demand in immediately available funds for drafts
drawn under any Letter of Credit. If any drawing is not so reimbursed, then the
payment by the Issuing Bank of a draft drawn under any Letter of Credit shall
constitute for all purposes of this Agreement the making by the Issuing Bank of
a Letter of Credit Advance which shall be a Prime Rate Advance (retroactive to
the date of the demand), in the amount of such draft. The Borrower, the
Administrative Agent and each Revolving Credit Lender hereby acknowledge and
agree that Letter of Credit Advances may be made, or deemed made, by the Issuing
Bank in respect of any Letter of Credit and to participate in all Letter of
Credit Advances made hereunder as provided herein. Upon written demand by the
Issuing Bank, with a copy of such demand to the Administrative Agent, each
Revolving Credit Lender shall purchase from the Issuing Bank, and the Issuing
Bank shall sell and assign to each such Revolving Credit Lender, such Lender's
Pro Rata Share of such outstanding Letter of Credit Advance as of the date of
such
49
purchase, by making available (for the account of its Applicable Lending Office)
to the Administrative Agent (for the account of the Issuing Bank), by deposit to
the Administrative Agent's Account, in same day funds, an amount equal to the
portion of the outstanding principal amount of such Letter of Credit Advance to
be purchased by such Lender. Promptly after receipt thereof, the Administrative
Agent shall transfer such funds to the Issuing Bank. The Borrower hereby agrees
to each such sale and assignment. Each Revolving Credit Lender agrees to
purchase its Pro Rata Share of an outstanding Letter of Credit Advance on (i)
the Business Day on which demand therefor is made by the Issuing Bank; provided
--------
that notice of such demand is given not later than 1:00 p.m. (New York time) on
such Business Day or (ii) the first Business Day next succeeding such demand if
notice of such demand is given after such time. Upon any such assignment by the
Issuing Bank to any other Revolving Credit Lender of a portion of a Letter of
Credit Advance, the Issuing Bank represents and warrants to such other Lender
that the Issuing Bank is the legal and beneficial owner of such interest being
assigned by it, free and clear of any liens, but makes no other representation
or warranty and assumes no responsibility with respect to such Letter of Credit
Advance, the Loan Documents or any Loan Party. If and to the extent that any
Revolving Credit Lender shall not have so made its pro rata share of the amount
of such Letter of Credit Advance available to the Administrative Agent, such
Revolving Credit Lender agrees to pay to the Administrative Agent forthwith on
demand such amount together with interest thereon, for each day from the date of
demand by the Issuing Bank until the date such amount is paid to the
Administrative Agent, at the Federal Funds Rate for its account or the account
of the Issuing Bank, as applicable. If such Lender shall pay to the
Administrative Agent such amount for the account of the Issuing Bank on any
Business Day, such amount so paid in respect of principal shall constitute a
Letter of Credit Advance made by such Lender on such Business Day for purposes
of this Agreement, and the outstanding principal amount of the Letter of Credit
Advance made by the Issuing Bank shall be reduced by such amount on such
Business Day.
(d) Failure to Make Letter of Credit Advances. The failure of any
-------------------------------------------
Lender to make any Letter of Credit Advance to be made by it on the date
specified in Section 2.03(c) shall not relieve any other Lender of its
obligation hereunder to make its Letter of Credit Advance on such
50
date, but no Lender shall be responsible for the failure of any other Lender to
make the Letter of Credit Advance to be made by such other Lender on such date.
SECTION 2.04. REPAYMENT OF ADVANCES.
(a) Revolving Credit Advances. The Borrower shall repay to
-----------------------------
the Administrative Agent for the ratable account of the Revolving Credit Lenders
on the Revolving Credit Termination Date the aggregate outstanding principal
amount of the Revolving Credit Advances then outstanding.
(b) Swing Line Advances. The Borrower shall repay to the
---------------------
Administrative Agent for the account of the Swing Line Bank that has made a
Swing Line Advance the outstanding principal amount of each Swing Line Advance
made by such Swing Line Bank in accordance with Section 2.02(b), but in any
event no later than the Revolving Credit Termination Date.
(c) Letter of Credit Advances.
-------------------------
(i) The Borrower shall repay to the Administrative Agent for
the account of the Issuing Bank and each other Revolving Credit Lender that has
made a Letter of Credit Advance on the earlier of demand and the Revolving
Credit Termination Date the outstanding principal amount of each Letter of
Credit Advance made by each of them.
(ii) The Obligations of the Borrower under this Agreement, any
Letter of Credit Agreement and any other agreement or instrument relating to any
Letter of Credit shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement, such Letter of Credit
Agreement and such other agreement or instrument under all circumstances,
including, without limitation, the following circumstances:
(A) any lack of validity or enforceability of any Loan
Document, any Letter of Credit Agreement, any Letter of Credit or any other
agreement or instrument relating
51
to any of the foregoing (as the same now exists or may hereinafter be amended,
modified, supplemented, extended, renewed, restated or replaced, all of the
foregoing being, collectively, the "L/C Related Documents");
(B) any change in the time, manner or place of payment
of, or in any other term of, all or any of the Obligations of the Borrower in
respect of any L/C Related Document or any other amendment or waiver of or any
consent to departure from all or any of the L/C Related Documents;
(C) the existence of any claim, set-off, defense or
other right that the Borrower may have at any time against any beneficiary or
any transferee of a Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), the Issuing Bank, or any
other Person, whether in connection with the transactions contemplated by the
L/C Related Documents or any unrelated transaction;
(D) any statement or any other document presented
under a Letter of Credit should prove to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect; or
(E) any exchange, release or non-perfection of any
Collateral or other collateral, or any release or amendment or waiver of or
consent to departure from any Subsidiary Guaranty, Foreign Guaranty or any other
guarantee, for all or any of the Obligations of the Borrower in respect of the
L/C Related Documents.
SECTION 2.05. TERMINATION OR REDUCTION OF THE COMMITMENTS; INCREASE IN THE
COMMITMENTS.
(a) Optional Termination or Reduction of the Commitments. The
----------------------------------------------------------
Borrower may, upon at least three (3) Business Days' notice to the
Administrative Agent, terminate in whole or
52
reduce in part the unused portions of each of the Unused Revolving Credit
Commitments and/or the Letter of Credit Facility; provided, however, that each
-------- -------
partial reduction of a Facility (i) shall be in an aggregate amount of $500,000
or an integral multiple of $100,000 in excess thereof, and (ii) shall be made
ratably among the appropriate Lenders in accordance with their Commitments with
respect to such Facility.
(b) Mandatory Termination or Reduction of the Commitments.
-----------------------------------------------------
(i) The Revolving Credit Facility shall be automatically and
permanently reduced on each of the following dates (or on the next Business Day,
if any such date is not a Business Day) in the amounts set forth below:
Amount (if prior to Amount (if after
Date Revolving Credit Increase) Revolving Credit Increase)
---- -------------------------- --------------------------
August 12, 2001 $1,250,000 $1,250,000
November 12, 2001 $1,250,000 $1,250,000
February 12, 2002 $1,250,000 $1,250,000
May 12, 2002 $1,250,000 $1,250,000
August 12, 2002 $1,250,000 $2,500,000
November 12, 2002 $1,250,000 $2,500,000
February 12, 2003 $1,250,000 $2,500,000
May 12, 2003 $1,250,000 $2,500,000
August 12, 2003 $3,750,000 $3,750,000
November 12, 2003 $3,750,000 $3,750,000
February 12, 2004 $3,750,000 $3,750,000
May 12, 2004 $3,750,000 $3,750,000
provided that each such reduction of the Revolving Credit Facility shall be made
--------
ratably among the Revolving Credit Lenders in accordance with the Revolving
Credit Commitments.
(ii) The Letter of Credit Facility shall be permanently reduced
from time to time on the date of each reduction in the Revolving Credit Facility
by the amount, if any, by which
53
the amount of the Letter of Credit Facility exceeds the Revolving Credit
Facility after giving effect to such reduction of the Revolving Credit Facility.
With respect to Asset Dispositions under Section 2.06(b), the Revolving
Credit Facility shall be automatically and permanently reduced on each date on
which prepayment thereof is required to be made pursuant to Section 2.06(b) in
an amount equal to the applicable prepayment, provided that each such reduction
of the Revolving Credit Facility shall be made ratably among the Revolving
Credit Lenders in accordance with their Revolving Credit Commitments, provided,
--------
further that no such permanent reduction shall be made, if within one hundred
-------
eighty (180) days after the closing of same, the Net Cash Proceeds of any Asset
Disposition is expended to make a Permitted Acquisition or to purchase capital
assets to be used by Borrower or any Subsidiary in its existing business;
provided, further, that if the Net Cash Proceeds of any Asset Disposition causes
-------- -------
the aggregate Net Cash Proceeds of all Asset Dispositions in any Fiscal Year to
exceed $10,000,000, the Net Cash Proceeds from such disposition and any
additional Asset Dispositions in such Fiscal Year shall be used to prepay and
permanently reduce the Revolving Credit Facility as provided above.
(c) Increase in the Commitment. Without any action by any Person,
--------------------------
the Revolving Credit Increase shall occur upon the satisfaction of the following
conditions:
(i) the receipt by the Administrative Agent of true, correct
and complete copies of the executed agreements, documents and/or instruments
relating to the Subordinated Issuance, in form and substance satisfactory to the
Administrative Agent;
(ii) the receipt by the Administrative Agent of evidence of the
receipt by the Borrower of the Net Cash Proceeds of the Subordinated Issuance,
in form and substance satisfactory to the Administrative Agent;
54
(iii) the receipt by the Administrative Agent of evidence of
the payment in full of the Existing Subordinated Debt, in form and substance
satisfactory to the Administrative Agent;
(iv) the receipt by the Administrative Agent of the written
request by the Borrower for an increase in the Revolving Credit Facility in the
amount of $15,000,000 pursuant to this Section 2.05(c);
(v) a subordination agreement with the lender or lenders of
the Subordinated Issuance in form and substance satisfactory for the
Administrative Agent which shall include, without limitation, a maturity date
occurring after the fifth anniversary of the Initial Funding Date;
(vi) the receipt by the Administrative Agent of any other
agreements, documents and/or instruments reasonably requested by the
Administrative Agent in connection with the purposes of this Section 2.05(c),
including, without limitation, amended and restated Revolving Credit Notes, in
form and substance satisfactory to the Administrative Agent;
(vii) the passing of sixty (60) days following satisfaction of
the last of the foregoing conditions set forth in this Section 2.05(c); and
(viii) no Default or Event of Default shall exist on the date on
which the Revolving Credit Increase would occur if not for the existence of this
condition.
SECTION 2.06. PREPAYMENTS AND REPAYMENTS.
(a) Optional. The Borrower may, upon at least three (3) Business
--------
Days' notice in the case of Eurodollar Advances and same day notice in the case
of Prime Rate Advances to the Administrative Agent stating the proposed date and
55
aggregate principal amount of the prepayment or repayment, as the case may be,
and if such notice is given, the Borrower shall, without premium or penalty,
prepay or repay, as the case may be, the outstanding aggregate principal amount
of the Advances, in whole or ratably in part, together with accrued interest to
the date of such prepayment on the aggregate principal amount prepaid or repaid,
as the case may be; provided, however, that (i) each partial prepayment or
repayment, as the case may be, shall be in an aggregate principal amount of
$500,000 or an integral multiple of $100,000 in excess thereof and (ii) if any
prepayment or repayment, as the case may be, of a Eurodollar Rate Advance shall
be made on a day other than on the last day of an Interest Period therefor, the
Borrower shall, together with such prepayment or repayment, as the case may be,
pay any Eurodollar Rate breakage costs as provided in Section 8.04(c). Each
prepayment or repayment, as the case may be, made pursuant to this
Section 2.06(a) shall be applied in accordance with the Borrower's direction.
(b) Mandatory. With respect to (i) any sale, lease, transfer or
---------
other disposition of any property or asset of the Borrower or any of its
Subsidiaries (other than any sale, lease, transfer or other disposition of any
such property or asset as set forth in Sections 5.02(d)(i) and (d)(iii) (each an
"Asset Disposition", and collectively, "Asset Dispositions")), (ii) any Equity
Issuance, (iii) any Debt Issuance, (iv) any Extraordinary Receipt, or (v) any
Excess Cash Flow, the Borrower shall, (w) within fifteen (15) days after receipt
by the Borrower or any of its Subsidiaries of the Net Cash Proceeds from such
Asset Disposition or Extraordinary Receipt, as the case may be, or, (x) with
respect to an Equity Issuance, within two (2) Business Days after the
requirement set forth in clause (e) of the definition of "Equity Issuance"
pertaining to the application thereof to the applicable Permitted Acquisition
Purchase Price has not been met, or (y) with respect to any Debt Issuance,
within two (2) Business Days of receipt by the Borrower of the Net Cash Proceeds
therefrom, in any case prepay or repay, as the case may be (without premium or
penalty), the then outstanding Advances in an amount equal to (w) one hundred
percent (100%) of such Net Cash Proceeds resulting from such Asset Disposition
or Extraordinary Receipt, (x) seventy five percent (75%) of such Net Cash
Proceeds resulting from such Equity Issuance, (y) one hundred percent (100%) of
such Net Cash Proceeds resulting from such Debt Issuance, and (z) if the ratio
of Consolidated Senior Debt to Pro Forma EBITDA, as computed in accordance with
Section 5.04(b), is greater than
56
or equal to 2.50:1.00, 75%, and if such ratio is less than 2.50:1.00, 50%. Each
prepayment or repayment, as the case may be, made pursuant to this
Section 2.06(b) shall be subject to the provisions of Section 8.04(c) and shall
be applied as set forth in clause (c) below.
(c) Application of Prepayments and Repayments. All prepayments or
repayments, as the case may be, made pursuant to clause (b) of this Section 2.06
shall be applied to the outstanding Advances as follows:
(i) first, to prepay Letter of Credit Advances then
outstanding until all such Letter of Credit Advances are paid in full; and
(ii) second, to prepay Revolving Credit Advances then
outstanding (whereupon the Revolving Credit Facility shall be permanently
reduced to the extent set forth in Section 2.05(b)(iii) in the amount of such
prepayment) until such Revolving Credit Advances are paid in full; and
(iii) third, deposited in the L/C Cash Collateral Account to
cash collateralize 100% of the Available Amount of the Letters of Credit then
outstanding.
(d) Miscellaneous Provisions Relating to Prepayments, Termination or
-----------------------------------------------------------------
Reduction of Commitments and Maintenance of L/C Cash Collateral Account.
--------------------------------------------------------------------------
(i) To the extent that any application provided for in clause
(c) of this Section 2.06 allocable to Eurodollar Rate Advances shall occur on
other than the last day of an applicable Interest Period, the Borrower shall be
required to pay the amounts provided for in Section 8.04(c) hereof.
(ii) Upon the drawing of any Letter of Credit for which funds
are on deposit in the L/C Cash Collateral Account, such funds shall be applied
to reimburse the Issuing
57
Bank or the Revolving Credit Lenders, as applicable. Upon the termination of all
of the Commitments and the payment in full of all Obligations, the termination
or expiration of all Letters of Credit and the payment in full of all
Obligations in respect of all Letters of Credit, then all amounts remaining on
deposit in the L/C Cash Collateral Account shall be returned to the Borrower.
(iii) The amount remaining (if any) after the required
prepayment of the Advances then outstanding and the 100% cash collateralization
of the aggregate Available Amount of Letters of Credit then outstanding in
accordance with clause (c) of this Section 2.06 (the sum of such prepayment
amounts and cash collateralization amounts being referred to herein as the
"Reduction Amount") may be retained by the Borrower.
(iv) The Borrower shall, within fifteen (15) days following
the end of each month in each Fiscal Year, pay to the Administrative Agent for
deposit in the L/C Cash Collateral Account an amount sufficient to cause the
aggregate amount on deposit in such Account to equal the amount by which the
aggregate Available Amount of all Letters of Credit then outstanding exceeds the
Letter of Credit Facility on such day.
(v) At any time that the aggregate amount of Revolving Credit
Advances outstanding exceeds the Revolving Credit Availability, the Borrower
shall immediately repay Revolving Credit Advances to the extent necessary to
reduce the principal balance of Revolving Credit Advances to an amount equal to
or less than the Revolving Credit Availability.
(vi) The provisions of this Section 2.06 shall not be
construed to permit any Equity Issuance, Debt Issuance or Asset Disposition
otherwise prohibited under the terms of this Agreement.
58
SECTION 2.07. INTEREST.
(a) Scheduled Interest. The Borrower shall pay to the
---------------------
Administrative Agent, for the benefit of the Lenders, interest on the unpaid
principal amount of each Advance owing to each Lender from the date of such
Advance until such principal amount shall be paid in full, at the following
rates per annum:
(i) Prime Rate Advances. During such periods as such
---------------------
Advance is a Prime Rate Advance, a rate per annum equal at all times to the sum
of (x) the Prime Rate in effect from time to time plus (y) the Applicable Margin
for such Advance in effect from time to time, payable in arrears quarterly on
the last day of each calendar quarter during such periods and on the date such
Prime Rate Advance shall be Converted or paid in full. Changes in the rate of
interest resulting from changes in the Prime Rate shall take place immediately
without notice or demand of any kind.
(ii) Eurodollar Rate Advances. During such periods as such
--------------------------
Advance is a Eurodollar Rate Advance, a rate per annum equal at all times during
each Interest Period for such Advance to the sum of (x) the Eurodollar Rate for
such Interest Period for such Advance plus (y) the Applicable Margin for such
----
Advance in effect on the first day of such Interest Period, payable in arrears
on the last day of such Interest Period and, if such Interest Period has a
duration of more than three months, on each day that occurs during such Interest
Period every three months from the first day of such Interest Period and on the
date such Eurodollar Rate Advance shall be Converted or paid in full.
(iii) Swing Line Advances. During such periods as such Advance
-------------------
is a Swing Line Advance, a rate per annum equal at all times to the Swing Line
Rate in effect from time to time, payable in arrears monthly on the last day of
each month and on the date such Swing Line Advance shall be rolled over into the
Revolving Credit Facility as provided in Section 2.02(b) or paid in full.
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(b) Default Interest. (i) With respect to any principal amount of
-----------------
any Advance not paid when due by the Borrower (whether at the stated maturity,
by acceleration or otherwise), the Borrower shall pay interest on such unpaid
principal amount, in arrears on the dates referred to in clause (a)(i), (a)(ii)
or (a)(iii) above and on demand, at a rate per annum equal at all times to two
percent (2%) per annum above the rate per annum required to be paid on such
Advance pursuant to clause (a)(i), (a)(ii) or (a)(iii) above; and with respect
to the amount of any interest, fee or other amount payable hereunder not paid
when due (whether at the stated maturity, by acceleration or otherwise) the
Borrower shall pay interest on such amount to the fullest extent permitted by
law from the date such amount shall be due until such amount shall be paid in
full, in arrears on the date such amount shall be paid in full and on demand, at
a rate per annum equal at all times to two percent (2%) per annum above the rate
per annum required to be paid, in the case of interest, on the Type of Advance
on which such interest has accrued pursuant to clause (a)(i) or (a)(ii) above,
and, in all other cases, on Prime Rate Advances pursuant to clause (a)(i) above.
(c) Notice of Interest Rate. Promptly after receipt of a Notice of
------------------------
Borrowing pursuant to Section 2.02(a), the Administrative Agent shall give
notice to the Borrower and each appropriate Lender of the applicable interest
rate determined by the Administrative Agent for purposes of clause (a)(i) or
(ii).
SECTION 2.08. FEES.
(a) Commitment Fees. The Borrower shall pay to the Administrative
---------------
Agent, for the account of the Lenders, commitment fees on the Unused Revolving
Credit Commitment, from the earlier of: (i) Initial Funding Date in the case of
each Initial Lender and from the effective date specified in the Assignment and
Acceptance pursuant to which it became a Lender in the case of each other
Lender, and (ii) 90 days after the date hereof, until the Revolving Credit
Termination Date payable in arrears quarterly on the last Business Day of each
March, June, September, and December, commencing on the first of such dates
after the Initial Funding Date, and on the Revolving Credit Termination Date at
the applicable percent per annum set forth in the Unused
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Commitment Fee Table set forth below, determined in the same manner as are the
Applicable Margins for the Facilities, by reference to the ratio of Consolidated
Total Funded Debt to Pro Forma EBITDA for the four full fiscal quarters
preceding such determination. For purposes of this clause (a), Swing Line
Advances shall not constitute utilization of the Revolving Credit Commitments of
the Revolving Credit Lenders.
Notwithstanding the foregoing, for the first six (6) months after the
Initial Funding Date, the rate per annum on the average daily Unused Revolving
Credit Commitment of each Lender shall be equal to 0.500%.
UNUSED COMMITMENT FEE TABLE
---------------------------
Consolidated Total Funded
Debt to Pro Forma EBITDA Percentage
------------------------ ----------
Equal to or greater than 3.00 to 1.00 .500%
Equal to or greater than 3.00 to 1.00
but less than 3.00 to 1.00 .500%
Equal to or greater than 2.00 to 1 .00,
but less than 3.00 to 1.00 .500%
Equal to or greater than 2.50 to 1 .00,
but less than 3.00 to 1.00 .500%
Less than 2.00 to 1.00 .375%
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(b) Letter of Credit Fees.
---------------------
(i) The Borrower shall pay to the Administrative Agent for
the account of each Revolving Credit Lender a commission, payable in arrears
quarterly on the last Business Day of each March, June, September and December,
commencing on the first of such dates after the Initial Funding Date, and on the
Revolving Credit Termination Date, on such Lender's Pro Rata Share of the
average daily aggregate Available Amount during such quarter of all Letters of
Credit outstanding from time to time at the rate per annum equal to the
Applicable Margin then in effect for Eurodollar Rate Advances under the
Revolving Credit Facility.
(ii) In addition to the foregoing fees described in Section
2.08(b)(i) above, the Borrower shall pay to the Issuing Bank, for its own
account, (x) on the Available Amount of each Letter of Credit, a fronting fee,
for the period from the date of issuance of such Letter of Credit to and
including the termination thereof, computed at the rate of one quarter of one
percent (1/4%) per annum, payable in arrears quarterly on the last Business Day
of each March, June, September and December of each year and on the date of
termination thereof and (y) transfer fees and other customary fees and charges
in connection with the issuance or administration of each Letter of Credit as
the Borrower and the Issuing Bank shall agree.
(c) Administrative Agent's Fees. The Borrower shall pay to the
----------------------------
Administrative Agent for its own account such fees as may from time to time be
agreed between the Borrower and the Administrative Agent, including, without
limitation, the fees specified in that certain letter agreement dated April 15,
1999, between Borrower and Fleet (as such letter agreement may be amended,
supplemented or otherwise modified from time to time, the "Fee Letter") and due
under and pursuant to such Fee Letter.
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SECTION 2.09. CONVERSION OF ADVANCES.
(a) Optional. The Borrower may on any Business Day, upon notice
--------
given to the Administrative Agent not later than 1:00 p.m. (New York time) on
the third Business Day prior to the date of the proposed Conversion to
Eurodollar Rate Advances and by 1:00 p.m. on the Business Day prior to the
proposed Conversion to Prime Rate Advances and subject to the provisions of
Sections 2.07 and 2.10, Convert all or any portion of the Advances of one Type
comprising the same Borrowing into Advances of the other Type; provided,
--------
however, that any Conversion of Eurodollar Rate Advances into Prime Rate
-------
Advances shall be made only on the last day of an Interest Period for such
Eurodollar Rate Advances, no Conversion of any Advances shall be less than the
minimum amount applicable under Section 2.01(a) or (b) or result in more
separate Borrowings than permitted under Section 2.02(c) and each Conversion of
Advances comprising part of the same Borrowing under any Facility shall be made
ratably among the appropriate Lenders in accordance with their Commitments under
such Facility. Each such notice of Conversion shall, within the restrictions
specified above, specify (i) the date of such Conversion, (ii) the Advances to
be Converted and (iii) if such Conversion is into Eurodollar Rate Advances, the
duration of the initial Interest Period for such Advances. Each notice of
Conversion shall be irrevocable and binding on the Borrower.
(b) Mandatory.
---------
(i) On the date on which the aggregate unpaid principal
amount of Eurodollar Rate Advances comprising any Borrowing shall be reduced, by
payment or prepayment or otherwise, to less than $500,000, such Advances shall
automatically Convert into Prime Rate Advances on the last day of the Interest
Period relating thereto.
(ii) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and
63
the appropriate Lenders, whereupon each such Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Prime Rate Advance.
(iii) Upon the occurrence and during the continuance of any
Event of Default and the acceleration of the Notes, interest thereon and other
amounts payable by the Borrower under this Agreement and the other Loan
Documents pursuant to Article VI, (x) each Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Prime Rate Advance and (y) the obligation of the Lenders to make,
or to Convert Advances into, Eurodollar Rate Advances shall be suspended.
SECTION 2.10. INCREASED COSTS, ETC.
(a) If, after the date hereof, due to (i) the introduction of any
change in reserve requirements included in the Eurodollar Rate Reserve
Percentage, any change in the interpretation of, or any change in, any law or
regulation, or (ii) the compliance with any guideline or request from any
central bank or other governmental authority (whether or not having the force of
law made after the date hereof), there shall be any increase in the cost to any
Lender Party of agreeing to make or of making, funding or maintaining Eurodollar
Rate Advances or of agreeing to issue or of issuing or maintaining Letters of
Credit or of agreeing to make or of making or maintaining Letter of Credit
Advances (excluding for purposes of this Section 2.10 any such increased costs
resulting from (x) Taxes or Other Taxes (as to which Section 2.12 shall govern)
and (y) changes in the basis of taxation of overall net income or overall gross
income by the United States or by the foreign jurisdiction or state under the
laws of which such Lender Party is organized or has its Applicable Lending
Office or any political subdivision thereof), then the Borrower shall from time
to time, upon demand by such Lender Party (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender Party additional amounts sufficient to compensate such Lender Party for
such increased cost; provided, however, that a Lender Party claiming additional
-------- -------
amounts under this Section 2.10(a) agrees to use reasonable efforts (consistent
with legal and regulatory restrictions) to designate a different Applicable
Lending Office if the
64
making of such a designation would avoid the need for, or reduce the amount of,
such increased cost that may thereafter accrue and would not, in the reasonable
judgment of such Lender Party, be otherwise disadvantageous to such Lender
Party. A certificate as to the amount of such increased cost, submitted to the
Borrower by such Lender Party, shall be conclusive and binding for all purposes,
absent manifest error.
(b) If, after the date hereof, due to (i) the introduction of any
change in the interpretation of, or any change in, any law or regulation, or
(ii) the compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law made after the
date hereof), there shall be any increase in the amount of capital required or
reasonably expected to be maintained by any Lender Party or any corporation
controlling such Lender Party as a result of or based upon the existence of such
Lender Party's commitment to lend or to issue Letters of Credit hereunder or the
issuance or maintenance of the Letters of Credit, then, upon demand by such
Lender Party (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to the Administrative Agent for the account of such Lender
Party, from time to time as specified by such Lender Party, additional amounts
sufficient to compensate such Lender Party or such corporation in the light of
such circumstances, to the extent that such Lender Party reasonably determines
such increase in capital to be allocable to the existence of such Lender Party's
commitment to lend or to issue Letters of Credit hereunder or to the issuance or
maintenance of any Letters of Credit. A certificate as to such amounts submitted
to the Borrower by such Lender Party shall be conclusive and binding for all
purposes, absent manifest error.
(c) If, with respect to any Eurodollar Rate Advances under any
Facility, Lenders owed greater than 50% of the then aggregate unpaid principal
amount thereof notify the Administrative Agent that the Eurodollar Rate for any
Interest Period for such Advances will not adequately reflect the cost to such
Lenders of making, funding or maintaining their Eurodollar Rate Advances for
such Interest Period, the Administrative Agent shall forthwith so notify the
Borrower and the appropriate Lenders, whereupon (i) each such Eurodollar Rate
Advance under any Facility will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Prime
65
Rate Advance and (ii) the obligation of the appropriate Lenders to make, or to
Convert Advances into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower that such Lenders have determined
that the circumstances causing such suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if, after
the date hereof, the introduction of any change in, or any change in the
interpretation of, any law or regulation shall make it unlawful, or any central
bank or other governmental authority shall assert that it is unlawful, for any
Lender or its Eurodollar Lending Office to perform its obligations hereunder to
make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate
Advances hereunder, then, on notice thereof and demand therefor by such Lender
to the Borrower through the Administrative Agent, (i) that portion of each
Eurodollar Rate Advance made by such Lender under each Facility under which such
Lender has a Commitment will automatically, upon such demand, Convert into a
Prime Rate Advance and (ii) the obligation of such Lender to make, or to Convert
Advances into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower that such Lender has determined
that the circumstances causing such suspension no longer exist; provided,
--------
however, that before making any such demand, such Lender agrees to use
-------
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Eurodollar Lending Office if the making
of such a designation would allow such Lender or its Eurodollar Lending Office
to continue to perform its obligations to make Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar Rate Advances and would not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender.
SECTION 2.11. PAYMENTS AND COMPUTATIONS.
(a) The Borrower shall make each payment hereunder and under the
Notes, irrespective of any right of counterclaim or set-off (except as otherwise
provided in Section 2.13), not later than 1:00 p.m. (New York time) on the day
when due in lawful money of the United States to the Administrative Agent at the
Administrative Agent's Account in immediately available funds.
66
The Administrative Agent will promptly thereafter cause like funds to be
distributed (i) if such payment by the Borrower is in respect of principal,
interest, commitment fees or any other Obligation then payable hereunder and
under the Notes to more than one Lender Party, to such Lender Parties for the
account of their respective Applicable Lending Offices ratably in accordance
with the amounts of such respective Obligations then payable to such Lender
Parties and (ii) if such payment by the Borrower is in respect of any Obligation
then payable hereunder to one Lender Party, to such Lender Party for the account
of its Applicable Lending Office, in each case to be applied in accordance with
the terms of this Agreement. Upon its acceptance of an Assignment and Acceptance
and recording of the information contained therein in the Register pursuant to
Section 8.07(d), from and after the effective date of such Assignment and
Acceptance, the Administrative Agent shall make all payments hereunder and under
the Notes in respect of the interest assigned thereby to the Lender Party
assignee thereunder, and the parties to such Assignment and Acceptance shall
make all appropriate adjustments in such payments for periods prior to such
effective date directly between themselves.
(b) If the Administrative Agent receives funds for application to
the Obligations under the Loan Documents under circumstances for which the Loan
Documents do not specify the Advances, the Facility or other amount to which, or
the manner in which, such funds are to be applied, the Administrative Agent may,
but shall not be obligated to, elect to distribute such funds to each Lender
Party ratably in accordance with such Lender Party's proportionate share of the
principal amount of all outstanding Advances and the Available Amount of all
Letters of Credit then outstanding in repayment or prepayment of such of the
outstanding Advances or other Obligations owed to such Lender Party, and for
application to such Obligation, as the Administrative Agent shall direct.
(c) The Borrower hereby authorizes each Lender Party, if and to the
extent payment owed to such Lender Party is not made when due hereunder or, in
the case of a Lender, under the Note held by such Lender, to charge from time to
time against any or all of the Borrower's accounts with such Lender Party any
amount so due.
67
(d) With the exception of the calculation of interest with respect
to the Fleet Base Rate which shall be calculated by the Administrative Agent on
the basis of a year of 365 or 366 days for the actual number of days occurring
in the period for which such interest is payable all computations of interest,
fees and Letter of Credit commissions shall be made by the Administrative Agent
on the basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest, fees or commissions are payable. Each determination by the
Administrative Agent of an interest rate, fee or commission hereunder shall be
conclusive and binding for all purposes, absent manifest error.
(e) Whenever any payment hereunder or under any Note shall be stated
to be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or commitment fee, as the
case may be; provided, however, that, if such extension would cause payment of
-------- -------
interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(f) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to any Lender Party
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender Party
on such due date an amount equal to the amount then due such Lender Party. If
and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent, each such Lender Party shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
Party together with interest thereon, for each day from the date such amount is
distributed to such Lender Party until the date such Lender Party repays such
amount to the Administrative Agent, at the Federal Funds Rate.
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SECTION 2.12. TAXES.
(a) Any and all payments by the Borrower hereunder or under the Notes
shall be made in accordance with Section 2.11, free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding, in
the case of each Lender Party and the Administrative Agent, net income taxes
that are imposed by the United States and net income taxes (or franchise taxes
imposed in lieu thereof) that are imposed on such Lender Party or the
Administrative Agent by the local, state or foreign jurisdiction under the laws
of which such Lender Party or the Administrative Agent (as the case may be) is
organized or any political subdivision thereof and, in the case of each Lender
Party, net income taxes (or franchise taxes imposed in lieu thereof) that are
imposed on such Lender Party by the local, state or foreign jurisdiction of such
Lender Party's Applicable Lending Office or any political subdivision thereof
(all such non-excluded taxes, levies, imposts, deductions, charges, withholdings
and liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under any
Note to any Eligible Assignee, any Lender Party or the Administrative Agent, (i)
the sum payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.12) such Lender Party or the Administrative Agent (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future stamp,
documentary, excise, property or similar taxes, charges or levies that arise
from any payment made hereunder or under the Notes or from the execution,
delivery or registration of, performing under, or otherwise with respect to,
this Agreement or the Notes (hereinafter referred to as "Other Taxes").
69
(c) The Borrower shall indemnify each Lender Party and the
Administrative Agent for the full amount of Taxes and Other Taxes, and for the
full amount of taxes imposed by any jurisdiction on amounts payable under this
Section 2.12, imposed on or paid by such Lender Party or the Administrative
Agent (as the case may be) and any liability (including penalties, additions to
tax, interest and expenses) arising therefrom or with respect thereto, except
with respect to any Lender Party or the Administrative Agent, as the case may
be, for such a liability arising from such Lender Party's or the Administrative
Agent's, as the case may be, willful misconduct or gross negligence. This
indemnification shall be made within thirty (30) days from the date such Lender
Party or the Administrative Agent, as the case may be, makes written demand
specifying in reasonable detail the basis therefor.
(d) Within thirty (30) days after the date of any payment of Taxes,
the Borrower shall furnish to the Administrative Agent, at its address referred
to in Section 8.02, the original receipt of payment thereof or a certified copy
of such receipt. In the case of any payment hereunder or under the Notes by or
on behalf of the Borrower through an account or branch outside the United States
or by or on behalf of the Borrower by a payor that is not a United States
person, if the Borrower determines that no Taxes are payable in respect thereof,
the Borrower shall furnish, or shall cause such payor to furnish, to the
Administrative Agent, at such address, an opinion of counsel acceptable to the
Administrative Agent stating that such payment is exempt from Taxes. For
purposes of this subsection (d) and subsection (e), the terms "United States"
and "United States person" shall have the meanings specified in Section 7701 of
the Internal Revenue Code.
(e) Each Lender Party organized under the laws of a jurisdiction
outside the United States shall, (i) on or prior to the date of its execution
and delivery of this Agreement in the case of each Initial Lender or Initial
Issuing Bank, as the case may be, and on the date of the Assignment and
Acceptance pursuant to which it became a Lender Party in the case of each other
Lender Party, and (ii) from time to time thereafter as requested in writing by
the Borrower or the Administrative Agent (except to the extent such Lender Party
is unable to do so by reason of a change in the Code, any applicable tax treaty,
or any official interpretation of either occurring after
70
the Lender Party became such under this Agreement (a "Change in Law"), provide
each of the Administrative Agent and the Borrower with two (2) original Internal
Revenue Service Form 1001 or 4224, as appropriate, and two (2) original Forms
W-8 or any successor or other form prescribed by the Internal Revenue Service,
certifying that such Lender is exempt from or entitled to a reduced rate of
United States withholding tax on payments pursuant to this Agreement or the
Notes. If the forms provided by a Lender Party at the time such Lender Party
first becomes a party to this Agreement indicate a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered excluded from Taxes unless and until such Lender Party provides the
appropriate form certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate only shall be considered excluded from Taxes for periods
governed by such form; provided, however, that, if at the date of the Assignment
-------- -------
and Acceptance pursuant to which a Lender Party becomes a party to this
Agreement, the Lender Party assignor was entitled to payments under subsection
(a) in respect of United States withholding tax with respect to interest paid at
such date, then, to such extent, the term Taxes shall include (in addition to
withholding taxes that may be imposed in the future or other amounts otherwise
includable in Taxes) United States withholding tax, if any, applicable with
respect to the Lender Party assignee on such date. If any form or document
referred to in this subsection (e) requires the disclosure of information, other
than information necessary to compute the tax payable and information required
on the date hereof by Internal Revenue Service Form 1001 or 4224, that a Lender
Party reasonably considers to be confidential, such Lender Party shall give
notice thereof to the Borrower and shall not be obligated to include in such
form or document such confidential information.
(f) For any period with respect to which a Lender Party described in
Section 2.12(e) has failed to provide the Borrower with the appropriate form
described in Section 2.12(e) (other than if such failure is due to a Change in
Law occurring after the date on which a form originally was required to be
provided), such Lender Party shall not be entitled to indemnification under
Sections 2.12(a) or (c) with respect to Taxes imposed by the United States by
reason of such failure.
71
(g) Any Lender Party claiming any additional amounts payable pursuant
to this Section 2.12 agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Applicable Lending Office if the making of such a change
would avoid the need for, or reduce the amount of, any such additional amounts
that may thereafter accrue and would not, in the reasonable judgment of such
Lender Party, be otherwise disadvantageous to such Lender Party.
SECTION 2.13. SHARING OF PAYMENTS, ETC. If any Lender Party shall obtain
at any time any payment (whether voluntary, involuntary, through the exercise of
any right of set-off, or otherwise) (i) on account of Obligations due and
payable to such Lender Party hereunder or under the Notes at such time in excess
of its ratable share (according to the proportion of (x) the amount of such
Obligations due and payable to such Lender Party at such time to (y) the
aggregate amount of the Obligations due and payable to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the
Obligations due and payable to all Lender Parties hereunder or under the Notes
at such time obtained by all the Lender Parties at such time or (ii) on account
of Obligations owing (but not due and payable) to such Lender Party hereunder
and under the Notes at such time in excess of its ratable share (according to
the proportion of (x) the amount of such Obligations owing to such Lender Party
at such time to (y) the aggregate amount of the Obligations owing (but not due
and payable) to all Lender Parties hereunder and under the Notes at such time)
of payments on account of the Obligations owing (but not due and payable) to all
Lender Parties hereunder and under the Notes at such time obtained by all of the
Lender Parties at such time, such Lender Party shall forthwith purchase from the
other Lender Parties such participations in the Obligations due and payable or
owing to them, as the case may be, as shall be necessary to cause such
purchasing Lender Party to share the excess payment ratably with each of them;
provided, however, that if all or any portion of such excess payment is
-------- -------
thereafter recovered from such purchasing Lender Party, such purchase from each
other Lender Party shall be rescinded and each such other Lender Party shall
repay to the purchasing Lender Party the purchase price to the extent of such
Lender Party's ratable share (according to the proportion of (x) the purchase
price paid to such Lender Party to (y) the aggregate purchase price paid to all
Lender Parties) of such recovery together with an amount equal
72
to such Lender Party's ratable share (according to the proportion of (x) the
amount of such other Lender Party's required repayment to (y) the total amount
of such required repayments to the purchasing Lender Party) of any interest or
other amount paid or payable by the purchasing Lender Party in respect of the
total amount so recovered. The Borrower agrees that any Lender Party so
purchasing a participation from another Lender Party pursuant to this
Section 2.13 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off) with respect to such
participation as fully as if such Lender Party were the direct creditor of the
Borrower in the amount of such participation.
SECTION 2.14. USE OF PROCEEDS. The proceeds of the Advances and issuances
of Letters of Credit shall be available, and the Borrower shall use such
proceeds and Letters of Credit solely for the following purposes:
(a) to refinance or prepay all outstanding Debt of the Borrower and
its Subsidiaries under the Existing Credit Facility and the outstanding Debt of
the Foreign Subsidiaries as listed on Schedule 2.14(a) attached hereto.
----------------
(b) to finance Permitted Acquisitions, to pay fees and expenses
relating to the financing set forth in this Agreement and the other Loan
Documents, and to provide for working capital and other general corporate
purposes of the Borrower and its Subsidiaries.
SECTION 2.15. DEFAULTING LENDERS.
(a) In the event that, at any one time, (i) any Lender Party shall be
a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Advance
to the Borrower and (iii) the Borrower shall be required to make any payment
hereunder or under any other Loan Document to or for the account of such
Defaulting Lender, then the Borrower may, so long as no Default shall occur or
be continuing at such time and to the fullest extent permitted by applicable
law, set off and otherwise apply the obligation of the Borrower to make such
payment to or for the account of such
73
Defaulting Lender against the obligation of such Defaulting Lender to make such
Defaulted Advance. In the event that, on any date, the Borrower shall so set off
and otherwise apply its obligation to make any such payment against the
obligation of such Defaulting Lender to make any such Defaulted Advance on or
prior to such date, the amount so set off and otherwise applied by the Borrower
shall constitute for all purposes of this Agreement and the other Loan Documents
an Advance by such Defaulting Lender made on the date under the Facility
pursuant to which such Defaulted Advance was originally required to have been
made pursuant to Section 2.01. Such Advance shall be a Prime Rate Advance and
shall be considered, for all purposes of this Agreement, to comprise part of the
Borrowing in connection with which such Defaulted Advance was originally
required to have been made pursuant to Section 2.01, even if the other Advances
comprising such Borrowing shall be Eurodollar Rate Advances on the date such
Advance is deemed to be made pursuant to this subsection (a). The Borrower shall
notify the Administrative Agent at any time the Borrower exercises its right of
set-off pursuant to this subsection (a) and shall set forth in such notice (i)
the name of the Defaulting Lender and the Defaulted Advance required to be made
by such Defaulting Lender and (ii) the amount set off and otherwise applied in
respect of such Defaulted Advance pursuant to this subsection (a). Any portion
of such payment otherwise required to be made by the Borrower to or for the
account of such Defaulting Lender which is paid by the Borrower, after giving
effect to the amount set off and otherwise applied by the Borrower pursuant to
this subsection (a), shall be applied by the Administrative Agent as specified
in subsection (b) or (c) of this Section 2.15.
(b) In the event that, at any one time, (i) any Lender Party shall be
a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Amount to
the Administrative Agent or any of the other Lender Parties and (iii) the
Borrower shall make any payment hereunder or under any other Loan Document to
the Administrative Agent for the account of such Defaulting Lender, then the
Administrative Agent may, on its behalf or on behalf of such other Lender
Parties and to the fullest extent permitted by applicable law, apply at such
time the amount so paid by the Borrower to or for the account of such Defaulting
Lender to the payment of each such Defaulted Amount to the extent required to
pay such Defaulted Amount. In the event that the Administrative Agent shall
74
so apply any such amount to the payment of any such Defaulted Amount on any
date, the amount so applied by the Administrative Agent shall constitute for all
purposes of this Agreement and the other Loan Documents, payment, to such
extent, of such Defaulted Amount on such date. Any such amount so applied by the
Administrative Agent shall be retained by the Administrative Agent or
distributed by the Administrative Agent to such other Lender Parties, ratably in
accordance with the respective portions of such Defaulted Amounts payable at
such time to the Administrative Agent and such other Lender Parties and, if the
amount of such payment made by the Borrower shall at such time be insufficient
to pay all Defaulted Amounts owing at such time to the Administrative Agent and
the other Lender Parties, in the following order of priority:
(i) first, to the Administrative Agent for any Defaulted
Amount then owing to the Administrative Agent; and
(ii) second, to the Lender Parties for any Defaulted Amounts
then owing to such Lender Parties, ratably in accordance with such respective
Defaulted Amounts then owing to such Lender Parties.
Any portion of such amount paid by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by the
Administrative Agent pursuant to this subsection (b), shall be applied by the
Administrative Agent as specified in subsection (c) of this Section 2.15.
(c) In the event that, at any one time, (i) any Lender Party shall be
a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Advance
or a Defaulted Amount and (iii) the Borrower, the Administrative Agent or any
other Lender Party shall be required to pay or distribute any amount hereunder
or under any other Loan Document to or for the account of such Defaulting
Lender, then the Borrower or such other Lender Party shall pay such amount to
the Administrative Agent to be held by the Administrative Agent, to the fullest
extent permitted by applicable law, in escrow or the Administrative Agent shall,
to the fullest extent permitted by
75
applicable law, hold in escrow such amount otherwise held by it. Any funds held
by the Administrative Agent in escrow under this subsection (c) shall be
deposited by the Administrative Agent in an account with Fleet, in the name and
under the control of the Administrative Agent, but subject to the provisions of
this subsection (c). The terms applicable to such account, including the rate of
interest payable with respect to the credit balance of such account from time to
time, shall be Fleet's standard terms applicable to escrow accounts maintained
with it. Any interest credited to such account from time to time shall be held
by the Administrative Agent in escrow under, and applied by the Administrative
Agent from time to time in accordance with the provisions of, this subsection
(c). The Administrative Agent shall, to the fullest extent permitted by
applicable law, apply all funds so held in escrow from time to time to the
extent necessary to make any Advances required to be made by such Defaulting
Lender and to pay any amount payable by such Defaulting Lender hereunder and
under the other Loan Documents to the Administrative Agent or any other Lender
Party, as and when such Advances or amounts are required to be made or paid and,
if the amount so held in escrow shall at any time be insufficient to make and
pay all such Advances and amounts required to be made or paid at such time, in
the following order of priority:
(i) first, to the Administrative Agent for any amount then
due and payable by such Defaulting Lender to the Administrative Agent hereunder;
(ii) second, to the Lender Parties for any amount then due and
payable by such Defaulting Lender to such Lender Parties hereunder, ratably in
accordance with such respective amounts then due and payable to such Lender
Parties; and
(iii) third, to the Borrower for any Advance then required to
be made by such Defaulting Lender pursuant to a Commitment of such Defaulting
Lender.
In the event that any Lender Party that is a Defaulting Lender shall, at any
time, cease to be a Defaulting Lender, any funds held by the Administrative
Agent in escrow at such time with respect to such Lender Party shall be
distributed by the Administrative Agent to such Lender Party and
76
applied by such Lender Party to the Obligations owing to such Lender Party at
such time under this Agreement and the other Loan Documents in such manner as
the Administrative Agent shall reasonably direct.
(d) The rights and remedies against a Defaulting Lender under this
Section 2.15 are in addition to other rights and remedies that the Borrower may
have against such Defaulting Lender with respect to any Defaulted Advance and
that the Administrative Agent or any Lender Party may have against such
Defaulting Lender with respect to any Defaulted Amount.
SECTION 2.16. REGULATION U. Each Lender Party shall be responsible for
its compliance hereunder with Regulation U, if and as applicable, and the
Administrative Agent shall have no responsibility with respect to any such
compliance by any Lender Party.
ARTICLE III
CONDITIONS OF LENDING
---------------------
SECTION 3.01. CONDITIONS PRECEDENT TO THE INITIAL FUNDING DATE. The
obligation of each Lender to make its Initial Extension of Credit hereunder and
the effectiveness of this Agreement is subject to the condition that the
Administrative Agent shall have received each of the following, each in form and
substance satisfactory to the Administrative Agent, and in sufficient copies for
each Lender:
(a) Credit Agreement. This Agreement, which shall have been executed
----------------
by each party hereto.
(b) Resolutions; Incumbency. With respect to each of the Borrower
-----------------------
and each of the Subsidiaries:
77
(i) copies of the resolutions of the board of directors of
such Person authorizing the execution, delivery and performance of the Loan
Documents to which such Person is a party and the transactions contemplated
hereby and thereby, certified by the Secretary or an Assistant Secretary of such
Person; and
(ii) a certificate of the Secretary or Assistant Secretary of
such Person certifying the names, titles and true signatures of the officers of
such Person authorized to execute, deliver and perform, as applicable, the Loan
Documents to be delivered by it hereunder.
(c) Organization Documents; Good Standing. With respect to each of
-------------------------------------
the Borrower and each of the Subsidiaries:
(i) the articles or certificate of incorporation, memorandum
and articles of association, and bylaws of such Person as then in effect,
certified by the Secretary or Assistant Secretary of such Person; and
(ii) a good standing certificate for such Person from the
Secretary of State (or similar, applicable Governmental Authority) of its state
of incorporation and each state where such Person is qualified to do business as
a foreign corporation as of a recent date, together with a bring-down
certificate by facsimile.
(d) Legal Opinions. Opinions addressed to the Administrative Agent
--------------
and the Lenders, dated as of the Initial Funding Date, of (i) Xxxxxxxx Xxxxxxxxx
Professional Corporation, counsel to the Borrower; and (ii) Wilde Sapte, special
English counsel to the Borrower, in each case, in form and substance
satisfactory to the Administrative Agent.
(e) Certificate. A certificate signed by a Responsible Officer of
-----------
the Borrower, stating that:
78
(i) the representations and warranties contained in Article
IV are true and correct;
(ii) no Default or Event of Default exists;
(iii) no event of default or any event that would constitute an
event of default but for the requirement that notice be given at time elapse or
both, exists under the Existing Credit Facility; and
(iv) there has not occurred since February 28, 1999, with
respect to the Borrower and its Subsidiaries, any event or circumstance that has
resulted or could reasonably be expected to result in a Material Adverse Effect.
(f) Pro Forma Balance Sheet; Projections; and Financials.
----------------------------------------------------
(i) A pro forma consolidated balance sheet of the Borrower
and its Subsidiaries (based on the interim financial statements of the Borrower
as of February 28, 1999, together with a compliance certificate executed by a
Responsible Officer, demonstrating compliance by the Borrower with Section 5.04
as of the Initial Funding Date, which pro forma balance sheet and compliance
certificate shall be in form and substance satisfactory to the Administrative
Agent; and
(ii) Projections for the period commencing in August 31, 1998,
and concluding on the date five years thereafter in form and substance
acceptable to the Administrative Agent.
(g) Solvency Certificates. The Borrower shall have delivered a
----------------------
written certificate of a Responsible Officer of the Borrower, in form and
substance satisfactory to the Administrative Agent with respect to the solvency
of the Borrower and each of the Subsidiaries.
79
(h) [Intentionally Omitted]
(i) Notes. The Notes in the form of Exhibit B and Exhibit C, payable
----- --------- ---------
to the order of the applicable Lender Parties duly executed by the Borrower.
(j) Lender Release Letters. A fully executed, valid and binding
------------------------
bank release letter, or other customary evidence of satisfaction acceptable to
the Administrative Agent, delivered by each lender to the Borrower and each of
its Subsidiaries (which must include the lenders under Existing Credit Facility)
being repaid on the Initial Funding Date stating that the total amount due under
any credit and loan documents or agreements with such lenders, as the case may
be, howsoever due and owing (whether as principal, interest or premium) shall be
satisfied (and such agreements terminated) upon payment of an amount certain,
together with such lien releases and other customary payoff documentation as the
Administrative Agent shall reasonably require.
(k) Collateral Documents.
--------------------
(i) A security agreement duly executed by the Borrower, in
form and substance satisfactory to the Administrative Agent, granting to the
Administrative Agent, for itself and ratably for the benefit of the Lender
Parties and the Hedge Banks, a first priority security interest (subject only to
Permitted Liens) in the Collateral described therein (together with each
security agreement duly executed and delivered by the Domestic Subsidiaries, in
form and substance satisfactory to the Administrative Agent, granting to the
Administrative Agent, for itself and ratably for the benefit of the Lender
Parties and the Hedge Banks, a first priority security interest (subject only to
Permitted Liens) in the Collateral described therein, in each case as amended,
supplemented or otherwise modified from time to time in accordance with its
terms, a "Security Agreement"), together with:
(A) proper, duly executed financing statements under the
Uniform Commercial Code of all jurisdictions that the Administrative Agent may
deem necessary or desirable
80
in order to perfect and protect the first priority Liens and security interests
created under the Security Agreement, covering the Collateral described in the
Security Agreement;
(B) completed requests for information listing all
effective financing statements filed that name the Borrower or any Domestic
Subsidiary as debtor, together with copies of such financing statements; and
(C) evidence of the insurance required by the terms of the
Security Agreement.
(ii) A pledge agreement duly executed by the Borrower, in form
and substance satisfactory to the Administrative Agent, granting to the
Administrative Agent, for itself and ratably for the benefit of the Lender
Parties and the Hedge Banks, a first priority security interest (subject only to
Permitted Liens) in the Collateral described therein (together with each pledge
agreement duly executed and delivered by any Domestic Subsidiary which is the
parent company of another Domestic Subsidiary, in form and substance
satisfactory to the Administrative Agent, granting to the Administrative Agent,
for itself and ratably for the benefit of the Lender Parties and the Hedge
Banks, a first priority security interest (subject only to Permitted Liens) in
the Collateral described therein, in each case as amended, supplemented or
otherwise modified from time to time in accordance with its terms, a "Pledge
Agreement"), together with certificates representing the Pledged Securities
referred to in the Pledge Agreement, accompanied by undated stock powers
executed in blank and irrevocable proxies.
(iii) agreements with respect to the Collateral Agreement of
acquisition agreements with respect to prior acquisitions (each an "Acquisition
Rights Agreement", and, collectively "Acquisition Rights Assignments"), by
sellers of assets and capital stock to the Borrower and its Subsidiaries in
favor of the Administrative Agent, for itself and ratably for the benefit of the
Lender Parties and the Hedge Banks, in each case, in form and substance
satisfactory to the Administrative Agent;
81
(iv) intellectual property security agreements in form and
substance reasonably acceptable to the Administrative Agent;
(v) all consents, waivers, acknowledgments and other
agreements from third persons, which the Administrative Agent may deem necessary
or desirable in order to permit, protect and perfect its security interest for
and liens upon the Collateral (for itself and ratably for the benefit of the
Lender Parties and the Hedge Banks) or to effectuate the provisions or purposes
of this Agreement and the other Loan documents, including, without limitation
acknowledgments by lessors, mortgagees and warehousemen of the Administrative
Agent's security interests in the Collateral, for itself, and ratably for the
benefit of Lender Parties and the Hedge Banks, waivers by such persons of any
security interests, liens or other claims by such person to the Collateral and
agreements permitting the Administrative Agent's access to, and the right to
remain on, the premises to exercise its and their rights and remedies and
otherwise deal with the Collateral.
(vi) (A) A guaranty in form and substance satisfactory to the
Administrative Agent, duly executed by each Domestic Subsidiary of the Borrower
(as hereafter amended, supplemented or otherwise modified from time to time in
accordance with its terms, the "Subsidiary Guaranty"); and
(B) A guaranty in form and substance satisfactory to the
Administrative Agent, duly executed by each Foreign Subsidiary of the Borrower
(as hereafter amended, supplemented or otherwise modified from time to time in
accordance with its terms, the "Foreign Guaranty").
(vii) Evidence that all other actions necessary or, in the
reasonable opinion of the Administrative Agent, customary to perfect and protect
the first priority Lien created by the Collateral Documents has been taken.
82
(l) Payment of Fees. Evidence of payment by the Borrower of all
-----------------
accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Initial Funding Date, including any such costs, fees and expenses arising
under or referenced in Sections 2.08 and 8.04, and the fees and expenses of
counsel for the Administrative Agent.
(m) Post-Closing Letter Agreement. A letter agreement with respect
------------------------------
to certain items to be delivered post-closing, including, without limitation,
(i) evidence of and collateral assignment of life insurance policy in favor of
the Borrower with respect to the life of Xxxxxxx Xxx, together with an
associated life insurance questionnaire, in form and substance satisfactory to
the Administrative Agent; and (ii) at the discretion of the Administrative
Agent, with respect to the premises of the Borrower located at 000 Xxxx 00xx
Xxxxxx, Xxx Xxxx, Xxx Xxxx, including, without limitation, (A) a leasehold
mortgage, (B) a Phase I environmental audit, (C) a valid and effective title
insurance policy; all in form and substance satisfactory to the Administrative
Agent.
(n) Other Documents. Such other customary approvals, opinions,
----------------
documents or materials as in the Administrative Agent may reasonably request.
SECTION 3.02. CONDITIONS PRECEDENT TO ALL CREDIT EXTENSIONS. The
obligation of each Lender to make an Advance (including its initial Advance) and
the obligation of the Issuing Bank to issue a Letter of Credit (including the
initial issuance thereof) or renew a Letter of Credit and the right of the
Borrower to request the issuance or renewal of a Letter of Credit, shall each be
subject to the further conditions precedent that on the date of each such
Borrowing or issuance or renewal:
(a) Notice, Application; Continuation of Representations and
-----------------------------------------------------------------
Warranties. The following statements shall be true and the Administrative Agent
----------
shall have received (except in the case of the Letter of Credit Advance made by
the Issuing Bank or a Revolving Credit Lender pursuant to Section 2.03(c) and a
Swing Line Advance made by a Swing Line Bank pursuant to Section 2.02(b)) a
certificate signed by a duly authorized officer of the Borrower, dated the date
of such Borrowing or issuance or renewal, stating that (and each of the giving
of the applicable Notice
83
of Borrowing, Notice of Swing Line Borrowing or Notice of Issuance and the
acceptance by the Borrower of the proceeds of a Borrowing or of a Letter of
Credit or the renewal of a Letter of Credit, shall constitute a representation
and warranty by the Borrower that both on the date of such notice and on the
date of such Borrowing or issuance or renewal such statements are true):
(i) the representations and warranties contained in each Loan
Document are correct in all material respects on and as of such date (or, if any
such representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date), before and after giving effect to such
Borrowing or issuance or renewal and to the application of the proceeds
therefrom, as though made on and as of such date; and
(ii) no event has occurred and is continuing, or would result
from such Borrowing or issuance or renewal or from the application of the
proceeds therefrom, that constitutes a Default or an Event of Default.
(b) Permitted Acquisitions. With respect to any Permitted
------------------------
Acquisition, the Administrative Agent shall have received a certificate executed
by the Borrower's Responsible Officer showing the Borrower's compliance
(including the computations used by the Borrower in determining such compliance)
with the financial covenants set forth in Sections 5.04(a) through (c) on a pro
forma basis after giving effect to the proposed Permitted Acquisition.
(c) Other Approvals. The Administrative Agent shall have received
----------------
such other approvals, opinions or documents as any appropriate Lender through
the Administrative Agent may reasonably request, and all legal matters incident
to such Borrowing or issuance of such Letter of Credit shall be reasonably
satisfactory to counsel for the Administrative Agent.
SECTION 3.03. DETERMINATIONS UNDER SECTIONS 3.01 AND 3.02. For purposes of
determining compliance with the conditions specified in Section 3.01 and 3.02,
each Lender Party shall be deemed to have consented to, approved or accepted or
to be satisfied with each document or other
84
matter required thereunder to be consented to or approved by or acceptable or
satisfactory to the Lender Parties, unless an officer of the Administrative
Agent responsible for the transactions contemplated by the Loan Documents shall
have received written notice from such Lender Party prior to the Initial
Extension of Credit specifying its objection thereto and, if the Initial
Extension of Credit consists of a Borrowing, such Lender Party shall not have
made available to the Administrative Agent such Lender Party's ratable portion
of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
------------------------------
SECTION 4.01. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants as follows:
(a) The Borrower and each of its Subsidiaries (i) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (ii) is duly qualified and in good standing in each other
jurisdiction in which it owns or leases property or in which the conduct of its
business requires it to so qualify or be licensed except where the failure to so
qualify or be licensed could not reasonably be expected to have a Material
Adverse Effect and (iii) has all requisite power and authority, corporate or
otherwise (including, without limitation, all governmental licenses, permits and
other approvals), to own or lease and operate its properties and to carry on its
business as now conducted.
(b) Set forth on Schedule 4.01(b) hereto is a complete and accurate
----------------
list of all Subsidiaries of the Borrower as of the date hereof, showing as of
the date hereof (as to each such Subsidiary) the jurisdiction of its
organization, the number of shares of each class of capital stock, authorized,
and the number outstanding, on the date hereof and the percentage of the
outstanding shares of each such class owned (directly or indirectly) by the
Borrower or such Subsidiary and the number of shares covered by all outstanding
options, warrants, rights of conversion or purchase and
85
similar rights at the date hereof. All of the outstanding capital stock of all
of such Subsidiaries has been validly issued, is fully paid and non-assessable
and is owned by the Borrower or such Subsidiary or one or more of their
respective Subsidiaries free and clear of all Liens, except those created under
the Collateral Documents.
(c) The execution, delivery and performance by each Loan Party of
this Agreement and each other Loan Document to which it is or is to be a party,
and the consummation of transactions contemplated hereby and thereby, are within
such Loan Party's governing powers, have been duly authorized by all necessary
corporate action, and do not (i) contravene such Loan Party's organization
documents, (ii) violate any law (including, without limitation, the Securities
Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended),
rule, regulation (including, without limitation, Regulation T, U or X), order,
writ, judgment, injunction, decree, determination or award, (iii) conflict with
or result in the breach of, or constitute a default under, any Material
Contract, loan agreement, indenture, mortgage, deed of trust, lease or other
material instrument binding on or affecting the Borrower or any of its
Subsidiaries or any of their respective properties or (iv) except for the Liens
created pursuant to the Collateral Documents, result in or require the creation
or imposition of any Lien upon or with respect to any of the properties of the
Borrower or any of its Subsidiaries. Neither the Borrower nor any of its
Subsidiaries is in violation of any such law, rule, regulation, order, writ,
judgment, injunction, decree, determination or award or in breach of any such
contract, loan agreement, indenture, mortgage, deed of trust, lease or other
instrument or agreement, the violation or breach of which could reasonably be
expected to have a Material Adverse Effect.
(d) No authorization or approval or other action by, and no notice to
or filing (other than pursuant to the Collateral Documents) with, any
governmental authority or regulatory body or any other third party is required
for (i) the due execution, delivery, recordation, filing or performance by the
Borrower or any of its Subsidiaries of this Agreement or any other Loan Document
to which it is or is to be a party, or for the consummation of the transactions
contemplated hereby or thereby, (ii) the grant by any Loan Party of the Liens to
be granted by it pursuant to the
86
Collateral Documents, (iii) the perfection or maintenance of the Liens created
by the Collateral Documents (including the first priority nature thereof) or
(iv) the exercise by the Administrative Agent or any Lender Party of its rights
under the Loan Documents or the remedies in respect of the Collateral pursuant
to the Collateral Documents, except for the authorizations, approvals, actions,
notices and filings listed on Schedule 4.01(d), all of which shall have been
----------------
duly obtained, taken, given or made on or prior to the Initial Funding Date and
are in full force and effect. On the Initial Funding Date, all applicable
waiting periods in connection with the transactions contemplated hereby, if any,
will have expired without any action having been taken by any competent
authority restraining, preventing or imposing materially adverse conditions upon
the transactions contemplated hereby or the rights of the Loan Parties freely to
transfer or otherwise dispose of, or to create any Lien on, any properties now
owned or hereafter acquired by any of them.
(e) This Agreement has been and each of the Notes and each other Loan
Document has been or when delivered hereunder will have been, duly executed and
delivered by each Loan Party thereto, as applicable. This Agreement is and each
of the Notes and each other Loan Document has been or when delivered hereunder
will be, the legal, valid and binding obligation of each Loan Party thereto, as
applicable, enforceable against such Loan Party in accordance with its terms,
except as such enforceability may be limited by (i) bankruptcy, insolvency,
reorganization, moratorium or similar laws of general applicability affecting
the enforcement of creditors' rights and (ii) the application of general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(f) The Consolidated balance sheet of the Borrower and its
Subsidiaries as at August 31, 1998, and the related Consolidated statement of
income and Consolidated statement of cash flows of the Borrower and its
Subsidiaries for the Fiscal Year then ended, accompanied by an opinion of Ernst
& Young LLP independent public accountants, and the Consolidated balance sheet
of the Borrower and its Subsidiaries as at February 28, 1999, and the related
Consolidated statement of income and Consolidated statement of cash flows of the
Borrower and its Subsidiaries for the six (6) months then ended, duly certified
by the chief executive officer of the Borrower, copies of which
87
have been furnished to the Administrative Agent, fairly present in all material
respects, subject, in the case of said balance sheet as at February 28, 1999,
and said statement of income and cash flows for the three months then ended, to
normal year-end audit adjustments and the absence of footnotes, the Consolidated
financial condition of the Borrower and its Subsidiaries as at such dates and
the Consolidated results of the operations of the Borrower and its Subsidiaries
for the period ended on such date, all in accordance with GAAP applied on a
consistent basis, and, since February 28, 1999, there has been no change which
could reasonably be expected to result in a Material Adverse Effect.
(g) The Consolidated pro forma balance sheet of the Borrower and its
Subsidiaries as at February 28, 1999, and the related Consolidated pro forma
statement of income of the Borrower and its Subsidiaries for the period then
ended, certified by the chief executive officer of the Borrower, copies of which
have been furnished to the Administrative Agent, fairly present in all material
respects the Consolidated pro forma financial condition of the Borrower and its
Subsidiaries as at such date and the Consolidated pro forma results of
operations of the Borrower and its Subsidiaries for the period ended on such
date, in each case after giving effect to the transactions contemplated hereby,
all in accordance with GAAP.
(h) No information, exhibit or report furnished by Borrower or any
Person on behalf of Borrower to the Administrative Agent or any Lender Party in
connection with the Loan Documents or pursuant to the terms of the Loan
Documents contained any untrue statement of a material fact or omitted to state
a material fact necessary to make the statements made therein not misleading.
(i) As of the date hereof, other than as disclosed on Schedule
--------
4.01(i) (the "Disclosed Litigation"), there is no action, suit, investigation,
-------
litigation or proceeding affecting the Borrower or any of its Subsidiaries
including, without limitation, any Environmental Action, pending or, to their
knowledge, threatened before or by any court, governmental agency or arbitrator
that could reasonably be expected to have a Material Adverse Effect, and there
has been no change
88
in the status, or financial effect on the Borrower or any of its Subsidiaries of
any of the Disclosed Litigation which could reasonably be expected to result in
a Material Adverse Effect.
(j) Neither the Borrower nor any of its Subsidiaries is engaged in
the business of extending credit for the purpose of purchasing or carrying
Margin Stock. No part of the proceeds received by the Borrower or any of its
Subsidiaries from the Advances and Letter of Credit will be used directly or
indirectly (i) for any purpose other than as set forth in Section 2.14, or (ii)
for the purpose of purchasing or carrying, or for payment in full or in part of
Debt that was incurred for the purpose of carrying, any Margin Stock.
(k) As of the date hereof, except as set forth on Schedule 4.01(k)
----------------
hereto, neither the Borrower nor any of its Subsidiaries nor any of their
respective ERISA Affiliates maintains or has maintained any Plans or
Multiemployer Plans. Set forth on Schedule 4.01(k) is a complete and accurate
----------------
list of all Welfare Plans and all defined contribution plans in respect of which
any Loan Party could have liability.
(l) Except as set forth in the financial statements referred to in
this Section 4.01 and in Section 5.03, neither the Borrower nor any of its
Subsidiaries has any liability with respect to "expected post retirement benefit
obligations" within the meaning of Statement of Financial Accounting Standards
No. 106 which could reasonably be expected to have a Material Adverse Effect.
(m) Neither the business nor the properties of the Borrower or
any of its Subsidiaries have been affected by any fire, explosion, accident,
strike, lockout or other labor dispute, drought, storm, hail, earthquake,
embargo, act of God or of the public enemy or other casualty (whether or not
covered by insurance) that could reasonably be expected to have a Material
Adverse Effect.
89
(n) The operations and properties of the Borrower and each of its
Subsidiaries comply in all respects with all applicable Environmental Laws and
Environmental Permits, except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect, and no circumstances
exist that could reasonably be expected to form the basis of an Environmental
Action against the Borrower or any of its Subsidiaries or any of their
properties that could reasonably be expected to have a Material Adverse Effect.
(o) Except as set forth on Schedule 4.01(o), neither the Borrower nor
----------------
any of its Subsidiaries is a party to any indenture, loan or credit agreement or
any lease or other agreement or instrument or subject to any charter or
corporate restriction that could reasonably be expected to have a Material
Adverse Effect.
(p) Each of the Borrower and its Subsidiaries has filed, as caused
to be filed or has been included in all income and other material tax returns
(Federal, state, local and foreign) required to be filed and has paid all taxes
shown thereon to be due, together with applicable interest and penalties or is
contesting such taxes in good faith and by appropriate proceedings diligently
conducted and reserves or other appropriate provisions therefor have been
established in accordance with GAAP.
(q) No "ownership change" as defined in Section 382(g) of the
Internal Revenue Code, and no event that would result in the application of the
"separate return limitation year" or "consolidated return change of ownership"
limitations under the Federal income tax consolidated return regulations, has
occurred with respect to the Borrower or any of its Subsidiaries.
(r) Neither the Borrower nor any of its Subsidiaries is an
"investment company," or an "affiliated person" of, or "promoter" or "principal
underwriter" for, an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended. Neither the making of any Advances,
nor the issuance of any Letters of Credit, nor the application of the proceeds
or repayment thereof by the Borrower, nor the consummation of the transactions
contemplated hereby,
90
will violate any provision of such Act or any rule, regulation or order of the
Securities and Exchange Commission thereunder or any takeover, disclosure or
other federal, state or foreign securities law or Regulations T, U or X. The
Borrower is not subject to regulation under any federal, state or foreign
statute or regulation which limits its ability to incur Debt.
(s) The Borrower is, individually and together with its Subsidiaries,
Solvent.
(t) Set forth on Schedule 4.01(t) is a complete and accurate list of
----------------
all Surviving Debt of the Borrower and each of its Subsidiaries as of the date
hereof the principal amount of which is greater than $500,000, showing as of the
Initial Funding Date, with respect to the Borrower and each of its Subsidiaries,
the principal amount outstanding thereunder, the name of the relevant creditor,
the maturity date thereof and if any promissory note exists with respect
thereto. There exists no promissory notes which evidence intercompany loans
between or among the Borrower or any of its Subsidiaries.
(u) Except as could not reasonably be expected to have a Material
Adverse Effect, each Material Contract has been duly authorized, executed and
delivered by all parties thereto, has not been amended or otherwise modified, is
in full force and effect, and to the best of Borrower's knowledge, is binding
upon and enforceable against all parties thereto in accordance with its terms,
except as such enforceability may be limited by (i) bankruptcy, insolvency,
reorganization, moratorium or similar laws of general applicability affecting
the enforcement of creditors' rights and (ii) the application of general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law). There exists no default under any Material
Contract by the Borrower or any of its Subsidiaries and, to the best knowledge
of the Borrower, there exists no default under any Material Contract by any
other party thereto, in each case which could reasonably be expected to have a
Material Adverse Effect.
91
(v) Borrower and each of its Subsidiaries owns or has rights to use
all patents, trademarks, trade names, service marks, copyrights and other
intellectual property necessary to conduct its business as now or heretofore
conducted by it.
(w) The Collateral Documents create in favor of the Administrative
Agent, for itself and ratably for the benefit of the Lender Parties and the
Hedge Banks, a valid and perfected first priority security interest in the
Collateral (other than Permitted Liens) securing the payment of the Obligations.
The Loan Parties are the legal and beneficial owners of the Collateral free and
clear of any Lien, except for the Liens and security interests created or
expressly permitted under the Loan Documents.
ARTICLE V
COVENANTS OF THE BORROWER AND THE SUBSIDIARIES
----------------------------------------------
SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Advance shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, the Borrower will:
(a) Compliance with Law. Comply, and cause each of its Subsidiaries
-------------------
to comply, in all respects, with all applicable laws, rules, regulations and
orders, except to the extent that the failure to comply therewith could not
reasonably be expected to have a Material Adverse Effect.
(b) Payment of Taxes, Etc. Timely pay and discharge, and cause each
-----------------------
of its Subsidiaries to timely pay and discharge, (i) all income and other
material taxes, assessments and governmental charges or levies imposed upon its
property and (ii) all lawful claims that, if unpaid, might by law become a Lien
upon its property; provided, however, that the Borrower and its Subsidiaries
-------- -------
shall not be required to pay or discharge any such tax, assessment, charge or
claim that
92
is being contested in good faith and by appropriate proceedings diligently
conducted and as to which reserves or other appropriate provisions therefor have
been established in accordance with GAAP.
(c) Compliance with Environmental Laws. (i) Comply, and cause each
------------------------------------
of its Subsidiaries and all lessees and other Persons operating or occupying its
properties to comply, in all material respects, with all applicable
Environmental Laws and Environmental Permits; (ii) obtain and renew and cause
each of its Subsidiaries to obtain and renew all Environmental Permits
reasonably necessary for its operations and properties; and (iii) conduct, and
cause each of its Subsidiaries to conduct, any investigation, study, sampling
and testing, and undertake any cleanup, removal, remedial or other action
necessary to remove and clean up all Hazardous Materials from any of its
properties, in accordance with the requirements of all Environmental Laws;
except in the case of each of clauses (i), (ii) and (iii) above, to the extent
that the failure to comply therewith could not reasonably be expected to have a
Material Adverse Effect; provided, however, that the Borrower and its
-------- -------
Subsidiaries shall not be required to undertake any such cleanup, Removal,
Remedial or Response action to the extent that its obligation to do so is being
contested in good faith and by proper proceedings and adequate reserves are
being maintained with respect to such circumstances.
(d) Maintenance of Insurance. Maintain, and cause each of its
--------------------------
Subsidiaries to maintain, insurance with responsible and reputable insurance
companies or associations in such amounts and covering such risks as is usually
carried by companies engaged in similar businesses and owning similar properties
in the same general areas in which the Borrower or such Subsidiary operates.
(e) Preservation of Corporate Existence, Etc. Preserve and maintain,
-----------------------------------------
and cause each of its Subsidiaries to preserve and maintain, its existence,
legal structure, legal name, rights (charter and statutory), permits, licenses,
approvals, privileges and franchises, in each case where the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
93
(f) Visitation Rights. At any reasonable time and from time to time,
------------------
upon reasonable notice, permit the Administrative Agent, any of the Lender
Parties or any agents or representatives thereof, (i) to examine and make copies
of and abstracts from the records and books of account of and visit the
properties of the Borrower and its Subsidiaries and to discuss the affairs,
finances and accounts of the Borrower and any such Subsidiaries with any of
their officers or directors, and (ii) to conduct such commercial finance
examinations and/or Collateral audits of the Borrower and its Subsidiaries
during each calendar year as the Administrative Agent and any Lender Party may
reasonably request; provided, however, that so long as no Event of Default
-------- -------
exists, the Administrative Agent may make only one such examination per year at
the expense of the Borrower, which expense shall be reasonable and customary for
such examinations.
(g) Keeping of Books. Keep, and cause each of its Subsidiaries to
----------------
keep, proper books of record and account, in which full and correct entries
shall be made of all financial transactions and the assets and business of the
Borrower and each such Subsidiary in accordance with GAAP.
(h) Maintenance of Properties, Etc. Maintain and preserve, and cause
-------------------------------
each of its Subsidiaries to maintain and preserve, all of its properties that
are reasonably necessary in the conduct of its business in good working order
and condition, ordinary wear and tear excepted.
(i) Performance of Material Contracts. Perform and observe, and cause
---------------------------------
each of its Subsidiaries to perform and observe, all of the terms and provisions
of each Material Contract to be performed or observed by it, maintain, and cause
each of its Subsidiaries to maintain, each such Material Contract in full force
and effect, and enforce, and cause each of its Subsidiaries to enforce, each
such Material Contract in accordance with its terms, except in each case where
the failure to do so could not reasonably be expected to have a Material Adverse
Effect.
(j) Transactions with Affiliates. Conduct, and cause each of its
------------------------------
Subsidiaries to conduct, all transactions otherwise permitted under the Loan
Documents with any of its Affiliates
94
on terms that are fair and reasonable and no less favorable to the Borrower or
such Subsidiary than it would obtain in a comparable arms-length transaction
with a Person not an Affiliate.
(k) Interest Rate Protection. Within one hundred eighty (180) days
-------------------------
after the Initial Funding Date, obtain and thereafter keep in effect one or more
interest rate Bank Hedge Agreements (the terms and other provisions of all such
Bank Hedge Agreements to be subject to the prior written consent of the
Administrative Agent) covering at least thirty percent (30%) of the Advances
made in connection with the Initial Funding for an aggregate period of not less
than two (2) years.
(l) Year 2000 Compatibility. Take, and cause each of its Subsidiaries
-----------------------
to take, all action necessary to assure that its computer based systems,
hardware and software used in their business and operations are able to operate
and effectively receive, transmit, process, store, retrieve or retransmit data
including dates on and after January 1, 2000, on or before June 30, 1999, except
where the failure to do so could not reasonably be expected to result in a
Material Adverse Effect, and, at the request of the Administrative Agent or the
Lenders, the Loan Parties will provide evidence to the satisfaction of the
Lenders of such year 2000 compatibility.
(m) Agreement to Grant Additional Security.
--------------------------------------
(i) Subject to subsection 5.01(n) below, promptly, and in any
event within thirty (30) days after the acquisition of assets of the type that
would have constituted Collateral at the Initial Funding Date and investments of
the type that would have constituted Collateral on the Initial Funding Date
(other than assets with a fair market value of less than $100,000), notify the
Administrative Agent of the acquisition of such assets or investments and, to
the extent not already Collateral in which the Administrative Agent has a
perfected security interest pursuant to the Collateral Documents, such assets
and investments will become additional Collateral hereunder to the extent the
Administrative Agent deems the pledge of such assets practicable (the
"Additional Collateral"), and the Borrower will, and will cause each applicable
Subsidiary, to take all necessary action, including providing appropriate lien
searches and the filing of appropriate financing
95
statements under the provisions of the UCC, applicable foreign, domestic or
local laws, rules or regulations in each of the offices where such filing is
necessary or appropriate to (A) grant the Administrative Agent, for itself and
ratably for the benefit of the Lender Parties and the Hedge Banks, a perfected
first priority Lien (other than Permitted Liens) in such Collateral (or
comparable interest under foreign law in the case of foreign Collateral)
pursuant to and to the full extent required by the Collateral Documents and this
Agreement and (B) otherwise to the Administrative Agent any and all other
agreements, documents and/or contracts which were similarly executed and/or
delivered to the Administrative Agent at or prior to the Initial Funding Date
with respect to such grant of a security interest.
(ii) Subject to subsection 5.01(n) below, contemporaneously
with the consummation of a Permitted Acquisition or the formation of any
Subsidiary, or at the request of the Administrative Agent, cause each of the
Borrower's Subsidiaries as the Administrative Agent shall request to become
party to, or to execute and deliver a Subsidiary Guaranty or a Foreign Guaranty,
as the case may be, guarantying to the Administrative Agent, Lender Parties and
the Hedge Banks the prompt payment, when and as due, of all Obligations of the
Loan Parties under the Loan Documents, including all obligations under any Hedge
Agreements or other hedging agreements.
(iii) Subject to subsection 5.01(n) below, cause each
Subsidiary Guarantor created or established (whether by acquisition, initial
formation or otherwise) after the date hereof, concurrently with its creation or
establishing, to grant to the Administrative Agent, for itself and ratably for
the benefit of the Lender Parties and the Hedge Banks, a first priority Lien on
all property (tangible and intangible) of such Guarantor which constitutes
Collateral under the Security Agreement, including, without limitation, all of
the capital stock of any of its Domestic Subsidiaries and 65% of the stock of
any Foreign Subsidiaries organized under the laws of the United Kingdom or any
other foreign country and owned directly by it, upon terms similar to those set
forth in the Collateral Documents and otherwise satisfactory in form and
substance to the Administrative Agent. The Borrower shall cause each Subsidiary
Guarantor, at its own expense, to become a party to (or execute a separate)
Security Agreement and any other Collateral Document and to execute,
96
acknowledge and deliver, or cause the execution, acknowledgment and delivery of,
and thereafter register, file or record in any appropriate governmental office,
any document or instrument reasonably deemed by the Administrative Agent to be
necessary or desirable for the creation and perfection of the foregoing Liens.
The Borrower will cause each such Subsidiary Guarantor to take all actions
requested by the Administrative Agent (including, without limitation, the filing
of UCC-1's, providing lien releases and payoff letters) in connection with the
granting of such security interests.
(iv) Subject to subsection 5.01(n) below, (i) deliver to the
Administrative Agent the original of all instruments, documents and chattel
paper, and all other Collateral of which the Administrative Agent should have
physical possession in order to perfect and protect its security interest
therein, duly pledged, endorsed or assigned to the Administrative Agent without
restriction; (ii) use commercially reasonable efforts to obtain landlord
waivers, in form and substance satisfactory to the Administrative Agent, with
respect to any Inventory or other Collateral located at a location that is not
owned by the Borrower or a Subsidiary; (iii) deliver to the Administrative Agent
warehouse receipts covering any portion of the Inventory or other Collateral
located in warehouses and for which warehouse receipts are issued; (iv) when an
Event of Default exists, transfer Inventory to locations designated by the
Administrative Agent; (v) if any Collateral is at any time in the possession or
control of any warehousemen, bailee or the Borrower's agents or processors,
notify the Administrative Agent thereof and notify such person of the
Administrative Agent's security interest in such Collateral and obtain a
landlord waiver or bailee letter, in form and substance satisfactory to the
Administrative Agent, from such person and instruct such person to hold all such
Collateral for the Administrative Agent's account subject to the Administrative
Agent's instructions; (vi) if at any time any Inventory or other Collateral is
located on any Real Property of the Borrower or its Subsidiaries which is
subject to a mortgage or other Lien, obtain a mortgagee waiver, in form and
substance satisfactory to the Administrative Agent, from the holder of each
mortgage or other Lien on such real property; (vii) if requested by the
Administrative Agent, if any Real Property exists with respect to which a
Mortgage has not been granted to the Administrative Agent, for itself and
ratably for the benefit of the Lender Parties and the Hedge Banks, execute and
97
deliver to the Administrative Agent a Mortgage and associated environmental
reports and title insurance policy and UCC-1 financing statements, all in form
and substance satisfactory to the Administrative Agent; and (viii) take all such
other actions and obtain all such other agreements as the Administrative Agent
may reasonably deem necessary or desirable in respect of any Collateral
including, without limitation, UCC, federal and state tax lien searches and
releases and payoff letters. This Section 5.01(m)(iv) shall be applicable to all
Collateral whether existing on the Initial Funding Date or at any time
thereafter, and it shall be deemed an Event of Default under this Agreement if
the actions required by this Section 5.01(m)(iv) are not taken by the Borrower
and its Subsidiaries, as applicable, as soon as practicable with respect to any
such Collateral.
(v) Subject to subsection 5.01(n) below, the security
interests required to be granted pursuant to this Section shall be granted
pursuant to the Collateral Documents or, in the Administrative Agent's
discretion, such other security documentation (which shall be substantially
similar to the Collateral Documents already executed and delivered by the
Borrower and the Guarantors or is required to be executed pursuant to the
definition of "Permitted Acquisition") as is satisfactory in form and substance
to the Administrative Agent (the "Additional Collateral Documents") and shall
constitute valid and enforceable perfected security interests prior to the
rights of all third Persons subject to no other Liens except Liens permitted
under Section 5.02(a) and shall be granted with respect to each type of
Collateral which this Agreement or the other Loan Documents contemplate as
Collateral. The Additional Collateral Documents and other instruments related
thereto shall be duly recorded or filed in such manner and in such places and at
such times as are required by law to establish, perfect, preserve and protect
the Liens, in favor of the Administrative Agent, for itself and ratably for the
benefit of the Lender Parties and the Hedge Banks, granted pursuant to the
Additional Collateral Documents and, all taxes, fees and other charges payable
in connection therewith shall be paid in full by the Borrower. At the time of
the execution and delivery of Additional Collateral Documents, the Borrower
shall cause to be delivered to the Administrative Agent such agreements,
opinions of counsel, and other related documents as may be reasonably requested
by the Administrative Agent or the Required Lenders to assure themselves that
this Section 5.01(m) has been complied with.
98
(n) Foreign Subsidiaries Security. If the Administrative Agent
--------------------------------
reasonably believes that appropriate changes have been made to the relevant
sections of the Internal Revenue Code as in effect on the Initial Funding Date,
the regulations and rules promulgated thereunder and any rulings issued
thereunder, the Administrative Agent may request that counsel for the Borrower
reasonably acceptable to the Administrative Agent within 30 days after such
request deliver evidence satisfactory to the Administrative Agent, with respect
to any Foreign Subsidiary of the Borrower, that (i) a pledge of more than 65% of
the total Voting Stock of such Foreign Subsidiary or (ii) the entering into by
such Foreign Subsidiary of a pledge agreement in substantially the form of the
Pledge Agreement, in either case would cause the earnings of such Foreign
Subsidiary to be treated as a deemed dividend to such Foreign Subsidiary's
United States parent or would otherwise violate a material applicable law or
governmental or regulatory restriction or rule (including laws, rules, or
restrictions of, or issued by, a government or regulatory authorities of a
foreign jurisdiction) or would otherwise cause a material adverse monetary tax
consequence to the Borrower, and in the case of a failure to deliver the
evidence described in clause (i) above, (A) that portion of such Foreign
Subsidiary's outstanding capital stock and intercompany notes, if any, not
theretofore pledged pursuant to a Pledge Agreement shall be pledged to the
Administrative Agent, for itself and ratably for the benefit of the Lender
Parties or the Hedge Banks pursuant to the Security Agreement or the Pledge
Agreement (or another pledge agreement in substantially similar form, if
needed), as applicable, and in the case of a failure to deliver the evidence
described in clause (ii) above, (B) such Foreign Subsidiary shall execute and
deliver a pledge agreement granting the Administrative Agent for a security
interest in all of the capital stock of each Subsidiary of such Foreign
Subsidiary and intercompany notes, if any, payable to such Foreign Subsidiary,
in each case with all documents delivered pursuant to this Section 5.01(n) to be
in form and substance satisfactory to the Administrative Agent.
SECTION 5.02. NEGATIVE COVENANTS. So long as any Advance shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, the Borrower will not, at any time, without the prior
consent of the Required Lenders:
99
(a) Liens, Etc. Create, incur, assume or suffer to exist, or permit
-----------
any of its Subsidiaries to create, incur, assume or suffer to exist, any Lien on
or with respect to any of its assets and properties of any character (including,
without limitation, the Collateral) whether now owned or hereafter acquired, or
sign or suffer to exist, or permit any of its Subsidiaries to sign or suffer to
exist, any security agreement, or assign, or permit any of its Subsidiaries to
assign, any accounts or other right to receive income, excluding, however, from
--------- -------
the operation of the foregoing restrictions the following:
(i) Liens created under the Loan Documents;
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and described on
Schedule 5.02(a)(iii);
---------------------
(iv) purchase money Liens securing Debt permitted under
Section 5.02(b)(iii)(A) upon equipment acquired or held by the Borrower or any
of its Subsidiaries in the ordinary course of business to secure the purchase
price of such equipment or to secure Debt incurred solely for the purpose of
financing the acquisition of any such equipment to be subject to such Liens, or
Liens existing on any such equipment at the time of acquisition (other than any
such Liens created in contemplation of such acquisition that do not secure the
purchase price), or extensions, renewals or replacements of any of the foregoing
for the same or a lesser amount; provided, however, that no such Lien shall
-------- -------
extend to or cover any property other than the equipment being acquired,
constructed or improved; and
(v) Liens arising in connection with Capitalized Leases
permitted under Section 5.02(b)(iii)(B); provided that no such Lien shall extend
--------
to or cover any Collateral or any assets or properties other than the assets or
properties subject to such Capitalized Leases.
100
(b) Debt. Create, incur, assume or suffer to exist, or permit any of
----
its Subsidiaries to create, incur, assume or suffer to exist, any Debt other
than:
(i) in the case of the Borrower and the other Loan Parties,
Debt incurred pursuant to the Loan Documents;
(ii) unsecured Debt (v) of the Borrower to any of its Domestic
Subsidiaries, (w) of any Domestic Subsidiary of the Borrower to the Borrower or
any other Domestic Subsidiary of the Borrower, (x) of any Wholly-Owned Foreign
Subsidiary of the Borrower to the Borrower or any Domestic Subsidiary of the
Borrower; provided, however, that the aggregate of all outstanding unsecured
-------- -------
Debt of a Wholly-Owned Foreign Subsidiary of the Borrower to the Borrower or any
Domestic Subsidiary of the Borrower and Investments by the Borrower or any
Domestic Subsidiary of the Borrower in any Person organized under the laws of
any jurisdiction other than the United States of America or any state thereof as
permitted pursuant to Section 5.02(e)(i) herein shall not exceed (A) $10,000,000
in any Fiscal Year or (B) in any event, $15,000,000 in the aggregate outstanding
at any time, (y) of any Wholly-Owned Foreign Subsidiary of the Borrower to any
other Wholly-Owned Foreign Subsidiary of the Borrower, and (z) of the Borrower
or any Domestic Subsidiary of the Borrower to any Wholly-Owned Foreign
Subsidiary of the Borrower not to exceed $15,000,000 in the aggregate
outstanding at any time;
(iii) in the case of the Borrower and any of its Subsidiaries:
(A) Debt secured by Liens permitted by Section 5.02(a)(iv),
in each case incurred only if, immediately after giving effect to the incurrence
thereof, the limit on Capital Expenditures set forth in Section 5.02(p) hereof
would not be breached;
101
(B) Debt incurred with respect to Capitalized Leases, in
each case incurred only if, immediately after giving effect to the incurrence
thereof, the limit on Capital Expenditures set forth in Section 5.02(p) hereof
would not be breached;
(C) the Surviving Debt, and any Debt extending the maturity
of, or refunding or refinancing, in whole or in part, the Surviving Debt;
provided that the principal amount or interest rate with respect thereto of such
--------
Surviving Debt shall not be increased above the principal amount thereof
outstanding and interest rate existing on the date hereof;
(D) endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business;
(E) Subordinated Debt; provided, that a subordination
--------
agreement is in effect which is in favor of and is acceptable to the
Administrative Agent;
(F) unsecured Debt incurred in the ordinary course of
business in the form of accounts payable arising from the purchase of property
or services, including, without limitation, Inventory acquired for resale;
(G) in the case of Borrower or any of its Subsidiaries,
Debt of Proposed Businesses, whether secured or unsecured, assumed by Borrower
or such Subsidiary, as the case may be, in respect of Permitted Acquisitions
(subject to the limitations set forth in the definition of "Permitted
Acquisitions" set forth herein);
(H) in addition to Debt that is otherwise permitted in
clauses (F) and (G) above, unsecured Debt that is incurred in the ordinary
course of business, not to exceed in the aggregate $1,500,000 at any time
outstanding;
102
(I) Debt in respect of Bank Hedge Agreements provided that
such Debt shall not exceed at any one time eighty percent (80%) of the Revolving
Credit Commitments; or
(J) Existing Debt of others guaranteed directly or
indirectly by Borrower or any of its Subsidiaries and listed on
Schedule 5.02(b)(iii)(J).
(c) Fundamental Changes.
-------------------
(i) Merge into or consolidate with any Person or permit
any Person to merge into it, or permit any of its Subsidiaries to do so, except
(A) the Borrower or any of its Subsidiaries may make Permitted Acquisitions, (B)
any Subsidiary of Borrower may merge or consolidate with and into the Borrower
(provided, the Borrower is the surviving entity) or one of the Borrower's
--------
Wholly-Owned Domestic Subsidiaries (provided, that, if a Loan Party is a party
--------
to such merger or consolidation, a Domestic Wholly-Owned Subsidiary is the
surviving entity) and (C) any Foreign Subsidiary of Borrower may merge or
consolidate with and into one of the Borrower's Foreign Subsidiaries (provided,
--------
that a Wholly-Owned Foreign Subsidiary is the surviving entity).
(ii) Liquidate, wind-up or dissolve itself (or suffer any
liquidation or dissolution), convey, sell, assign, lease, transfer or otherwise
dispose of (or agree to do any of the foregoing at any future time) all or
substantially all of its property, business or assets, or permit any of its
Subsidiaries to do any of the foregoing, except to the extent such Subsidiary
liquidates, winds-up or dissolves into or is otherwise sold, leased, transferred
or disposed of to the Borrower or any other wholly-owned Domestic Subsidiary of
the Borrower, or as otherwise permitted under Section 5.02(e).
103
(iii) Acquire or permit any Subsidiary to acquire all or
substantially all of the assets of any other Person (including capital stock),
except that the Borrower or any Subsidiary of Borrower may consummate Permitted
Acquisitions.
(d) Sales, Etc. of Assets. Sell, lease, transfer or otherwise dispose
---------------------
of, or permit any of its Subsidiaries to sell, lease, transfer or otherwise
dispose of, any assets or grant any option or other right to purchase, lease or
otherwise acquire any assets, except:
(i) sales of Inventory in the ordinary course of
business;
(ii) sales, leases, transfers or other dispositions of
obsolete or redundant equipment in the ordinary course of business;
(iii) the sale or discount without recourse of accounts
receivable arising in the ordinary course of business in connection with the
compromise or collection thereof; and
(iv) in addition to sales, leases, transfers and other
dispositions permitted by subsections (i), (ii) and (iii) of this
Section 5.02(d), sales, leases, transfers and other dispositions resulting in
Net Cash Proceeds not to exceed in the aggregate $2,500,000, which Net Cash
Proceeds shall be applied in accordance with Section 2.05(b)(ii).
(e) Investments in Other Persons. Make or hold, or permit any of its
----------------------------
Subsidiaries to make or hold, any Investment in any Person other than:
(i) Investments by the Borrower or any of its Subsidiaries
(x) in Domestic Subsidiaries and (y) in Wholly-Owned Foreign Subsidiaries not to
exceed in the aggregate $15,000,000 provided, however, that the aggregate of all
-------- -------
outstanding unsecured Debt permitted pursuant to Section 5.02(b)(ii)(y) and
Investments from the Initial Funding Date by the Borrower or any Domestic
Subsidiary of the Borrower in any Person organized under the laws of any
jurisdiction other than the United States of America or any state thereof, shall
not exceed (A) $10,000,000 in any Fiscal Year or (B) in any event, $15,000,000
in the aggregate outstanding at any time.
104
(ii) Loans and advances to directors, officers and other
employees in the ordinary course of the business of the Borrower and its
Subsidiaries in an aggregate principal amount not to exceed $750,000 at any time
outstanding;
(iii) Investments by the Borrower and its Subsidiaries in Cash
Equivalents;
(iv) Investments by the Borrower and its Subsidiaries in Bank
Hedge Agreements; provided that such Investments shall not exceed at any one
time eighty percent (80%) of the Revolving Credit Commitment;
(v) Investments consisting of intercompany Debt permitted
under Section 5.02(b)(ii);
(vi) Investments consisting of accounts receivable arising in
the ordinary course of business; and
(vii) Investments in the form of Permitted Acquisitions; and
(viii) Investments in related businesses which do not exceed
$2,500,000 in the aggregate at any one time outstanding for the Borrower and its
Subsidiaries on a Consolidated Basis.
(f) Dividends Etc. Declare or pay any dividends, purchase, redeem,
--------------
retire, defease or otherwise acquire for value any of its capital stock or any
warrants, rights or options to acquire such capital stock, now or hereafter
outstanding, return any capital to its stockholders as such or make any
distribution to its stockholders, except:
(i) the Borrower may declare and pay dividends and make
distributions payable solely in common stock of the Borrower;
105
(ii) a Subsidiary of the Borrower may declare and pay
dividends and make distributions to the Borrower or to another Loan Party; and
(iii) for issuances of stock or other equity interests
expressly permitted by Section 5.02(q).
(g) Leases. Permit Consolidated Lease Expenses (other than Capital
------
Leases) for any Fiscal Year to exceed $2,500,000.
(h) Change in Nature of Business. Make, or permit any of its
-------------------------------
Subsidiaries to make, any material change in the nature of its business as
carried on at the date hereof.
(i) Charter Amendments. Amend, or permit any of its Subsidiaries to
------------------
amend, its certificate or articles of incorporation or by-laws, in a manner
which would have a Material Adverse Effect except for a charter amendment which
would increase the authorized common stock of the Borrower to 25,000,000 shares
and authorized Preferred Stock of the Borrower to 10,000,000 shares.
(j) Accounting Changes. Make or permit, or permit any of its
--------------------
Subsidiaries to make or permit, any change (i) in accounting policies or
reporting practices, except as mandated by GAAP or approved by its independent
auditors for purposes of consistency or improved presentation or (ii) in its
Fiscal Year.
(k) Prepayments, Etc. of Debt. (i) Prepay, redeem, purchase, defease
-------------------------
or otherwise satisfy prior to the scheduled maturity thereof in any manner, or
make any payment in violation of any subordination terms of, any Debt, other
than (A) the prepayment of the Advances in accordance with the terms of this
Agreement, (B) regularly scheduled or required repayments or redemptions of
Surviving Debt which could not reasonably be expected to have a Material Adverse
Effect, or (ii) amend, modify or change in any manner any term or condition of
any Surviving Debt, or (iii) permit any of its Subsidiaries to do any of the
foregoing other than to repay any Debt payable to the Borrower or any other
Subsidiary.
106
(l) Amendment, Etc. of Material Contracts. Except in the ordinary
---------------------------------------
course of business or to the extent such would not result in a Material Adverse
Effect, either cancel or terminate any Material Contract, consent to or accept
any cancellation or termination thereof, amend or otherwise modify any Material
Contract, give any consent, waiver or approval thereunder, waive any default
under or breach of any Material Contract, or take any other action in connection
with any Material Contract.
(m) Negative Pledge. Enter into or suffer to exist, or permit any
----------------
of its Subsidiaries to enter into or suffer to exist, any agreement prohibiting
or conditioning the creation or assumption of any Lien upon any of its
properties or assets (including, without limitation the Collateral) other than
as permitted in the Loan Documents.
(n) Partnerships, New Subsidiaries. Except as otherwise permitted
--------------------------------
under this Agreement, (i) become a general partner in any general or limited
partnership or joint venture with any unaffiliated third Person, or permit any
of its Subsidiaries to do so, or (ii) create any new Subsidiary, unless such
newly created Subsidiary shall become a Guarantor (by executing and delivering
to the Administrative Agent a Subsidiary Guaranty or a Foreign Guaranty, as
applicable) and an additional grantor pursuant to the terms of the Security
Agreement, and all shares of the capital stock of such Domestic Subsidiary are
pledged to the Administrative Agent in accordance with Section 5.01(m) and
pursuant to the Pledge Agreement.
(o) Speculative Transactions. Engage, or permit any of its
--------------------------
Subsidiaries to engage, in any transaction involving commodity options or
futures contracts or derivatives or any similar speculative transactions, except
for Bank Hedge Agreements.
(p) Capital Expenditures. Make, or permit any of its Subsidiaries to
--------------------
make, any Capital Expenditure that would cause the aggregate of all such Capital
Expenditures made by the Borrower and its Subsidiaries in any Fiscal Year set
forth below to exceed the aggregate amount set forth opposite such Fiscal Year:
107
Fiscal Year Amount/Category of Expenditures Total Amount
----------- ------------------------------- ------------
1999 Financing Leases - $4,500,000 $7,000,000
Other - 2,500,000
2000 Financing Leases - $5,000,000 $7,500,000
Other - 2,500,000
2001 Financing Leases - $5,500,000 $8,000,000
Other - 2,500,000
2002 and each fiscal Financing Leases - $6,000,000 $8,500,000
year thereafter Other - 2,500,000
provided, however, that (a) up to $500,000 of the amount permitted to be
-------- -------
expended in a Fiscal Year from the "Other" category that is not expended in such
Fiscal Year (not including any amount permitted to be carried forward from a
prior year) shall be permitted to be expended in, but only in, the subsequent
Fiscal Year, and (b) amounts representing Capital Expenditures paid or incurred
with respect to a Proposed Business in the ordinary course of its business prior
to consummation of a Permitted Acquisition shall not be deemed included in the
calculation of the aggregate amount of Capital Expenditures for purposes of
determining the maximum annual Capital Expenditures permitted to be made
hereunder, so long as such amounts were incurred prior to the date of
consummation of a Permitted Acquisition and were not incurred in anticipation of
such acquisition, and otherwise conform with the terms and conditions of this
clause (o).
(q) Issuance of Stock. Except as otherwise specifically permitted in
-----------------
this Agreement, the Borrower will not, and will not permit any of its
Subsidiaries to, directly or indirectly, issue, sell, assign, pledge or
otherwise encumber or dispose of any shares of capital stock of the Borrower or
any Subsidiary of the Borrower, except:
(A) to the Borrower or any of its Wholly-Owned
Subsidiaries;
108
(B) for issuances or sales of capital stock or other equity
interests of the Borrower;
(C) in connection with the Borrower's or any of its
Subsidiaries' stock purchase, stock option or similar incentive plans, or any
exercise pursuant thereto, for the benefit of the Borrower's or any of its
Subsidiaries' directors, management, employees and other eligible participants;
and
(D) for issuances of capital stock of the Borrower to any
Person as consideration paid in connection with any Permitted Acquisition.
(r) Sale and Leasebacks. Enter into any arrangement with any Person
-------------------
providing for the leasing by the Borrower or any Subsidiary of real or personal
property which has been or is to be sold or transferred by the Borrower or such
Subsidiary to such Person or to any other Person for which Funds have been or
are to be advanced by such person or the granting of such property or rental
obligation of the Borrower or such Subsidiary.
SECTION 5.03. REPORTING REQUIREMENTS. So long as any Advance shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, the Borrower will furnish to the Administrative Agent
for itself and on behalf of the Lender Parties (references in this Section 5.03
to any reports or statements being Consolidated or consolidating shall be
applicable at any time the Borrower has any Subsidiaries):
(a) Default Notice. As soon as possible and in any event within two
--------------
(2) Business Days after obtaining knowledge of the occurrence of any Default or
Event of Default or any event, development or occurrence reasonably likely to
have a Material Adverse Effect, a statement of the Responsible Officer of the
Borrower setting forth details of such Default or Event of Default or event,
development or occurrence and the action that the Borrower has taken and
proposes to take with respect thereto.
109
(b) Annual Financials. As soon as available, but in any event
------------------
within 90 days after the end of each Fiscal Year, a copy of the Consolidated and
consolidating balance sheets of the Borrower and it Subsidiaries as at the end
of such year and the related Consolidated and consolidating statements of income
and retained earnings and of cash flows for such year, setting forth in each
case in comparative form the figures for the previous year, reported on without
a "going concern" or like qualification or exception, or qualification arising
out of the scope of the audit, by Ernst & Young, LLP or other independent
certified public accountants of nationality recognized standing; and
(c) Quarterly Financials. As soon as available, but in any event
---------------------
not later than 45 days after the end of each of the first three quarterly
periods of each Fiscal Year, the unaudited Consolidated and consolidating
balance sheets for the Borrower and its Consolidated Subsidiaries as at the end
of such quarter and the related unaudited Consolidated and consolidating
statements of income and retained earnings and of cash flows of the Borrower and
its Consolidated Subsidiaries for such quarter and the portion of the Fiscal
Year through the end of such quarter, setting forth in each case in comparative
form the figures for the previous year, certified by a Responsible Officer as
being fairly stated in all material respects (subject to normal year-end audit
adjustments); and
(d) Monthly Reports. Within thirty (30) days after the end of each
----------------
calendar month (i) an accounts receivable aging schedule for the Borrower and
its Subsidiaries on a Consolidated and consolidating basis and (ii) a schedule
of the Borrower's and each Subsidiary's xxxxxxxx for the immediately preceding
calendar month (without giving effect to any intercompany adjustments); and such
financial statements shall be complete and correct in all material respects and
shall be prepared in reasonable detail and in accordance with GAAP applied
consistently throughout the periods reflected therein and with prior periods
(except as approved by such accountants or officer, as the case may be, and
disclosed therein).
(e) Certificate of Independent Certified Accountants. Concurrently
--------------------------------------------------
with the delivery of the financial statements referred to in Section 5.03(b), a
certificate of the independent certified public accountants reporting on such
financial statements stating that in making the
110
examination necessary therefor no knowledge was obtained of any Default or Event
of Default, except as specified in such certificate;
(f) Certificate of Responsible Officer. Concurrently with the
--------------------------------------
delivery of the financial statements referred to in Section 5.03(b) and (c), a
certificate of a Responsible Officer (i) stating that, to the best of such
Officer's knowledge, the Borrower during such period has observed or performed
all of its covenants and other agreements, and satisfied every condition,
contained in this Agreement and the other Loan Documents to be observed,
performed or satisfied by it, and that such Officer has obtained no knowledge of
any Default or Event of Default except as specified in such certificate and (ii)
showing in detail the calculations, including compliance with financial
covenants, supporting such Officer's certification of the Borrower's compliance
with the requirements of Section 5.04(a) through 5.04(c);
(g) Annual Forecasts. Not later than thirty days prior to the end
----------------
of each Fiscal Year, a copy of the projections by the Borrower of the operating
budget and cash flow budget of the Borrower and its Subsidiaries for the
succeeding Fiscal Year on a Consolidated consolidating basis, such projections
have been prepared on the basis of sound financial planning practice and that
such Officer has no reason to believe they are incorrect or misleading in any
material respect;
(h) Insurance. During the month of August in each calendar year, a
---------
report of a reputable insurance broker with respect to the insurance maintained
by the Borrower and its Subsidiaries in accordance with Section 5.01(d) of this
Agreement and Section 5.2 of the Security Agreement, and such supplemental
reports with respect to insurance maintained by the Borrower and its
Subsidiaries as the Administrative Agent may from time to time reasonably
request, and
(i) ERISA Events and ERISA Reports. (i) Promptly and in any event
-------------------------------
within twenty (20) days after the Borrower or any ERISA Affiliate knows or has
reason to know that any ERISA Event has occurred, which could reasonably be
expected to have a Material Adverse Effect, a statement of the chief financial
officer or chief executive officer of the Borrower describing such ERISA Event
and the action, if any, that the Borrower or such ERISA Affiliate has taken and
proposes to take with respect thereto and (ii) on the date any records,
documents or other information
111
must be furnished to the PBGC with respect to any Plan pursuant to Section 4010
of ERISA, a copy of such records, documents and information.
(j) Plan Terminations. Promptly and in any event within five (5)
------------------
Business Days after receipt thereof by the Borrower or any ERISA Affiliate,
copies of each notice from the PBGC stating its intention to terminate any Plan
or to have a trustee appointed to administer any Plan or correspondence from the
PBGC indicating it is considering termination of any Plan.
(k) Litigation. Promptly after the commencement thereof, notice
----------
of all actions, suits, investigations, litigation and proceedings before or by
any court or governmental department, commission, board, bureau, agency or
instrumentality, Federal, state, local or foreign, that reasonably could be
expected to have a Material Adverse Effect and, promptly after the occurrence
thereof, notice of any change in either the status of the Disclosed Litigation
or the financial effect on the Borrower or any of its Subsidiaries in connection
therewith from that described on Schedule 4.01(i) which could reasonably be
----------------
expected to result in a Material Adverse Effect.
(l) Securities Reports. Promptly after the sending or filing thereof,
------------------
copies of all proxy statements, financial statements and reports that the
Borrower or any of its Subsidiaries sends to its stockholders, and copies of all
regular, periodic and special reports, and all registration statements, that the
Borrower or any of its Subsidiaries files with the Securities and Exchange
Commission or any other governmental authority or with any national securities
exchange.
(m) Agreement Notices. Promptly upon receipt thereof, copies of all
-----------------
notices, requests and other documents received by the Borrower or any of its
Subsidiaries under or pursuant to any Material Contract or indenture, loan or
credit agreement or similar agreement or instrument regarding or related to any
breach or default by any party thereto or any event that could materially impair
the value of the interests or the rights of the Borrower or any of its
Subsidiaries or otherwise have a Material Adverse Effect and copies of any
amendment, modification or waiver of any provision of any Material Contract or
indenture, loan or credit agreement or similar agreement or indenture and, from
time to time upon request by the Administrative Agent, such information and
reports regarding the foregoing as the Administrative Agent may reasonably
request.
112
(n) Environmental Conditions. Promptly after the assertion or
-------------------------
occurrence thereof, notice of any Environmental Action against or of any
noncompliance by the Borrower or any of its Subsidiaries with any Environmental
Law or Environmental Permit that could reasonably be expected to have a Material
Adverse Effect.
(o) Management Letters. As soon as available and in any event within
------------------
five (5) Business Days after the receipt thereof, copies of any "management
letter" or similar letter received by the Borrower or its Board of Directors (or
any Committee thereof) from its independent public accountants.
(p) Permitted Acquisition Documents. Within thirty (30) days
-----------------------------------
following the consummation of each Permitted Acquisition for which the related
Permitted Acquisition Purchase Price is in excess of $1,000,000, a reasonably
detailed description of such Permitted Acquisition and a copy of the Permitted
Acquisition Documents, in each case certified as true and correct by a
Responsible Officer of the Borrower.
(q) Other Information. Such other information respecting the
------------------
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower or any of its Subsidiaries or the
Collateral as the Administrative Agent or any Lender Party (through the
Administrative Agent) may from time to time reasonably request.
SECTION 5.04. FINANCIAL COVENANTS. So long as any Advance shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, the Borrower will:
(a) Consolidated Total Funded Debt to Pro Forma EBITDA Ratio.
----------------------------------------------------------------
Maintain as of the last day of each fiscal quarter of the Borrower commencing
with the first complete fiscal quarter after the Initial Funding Date a ratio of
(i) Consolidated Total Funded Debt to (ii) Pro Forma EBITDA for the most
recently completed four fiscal quarters of the Borrower of not more than
4.25:1.00.
113
(b) Consolidated Senior Debt to Pro Forma EBITDA Ratio. Maintain
------------------------------------------------------
as of the last day of each fiscal quarter of the Borrower commencing with the
first complete fiscal quarter after the Initial Funding Date a ratio of (i)
Consolidated Senior Debt to (ii) Pro Forma EBITDA for the most recently
completed four fiscal quarters of the Borrower of not more than the ratio set
forth below:
FOUR FISCAL-QUARTERS ENDING ON: RATIO
------------------------------ -----
First Quarter 3.50:1.00
Second Quarter 3.50:1.00
Third Quarter 3.50:1.00
Fourth Quarter 3.50:1.00
Fifth Quarter 3.50:1.00
Sixth Quarter 3.50:1.00
Seventh Quarter 3.50:1.00
Eighth Quarter 3.50:1.00
Each Fiscal Quarter Thereafter 3.45:1.00
(c) Fixed Charge Coverage Ratio. Maintain as of the last day of each
---------------------------
fiscal quarter of the Borrower commencing with the first complete fiscal quarter
after the Initial Funding Date a ratio of (i) Pro Forma EBITDA for the most
recently completed four fiscal quarters of the Borrower, less (x) cash Capital
----
Expenditures made by the Borrower and its Subsidiaries during such four fiscal
quarters and less (y) the aggregate amount of federal, state, local and foreign
----
income taxes paid by the Borrower and its Subsidiaries in cash during such four
fiscal quarters to the (ii) sum of (x) cash interest paid by the Borrower and
its Subsidiaries on all Debt during such four fiscal quarters plus (y) scheduled
----
principal amounts of all Debt paid by the Borrower and its Subsidiaries during
the preceding four fiscal quarters commencing on such day, plus (z) cash
----
dividends, if any, paid by the Borrower to the holders of its common stock
during such four fiscal quarters, at not less than 1.45:1.00.
114
(d) Minimum Net Worth. Maintain as of the last day of each fiscal
------------------
quarter of the Borrower an excess of Consolidated total assets over Consolidated
total liabilities of the Borrower and its Subsidiaries of not less than (i)
eighty percent (80%) of the excess of Consolidated total assets over
Consolidated total liabilities of the Borrower and its Subsidiaries at the
Initial Funding Date plus (ii) eighty percent (80%) of Consolidated positive net
----
income (and excluding one hundred percent (100%) of Consolidated net losses) of
the Borrower and its Subsidiaries plus (iii) one hundred percent (100%) of Net
----
Proceeds of any Equity Issuance as at the Initial Funding Date and each June 30
and December 31 thereafter computed on a cumulative basis for said entire
period.
ARTICLE VI
EVENTS OF DEFAULT
-----------------
SECTION 6.01. EVENTS OF DEFAULT. If any of the following ("Events of
Default") shall occur and be continuing:
(a) (i) The Borrower shall fail to pay any principal of any Advance
when the same shall become due and payable or (ii) the Borrower shall fail to
pay any interest on any Advance, or any Loan Party shall fail to make any other
payment under any Loan Document, in each case under this clause (ii) within five
(5) days after the same becomes due and payable; or
(b) Any representation or warranty made by any Loan Party (or any of
its officers) under or in connection with any Loan Document shall prove to have
been incorrect in any material respect when made or confirmed; or
(c) The Borrower shall fail to perform or observe any term, covenant
or agreement contained in Sections 2.14, 5.01(1), 5.01(m), 5.01(n), 5.02,
5.03(a) or 5.04; or
(d) The Borrower or any of its Subsidiaries shall fail to perform any
other term, covenant or agreement contained in any Loan Document on its part to
be performed or observed if
115
such failure shall remain unremedied for thirty (30) days after written notice
thereof shall have been given to the Borrower by the Administrative Agent or any
Lender Party; or
(e) The Borrower or any of its Subsidiaries shall fail to pay any
principal of, premium or interest on or any other amount payable in respect of
any Debt that is outstanding in a principal or notional amount of at least
$250,000 either individually or in the aggregate (but excluding Debt outstanding
hereunder) of the Borrower or such Subsidiary (as the case may be), when the
same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise, beyond the period of grace, if
any); or any other event shall occur or condition shall exist under any
agreement or instrument relating to any such Debt, in each case if the effect of
such event or condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt or otherwise to cause, or to permit the holder thereof to
cause, such Debt to mature; or any such Debt shall be declared to be due and
payable or required to be prepaid or redeemed (other than by a regularly
scheduled required prepayment or redemption), purchased or defeased, or an offer
to prepay, redeem, purchase or defease such Debt shall be required to be made,
in each case prior to the stated maturity thereof; or
(f) The Borrower or any of its Subsidiaries shall admit in writing
its inability to pay its debts generally, or shall make a general assignment for
the benefit of creditors; or any proceeding shall be instituted by or against
the Borrower or any of its Subsidiaries seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
administrative receiver, trustee or other similar official for it or for any
substantial part of its property and, in the case of any such proceeding
instituted against it (but not instituted by it) that is being diligently
contested by it in good faith, either such proceeding shall remain undismissed
or unstayed for a period of sixty (60) days or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other similar
official for, it or any substantial part of its property) shall occur, or the
Borrower or any of its Subsidiaries shall take any corporate action to authorize
any of the actions set forth above in this subsection (f); or
116
(g) Any judgment or order for the payment of money in excess of
$250,000 (other than such a judgment or order which is fully covered by
insurance for which the appropriate insurer has acknowledged responsibility in
writing) shall be rendered against the Borrower or any of its Subsidiaries and
either (i) enforcement proceedings shall have been commenced by any creditor
upon such judgment or order or (ii) there shall be a period of thirty (30)
consecutive days during which a stay of enforcement of such judgment or order,
by reason of a pending appeal or otherwise, shall not be in effect; or
(h) Any material provision of any Loan Document after delivery
thereof shall for any reason cease to be valid and binding on or enforceable
against any Loan Party which is party to it, or any such Loan Party shall so
state in writing; or
(i) Xxxxxxx X. Xxx shall cease to maintain beneficial ownership of
5% or more of the outstanding class of Capital Stock having ordinary voting
power in the election of directors of the Borrower, unless such cessation is the
result of a testamentary disposition upon his death; or
(j) (i) Any Person or "group" (within the meaning of Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended) other than Xxxxxxx X.
Xxx or Xxxxxxx X. Xxxxxx (A) shall have acquired beneficial ownership of 20% or
more of any outstanding class of Capital Stock having ordinary voting power in
the election of directors of the Borrower or (B) shall obtain the power (whether
or not exercised) to elect a majority of the Borrower's directors or (ii) the
Board of Directors of the Borrower shall not consist of a majority of Continuing
Directors; "Continuing Directors" shall mean the directors of the Borrower on
the Initial Funding Date and each other director, if such other director's
nomination for election to the Board of Directors of the Borrower is recommended
by a majority of the then Continuing Directors, provided that notwithstanding
anything in this Section 6.01(j) to the contrary, the transfer of Capital Stock
owned by either Xxxxxxx X. Xxx or Xxxxxxx X. Xxxxxx upon their death shall not
be deemed an Event of Default hereunder.
(k) Any ERISA Event shall have occurred with respect to a Plan and
the sum (determined as of the date of occurrence of the last such ERISA Event)
of the Insufficiency of such
117
Plan and the Insufficiency of any and all other Plans with respect to which an
ERISA Event shall have occurred and then exist (or the liability of the Loan
Parties and the ERISA Affiliates related to such ERISA Events) exceeds $100,000;
or
(l) Any Loan Party or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that it has incurred Withdrawal Liability
to such Multiemployer Plan in an amount that, when aggregated with all other
amounts required to be paid to Multiemployer Plans by the Loan Parties and the
ERISA Affiliates as Withdrawal Liability (determined as of the date of such
notification), exceeds $100,000, unless contested in good faith and by
appropriate proceedings diligently conducted and reserves or other appropriate
provisions shall have been established therefor in accordance with GAAP, or
requires payments exceeding $100,000 per annum; or
(m) Any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, and as a result of such reorganization or termination the aggregate
annual contributions of the Loan Parties and the ERISA Affiliates to all
Multiemployer Plans that are then in reorganization or being terminated have
been or will be increased over the amounts contributed to such Multiemployer
Plans for the plan years of such Multiemployer Plans immediately preceding the
plan year in which such reorganization or termination occurs by an amount
exceeding $100,000; or
(n) there shall occur in the reasonable judgment of the Required
Lenders any Material Adverse Effect; or
(o) Any Collateral Document after delivery thereof shall for any
reason cease to or otherwise not create a valid and perfected first priority
Lien on and security interest in the Collateral (subject to Permitted Liens)
purported to be covered thereby and could reasonably result in a Material
Adverse Effect; or
118
(p) There shall be an event of default under any of the other
Loan Documents, not cured within the applicable grace period thereunder (if
any); then, and in any such event, the Administrative Agent (i) shall at the
request, or with the consent, of the Required Lenders, by notice to the
Borrower, declare the Commitments of each appropriate Lender and of the Issuing
Bank to issue Letters of Credit to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or with the consent, of the
Required Lenders, (A) by notice to the Borrower, declare the Notes, all interest
thereon and all other amounts payable under this Agreement and the other Loan
Documents to be forthwith due and payable, whereupon the Notes, all such
interest and all such other amounts shall become and be forthwith due and
payable, without presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived by the Borrower and (B) by notice to each
party required under the terms of any agreement in support of which a Standby
Letter of Credit is issued, request that all Obligations under such agreement be
declared to be due and payable; provided, however, that upon the occurrence of
-------- -------
an Event of Default set forth in Section 6.01(f), (x) the obligation of each
Lender to make Advances and of the Issuing Bank to issue Letters of Credit shall
automatically be terminated and (y) the Notes, all such interest and all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower. In addition, upon the occurrence and continuance of an
Event of Default, the Administrative Agent shall have the right to require the
establishment of a blocked account arrangement with respect to the Borrower and
its Subsidiaries and the Borrower hereby agrees to enter into a blocked account
agreement or agreements, in form and substance satisfactory to the
Administrative Agent upon the occurrence and continuance of an Event of Default.
SECTION 6.02. ACTIONS IN RESPECT OF THE LETTERS OF CREDIT UPON DEFAULT. If
any Event of Default shall have occurred and be continuing, the Administrative
Agent may, or shall at the request of the Required Lenders, irrespective of
whether it is taking any of the actions described in Section 6.01 or otherwise,
make demand upon the Borrower to, and forthwith upon such demand the Borrower
will, pay to the Administrative Agent on behalf of the Lender Parties in same
day funds at the Administrative Agent's office designated in such demand, for
deposit in the L/C Cash Collateral Account, an amount equal to the aggregate
Available Amount of all Letters of Credit then outstanding. If at any time the
Administrative Agent determines that any funds held in the L/C Cash
119
Collateral Account are subject to any right or claim of any Person other than
the Administrative Agent and the Lender Parties and the Hedge Banks or that the
total amount of such funds is less than the aggregate Available Amount of all
Letters of Credit, the Borrower will, forthwith upon demand by the
Administrative Agent, pay to the Administrative Agent, as additional funds to be
deposited and held in the L/C Cash Collateral Account, an amount equal to the
excess of (a) such aggregate Available Amount over (b) the total amount of
funds, if any, then held in the L/C Cash Collateral Account that the
Administrative Agent determines to be free and clear of any such right and
claim.
ARTICLE VII
THE ADMINISTRATIVE AGENT AND DOCUMENTATION AGENT
------------------------------------------------
SECTION 7.01. AUTHORIZATION AND ACTION. Each Lender Party (which term
shall mean in its capacity as a Lender, the Issuing Bank, the Swing Line Bank
and/or any Hedge Bank for purposes of this Article VII) hereby appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers and discretion under this Agreement and the other
Loan Documents as are delegated to the Administrative Agent by the terms hereof
and thereof, together with such powers and discretion as are reasonably
incidental thereto. As to any matters not expressly provided for by the Loan
Documents (including, without limitation, enforcement or collection of the
Revolving Credit Notes), the Administrative Agent shall not be required to
exercise any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of the Required Lenders, and such
instructions shall be binding upon all Lender Parties and all holders of Notes;
provided, however, that the Administrative Agent shall not be required to take
-------- -------
any action that exposes the Administrative Agent to personal liability or that
is contrary to this Agreement, any other Loan Document or applicable law. The
Administrative Agent agrees to give to each Lender Party prompt notice of each
notice given to it by the Borrower pursuant to the terms of this Agreement. The
Administrative Agent shall not be a trustee or fiduciary for any Lender.
SECTION 7.02. AGENT'S RELIANCE, ETC. Neither the Administrative Agent nor
any of its directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by
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it or them under or in connection with the Loan Documents, except for its or
their own gross negligence or willful misconduct. Without limitation of the
generality of the foregoing, the Administrative Agent: (a) may treat the payee
of any Note as the holder thereof until the Administrative Agent receives and
accepts an Assignment and Acceptance entered into by the Lender that is the
payee of such Note, as assignor, and an Eligible Assignee, as assignee, as
provided in Section 8.07; (b) may consult with legal counsel (including counsel
for any Loan Party), independent public accountants and other experts selected
by it and shall not be liable for any action taken or omitted to be taken in
good faith by it in accordance with the advice of such counsel, accountants or
experts; (c) makes no warranty or representation to any Lender Party and shall
not be responsible to any Lender Party for any statements, warranties or
representations (whether written or oral) made in or in connection with the Loan
Documents; (d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of any
Loan Document on the part of any Loan Party or to inspect the property
(including the books and records) of any Loan Party; (e) shall not be
responsible to any Lender Party for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with any Loan Document or any other instrument or
document furnished pursuant thereto; and (f) shall incur no liability under or
in respect of any Loan Document by acting upon any notice, consent, certificate
or other instrument or writing (which may be by telegram, telecopy or telex)
believed by it to be genuine and signed or sent by the proper party or parties.
SECTION 7.03. FLEET AND AFFILIATES. With respect to its Commitments, the
Advances made by it and the Notes issued to it, Fleet shall have the same rights
and powers under the Loan Documents as any other Lender Party and may exercise
the same as though it were not the Administrative Agent; and the term "Lender
Party" or "Lender Parties" shall, unless otherwise expressly indicated, include
Fleet in its individual capacity. Fleet and its affiliates may accept deposits
from, lend money to, act as trustee under indentures of, accept investment
banking engagements from, and generally engage in any kind of business with, the
Borrower, any of its Subsidiaries and any Person who may do business with or own
securities of the Borrower or any such Subsidiary, all as if Fleet were not the
Administrative Agent and without any duty to account therefor to the Lender
Parties.
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SECTION 7.04. LENDER PARTY CREDIT DECISION. Each Lender Party acknowledges
that it has, independently and without reliance upon the Administrative Agent or
any other Lender Party and based on the financial statements referred to in
Sections 4.01(f) and (g) and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender Party also acknowledges that it will, independently and
without reliance upon the Administrative Agent or any other Lender Party and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement.
SECTION 7.05. INDEMNIFICATION.
(a) Each Lender Party severally agrees to indemnify the
Administrative Agent (to the extent not promptly reimbursed by the Borrower)
from and against such Lender Party's ratable share (determined as provided
below) of any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against the
Administrative Agent in any way relating to or arising out of any of the Loan
Documents or any action taken or omitted by the Administrative Agent under any
of the Loan Documents; provided, however, that no Lender Party shall be liable
-------- -------
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender Party agrees to reimburse the
Administrative Agent promptly upon written demand for its ratable share of any
costs and expenses (including, without limitation, fees and expenses of counsel)
payable by the Borrower under Section 8.04, to the extent that the
Administrative Agent is not promptly reimbursed for such costs and expenses by
the Borrower.
(b) Each Lender Party severally agrees to indemnify the Issuing Bank
(to the extent not promptly reimbursed by the Borrower) from and against such
Lender Party's ratable share (determined as provided below) of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that
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may be imposed on, incurred by, or asserted against the Issuing Bank in any way
relating to or arising out of any of the Loan Documents or any action taken or
omitted by the Issuing Bank under any of the Loan Documents; provided, however,
-------- -------
that no Lender Party shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Issuing Bank's gross negligence or
willful misconduct. Without limitation of the foregoing, each Lender Party
agrees to reimburse the Issuing Bank promptly upon written demand for its
ratable share of any costs and expenses (including, without limitation, fees and
expenses of counsel) payable by the Borrower under Section 8.04, to the extent
that the Issuing Bank is not promptly reimbursed for such costs and expenses by
the Borrower.
(c) For purposes of Sections 7.05(a) and 7.05(b), the Lender Parties'
respective ratable shares of any amount shall be determined, at any time,
according to the sum of (i) the aggregate principal amount of the Advances
outstanding at such time and owing to the respective Lender Parties, (ii) their
respective Pro Rata Shares of the aggregate Available Amount of all Letters of
Credit outstanding at such time, (iii) the aggregate unused portions of their
respective Term Loan Commitments at such time, and (iv) their respective Unused
Revolving Credit Commitments at such time; provided, that the aggregate
--------
principal amount of Swing Line Advances owing to the Swing Line Bank and Letter
of Credit Advances owing to the Issuing Bank shall be considered to be owed to
the Revolving Credit Lenders ratably in accordance with their respective
Revolving Credit Commitments. In the event that any Defaulted Advance shall be
owing by any Defaulting Lender at any time, such Defaulting Lender Party's
Commitment with respect to the Facility under which such Defaulted Advance was
required to have been made shall be considered to be unused for purposes of this
Section 7.05 to the extent of the amount of such Defaulted Advance. The failure
of any Lender Party to reimburse the Administrative Agent or the Issuing Bank,
as the case may be, promptly upon written demand for its ratable share of any
amount required to be paid by the Lender Parties to the Administrative Agent or
the Issuing Bank, as the case may be, as provided herein shall not relieve any
other Lender Party of its obligation hereunder to reimburse the Administrative
Agent or the Issuing Bank, as the case may be, for its ratable share of such
amount, but no Lender Party shall be responsible for the failure of any other
Lender Party to reimburse the Administrative Agent or the Issuing Bank, as the
case may be, for such other Lender Party's ratable share of such amount. Without
prejudice to the survival of any other agreements of any Lender Party hereunder,
the
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agreement and obligations of each Lender Party contained in this Section 7.05
shall survive the payment in full of principal, interest and all other amounts
payable hereunder and under the other Loan Documents.
SECTION 7.06. SUCCESSOR ADMINISTRATIVE AGENTS. The Administrative Agent
may resign at any time by giving written notice thereof to the Lender Parties
and the Borrower and may be removed as to all of the Facilities at any time with
or without cause by the Required Lenders. Upon any such resignation or removal,
the Required Lenders shall have the right to appoint a successor Administrative
Agent as to such of the Facilities as to which the Administrative Agent has
resigned or been removed, which successor shall have been approved by the
Borrower, which approval shall not be unreasonably withheld or delayed. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within thirty (30) days after
the retiring Administrative Agent's giving of notice of resignation or the
Required Lenders' removal of the retiring Administrative Agent, then the
retiring Administrative Agent may, on behalf of the Lender Parties, appoint a
successor Administrative Agent, which shall be a Lender which is a commercial
bank organized under the laws of the United States or of any State thereof and
having a combined capital and surplus of at least $250,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent as to all of the Facilities and upon the execution and
filing or recording of such financing statements, or amendments thereto, and
such other instruments or notices, as may be necessary or desirable, or as the
Required Lenders may request, in order to continue the perfection of the Liens
granted or purported to be granted by the Collateral Documents, such successor
Administrative Agent shall succeed to and become vested with all the rights,
powers, discretion, privileges and duties of the retiring Administrative Agent,
and the retiring Administrative Agent shall be discharged from all of its duties
and obligations under this Agreement and the other Loan Documents. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent as to less than all of the Facilities and upon the
execution and filing or recording of such financing statements, or amendments
thereto, and such other instruments or notices, as may be necessary or
desirable, or as the Required Lenders may request, in order to continue the
perfection of the Liens granted or purported to be granted by the Collateral
Documents, such successor Administrative Agent shall succeed to and become
vested with all the rights, powers, discretion, privileges and
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duties of the retiring Administrative Agent as to such Facilities, other than
with respect to funds transfers and other similar aspects of the administration
of Borrowings under such Facilities, issuances of Letters of Credit
(notwithstanding any resignation as Administrative Agent with respect to the
Letter of Credit Facility) and payments by the Borrower in respect of such
Facilities, and the retiring Administrative Agent shall be discharged from its
duties and obligations under this Agreement as to such Facilities, other than as
aforesaid. After any retiring Administrative Agent's resignation or removal
hereunder as Administrative Agent as to all of the Facilities, the provisions of
this Article VII shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent as to any Facilities under
this Agreement.
SECTION 7.07. DOCUMENTATION AGENT. The Documentation Agent shall have no
rights, obligations or duties under this Agreement other than in its capacity as
a Lender hereunder.
ACTICLE VIII
MISCELLANEOUS
-------------
SECTION 8.01. AMENDMENTS, ETC. No amendment or waiver of any provision of
this Agreement or the Notes or any other Loan Document, nor consent to any
departure by the Borrower therefrom, shall in any event be effective unless the
same shall be in writing and signed (or, in the case of the Collateral
Documents, consented to) by the Required Lenders, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that (a) no amendment, waiver or
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consent shall, unless in writing and signed by all of the Lender Parties (other
than any Lender Party that is, at such time, a Defaulting Lender), do any of the
following at any time: (i) change the percentage of (x) the Commitments, (y) the
aggregate unpaid principal amount of the Advances or (z) the aggregate Available
Amount of outstanding Letters of Credit that, in each case, shall be required
for the Lenders or any of them to take any action hereunder; (ii) release any
material portion of the Collateral in any transaction or series of related
transactions or permit the creation, incurrence, assumption or existence of any
Lien on any material portion of the Collateral in any transaction or series of
related transactions to secure any liabilities or obligations other than
Obligations
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owing to the Secured Parties under the Loan Documents; (iii) release any of the
Subsidiary Guarantors from their Subsidiary Guaranty or Foreign Guaranty, as
applicable, except as permitted under this Agreement, the Subsidiary Guaranty or
the Foreign Guaranty; (iv) amend this Section 8.01 or change the definition of
"Required Lenders"; or (v) limit the liability of any Loan Party under any of
the Loan Documents, except as permitted under this Agreement; and (b) no
amendment, waiver or consent shall, unless in writing and signed by the Required
Lenders and each Lender Party that has a Commitment under the Revolving Credit
Facility if affected by such amendment, waiver or consent, (i) change the
amounts of the Commitments of such Lender Party or subject such Lender Party to
any additional obligations, (ii) reduce the principal of, or interest on, the
Notes held by such Lender Party or any fees or other amounts payable hereunder
to such Lender Party, (iii) postpone any date fixed for any scheduled payment of
principal of, or interest on, the Notes held by such Lender Party or any fees or
other amounts payable hereunder to such Lender Party or (iv) change the order of
application of any prepayment set forth in Section 2.06 in any manner that
materially and adversely affects such Lender Party; provided, further, that no
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amendment, waiver or consent shall, unless in writing and signed by the Swing
Line Bank or the Issuing Bank, as the case may be, in addition to the Lenders
required above to take such action, affect the rights or obligations of the
Swing Line Bank or the Issuing Bank, as the case may be, under this Agreement or
any other Loan Document; and provided, further, that no amendment, waiver or
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consent shall, unless in writing and signed by the Administrative Agent in
addition to the Lenders required above to take such action, affect the rights or
duties of the Administrative Agent under this Agreement or any other Loan
Document.
SECTION 8.02. NOTICES ETC. All notices and other communications provided
for hereunder shall be in writing (including telegraphic, telecopy or telex
communication) and mailed, telegraphed, telecopied, telexed, delivered by
overnight courier service or personally served,
(i) if to the Borrower:
Unidigital Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxxx X. Xxx, Chief Executive Officer
Telephone No.: (000) 000-0000
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Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxxxx Ingersoll Professional Corporation
College Centre
000 Xxxxxxx Xxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx X. Xxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
(ii) if to the Administrative Agent:
Fleet Bank, N.A.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxx, Senior Vice President
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxx Xxxxxxx, Vice President
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxx Xxxxxx
Xxxxxxxx Xxxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxxxx Xxxxx Singer & Xxxxxxxxx, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq. or
Xxxx X. Xxxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
(iii) if to any Initial Lender or the Initial Issuing Bank, at
its Domestic Lending Office specified opposite its name on Schedule I attached
----------
hereto;
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(iv) if to any other Lender Party, at its Domestic Lending
Office specified in the Assignment and Acceptance pursuant to which it became a
Lender Party;
or, as to the Borrower or the Administrative Agent, at such other address as
shall be designated by such party in a written notice to the other parties and,
as to each other party, at such other address as shall be designated by such
party in a written notice to the Borrower and the Administrative Agent. All such
notices and communications shall, (w) when mailed by certified mail, return
receipt requested, be effective three (3) days after mailing, (x) when
telegraphed, telecopied or telexed, be effective upon delivery to the telegraph
company, upon transmission by telecopier or upon confirmation by telex
answerback, (y) when delivered in person, be effective when delivered and (z)
when delivered by overnight courier, be effective two (2) Business Days after
delivery to the courier properly addressed, except that notices and
communications to the Administrative Agent pursuant to Article II, III or VII
shall not be effective until received by the Administrative Agent. Delivery by
telecopier of an executed counterpart of this Agreement, the Notes or any other
Loan Document or of any Exhibit hereto or thereto or of any amendment or waiver
of any provision hereof or thereof shall be as effective as delivery of a
manually executed counterpart thereof.
SECTION 8.03. NO WAIVER; REMEDIES. No failure on the part of any Lender
Party or the Administrative Agent to exercise, and no delay in exercising, any
right hereunder or under any Note or under any other Loan Document shall operate
as a waiver thereof, nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law or in equity.
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SECTION 8.04. COSTS AND EXPENSES.
(a) The Borrower agrees to pay on demand (i) all reasonable costs and
expenses of the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification and amendment of the Loan
Documents (including, without limitation, (A) all due diligence, collateral
review, syndication (including printing, distribution and bank meetings),
transportation, computer, duplication, appraisal, audit, insurance, consultant,
search, filing, registration and recording fees and expenses, and (B) the
reasonable fees and expenses of counsel for the Administrative Agent with
respect thereto, including advising the Administrative Agent as to its rights
and responsibilities, or the perfection, protection or preservation of rights or
interests under the Loan Documents, with respect to negotiations with any Loan
Party or with other creditors of any Loan Party or any of its Subsidiaries
arising out of any Default or any events or circumstances that may give rise to
a Default and with respect to presenting claims in or otherwise participating in
or monitoring any bankruptcy, insolvency or other similar proceeding involving
creditors' rights generally and any proceeding ancillary thereto) and (ii) all
reasonable costs and expenses of the Administrative Agent and the Lender Parties
in connection with the enforcement of the Loan Documents, whether in any action,
suit or litigation or any bankruptcy, insolvency or other similar proceeding
affecting creditors' rights generally or otherwise (including, without
limitation, the fees and expenses of counsel for the Administrative Agent and
each Lender Party with respect thereto).
(b) The Borrower agrees to indemnify and hold harmless the
Administrative Agent, each Lender Party and each of their respective Affiliates
and their respective officers,
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directors, employees, agents and advisors (each, an "Indemnified Party") from
and against any and all claims, damages, losses, liabilities and expenses
(including, without limitation, reasonable fees and expenses of counsel) that
may be incurred by or asserted or awarded against any Indemnified Party, in each
case arising out of or in connection with or by reason of, or in connection with
the preparation for a defense of, any investigation, litigation or proceeding
arising out of, related to or in connection with (i) any of the transactions
contemplated by the Loan Documents, (ii) any acquisition or proposed acquisition
or similar business combination or proposed business combination by the Borrower
or any of its Subsidiaries or other Affiliates of all or any portion of the
shares of capital stock or all or substantially all of the property and assets
of any other Person, (iii) the Facilities, the actual or proposed use of the
proceeds of the Advances or the Letters of Credit by the Borrower or any of its
Subsidiaries or other Affiliates and any of the other transactions contemplated
by the Loan Documents, (iv) the actual or alleged presence of Hazardous
Materials on any property of the Borrower or any of its Subsidiaries or any
Environmental Action relating in any way to the Borrower or any of its
Subsidiaries or (v) any broker's or finder's fees or commissions or any similar
fees or commissions which are or will be owed or payable by the Borrower or any
of its Subsidiaries in connection with the incurrence and maintenance of the
Obligations, any other transactions contemplated by the Loan Documents or any
services rendered in connection with such transactions, in the case of each of
clauses (i) through (v) above whether or not such investigation, litigation or
proceeding is brought by the Borrower or any of its Subsidiaries, or their
directors, officers, managers, employees, stockholders, or creditors or an
Indemnified Party or any Indemnified Party is otherwise a party thereto and
whether or not the transactions contemplated hereby are consummated, except to
the extent such claim, damage, loss, liability or expense is found in a final,
non-appealable judgment by a court of competent jurisdiction to have resulted
from such
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Indemnified Party's gross negligence or willful misconduct. The Borrower also
agrees not to assert any claim against the Administrative Agent, any Lender
Party or any of their respective Affiliates, or any of their respective
officers, directors, employees, attorneys and agents, on any theory of
liability, for special, indirect, consequential or punitive damages arising out
of or otherwise relating to the Facilities, the actual or proposed use of the
proceeds of the Advances or the Letters of Credit, the Loan Documents or any of
the transactions contemplated thereby, other than claims for direct, as opposed
to consequential, damages which shall have been determined in a final
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Person's gross negligence or willful misconduct.
(c) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance is made by the Borrower to or for the account of a Lender Party
other than on the last day of the Interest Period for such Advance, as a result
of a payment or Conversion pursuant to Section 2.09(b)(i) or 2.10(d) or a
prepayment pursuant to Section 2.06, acceleration of the maturity of the Notes
pursuant to Section 6.01 or for any other reason, the Borrower shall, upon
demand by such Lender Party (with a copy of such demand to the Administrative
Agent), pay to the Administrative Agent for the account of such Lender Party any
amounts required to compensate such Lender Party for any additional losses,
costs or expenses that it may reasonably incur as a result of such payment,
including, without limitation, any loss, cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds required by any
Lender Party to fund or maintain such Advance.
(d) If any Loan Party fails to pay when due any costs, expenses or
other amounts payable by it under any Loan Document, including, without
limitation, fees and
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expenses of counsel and indemnities, such amount may be paid on behalf of such
Loan Party by the Administrative Agent, in its sole discretion.
(e) Without prejudice to the survival of any other agreement of any
Loan Party hereunder or under any other Loan Document, the agreements and
obligations of the Borrower contained in Sections 2.10 and 2.12 and this
Section 8.04 shall survive the payment in full of principal, interest and all
other amounts payable hereunder and under any of the other Loan Documents.
SECTION 8.05. RIGHT OF SET-OFF. Borrower hereby grants to the
Administrative Agent for itself and ratably for the benefit of the Lender
Parties and the Hedge Banks, a lien, security interest and right of setoff as
security for all liabilities and obligations to the Administrative Agent, the
Lender Parties and the Hedge Banks, whether now existing or hereafter arising,
upon and against all deposits, credits, collateral and property, now or
hereafter in the possession, custody, safekeeping or control of the
Administrative Agent, the Lender Parties and the Hedge Banks or any entity under
the control of Fleet Financial Group, Inc., or in transit to any of them. At any
time, without demand or notice, the Administrative Agent, the Lender Parties and
the Hedge Banks may set off the same or any part thereof and apply the same to
any liability or obligation of Borrower due to the appropriate party even though
unmatured and regardless of the adequacy of any collateral securing the
Obligation of the Borrower. ANY AND ALL RIGHTS TO REQUIRE THE ADMINISTRATIVE
AGENT, THE LENDER PARTIES AND THE HEDGE BANKS TO EXERCISE THEIR RESPECTIVE
RIGHTS OR REMEDIES WITH RESPECT TO ANY COLLATERAL WHICH SECURES THE OBLIGATIONS
OF THE BORROWER OR ANY OTHER LOAN PARTY, PRIOR TO EXERCISING ITS RIGHT OF
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SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE BORROWER
ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED. Section 1.6 Binding
-------------------
Effect.
------
SECTION 8.06. BINDING EFFECT. This Agreement shall become effective when
it shall have been executed by the Borrower and the Administrative Agent and
when the Administrative Agent shall have been notified by each Initial Lender
and the Initial Issuing Bank that each such Initial Lender and the Initial
Issuing Bank has executed it and thereafter shall be binding upon and inure to
the benefit of the Borrower, the Administrative Agent, each Lender Party, each
Hedge Bank and their respective successors and assigns, except that the Borrower
shall not have the right to assign any of its rights hereunder or any interest
herein without the prior written consent of the Lender Parties.
SECTION 8.07. ASSIGNMENTS AND PARTICIPATIONS.
(a) Each Lender Party may assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitment or Commitments, the
Advances owing to it and the Note or Notes held by it); provided, however, that
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(i) each such assignment shall be of a uniform, and not a varying, percentage of
all rights and obligations hereunder and thereunder (including, without
limitation, under and in respect of the Facilities) on a pro rata basis with
respect thereto, (ii) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender or an assignment of all of a
Lender Party's and Hedge Bank's rights and obligations under this Agreement and
the other Loan Documents, as applicable, the amount of the
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Commitment of the assigning Lender Party being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000, (iii) no
such assignments shall be permitted without the prior consent of the
Administrative Agent (which may be withheld for any reason) until the earlier to
occur of (x) the date on which the Administrative Agent shall have notified the
Lender Parties that syndication of the Commitments hereunder has been completed
or (y) the 120th day following the Initial Funding Date, (iv) no such assignment
shall be permitted if, immediately after giving effect thereto, the Borrower
would be required to make payments to or on behalf of the assignee Lender Party
pursuant to Section 2.10(a) or (b) or Section 2.12 and the assignor Lender Party
was not, at the time of such assignment, entitled to receive any payment
pursuant to Section 2.10(a) or (b) or Section 2.12, and (v) the parties to each
such assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with any Note or Notes subject to such assignment and a processing and
recordation fee of $3,000. Swing Line Notes shall not be subject to assignment
and all amounts owing thereunder shall be deemed owing under the applicable
Revolving Credit Note at the time of an assignment pursuant to Section 8.07.
(b) Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in such Assignment and Acceptance, (x) the
assignee thereunder shall be a party hereto and under the other Loan Documents,
as applicable, and, to the extent that rights and obligations hereunder and
under the other Loan Documents, as applicable, have been assigned to it pursuant
to such Assignment and Acceptance, have the rights and obligations of a Lender
or Issuing Bank, as the case may be, hereunder and under the other Loan
Documents, as applicable, and (y) the Lender or Issuing Bank assignor thereunder
shall, to the extent that rights
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and obligations hereunder have been assigned by it pursuant to such Assignment
and Acceptance, relinquish its rights and be released from its obligations under
this Agreement and under the other Loan Documents, as applicable (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender's or Issuing Bank's rights and obligations under this Agreement
and under the other Loan Documents, as applicable, such Lender or Issuing Bank
shall cease to be a party hereto and under the other Loan Documents, as
applicable), except as to Sections 2.10, 2.12 and 8.04 for the period prior to
the effective date of such assignments.
(c) By executing and delivering an Assignment and Acceptance, the
Lender Party assignor thereunder and the assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender Party makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with this Agreement or any other Loan Document or any
other instrument or document furnished pursuant hereto or thereto; (ii) such
assigning Lender Party makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or any
other Loan Party or the performance or observance by any Loan Party of any of
its obligations under any Loan Document or any other instrument or document
furnished pursuant thereto; (iii) such assignee confirms that it has received a
copy of this Agreement, together with copies of the financial statements
referred to in Sections 4.01(f) and (g) and such other documents and information
as it
135
has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (iv) such assignee will, independently and
without reliance upon the Administrative Agent, such assigning Lender Party or
any other Lender Party and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee confirms
that it is an Eligible Assignee; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement and the other Loan Documents as
are delegated to the Administrative Agent by the terms hereof and thereof,
together with such powers and discretion as are reasonably incidental thereto;
and (vii) such assignee agrees that it will perform in accordance with their
terms all of the obligations which by the terms of this Agreement are required
to be performed by it as a Lender or Issuing Bank, as the case may be.
(d) The Administrative Agent shall maintain at its address referred
to in Section 8.02 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses of
the Lender Parties and the Commitment under each Facility of, and principal
amount of the Advances owing under each Facility to, each Lender Party from time
to time (the "Register"). The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Borrower, the
Administrative Agent and the Lender Parties may treat each Person whose name is
recorded in the Register as a Lender Party hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower or any
Lender Party at any reasonable time and from time to time upon reasonable prior
notice.
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(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender Party and an assignee, together with any Note or Notes subject
to such assignment and the appropriate processing and recordation fee and any
other agreement, documents and instruments reasonably requested by the
Administrative Agent, the Administrative Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of Exhibit A
---------
hereto, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrower. In the case of any assignment by a Lender, within five (5) Business
Days after its receipt of such notice, the Borrower, at its own expense, shall
execute and deliver to the Administrative Agent in exchange for the surrendered
Note or Notes a new Note to the order of such Eligible Assignee in an amount
equal to the Commitment assumed by it under a Facility pursuant to such
Assignment and Acceptance and, if the assigning Lender has retained a Commitment
hereunder under such Facility, a new Note to the order of the assigning Lender
in an amount equal to the Commitment retained by it hereunder. Such new Note or
Notes shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Note or Notes, shall be dated the effective date of
such Assignment and Acceptance and shall otherwise be in substantially the form
of Exhibit B.
---------
(f) The Issuing Bank may assign to an Eligible Assignee all of its
rights and obligations under the undrawn portion of its Letter of Credit
Commitment and its other rights and obligations hereunder and under the other
Loan Documents, as applicable, at any time; provided, however, that (i) each
-------- -------
such assignment shall be to an Eligible Assignee and (ii) the parties to each
such assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, with a
processing and recordation
137
fee of $3,000 and any other agreement, documents and instruments reasonably
requested by the Administrative Agent.
(g) Each Lender Party may sell participations to one or more Persons
(other than any Loan Party or any of its Affiliates) in or to all or a portion
of its rights and obligations under this Agreement and the other Loan Documents,
as applicable (including, without limitation, all or a portion of its
Commitments, the Advances owing to it and the Note or Notes, if any, held by
it); provided, however, that (i) such Lender Party's obligations under this
-------- -------
Agreement and the other Loan Documents (including, without limitation, its
Commitments) shall remain unchanged, (ii) such Lender Party shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender Party shall remain the holder of any such Note for all
purposes of this Agreement, (iv) the Borrower, the Administrative Agent and the
other Lender Parties shall continue to deal solely and directly with such Lender
Party in connection with such Lender Party's rights and obligations under this
Agreement and (v) no participant under any such participation shall have any
right (x) to any payments under Sections 2.10 or 2.12 (other than to the extent
the Lender Party is entitled thereto) and (y) to approve any amendment, waiver
or other modification of any provision of this Agreement or any other Loan
Document, or any consent to any departure by any Loan Party therefrom, except to
the extent that such amendment, waiver, modification or consent would reduce the
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, in each case to the extent subject to such participation, or postpone
any date fixed for any payment of principal of, or interest on, the Notes or any
fees or other amounts payable hereunder, in each case to the extent subject to
such participation, or release all or substantially all of the Collateral.
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(h) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section 8.07, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower furnished to such Lender
Party by or on behalf of the Borrower; provided, however, that, prior to any
-------- -------
such disclosure, the assignee or participant or proposed assignee or participant
shall agree to preserve the confidentiality of any Confidential Information
received by it from such Lender Party.
(i) Each of the Administrative Agent, for itself and ratably for
the benefit of the Lender Parties and the Hedge Banks, the Administrative Agent
for itself or any Lender Party or Hedge Bank may at any time pledge all or any
portion of its rights under the Loan Documents including any portion of any note
to any of the twelve (12) Federal Reserve Banks organized under Section 4 of the
Federal Reserve Act, 12 U.S.C. Section 341 (or any successor provision related
thereto). No such pledge or enforcement thereof shall release the Administrative
Agent or any of the Lender Parties, or any Hedge Bank from its obligations under
any of the Loan Documents.
SECTION 8.08. EXECUTION IN COUNTERPARTS; SEVERABILITY. This Agreement may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be as effective as delivery of a manually executed
counterpart of this Agreement. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required hereunder
shall not in any way affect or
139
impair the legality or enforceability of the remaining provisions of this
Agreement or any instrument or agreement required hereunder.
SECTION 8.09. NO LIABILITY OF THE ISSUING BANK. The Borrower assumes all
risks of the acts or omissions of any beneficiary or transferee of any Letter of
Credit with respect to its use of such Letter of Credit. Neither the Issuing
Bank nor any of its officers, directors, employees or agents, any Lender Party
or Hedge Bank shall be liable or responsible for: (a) the use that may be made
of any Letter of Credit or any acts or omissions of any beneficiary or
transferee in connection therewith; (b) the validity, sufficiency or genuineness
of documents, or of any endorsement thereon, even if such documents should prove
to be in any or all respects invalid, insufficient, fraudulent or forged; or (c)
any other circumstances whatsoever in making or failing to make payment under
any Letter of Credit, except that the Borrower shall have a claim against the
Issuing Bank, and the Issuing Bank shall be liable to the Borrower, to the
extent of any direct, but not consequential, damages suffered by the Borrower
that the Borrower proves were caused by (i) the Issuing Bank's willful
misconduct or gross negligence in determining whether documents presented under
any Letter of Credit comply with the terms of the Letter of Credit or (ii) the
Issuing Bank's willful failure to make lawful payment under a Letter of Credit
after the presentation to it of a draft and certificates strictly complying with
the terms and conditions of the Letter of Credit. In furtherance and not in
limitation of the foregoing, the Issuing Bank may accept documents that appear
on their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary.
SECTION 8.10. CONFIDENTIALITY. Neither the Administrative Agent nor any
Lender Party shall disclose any Confidential Information to any Person without
the consent of the Borrower,
140
other than (a) to the Administrative Agent's or such Lender Party's Affiliates
and their officers, directors, employees, agents and advisors and to actual or
prospective Eligible Assignees and participants, and then only on a confidential
basis, (b) as required by any law, rule or regulation or judicial process, (c)
as required by the National Association of Insurance Commissioners, and (d) as
requested or required by any state, federal or foreign authority or examiner
regulating banks or banking or insurance companies.
SECTION 8.11. JURISDICTION, ETC.
(a) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF ANY
NEW YORK STATE COURT OR FEDERAL COURT OF THE UNITED STATES OF AMERICA SITTING IN
NEW YORK CITY, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN ANY SUCH NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY
LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL
JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE
ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY LAW. NOTHING IN
141
THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY LENDER PARTY MAY OTHERWISE HAVE
TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS IN THE COURTS OF ANY JURISDICTION.
(b) EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF, OR RELATING TO, THIS AGREEMENT OR ANY OF
THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY IN ANY NEW YORK STATE OR FEDERAL
COURT. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE
OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
SECTION 8.12. GOVERNING LAW. THIS AGREEMENT, THE NOTES AND THE OTHER LOAN
DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.
SECTION 8.13. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO MUTUALLY
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY
JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR ANY
142
OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR ANY
COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR
ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE
ADMINISTRATION AGENT AND THE LENDER PARTIES TO ACCEPT THIS AGREEMENT AND MAKE
ADVANCES.
SECTION 8.14. REPLACEMENT OF ITEMS. Upon receipt of an affidavit of an
officer of the Administrative Agent or any of the Lender Parties as to the loss,
theft, destruction or mutilation of any of the Notes or any security document
which is not of public record, and, in the case of any such loss, theft,
destruction or mutilation, upon cancellation of any such Note or security
document, Borrower will issue and/or will cause any other applicable Loan Party
to issue, in lieu thereof, a replacement note or security document in the same
principal amount thereof and otherwise of like tenor.
SECTION 8.15. CERTAIN PAYMENTS. All Loan Documents are hereby expressly
limited so that in no contingency or event whatsoever, whether by reason of
acceleration of maturity of the indebtedness evidenced hereby or otherwise,
shall the amount paid or agreed to be paid to the Administrative Agent for
itself, and the Agent for itself ratably for the benefit of the Lender Parties
and the Hedge Banks or any of the Lender Parties or the Hedge Banks for the use
or the forbearance of the indebtedness evidenced hereby or otherwise exceed the
maximum permissible under applicable law. As used herein, the term "applicable
law" shall mean the law in effect as of the date hereof provided, however, that
in the event there is a change in the law which results in a higher permissible
rate of interest, then the applicable Loan Document shall be governed by such
new law as of its effective date. In this regard, it is expressly agreed that it
is the intent of
143
the parties hereof in the execution, delivery and acceptance of this Agreement
to contract in strict compliance with the laws of the State of New York from
time to time in effect. If, under or for any circumstances whatsoever,
fulfillment of any provision hereof or of any of the Loan Documents at the time
of performance of such provision shall be due, shall involve transcending the
limit of such validity prescribed by applicable law, then the obligation to be
fulfilled shall automatically be reduced to the limits of such validity, and if
under or from circumstances whatsoever the Administrative Agent or any of the
Lender Parties or any of the Hedge Banks should ever receive as interest an
amount which would exceed the highest lawful rate, such amount which would be
excessive interest shall be applied to the reduction of the principal balance
evidenced hereby and not to the payment of interest. This provision shall
control every other provision of all Loan Documents.
[Signature Pages Follow]
144
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.
UNIDIGITAL INC.
By: /s/ Xxxxxxx X. Xxx
---------------------------------
Name: Xxxxxxx X. Xxx
Title: Chief Executive Officer
FLEET BANK, N.A. as Administrative Agent,
Initial Issuing Bank and Swing Line Bank
By: /s/ Xxxx Xxxxxxx
-----------------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC. as
Documentation Agent
By: /s/ Xxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
By: /s/ Xxxxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Vice President
[Signature page 1 of 2 to Credit Agreement]
145
INITIAL LENDERS
FLEET BANK, N.A., as a Lender
By: /s/ Xxxx Xxxxxxx
-----------------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President
BANK AUSTRIA CREDITANSTALT CORPORATE
FINANCE, INC.
By: /s/ Xxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
By: /s/ Xxxxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Vice President
XXXXXXX XXXXX BUSINESS FINANCE
SERVICES, INC.
By: /s/ T.G. Kopezynski
-----------------------------------------
Name: T.G. Kopezynski
Title: Vice President
[Signature Page 2 of 2 to Credit Agreement]
