EXHIBIT 10.1
CREDIT AGREEMENT
among
Overnite Corporation
and
Overnite Transportation Company
as Borrowers
and
The Lenders From Time
To Time Parties Hereto,
as Lenders
with
Crestar Bank,
as Agent
Dated as of August __, 1998
TABLE OF CONTENTS
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS...................... 1
Section 1.1 Definitions............................... 1
Section 1.2 Accounting Terms.......................... 20
Section 1.3 Time Period Computations.................. 20
ARTICLE II GENERAL PROVISIONS OF REVOLVING CREDIT FACILITY....... 20
Section 2.1 The Revolving Loans....................... 20
Section 2.2 Revolving Loan Borrowing Procedures....... 21
Section 2.3 Standby Letters of Credit................. 24
Section 2.4 Swing Line Loan Subfacility............... 29
ARTICLE III INTEREST, FEES AND REPAYMENT.......................... 32
Section 3.1 Interest on the Revolving Loans........... 32
Section 3.2 Regulatory Changes........................ 32
Section 3.3 Interest After Due Date................... 33
Section 3.4 Payment and Computations.................. 33
Section 3.5 Payment at Maturity....................... 36
Section 3.6 Prepayments; Certain Early Repayments..... 36
Section 3.7 Facility Fee, Administrative Fee, and
Letter of Credit Fees................... 37
Section 3.8 LIBOR Conversion.......................... 38
Section 3.9 Breakage, etc............................. 39
ARTICLE IV CONDITIONS PRECEDENT.................................. 40
Section 4.1 Conditions Precedent...................... 40
Section 4.2 Further Conditions Precedent to Loans and
Standby Letters of Credit................ 42
ARTICLE V REPRESENTATIONS....................................... 43
Section 5.1 Existence, Power and Authority............ 43
Section 5.2 Authorization; Enforceable Obligations.... 44
Section 5.3 No Legal Bar.............................. 44
Section 5.4 Consents.................................. 44
Section 5.5 Litigation................................ 45
Section 5.6 No Default................................ 45
Section 5.7 Financial Condition....................... 45
Section 5.8 Use of Proceeds........................... 45
Section 5.9 Borrowers Not Investment Companies........ 46
Section 5.10 Taxes..................................... 46
Section 5.11 Subsidiaries.............................. 46
Section 5.12 Permits, Licenses, Etc.................... 46
Section 5.13 Compliance With Laws...................... 47
Section 5.14 OHI....................................... 48
Section 5.15 Amounts Owed to or from Affiliates;
Intercompany Agreements.................. 48
Section 5.16 Maintenance of Insurance.................. 48
Section 5.17 Properties................................ 49
Section 5.18 Change.................................... 49
Section 5.19 Outstanding Letters of Credit, Suretyship
Agreements and Similar Arrangements...... 49
Section 5.20 Disclosure Generally...................... 49
Section 5.21 Year 2000 Compliance...................... 49
ARTICLE VI COVENANTS............................................. 50
Section 6.1 Affirmative Covenants..................... 50
(a) Information...................................... 50
(i) Audited Annual Financials................. 50
(ii) Quarterly Financial Statements............ 50
(iii) Exchange Act and Securities Act Filings... 51
(iv) No Default................................ 51
(v) Compliance................................ 51
(vi) ERISA..................................... 51
(vii) Material Changes.......................... 51
(viii) Other Information......................... 52
(b) Financial Covenants.............................. 52
(i) Consolidated Indebtedness to Consolidated
Cash Flow Ratio.......................... 52
(ii) Consolidated Fixed Charge Ratio........... 52
(iii) Consolidated Tangible Net Worth Ratio..... 52
(c) Proceeds......................................... 53
(d) Payment of Debts and Taxes....................... 53
(e) ERISA............................................ 53
(f) Conduct and Maintenance of Business.............. 53
(g) Preservation of Corporate Existence.............. 54
(h) Books and Records................................ 54
(i) Insurance........................................ 54
(j) Compliance with Laws............................. 54
(k) Compliance with Loan Documents................... 54
(l) Lending Relationship with the Agent.............. 54
(n) Notice of Default................................ 55
ii
(o) Notice of Environmental Claims................... 55
(p) Payments Pari Passu.............................. 55
(q) Year 2000 Compliance............................. 55
(r) Further Assurances............................... 55
Section 6.2 Negative Covenants........................ 55
(a) Liens............................................ 56
(b) Indebtedness..................................... 56
(c) Capital Stock.................................... 57
(d) Loans............................................ 57
(e) No Merger or Acquisition......................... 58
(f) Accounting Policies; Fiscal Year................. 59
(g) Disposition of Assets............................ 59
(h) Permitted Investments............................ 59
ARTICLE VII EVENTS OF DEFAULT..................................... 59
Section 7.1 Events of Default......................... 59
ARTICLE VIII THE AGENT............................................ 62
Section 8.1 Appointment of Agent...................... 62
Section 8.2 Nature of Duties; Non-Reliance on Agent
and other Lenders........................ 63
Section 8.3 Rights, Exculpation, Etc.................. 64
Section 8.4 Reliance; Notice of Default............... 65
Section 8.5 Indemnification........................... 66
Section 8.6 The Agent Individually.................... 66
Section 8.7 Successor Agent; Resignation of Agent..... 66
Section 8.8 Certain Matters Requiring the Consent of
all Lenders.............................. 67
Section 8.9 Defaulting Lenders Vote Not Counted....... 68
ARTICLE IX MISCELLANEOUS.......................................... 69
Section 9.1 Amendments and Waivers; Cumulative
Remedies.................................. 69
Section 9.2 Survival of Representations and
Warranties................................ 69
Section 9.3 Supervening Illegality..................... 69
Section 9.4 No Reduction in Payments................... 70
Section 9.5 Stamp Taxes................................ 70
Section 9.6 Notices.................................... 70
Section 9.7 Governing Law.............................. 72
Section 9.8 Successors and Assigns; Participations;
Assignments................................ 72
Section 9.9 Affirmative Rate of Interest Permitted by
Law....................................... 73
iii
Section 9.10 Costs and Expenses; Indemnification........ 74
Section 9.11 Set-Off; Suspension of Payment
and Performance........................... 75
Section 9.12 Sharing of Collections, Proceeds and
Set-Offs; Application of Payments......... 75
Section 9.13 Lenders' Obligations Several; Independent
Nature of Lenders' Rights................. 77
Section 9.14 Judicial Proceedings; Waiver of Jury
Trial..................................... 77
Section 9.15 Integration................................ 78
Section 9.16 Further Acts and Assurances................ 78
Section 9.17 No Fiduciary Relationship.................. 78
Section 9.18 Severability............................... 78
Section 9.19 Counterparts............................... 78
Section 9.20 Headings, Bold Type and Table of Contents.. 79
Schedule I - Lender Commitments....................... v
Schedule 1.1 - Existing Liens........................... v
Schedule 5.5 - Litigation............................... v
Schedule 5.6 - Defaults................................. v
Schedule 5.11 - Subsidiaries............................. v
Schedule 5.15 - Intercompany Debts and Intercompany
Agreements.............................. v
Schedule 5.19 - Letters of Credit, Suretyship Agreements
and Similar Arrangements................ v
Exhibit A Form of Revolving Note..................... v
Exhibit B Form of Swing Line Note.................... v
Exhibit C Form of Borrowing Notice................... v
iv
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of August __, 1998 (as amended,
modified, or otherwise supplemented from time to time, this "Agreement"), is by
and among (i) OVERNITE CORPORATION, a Virginia corporation ("Parent Borrower"),
and OVERNITE TRANSPORTATION COMPANY, a Virginia corporation ("Operating
Borrower") (collectively, the "Borrowers"), (ii) THE LENDERS FROM TIME TO TIME
PARTIES TO THIS AGREEMENT (each, a "Lender" and, collectively, the "Lenders")
and (iii) CRESTAR BANK, a Virginia banking corporation in its separate capacity
as agent for the Lenders hereunder (in such capacity, the "Agent").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Borrowers have requested the Lenders to make available to
the Borrowers a revolving line of credit for loans and letters of credit up to
an aggregate of $200,000,000 for the purpose of Parent Borrower's acquisition of
Overnite Holding, Inc. and Operating Borrower from Union Pacific Corporation and
working capital and other requirements of the Borrowers, in each case upon the
terms and conditions set forth herein; and
WHEREAS, the Lenders are willing to make the loans and issue the
letters of credit to the Borrowers, and the Agent is willing to act as "Agent",
upon the terms and subject to the conditions and provisions set forth herein;
NOW, THEREFORE, in consideration of the premises and mutual covenants
and agreements herein contained, the Borrowers, the Lenders and the Agent hereby
agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section I.1 Definitions. As used in this Agreement, and unless the
-----------
context requires a different meaning, the following terms shall have the
meanings indicated (such meanings to be, when appropriate, equally applicable to
both the singular and plural forms of the terms defined):
"Accumulated Funding Deficiency" has the meaning ascribed to that term
------------------------------
in ERISA Section 302.
"Administrative Fee" has the meaning specified in Section 3.7(b) of
------------------
this Agreement.
"Administrative Fee Letter" has the meaning specified in Section
-------------------------
3.7(b) hereof, and shall include any amendment, modification or supplement
thereof.
"Affected Advance" has the meaning specified in Section 3.8(d) of this
----------------
Agreement.
"Affiliate" means, with respect to a Person, any other Person that,
---------
directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such first Person. For
purposes of this definition, "control" (including, with correlative
meanings, the terms "controlling", "controlled by" or "under common control
with"), as applied to any Person, means the possession, directly or
indirectly, of the power to vote 10% or more of the securities having
voting power for the election of directors of such Person or otherwise to
direct or cause the direction of the management and policies of that
Person, whether through the ownership of voting securities or by contract
or otherwise.
"Agent" has the meaning specified in the preamble of this Agreement
-----
and shall include any successor Agent appointed pursuant to Section 8.7 of
this Agreement.
"Agent Lending Office" or "Lending Office of the Agent" means the
-------------------- ---------------------------
Agent's offices at Crestar Bank, 000 Xxxx Xxxx Xxxxxx, Xxxxxxxx, XX 00000,
Attention: Xxxxx X. Xxxxxxx, or such other office in the United States of
America of Agent as it may from time to time designate to the Borrowers or
the Lenders by written notice.
"Aggregate Commitment" means $200,000,000.00.
--------------------
"Agreement" has the meaning specified in the preamble of this
---------
Agreement.
"Applicable Facility Fee" means, for any period, a facility fee
-----------------------
(stated in basis points) determined based upon the Borrowers' Consolidated
Leverage Ratio, as set forth below:
2
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Consolidated Applicable Facility Fee
Leverage Ratio (basis points)
---------------------------------------------------------------------------
less than 2.5 17.5
less than 2.0 more than 2.5 15
less than 1.5 more than 2.0 12.5
less than 1.0 more than 1.5 10
more than 1.0 8.5
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"Applicable LIBOR Margin" means, for any period, a number of basis
-----------------------
points, based upon the Borrowers' Consolidated Leverage Ratio, as set forth
below:
---------------------------------------------------------------------------
Consolidated Applicable LIBOR Margin
Leverage Ratio (basis points)
---------------------------------------------------------------------------
less than 2.5 65.5
less than 2.0 more than 2.5 53
less than 1.5 more than 2.0 46.5
less than 1.0 more one 1.5 41
more than 1.0 35.5
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"Applicable LIBOR Rate" means, for any period, LIBOR plus the
---------------------
Applicable LIBOR Margin.
"Authorized Officer" means any of the Chief Executive Officer, Chief
------------------
Financial Officer or Treasurer of any Person which is a corporation,
partnership, or other business organization.
"Bank Governmental Body" means (a) the United States of America or any
----------------------
State thereof or any department, agency, commission, board, bureau or
instrumentality of the United States of America or any State thereof, and
(b) any quasi-governmental authority, agency or authority (including any
central bank) exercising regulatory authority over the Lenders pursuant to
applicable law in respect of the transactions contemplated by this
Agreement.
3
"Bankruptcy Code" means Title 11 of the United States Code or any
---------------
similar or successor federal law for the relief of debtors, as the same may
be amended from time to time.
"Base Rate" means the higher of (a) the Prime Rate and (b) the Federal
---------
Funds Rate plus 0.50%.
"Base Rate Period" means any 30-day period in respect of which
----------------
interest accrues on the Revolving Loans bearing interest at the Base Rate.
"Benefit Plan" means any employee benefit plan (including a
------------
Multiemployer Benefit Plan), the funding requirements of which (under ERISA
Section 302 or Section 412 of the Code) are, or at any time within five
years immediately preceding the time in question were, in whole or in part,
the responsibility of the Borrowers or an ERISA Affiliate.
"Borrowers" means Parent Borrower and Operating Borrower.
---------
"Borrowers' Account" means the bank account of the Borrowers
------------------
maintained with the Agent for general purposes and assigned the account
number designated by the Agent in writing to the Borrowers.
"Borrowing Notice" has the meaning specified in Section 2.2(a) of this
----------------
Agreement.
"Breakage Period" has the meaning specified in Section 3.9 of this
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Agreement.
"Business Day" means any day on which commercial banks are open for
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business (and not required or authorized by law to close) in Richmond,
Virginia.
"Capital Expenditures" means all expenditures classified as capital
--------------------
expenditures in accordance with GAAP.
"Capital Lease" of any Person means any lease of any property (whether
-------------
real, personal or mixed) by such Person (as lessee or guarantor or other
surety) which would, in accordance with GAAP, be required to be classified
and accounted for as a capital lease on a balance sheet of such Person.
"Capital Stock" means any and all shares, interests, participations or
-------------
other equivalents (however designated) of capital stock of a corporation,
any and all
4
equivalent ownership interests in a Person other than a corporation, and
any and all warrants or options to purchase any of the foregoing.
"Cash Equivalents" means securities or other instruments of the type
----------------
described in (i) clauses (a) and (b) of the definition of Permitted
Investment, provided such obligations have a maturity of not more than
--------
twelve (12) months from the date purchased, (ii) clause (c) of the
definition of Permitted Investment, provided such instruments have a
--------
maturity of not more than 270 days from the date purchased, and (iii)
clause (d) of the definition of Permitted Investment, provided such
--------
commercial paper has a maturity of not greater than six (6) months from the
date purchased.
"Change in Control" means one or more of the following events:
-----------------
(a) if any Person (including a person as defined in Section 3(a)(9),
Section 13(d) or Section 14(d) of the Exchange Act) is or becomes the owner
or beneficial owner, directly or indirectly, of securities of the Parent
Borrower representing fifty percent (50%) or more of the combined voting
power of the Parent Borrower's then outstanding securities (the term
"beneficial owner" as used herein shall include but not be limited to any
person with the attributes or interests described in Rule 13d-3 (as now in
effect or as amended) promulgated under the Exchange Act); or
(b) (i) the shareholders of the Parent Borrower approve one or more
mergers, consolidations or combinations of the Parent Borrower with any
other corporations or entities which, if consummated prior to the Maturity
Date, would result in (x) the voting securities of the Parent Borrower
outstanding the day following the Effective Date (together with any voting
securities issued by the Parent Borrower permitted under Section 6.2(c)
herein) representing less than 50% of the combined voting power of the
voting securities of the Parent Borrower or such surviving entity
immediately after consummation of any such merger, consolidation or
combination, or (y) after giving effect to such merger, consolidation or
combination, a change in the person holding the Office of Chief Executive
Officer, President, Chief Operating Officer or Chief Financial Officer of
the Parent Borrower relative to the person holding such respective office
immediately prior to giving effect to such merger, consolidation or
combination, or (ii) the shareholders of the Parent Borrower approve a plan
of liquidation of the Parent Borrower or an agreement for the sale,
disposition or transfer by the Parent Borrower of all or substantially all
the assets of the Borrowers and their Consolidated Subsidiaries.
5
"Code" means the Internal Revenue Code of 1986, as amended from time
----
to time, and any successor Federal statute.
"Commitment" means, with respect to each Lender's commitment to make
----------
Revolving Loans and to issue (or participate in the issuance of) Standby
Letters of Credit, the aggregate Dollar amount set forth on Schedule I
hereto opposite such Lender's name under the heading "Commitment" or
assigned to it in accordance with Section 9.8(c), as such amount may be
reduced or otherwise adjusted from time to time in accordance with the
provisions of this Agreement.
"Consolidated Cash Flow" means, as computed at any time and from time
----------------------
to time, the sum of the Borrowers' and their Consolidated Subsidiaries'
Consolidated Net Income plus income taxes (other than income taxes excluded
from the definition of Consolidated Net Income), interest charges,
depreciation, amortization expenses (including amortization of goodwill)
and the amount of all rental expenses under operating leases, in each case
to the extent such items are taken into account in determining Consolidated
Net Income.
"Consolidated Indebtedness" means Indebtedness of the Borrowers and
-------------------------
their Consolidated Subsidiaries, as determined in accordance with GAAP.
"Consolidated Leverage Ratio" means the ratio of Consolidated
---------------------------
Indebtedness to Consolidated Cash Flow.
"Consolidated Net Income" means, for any period, the consolidated net
-----------------------
income of the Borrowers and their Consolidated Subsidiaries for any period,
as determined in accordance with GAAP, provided that there shall be
--------
excluded therefrom (a) the net income (or deficit) of any Person accrued
prior to the date it becomes a Consolidated Subsidiary or is merged into or
consolidated with Borrowers or any Consolidated Subsidiary except mergers
accounted for under the pooling of interests method, (b) the net income (or
deficit) of any Person (other than a Consolidated Subsidiary) in which
Borrowers or any Consolidated Subsidiary have an ownership interest, except
to the extent that Borrowers or such Consolidated Subsidiary have received,
or have the right to receive, such income, (c) the undistributed earnings
of any Subsidiary to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary is not at the time
permitted by the terms of any contractual obligation or requirement of law
applicable to such Subsidiary, (d) any aggregate net gain or loss during
such period arising from the sale, exchange or other disposition of capital
assets (such term to include all fixed assets, whether tangible or
6
intangible, all inventory sold in conjunction with the disposition of fixed
assets and all securities) other than in the ordinary and usual course of
its business, net of any related provision for taxes, (e) any write-up or
write-down of any asset net of any related provision for taxes, (f) any net
gain from the collection of the proceeds of life insurance policies, (g)
any gain arising from the acquisition of any securities, or the
extinguishment, under GAAP, of any Indebtedness of Borrowers or any
Subsidiary, (h) any extraordinary gain or loss, realized during such
period, net of any related provision for taxes, (i) in the case of a
successor to Parent Borrower by consolidation or merger or as a transferee
of its assets, any net income or loss of the successor corporation prior to
such consolidation, merger or transfer of assets, and (j) any deferred
credit representing the excess of equity in any Subsidiary at the date of
acquisition over the cost of the investment in such Subsidiary.
"Consolidated Net Worth" means, as computed at any time and from time
----------------------
to time, the excess of Consolidated Total Assets over Consolidated Total
Liabilities.
"Consolidated Subsidiary" means with respect to any Person, at any
-----------------------
time, any Subsidiary or other Person the accounts of which are consolidated
with those of such first Person in its consolidated financial statements as
of such time prepared in accordance with GAAP.
"Consolidated Tangible Net Worth" means, as to the Borrowers and their
-------------------------------
Consolidated Subsidiaries at any date of determination thereof, the sum at
such time of: the Consolidated Net Worth of the Borrowers and their
Consolidated Subsidiaries less, with respect to the Borrowers and their
Consolidated Subsidiaries, the total of (a) all assets which would be
classified as intangible assets under GAAP consistently applied and (b) any
revaluation or other write-up in book value of assets following September
30, 1998.
"Consolidated Total Assets" means all assets of the Borrowers and
-------------------------
their Subsidiaries, computed at any time and from time to time on a
consolidated basis, which would be classified, in accordance with GAAP, as
total assets of a corporation conducting a business the same as, or similar
in nature to, the business conducted by the Borrowers and their
Subsidiaries.
"Consolidated Total Liabilities" means all liabilities of the
------------------------------
Borrowers and their Subsidiaries, computed at any time and from time to
time on a consolidated basis, which would be classified, in accordance with
GAAP, as total liabilities of a
7
corporation conducting a business the same as, or similar in nature to, the
business conducted by the Borrowers and their Subsidiaries.
"Credit Agreement Related Claim" means any claim (whether civil,
------------------------------
criminal or administrative and whether sounding in tort, contract or
otherwise) in any way arising out of, related to, or connected with, this
Agreement or any other Loan Document or the relationships established
hereunder or thereunder.
"Default Rate" means the rate of interest applicable under Section 3.3
------------
of this Agreement from time to time.
"Dollars", "U.S.$" and the sign "$" mean such coin or currency of the
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United States of America as at the time shall constitute legal tender for
the payment of public and private debts.
"Drawing" has the meaning specified in Section 2.3(e) of this
-------
Agreement.
"Effective Date" has the meaning specified in Section 4.1 of this
--------------
Agreement.
"Environmental Control Statutes" shall mean each and every applicable
------------------------------
federal, state, county or municipal statute, ordinance, rule, regulation,
order, directive or requirement, together with all successor statutes,
ordinances, rules, regulations, orders, directives or requirements, of any
Governmental Authority, including without limitation laws in any way
related to Hazardous Substances.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended from time to time.
"ERISA Affiliate" means any Person, including a Subsidiary or other
---------------
Affiliate, that is a member of any group of organizations within the
meaning of Code Sections 414(b), (c), (m) or (o) of which Borrowers are a
member.
"Event of Default" has the meaning specified in Section 7.1 of this
----------------
Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
------------
and any successor Federal statute.
"Facility Fee" has the meaning specified in Section 3.7(a) of this
------------
Agreement.
8
"Federal Funds Rate" means, for any day, the rate per annum (rounded
------------------
upward to the nearest 1/100th of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by the Federal Reserve Bank of New York on the
Business Day next succeeding such day; provided that (a) if such day is not
--------
a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day and (b) if no such
rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate quoted to the Agent on
such day on such transactions as determined by the Agent.
"Fee Payment Date" means (a) in the case of the Facility Fee, the
----------------
first Business Day following the end of any Fiscal Quarter (or part
thereof), (b) in the case of the Administrative Fee, the first Business Day
following each annual anniversary of the Effective Date, and (c) in the
case of the L/C Fronting Fee, on the date of issuance of the Standby Letter
of Credit to which such fees relate.
"Final Prospectus" means the final prospectus filed with the SEC
----------------
pursuant to SEC Rule 424 in connection with the Parent Borrower Public
Offering.
"Fiscal Quarter" means the quarter, during any Fiscal Year, ending
--------------
March 31, June 30, September 30 and December 31.
"Fiscal Year" has the meaning specified in Section 6.1(a) of this
-----------
Agreement.
"Form 8-K" means Form 8-K as prescribed by the SEC under the Exchange
--------
Act.
"Form 10-K" means Form 10-K as prescribed by the SEC under the
---------
Exchange Act.
"Form 10-Q" means Form 10-Q as prescribed by the SEC under the
---------
Exchange Act.
"Funding Date" means the date on which any loan shall be made by a
------------
Lender to the Borrowers hereunder.
"GAAP" means generally accepted accounting principles as set forth in
----
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
9
pronouncements of the Financial Accounting Standards Board or such other
statements by such other Person as may be approved by a significant segment
of the accounting profession in the United States.
"Governmental Authority" means any nation or government, any state or
----------------------
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Hazardous Substance" means (a) any substance designated pursuant to
-------------------
section 311(b)(2)(A) of the Federal Water Pollution Control Act, (b) any
element, compound, mixture, solution or substance designated pursuant to
section 102 of CERCLA, (c) any hazardous waste having the characteristics
identified under or listed pursuant to section 3001 of the Solid Waste
Disposal Act (but not including any waste the regulation of which under the
Solid Waste Disposal Act has been suspended by Act of Congress), (d) any
toxic pollutant listed under section 307(a) of the Federal Water Pollution
Control Act, (e) any hazardous air pollutant listed under section 112 of
the Clean Air Act, and (f) any imminently hazardous chemical substance or
mixture with respect to which the Administrator has taken action pursuant
to section 7 of the Toxic Substances Control Act. The term specifically
includes petroleum, including crude oil or any faction thereof, asbestos,
asbestos containing materials and urea formaldehyde insulation. The term
does not include natural gas, natural gas liquids, liquefied natural gas,
or synthetic gas useable for fuel (or mixtures of natural gas and such
synthetic gas).
"Indebtedness" means, without duplication, all (a) indebtedness,
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obligations and liabilities now existing or hereafter arising for money
borrowed by the Borrowers or any Subsidiary thereof, whether or not
evidenced by a note, indenture or other agreement (including, without
limitation, the Revolving Notes and the Swing Line Note), (b) reimbursement
or indemnification obligations in respect of any letter of credit issued
for the account of the Borrowers or any Subsidiary thereof (other than
letters of credit related to State Payment Obligations), (c) reimbursement
or indemnification obligations in respect of any guarantee, suretyship
agreement or similar agreement issued on behalf of the Borrowers or any
Subsidiary thereof (other than such obligations in respect of guarantees,
suretyship agreements, and other similar arrangements related to State
Payment Obligations), (d) guarantees, suretyship agreements, and other
similar arrangements effecting the assumption of a debt or obligation of
any Person (other than the Borrowers or a Consolidated Subsidiary thereof)
as to which one or more of the Borrowers or a Consolidated Subsidiary have
a
10
reimbursement or indemnification obligation, or the endorsement of any
promissory note or other instrument or obligation of any Person (other than
the Borrowers or a Consolidated Subsidiary), (e) obligations of the
Borrowers or any Subsidiary thereof as lessee under any Capital Lease (as
reflected on a balance sheet prepared in accordance with GAAP), (f) all
obligations of the Borrowers or any Subsidiary thereof in respect of any
interest rate or currency swap, rate cap or other similar transaction
(valued in an amount equal to the highest termination payment, if any, that
would be payable by such Person upon termination of such transaction for
any reason on the date of determination); (g) all amounts owing by the
Borrowers or any Subsidiary thereof under purchase money mortgages or other
purchase money liens or conditional sales or other title retention
agreements and (h) all indebtedness secured by purchase money mortgages,
liens, security interests, conditional sales or other title retention
agreements upon property owned by the Borrowers or any Subsidiary thereof
(whether or not the Borrowers or Subsidiary have assumed or become liable
for the payment of such indebtedness).
"Indemnified Person" has the meaning specified in Section 9.10(b) of
------------------
this Agreement.
"Initial Fiscal Quarter" has the meaning specified in Section
----------------------
6.1(b)(i) of this Agreement.
"Intercompany Agreements" has the meaning specified in Section 5.16(b)
-----------------------
of this Agreement.
"Intercompany Debt" has the meaning specified in Section 5.16(a) of
-----------------
this Agreement.
"Interest Payment Date" means (a) in the case of Revolving Loans
---------------------
bearing interest at the Base Rate, the last Business Day of the calendar
quarter (or part thereof) in which interest accrues on such Revolving
Loans, (b) in the case of LIBOR Loans, the expiration of the LIBOR Period
in respect of such LIBOR Loans, (c) in the case of any Swing Line Loans, on
the last Business Day of the Swing Line Period in respect of such Swing
Line Loans, and (d) in the case of any interest period exceeding three (3)
months or ninety (90) days, as the case may be, those days that occur
during such interest period at intervals of three months or ninety days, as
the case may be, after the first day of such Interest Period.
11
"Investment" in any Person means, without duplication:
----------
(a) the acquisition (whether for cash, property, services or
securities or otherwise) of Capital Stock, bonds, notes, debentures,
partnership, limited liability company, or other ownership interests or
other securities of such Person; and
(b) any deposit with, or advance, loan or other extension of credit
to, such Person or guarantee or assumption of, or other contingent
obligation with respect to, Indebtedness of such Person, other than
Indebtedness and guarantees permitted by Section 6.2(b) and Loans permitted
by Section 6.2(d).
"Issuing Lender" means, initially, the Agent and, thereafter, such
--------------
other Lender as from time to time shall agree to act as the issuer of the
Standby Letters of Credit by notice to the Lenders, the Agent and the
Borrowers.
"L/C Fee" has the meaning specified in Section 2.3(b) of this
-------
Agreement.
"L/C Fee Payment Date" means the last Business Day of the calendar
--------------------
quarter.
"L/C Fronting Fee" has the meaning specified in Section 2.3(b) of this
----------------
Agreement.
"Lender" or "Lenders" have the meanings specified in the preamble of
------ -------
this Agreement.
"Lender Availability" means, as of any date of determination and with
-------------------
respect to each Lender, the amount determined by deducting (a) the amount
of such Lender's Pro Rata Share of the Total Outstanding Amount from (b)
----
the amount of such Lender's Pro Rata Share of the Revolving Loan
Commitment.
"LIBOR" means, with respect to any LIBOR Period, (a) the per annum
-----
interest rate (rounded upward to the nearest 1/100th of 1%) determined on
the basis of the offered rates for Dollar deposits for a term comparable to
such LIBOR Period and in an amount substantially equal to the outstanding
amount of the Revolving Loans in respect of which such determination is
made which appear on the Bloomberg Screen Page BBAM1 as of 11:00 a.m.
(London time) on the day that is two LIBOR Business Days prior to the first
day of such LIBOR Period, divided by (b) a number equal to 1.00 minus
-------
the LIBOR Reserve Rate.
12
"LIBOR Business Day" means any day on which commercial banks are open
------------------
for international business (including dealings in Dollar deposits) in
London or such other Euro-dollar interbank market as may be selected by the
Agent in its sole discretion.
"LIBOR Conversion" has the meaning specified in Section 3.8(a) of this
----------------
Agreement.
"LIBOR Conversion Notice" has the meaning specified in Section 3.8(a)
-----------------------
of this Agreement.
"LIBOR Loans" means the Revolving Loans which bear interest at the
-----------
Applicable LIBOR Rate.
"LIBOR Period" means the one month, two month, three month or six
------------
month interest period selected by the Borrowers pursuant to any LIBOR
Conversion Notice.
"LIBOR Reserve Rate" means, for any day with respect to a LIBOR Loan,
------------------
the maximum rate (expressed as a decimal) at which a Lender would be
required to maintain reserves under Regulation D of the Board of Governors
of the Federal Reserve System, as amended from time to time (or any
successor or similar regulations relating to such reserve requirements),
against "Eurocurrency liabilities" (as that term is used in Regulation D),
if such liabilities were outstanding. The LIBOR Reserve Rate shall be
adjusted automatically on and as of the effective date of any change in the
LIBOR Reserve Rate.
"Lien" of any Person means any mortgage, deed of trust, lien, pledge,
----
adverse interest in property, charge, security interest or other
encumbrance in or on, or any interest or title of any vendor, lessor,
lender or other secured party to or of such Person under any conditional
sale or other title retention agreement or Capital Lease with respect to,
any property or asset owned or held by such Person, or the signing or
filing of any security agreement with respect to any of the foregoing
authorizing any other party as the secured party thereunder to file any
financing statement.
"Loan" means any Revolving Loan (whether bearing interest at the Base
----
Rate or Applicable LIBOR Rate) or Swing Line Loan, and "Loans" shall mean,
-----
collectively, all Revolving Loans (whether bearing interest at the Base
Rate or Applicable LIBOR Rate) and Swing Line Loans.
13
"Loan Documents" means this Agreement, the Revolving Notes, the Swing
--------------
Line Note, and the Administrative Fee Letter.
"Mandatory Borrowing" has the meaning specified in Section 2.4(e) of
-------------------
this Agreement.
"Maturity Date" means August ___, 2003.
-------------
"Multiemployer Plan" means any "multiemployer plan" as defined in
------------------
ERISA Section 4001(a)(3) to which the Borrowers or any ERISA Affiliate are
making or accruing an obligation to make contributions, or have within any
of the preceding three plan years made or accrued an obligation to make
contributions.
"Note" means each of the Revolving Notes and the Swing Line Note.
----
"Obligations" means all now existing or hereafter arising
-----------
indebtedness, obligations, liabilities and covenants of the Borrowers to
the Lenders or the Agent, their respective Affiliates or permitted
successors and assigns or any other Indemnified Person, in each case
arising under or evidenced by this Agreement or any other Loan Document,
whether direct or indirect, absolute or contingent, now or hereafter
existing, or due or to become due.
"OHI" means Overnite Holding, Inc., a Delaware corporation and 100%
---
owned Subsidiary of Parent Borrower.
"Operating Borrower" means Overnite Transportation Company, a Virginia
------------------
corporation and 100% owned Subsidiary of OHI.
"Optional Prepayment" means the optional prepayment of Revolving Loans
-------------------
pursuant to Section 3.6(b) of this Agreement or the optional prepayment of
Swing Line Loans pursuant to Section 2.4(f) of this Agreement, as the
context shall require.
"Parent Borrower" means Overnite Corporation, a Virginia corporation.
---------------
"Parent Borrower Public Offering" means the Parent Borrower Public
-------------------------------
Offering of Common Stock of Parent Borrower pursuant to the Form S-1
Registration Statement, Registration Number 333-53169, initially filed with
the SEC on May 20, 1998, as amended.
14
"PBGC" means the Pension Benefit Guaranty Corporation and any
----
successor Federal Agency.
"Permitted Investment" means each of (a) direct obligations of the
--------------------
United States of America, and agencies thereof; (b) obligations fully
guaranteed by the United States of America; (c) certificates of deposit
issued by, or bankers' acceptance of, or time deposits with, any bank,
trust company or national banking association incorporated or doing
business under the laws of the United States of America or one of the
states thereof having combined capital and surplus and retained earnings of
at least $100,000,000; (d) commercial paper of companies having a rating
assigned to such commercial paper by Standard & Poor's Corporation or
Xxxxx'x Investors Service, Inc. (or, if neither such organization shall
rate such commercial paper at any time, by any nationally recognized rating
organization in the United States of America) of at least A-2 or P-2,
respectively; (e) registered investment companies that limit their
investments to the instruments described in clauses (a) through (d) hereof;
(f) overnight repurchase agreements based on securities of the types
described in clauses (a) and (b) with a bank, trust company or national
banking association satisfying the requirements of clause (c); or (g) any
other investment (including, without limitation, investments in Persons
that do not become Subsidiaries as a result of the investment), provided
--------
the aggregate amount of all investments referred to in this clause (g)
shall not exceed $6,000,000.00.
"Permitted Liens" means:
---------------
(a) any Liens for current taxes, assessments and other governmental
charges not yet due and payable or being contested in good faith by the
Borrowers or one or more of their Subsidiaries by appropriate proceedings
and for which adequate reserves have been established by the Borrowers or
one or more of their Subsidiaries as reflected in Borrowers' financial
statements;
(b) any mechanic's, materialman's, carrier's, warehousemen's or
similar Liens for sums not yet due or being contested in good faith by the
Borrowers or one or more of their Subsidiaries by appropriate proceedings
and for which adequate reserves have been established by the Borrowers or
one or more of their Subsidiaries as reflected in Borrowers' financial
statements;
(c) any Liens in favor of the Lenders under the Loan Documents;
(d) easements, rights-of-way, restrictions and other similar
encumbrances on the real property or fixtures of the Borrowers or one or
more
15
of their Subsidiaries incurred in the ordinary course of business which
individually or in the aggregate are not substantial in amount and which do
not in any case materially detract from the value of the property subject
thereto or interfere with the ordinary conduct of the business of the
Borrowers or any of their Subsidiaries;
(e) Liens (other than Liens imposed on any property of the Borrowers
or one or more of their Subsidiaries or any ERISA Affiliate pursuant to
ERISA or Section 412 of the Code) incurred or deposits made in the ordinary
course of business, including Liens in connection with workers'
compensation, unemployment insurance and other types of social security and
Liens to secure performance of tenders, statutory obligations, trade
contracts (other than for Indebtedness), surety and appeal bonds (in the
case of appeal bonds such Lien shall not secure any reimbursement or
indemnity obligation in an amount greater than $1,000,000), bids, leases
that are not Capital Leases, performance bonds, sales contracts and other
similar obligations, deposits securing liability to insurance carriers
under insurance or self-insurance arrangements, in each case, not incurred
in connection with the obtaining of credit or the payment of a deferred
purchase price, and which do not, in the aggregate, result in a material
adverse effect on the business, operations, assets or condition (financial
or otherwise) of the Borrowers or one or more of their Subsidiaries;
(f) any Liens existing upon the date hereof as set forth in Schedule
1.1 hereto;
(g) Liens securing obligations incurred to finance the deferred
purchase price of property, provided that (i) such Liens shall be created
--------
within 120 days after the acquisition of such property, (ii) such Liens do
not at any time encumber any property other than the property financed by
such obligations, (iii) the amount of the obligation secured thereby is not
increased, and (iv) the principal amount of an obligation secured by any
such Lien shall at no time exceed the lesser of (A) 100% of the original
purchase price of such property and (B) the fair value (as determined in
good faith by the Board of Directors of the Parent Borrower) of such
property at the time it was acquired;
(h) Liens securing obligations assumed in connection with Investments
made in accordance with Sections 6.2(e) and (h), provided that (i) such
--------
Liens exist at the time of the Investment and were not created in
anticipation thereof, (ii) any such Lien is not spread to cover any
additional property or assets after
16
the time of such Investment, and (iii) the amount of the obligation secured
by any such Lien is not increased; and
(i) other Liens not to exceed $2,000,000 in the aggregate.
"Permitted Uses" means (a) a $105,000,000 payment to Union Pacific
--------------
Corporation in connection with Parent Borrower's acquisition of OHI and
Operating Borrower, (b) working capital, (c) capital expenditures made in
compliance with this Agreement, (d) letters of credit, and (e) general
corporate purposes.
"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.
"Potential Event of Default" means an event, condition or circumstance
--------------------------
which, with the giving of notice or the lapse of time or both, would
constitute an Event of Default.
"Prepayment Date" has the meaning specified in Section 9.3 of this
---------------
Agreement.
"Prime Rate" means the rate of interest established and announced from
----------
time to time by the Agent as its Prime Rate, it being understood and agreed
that the Prime Rate is used as a reference for fixing the lending rate on
commercial loans and is not necessarily the lowest or most favorable rate
of interest charged by the Agent on such loans. The Prime Rate, as applied
to the Revolving Loans, will be changed on the same day as change occurs in
the Agent's Prime Rate, in accordance with the Agent's standard practices
in effect from time to time with respect to the administration of
commercial loans.
"Prohibited Transaction" has the meaning ascribed to such term in
----------------------
ERISA.
"Pro Rata Share" means, as of any date of determination and with
--------------
respect to any Lender, a fraction (expressed as a percentage), the
numerator of which shall be the amount of such Lender's Commitment and the
denominator of which shall be the aggregate amount of Commitments of all
Lenders, as such Commitments may be reduced or otherwise adjusted from time
to time in accordance with the provisions of this Agreement; provided,
--------
however, that if all of the Commitments are terminated or reduced to zero
-------
hereunder, the Pro Rata
17
Share shall mean, as of any date of determination and with respect to any
Lender, a fraction (expressed as a percentage), the numerator of which
shall be the sum of the aggregate amount of such Lender's Revolving Loans
then outstanding plus the aggregate amount of such Lender's participation
in any outstanding Standby Letter of Credit and the denominator of which
shall be the sum of the aggregate amount of all Revolving Loans then
outstanding plus all Standby Letters of Credit then outstanding.
"Regulation" shall mean any statute, law, ordinance, regulation, order
----------
or rule of any United States or foreign, federal, state, local or other
government or governmental body, including, without limitation, those
covering or related to banking, financial transactions, securities, public
utilities, environmental control, energy, safety, health, transportation,
bribery, record keeping, zoning, antidiscrimination, antitrust, wages and
hours, employee benefits, and price and wage control matters.
"Regulatory Change" means any applicable law, interpretation,
-----------------
directive, request or guideline (whether or not having the force of law),
or any change therein or in the administration or enforcement thereof, that
becomes effective or is implemented or first required or expected to be
complied with after the date hereof, whether the same is (i) the result of
-
an enactment by a government or any agency or political subdivision
thereof, a determination of a court or regulatory authority, or otherwise
or (ii) enacted, adopted, issued or proposed before or after the date
--
hereof, including any such that imposes, increases or modifies any tax,
reserve requirement, insurance charge, special deposit requirement,
assessment or capital adequacy requirement, but excluding any such that
imposes, increases or modifies any income or franchise tax imposed upon any
Lender by any jurisdiction (or any political subdivision thereof) in which
any Lender or any office is located.
"Release of Hazardous Substances" shall mean any spilling, leaking,
-------------------------------
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping, or disposing into the environment of any Hazardous
Substances (including the abandonment or discarding of barrels, containers,
and other closed receptacles containing any Hazardous Substance), but
excludes the normal application of fertilizer or pesticides.
"Reportable Event" means any event or condition described in ERISA
----------------
Section 4043(b), other than an event or condition with respect to which the
30-day notice requirement has been waived.
18
"Required Lenders" means, except as otherwise provided in Section
----------------
8.9(a) hereof, as of any date of determination, such Lenders whose Pro Rata
Shares of the Revolving Loan Commitment, in the aggregate, are greater than
sixty-six and two-thirds percent (66K%); provided, however, that for so
-------- -------
long as only two financial institutions constitute Lenders hereunder (it
being understood that, solely for the purposes of determining the number of
financial institutions constituting Lenders under this proviso, each
financial institution, together with its Affiliates, shall constitute a
single Lender), Required Lenders shall mean, except as otherwise provided
in Section 8.9(a) hereof, as of any date of determination, such Lenders
whose Pro Rata Shares of the Revolving Loan Commitment, in the aggregate,
constitute one hundred percent (100%).
"Revolving Loan" has the meaning specified in Section 2.1 of this
--------------
Agreement.
"Revolving Loan Commitment" means the commitment of the Lenders to
-------------------------
make Revolving Loans and issue (or participate in the issuance of) Standby
Letters of Credit in an aggregate amount of up to the Aggregate Commitment,
as such amount may be reduced or otherwise adjusted from time to time in
accordance with the provisions of this Agreement.
"Revolving Note" means any promissory note issued to a Lender by the
--------------
Borrowers pursuant to this Agreement, substantially in the form
(appropriately completed) of Exhibit A to this Agreement, as the same may
be amended, modified or supplemented from time to time, and any other
promissory note issued in exchange or substitution thereof, and "Revolving
---------
Notes" means, collectively, all such promissory notes so issued.
-----
"SEC" means the Securities and Exchange Commission and any successor
---
Federal agency.
"Securities Act" means the Securities Act of 1933, as amended, and any
--------------
successor Federal statute.
"Stamp Taxes" has the meaning specified in Section 9.5 of this
-----------
Agreement.
"Standby Letter of Credit" has the meaning specified in Section 2.3 of
------------------------
this Agreement.
19
"State Payment Obligations" means payment obligations to states of the
-------------------------
United States of America or the District of Columbia in respect of tolls
and fuel taxes not to exceed $5,000,000 in the aggregate at any time.
"Subsidiary" means any corporation, limited liability company,
----------
partnership, trust or other entity a majority of the capital stock (or
equivalent ownership or controlling interest) of which at the time
outstanding, having ordinary voting power for the election of directors (or
equivalent controlling interest or persons), are owned by Borrowers
directly or indirectly, and "Subsidiaries" means, collectively, all such
------------
entities.
"Swing Line Lender" has the meaning specified in Section 2.4(a) of
-----------------
this Agreement.
"Swing Line Borrowing Notice" has the meaning specified in Section
---------------------------
2.4(c) of this Agreement.
"Swing Line Loan" has the meaning specified in Section 2.4(a) of this
---------------
Agreement.
"Swing Line Note" means the promissory note issued by the Borrowers to
---------------
Crestar Bank pursuant to this Agreement in respect of the Swing Line Loans,
substantially in the form (appropriately completed) of Exhibit B to this
Agreement, as the same may be amended, modified or supplemented from time
to time, and any other promissory note issued in exchange or substitution
therefor.
"Swing Line Period" has the meaning specified in Section 2.4(c) of
-----------------
this Agreement.
"Swing Line Subfacility" has the meaning specified in Section 2.4(a)
----------------------
of this Agreement.
"Termination Event" means, with respect to any Benefit Plan, (a) any
-----------------
Reportable Event with respect to such Benefit Plan, (b) the termination of
such Benefit Plan, or the filing of a notice of intent to terminate such
Benefit Plan, or the treatment of any amendment to such Benefit Plan as a
termination under ERISA Section 4041(c), (c) the institution of proceedings
to terminate such Benefit Plan under ERISA Section 4042 or (d) the
appointment of a trustee to administer such Benefit Plan under ERISA
Section 4042.
20
"Total Outstanding Amount" has the meaning specified in Section 2.1(a)
------------------------
of this Agreement.
"Year 2000 Compliant" has the meaning specified in Section 5.21 of
-------------------
this Agreement.
"Year 2000 Problem" has the meaning specified in Section 5.21 of this
-----------------
Agreement.
Section 1.2 Accounting Terms. All accounting terms not specifically
----------------
defined herein shall be construed in accordance with GAAP consistently applied.
Section 1.3 Time Period Computations. In the computation of a
------------------------
period of time specified in this Agreement from a specified date to a subsequent
date, the word "from" means "from and including" and the words "to" and "until"
mean "to but excluding".
ARTICLE II
GENERAL PROVISIONS OF REVOLVING CREDIT FACILITY
Section 2.1 The Revolving Loans.
-------------------
(a) Revolving Loan Borrowings. Subject to the terms and conditions
-------------------------
of this Agreement, each Lender severally and not jointly agrees to make
revolving loans (each individually, a "Revolving Loan" and, collectively, the
"Revolving Loans") to the Borrowers, at any time and from time to time on and
after the Effective Date until one Business Day prior to the Maturity Date in an
amount which shall not exceed such Lender's Pro Rata Share of the Revolving Loan
Commitment; provided, however, that (i) the sum of the aggregate outstanding
-------- -------
amount of all Revolving Loans plus the aggregate outstanding amount of all Swing
----
Line Loans plus the aggregate outstanding amount of all Standby Letters of
----
Credit (such sum, the "Total Outstanding Amount") shall at no time exceed the
Aggregate Commitment, and (ii) the aggregate outstanding amount of all Revolving
Loans made by each individual Lender pursuant to this Section 2.1 plus the
----
aggregate outstanding amount of all Standby Letters of Credit made by the
Issuing Lender and deemed made by each other Lender pursuant to Section 2.3
hereof shall at no time exceed such Lender's Pro Rata Share of the Revolving
Loan Commitment. Within the limits and subject to the terms and conditions set
forth in this Agreement,
21
the Borrowers may borrow pursuant to this Section 2.1 and Section 2.2 hereof,
may prepay pursuant to Section 3.6(b), and reborrow under this Section 2.1
hereof.
(b) The Revolving Notes; Maturity. The Revolving Loans made by each
-----------------------------
Lender pursuant hereto shall be evidenced by a separate Revolving Note. Each
Revolving Note shall be issued on or before the Effective Date and shall bear
interest for the period from the initial Funding Date thereof until paid in full
on the unpaid principal amount thereof at the rate specified in Section 3.1 of
this Agreement. Each Lender is hereby authorized to record in the books and
records of such Lender (without making any notation in such Lender's Revolving
Note or any schedule thereto) the amount and Funding Date of each Revolving Loan
made by such Lender, and the amount and date of each payment or prepayment of
any Revolving Loan. No failure to so record nor any error in so recording shall
affect the obligations of the Borrowers to repay the actual outstanding
principal amount of the Revolving Loans, with interest thereon, as provided in
this Agreement. The aggregate principal amount of the Revolving Loans shall be
payable on the Maturity Date, unless sooner accelerated pursuant to the terms of
this Agreement.
Section 2.2 Revolving Loan Borrowing Procedures.
------------------------------------
(a) Notice of Revolving Borrowing. Whenever the Borrowers desire to
-----------------------------
borrow Revolving Loans under Section 2.1 hereof, the Borrowers shall deliver to
the Agent irrevocable written notice substantially in the form of Exhibit C
(each such notice, a "Borrowing Notice"). In the case of a Revolving Loan
bearing interest at the Base Rate, the Borrowing Notice shall be delivered no
later than 10:00 A.M. (Eastern time) on the Funding Date. In the case of a
Revolving Loan bearing interest at the Applicable LIBOR Rate, the Borrowing
Notice shall be delivered no later than 10:00 A.M. at least three (3) LIBOR
Business Days prior to the first day of the LIBOR Period as to which such loan
relates, it being understood that the Borrowers' entitlement to request
Revolving Loans bearing interest at the Applicable LIBOR Rate is subject to
compliance with, and the limitations of, Section 3.8(a) (with such modifications
as shall be necessary to reflect that an initial loan, rather than the
conversion of an outstanding loan, is being requested). The Borrowing Notice
shall specify (i) that the Borrowers wish to effect Revolving Loans, (ii) the
amount of the Revolving Loans thereby requested (which shall not be less than
$3,000,000 and shall be in multiples of $500,000), (iii) the requested Funding
Date of such Revolving Loans, which date shall be a Business Day, and (iv)
whether the requested Revolving Loans will bear interest at the Base Rate or
Applicable LIBOR Rate. Each Borrowing Notice shall be accompanied by the
officer's certificate contemplated by Section 4.2(d) hereof. In lieu of
delivering the above-described Borrowing Notice, and only with the consent of
the Agent in its
22
sole discretion at such time, the Borrowers may give the Agent telephonic notice
of any such proposed borrowing by the time required under this Section 2.2(a);
provided that, in the event the Agent so consents, such notice shall be
--------
confirmed in writing by delivery to the Agent promptly (but in no event later
than 12:00 noon (Eastern time) on the Funding Date of the requested Revolving
Loans) of a Borrowing Notice (it being understood that any such telephonic
notice shall be irrevocable). Notwithstanding anything contained herein to the
contrary, the Agent, without any notice or other authorization being required,
shall (and is hereby irrevocably instructed by the Borrowers to) effect
Revolving Loans bearing interest at the Base Rate in an amount sufficient to
effect each payment of interest on the Loans due on each Interest Payment Date,
and of each payment of the Facility Fee and the Administrative Fee due on the
applicable Fee Payment Date, in accordance with Section 3.4(a) of this
Agreement, provided that to the extent such payments are greater than the
--------
aggregate Lender Availability, such payments shall be effected by a debit to the
Borrowers' Account as provided in Section 3.4(a) hereof.
(b) Making of Revolving Loans. Promptly after receipt of a Borrowing
-------------------------
Notice under clause (a) of this Section 2.2 (or telephonic notice if the Agent
so consents thereto), the Agent shall notify each Lender by telecopy or telex or
other customary form of teletransmission of the requested borrowing. Each
Lender shall make the amount of its Revolving Loan available to the Agent in
Dollars and in immediately available funds, not later than 3:00 P.M. (Eastern
time) on the Funding Date specified in the Borrowing Notice. After the Agent's
receipt of the proceeds of such Revolving Loans from the Lenders, the Agent
shall (unless it shall have learned that any of the conditions precedent set
forth in Section 4.2 hereof have not been satisfied) make the proceeds of such
Revolving Loans available to the Borrowers on such Funding Date and shall
disburse such funds in Dollars to the Borrowers in immediately available funds
by crediting the Borrowers' Account.
(c) Failure to Fund by Lender. Unless the Agent shall have been
-------------------------
notified by any Lender prior to 12:00 P.M. (Eastern time) on any Funding Date in
respect of Revolving Loans requested under a Borrowing Notice that such Lender
does not intend to make available to the Agent such Lender's Revolving Loan on
such Funding Date, the Agent may assume that such Lender has made such amount
available to the Agent on such Funding Date and the Agent in its sole discretion
may, but shall not be obligated to, make available to the Borrowers a
corresponding amount on such Funding Date. If such corresponding amount is not
in fact made available to the Agent by such Lender on or prior to 3:00 P.M.
(Eastern time) on a Funding Date, such Lender agrees to pay and the Borrowers
agree to repay to the Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from
23
the date such amount is made available to the Borrowers until the date such
amount is paid or repaid to the Agent, at (i) in the case of such Lender, the
Federal Funds Rate, and (ii) in the case of the Borrowers, the Base Rate. If
such Lender shall pay to the Agent such corresponding amount, such amount so
paid shall constitute such Lender's Revolving Loan, and if both such Lender and
the Borrowers shall have paid and repaid, respectively, such corresponding
amount, the Agent shall promptly pay over to the Borrowers such corresponding
amount in same day funds, but the Borrowers shall remain obligated for all
interest thereon. Nothing contained in this Section 2.2(b) shall be deemed to
relieve any Lender of its obligation hereunder to make its Revolving Loan on any
Funding Date.
Section 2.3 Standby Letters of Credit.
-------------------------
(a) Generally. Subject to and in accordance with the terms and
---------
conditions set forth herein, the Borrowers may request the Issuing Lender, from
time to time during the period commencing on the Effective Date and ending ten
(10) Business Days prior to the Maturity Date, to issue, and subject to the
terms hereof the Issuing Lender shall issue, for the account of the Borrowers,
one or more standby letters of credit (each, a "Standby Letter of Credit")
pursuant to the Issuing Lender's customary letter of credit application;
provided that by entering into this Agreement the Borrowers shall be deemed to
--------
have requested the reissuance, effective as of the Effective Date, of all
Standby Letters of Credit previously issued by the Agent for the account of
Operating Borrower prior to the Effective Date, and such Standby Letters of
Credit shall thereafter be deemed for all purposes to have been issued under
this Agreement as of the Effective Date; provided, further, that the L/C
-------- -------
Fronting Fee shall not be payable on the Effective Date in respect of such
Standby Letters of Credit. The aggregate outstanding amount at any time and
from time to time of all Standby Letters of Credit shall not exceed $75,000,000.
The Issuing Lender shall have no obligation to issue any Standby Letter of
Credit if, after giving effect to the issuance thereof, the Total Outstanding
Amount shall then exceed the Aggregate Commitment (it being understood that the
Issuing Lender shall, upon request of the Borrowers, issue a Standby Letter of
Credit in an amount that would, after giving effect to the issuance thereof, not
cause the Aggregate Commitment to be exceeded).
(b) Standby Letter of Credit Fees; Maturity. The Borrowers shall,
---------------------------------------
among other things, pay to the Issuing Lender for the benefit of the Lenders,
pro rata, on each L/C Fee Payment Date, in arrears, a fee (the "L/C Fee") per
annum (calculated on the basis of a 360 day year and the actual number of days
elapsed), computed by multiplying the Applicable LIBOR Margin for the Fiscal
Quarter immediately preceding the applicable L/C Fee Payment Date by the daily
average of the aggregate of all
24
Standby Letters of Credit outstanding during such Fiscal Quarter. Any change in
the Applicable LIBOR Margin resulting from a change in the Consolidated Leverage
Ratio shall be effective five (5) Business Days after receipt of Borrowers'
financial statements reflecting such ratio; provided, however, that if such
-------- -------
financial statements are not delivered when due, then the highest Applicable
LIBOR Margin shall apply. In addition to the L/C Fee, the Borrowers shall pay to
the Issuing Lender, for its own account, a L/C Fronting Fee equal to 0.05% of
the amount of the Standby Letter of Credit per annum (calculated on the basis of
a 360 days year and the actual number of days the Standby Letter of Credit will
be outstanding) (the "L/C Fronting Fee"). The L/C Fronting Fee shall be payable
not later than the Fee Payment Date.
All Standby Letters of Credit issued by the Issuing Lender as
contemplated by this Section 2.3 shall expire no later than the Maturity Date.
Notwithstanding that the Issuing Lender shall have no obligation to issue any
Standby Letter of Credit the expiration date of which shall extend beyond the
Maturity Date, if the expiration date of any Standby Letter of Credit shall in
fact extend beyond the Maturity Date, then on the last Business Day immediately
preceding the Maturity Date, there shall be deemed to have been made Revolving
Loans in the outstanding amount of all Standby Letters of Credit the expiration
date of which shall occur after the Maturity Date, the proceeds of which the
Issuing Lender shall deposit in a collateral account at the Issuing Lender or an
Affiliate thereof in order to collateralize such Standby Letters of Credit,
which collateral account shall bear interest for the account of the Borrowers
based upon investment of the funds as agreed between the Issuing Lender and the
Borrowers.
(c) Standby Letter of Credit Request Procedure. Whenever the
------------------------------------------
Borrowers desire that a Standby Letter of Credit be issued on its behalf, the
Borrowers shall give the Issuing Lender (with copies to be sent to the Agent and
each other Lender) at least three (3) Business Days' prior written notice
therefor. The execution and delivery of each request for a Standby Letter of
Credit shall be deemed to be a representation and warranty by the Borrowers that
such Standby Letter of Credit may be issued in accordance with, and will not
violate the requirements of, this Section 2.3. Unless the Issuing Lender has
received notice from the Agent or any Lender before it issues the respective
Standby Letter of Credit that one or more of the conditions specified in Section
4.2 are not then satisfied, or that the issuance of such Standby Letter of
Credit would violate this Section 2.3, then the Issuing Lender may issue the
requested Standby Letter of Credit for the account of the Borrowers in
accordance with the terms of this Agreement and, with respect to any matters not
specifically covered by this Agreement, in accordance with the Issuing Lender's
usual and customary commercial lending practices as in effect from time to time.
25
(d) Letter of Credit Participations.
-------------------------------
(i) Immediately upon the issuance by the Issuing Lender of any
Standby Letter of Credit, the Issuing Lender shall be deemed to have sold
and transferred to each Lender (other than the Issuing Lender), and each
such Lender shall be deemed irrevocably and unconditionally to have
purchased and received from the Issuing Lender, without recourse or
warranty, an undivided interest and participation, in proportion to such
Lender's Pro Rata Share, in such Standby Letter of Credit, each drawing
made thereunder and the obligations of the Borrowers under this Agreement
with respect thereto, and any collateral therefor. Upon any change in a
Lender's Pro Rata Share of the Revolving Loan Commitment, it is hereby
agreed that with respect to all outstanding Standby Letters of Credit,
there shall be an automatic adjustment to the participations pursuant to
this Section 2.3(d) to reflect the new Pro Rata Share of the Revolving Loan
Commitment of the assigning and assignee Lenders.
(ii) In determining whether to pay under any Standby Letter of
Credit, the Issuing Lender shall have no obligation relative to the Lenders
other than to confirm that any documents required to be delivered under
such Standby Letter of Credit appear to have been delivered and that they
appear to comply on their face with the requirements of such Standby Letter
of Credit. Any action taken or omitted to be taken by the Issuing Lender
under or in connection with any Standby Letter of Credit, if taken or
omitted in the absence of gross negligence or willful misconduct, shall not
create for the Issuing Lender any resulting liability to any Lender.
(iii) Upon the request of any Lender, the Issuing Lender shall
furnish to such Lender copies of any Standby Letter of Credit to which the
Issuing Lender is party and such other documentation relating to such
Standby Letter of Credit as may reasonably be requested by such Lender.
(iv) As between the Borrowers on the one hand and the Issuing
Lender and the Lenders on the other hand, the Borrowers assume all risks of
the acts and omissions of, or misuse of the Standby Letters of Credit by
the respective beneficiaries of such Standby Letters of Credit. Without
limiting the generality of the foregoing, neither the Issuing Lender nor
any other Lender shall be responsible (except in the case of its gross
negligence or willful misconduct) for the following:
26
(A) the form, validity, sufficiency, accuracy, genuineness or
legal effect of any documents submitted by any party in connection
with the application for and issuance of or any drawing under such
Standby Letters of Credit, even if it should in fact prove to be in
any respects invalid, insufficient, inaccurate, fraudulent or forged;
(B) the validity or sufficiency of any instrument transferring
or assigning or purporting to transfer or assign any such Standby
Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason;
(C) failure of the beneficiary of any such Standby Letter of
Credit to comply fully with conditions required in order to draw upon
such Standby Letter of Credit, other than material conditions or
instructions that expressly appear in such Standby Letter of Credit;
(D) errors, omissions, interruptions or delays in the
transmission or delivery of any messages by mail, cable, telegraph,
telecopier, telex or otherwise, whether or not they are encoded;
(E) errors in interpretation of technical terms;
(F) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any such Standby
Letter of Credit or the proceeds thereof;
(G) the misapplication by the beneficiary of any such Standby
Letter of Credit of the proceeds of any drawing of any such Standby
Letter of Credit; or
(H) any consequences arising from causes beyond the control of
the Issuing Lender, including without limitation any acts of
governments.
(v) The obligations of the Lenders to make payments to the Agent
for the account of the Issuing Lender with respect to Standby Letters of
Credit shall be irrevocable and not subject to any qualification or
exception whatsoever and shall be made in accordance with the terms and
conditions of this Agreement under all circumstances, including, without
limitation, any of the following circumstances:
27
(A) any lack of validity or enforceability of this Agreement or
any of the other Loan Documents;
(B) the existence of any claim, setoff, defense or other right
which the Borrowers may have at any time against a beneficiary named
in a Standby Letter of Credit, any transferee of any Standby Letter of
Credit (or any Person for whom any such transferee may be acting), the
Agent, the Issuing Lender, any Lender, or any other Person, whether in
connection with this Agreement, any Standby Letter of Credit, the
transactions contemplated herein or any unrelated transactions;
(C) any draft, certificate or any other document presented under
the Standby Letter of Credit shall prove to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein shall
prove to be untrue or inaccurate in any respect;
(D) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan
Documents;
(E) the occurrence of any Event of Default or Potential Event of
Default; or
(F) the termination of this Agreement or any Commitment.
(e) Standby Letter of Credit Drawings Constitute Revolving Loans.
------------------------------------------------------------
The Issuing Lender shall promptly notify the Agent, and the Agent shall promptly
notify each Lender, in each case by telecopy or telex or other customary form of
teletransmission, of any drawing under any Standby Letter of Credit (each
drawing, a "Drawing"). Each Drawing shall immediately be deemed to be and for
all purposes of this Agreement shall constitute a Revolving Loan hereunder in
the amount of such drawing. Each Lender shall promptly and unconditionally
pay to the Agent for the account of the Issuing Lender an amount equal to such
Lender's Pro Rata Share of such Drawing in same day funds. Such payment shall
be made to the Agent at the Agent Lending Office. If the Agent delivers such
notice to such Lender prior to 2:00 P.M. (Eastern time) on any Business Day,
such Lender shall make its required payment on the same Business Day. If and to
the extent such Lender shall not have made available to the Agent for the
account of the Issuing Lender such Lender's Pro Rata Share of such Drawing, such
Lender agrees to pay to the Agent for the account of the Issuing Lender,
promptly upon demand, such amount, together with interest thereon, for each day
from such date until the date such amount is paid to the Agent for the Account
of the Issuing Lender at
28
the Federal Funds Rate plus 100 basis points. The failure of any Lender to make
available to the Agent for the Account of the Issuing Lender its Pro Rata Share
of any Drawing shall not relieve any other Lender of its obligation hereunder to
make available to the Agent for the Account of the Issuing Lender its Pro Rata
Share of any Drawing on the date so required; provided, however, that no Lender
-------- -------
shall be responsible for the failure of any other Lender to make available to
the Agent for the account of the Issuing Lender such other Lender's Pro Rata
Share of such Drawing.
Section 2.4 Swing Line Loan Subfacility.
---------------------------
(a) Swing Line Subfacility. Subject to the terms and conditions
----------------------
hereof, Crestar Bank, in its individual capacity (as such, the "Swing Line
Lender"), shall, in its sole and absolute discretion from and after the
Effective Date until one Business Day prior to the Maturity Date, make certain
revolving credit loans (each, a "Swing Line Loan" and, collectively, the "Swing
Line Loans") to the Borrowers; provided, however, that (i) the aggregate
-------- ------- -
principal amount of all Swing Line Loans shall at no time exceed $10,000,000
(such amount, the "Swing Line Subfacility"), and (ii) the sum of the aggregate
--
amount of all Revolving Loans (whether bearing interest at the Base Rate or
Applicable LIBOR Rate) plus the aggregate amount of all Swing Line Loans plus
----
the aggregate amount of all Standby Letters of Credit shall at no time exceed
the Aggregate Commitment.
(b) The Swing Line Note; Maturity. The Swing Line Loans made by the
-----------------------------
Swing Line Lender pursuant hereto shall be evidenced by a separate Swing Line
Note. The Swing Line Note shall be issued on or before the Effective Date and
shall bear interest for the period from the date of the initial funding of any
Swing Line Loan until paid in full on the unpaid principal amount thereof. The
Swing Line Lender is hereby authorized to record in its books and records
(without making any notation on the Swing Line Note or any schedule thereto) the
amount and date of funding of each Swing Line Loan made by it, and the amount
and date of each payment or prepayment of any Swing Line Loan. No failure to so
record nor any error in so recording shall affect the obligations of the
Borrowers to repay the actual outstanding principal amount of the Swing Line
Loans, with interest thereon, as provided in this Agreement. The aggregate
principal amount of the Swing Line Loans shall be payable on the Maturity Date,
unless sooner accelerated pursuant to the terms of this Agreement.
(c) Swing Line Loan Borrowing Procedure. Whenever the Borrowers
-----------------------------------
desire to borrow Swing Line Loans under this Section 2.4, the Borrowers shall
deliver to the Swing Line Lender irrevocable written notice (each such notice, a
"Swing Line Borrowing Notice"), and the Swing Line Lender may, in its sole and
absolute discretion
29
and upon such other arrangements as shall be specifically agreed to by the Swing
Line Lender and the Borrowers, make a Swing Line Loan to the Borrowers on the
date (which shall be a Business Day), at the time and in the amount so agreed;
provided, however, that (i) the principal amount of any Swing Line Loan made
-------- ------- -
hereunder shall not be less than $1,000,000.00 (and shall be in multiples of
$250,000.00) and (ii) an individual Swing Line Loan shall be offered by the
--
Swing Line Lender for a period of not less than 1 but not more than 29 days (any
such period, a "Swing Line Period").
(d) Interest on Swing Line Loans. Subject to the provisions of
----------------------------
clause (e) of this Section 2.4, in the event that the Swing Line Lender shall
make any Swing Line Loan pursuant to Section 2.4 hereof, the aggregate principal
amount of Swing Line Loans outstanding from time to time shall bear interest at
a rate per annum equal to the Base Rate for the applicable Swing Line Period.
(e) Repayment of Swing Line Loans. Each Swing Line Loan made by the
-----------------------------
Swing Line Lender hereunder shall be due and payable upon the expiration of the
Swing Line Period relating to such Swing Line Loan. The Swing Line Lender may,
at any time and in its sole and absolute discretion, by written notice to the
Borrowers and the Agent (which shall promptly deliver a copy thereof to the
other Lenders), demand repayment of its Swing Line Loans then outstanding by way
of a Revolving Loan borrowing (a "Mandatory Borrowing"), in which case the
Borrower shall be deemed to have requested a Revolving Loan borrowing in the
amount of the then outstanding Swing Line Loans which shall bear interest at the
Base Rate; provided, however, that, in the following circumstances, any such
-------- -------
demand shall also be deemed to have been given one Business Day prior to each of
(i) the Maturity Date, (ii) the occurrence of any Event of Default described in
- --
clause (g), (h) or (i) of Section 7.1 hereof, (iii) upon acceleration of the
Obligations hereunder, whether on account of an Event of Default described in
clause (g), (h) or (i) of Section 7.1 or any other Event of Default, and (iv)
the exercise of remedies in accordance with the provisions of Section 7.1
hereof. Each Lender hereby irrevocably agrees to make such Revolving Loans
promptly upon any such request or deemed request on account of a Mandatory
Borrowing, in the amount (but in proportion to each Lender's Pro Rata Share) and
in the manner specified in the preceding sentence and on the same such date
notwithstanding that (A) the amount of the Mandatory Borrowing may not comply
--------------------
with the minimum amount for borrowings of Revolving Loans otherwise required
hereunder, (B) whether any conditions specified in Section 4.2 are then
satisfied, (C) whether a Default or an Event of Default then exists, (D) failure
of any such request or deemed request for Revolving Loans to be made by the time
otherwise required in Section 2.2 hereof, (E) the date of such Mandatory
Borrowing, or (F) any reduction in the Revolving Loan Commitment or termination
of the Commitments relating thereto immediately prior to such Mandatory
Borrowing or
30
contemporaneously therewith. In the event that any Mandatory Borrowing cannot
for any reason be made on the date otherwise required above (including, without
limitation, as a result of the commencement of a proceeding in bankruptcy with
respect to the Borrowers), then each Lender hereby agrees that it shall
forthwith purchase (as of the date the Mandatory Borrowing would otherwise have
occurred, but adjusted for any payments received from the Borrowers on or after
such date and prior to such purchase) from the Swing Line Lender such
participations in the then outstanding Swing Line Loans as shall be necessary to
cause each such Lender to share in such Swing Line Loans ratably based upon its
respective Pro Rata Share of the Revolving Loan Commitment (determined before
giving effect to any termination of the Revolving Loan Commitments pursuant to
the last paragraph of Section 7.1), provided that (x) all interest payable on
--------
the Swing Line Loans shall be for the account of the Swing Line Lender until the
date as of which the respective participation of each other Lender is purchased,
and (y) at the time any purchase of participations pursuant to this sentence is
actually made, the purchasing Lender shall be required to pay to the Swing Line
Lender interest on the principal amount of such participation purchased for each
day from and including the day upon which the Mandatory Borrowing would
otherwise have occurred to but excluding the date of payment for such
participation, at the rate equal to, if paid within two (2) Business Days of the
date of the Mandatory Borrowing, the Federal Funds Rate, and thereafter at a
rate equal to the Base Rate.
(f) Optional Prepayment of Swing Line Loans. Subject to the
---------------------------------------
provisions of this clause (f) and Section 3.9 hereof, the Borrowers may, at
their sole option, prepay the principal amount of the Swing Line Loans in whole
or in part (in an amount of $250,000 or more and in multiples of $250,000) at
any time and from time to time, without premium or penalty. In respect of each
Optional Prepayment of a Swing Line Loan proposed to be made by the Borrowers,
the right of the Borrowers to make such Optional Prepayment is subject to the
Agent's receipt from the Borrowers, no later than 12:00 P.M. on the Business Day
specified therein as the date on which such Optional Prepayment is to be made,
of a written notice (which shall be irrevocable) specifying (i) that the
-
Borrowers desire to prepay such Swing Line Loan, (ii) the principal amount of
--
such Optional Prepayment, and (iii) the date (which shall be a Business Day) on
---
which such Optional Prepayment will be made. Any Optional Prepayment of a Swing
Line Loan, which has not been converted to a Revolving Loan, made by the
Borrowers as permitted hereunder shall be paid to the Agent for the account of
the Swing Line Lender no later than 12:00 P.M. (Eastern Time) on the applicable
prepayment date.
31
ARTICLE III
INTEREST, FEES AND REPAYMENT
Section 3.1 Interest on the Revolving Loans
-------------------------------
(a) Base Rate. The initial Revolving Loan and, except as provided
---------
pursuant to clause (b) of this Section 3.1, the aggregate principal amount of
the Revolving Loans outstanding from time to time shall bear interest at a rate
per annum equal to the Base Rate until the entire principal amount of the
Revolving Loans shall have been repaid. Any change in the rate of interest on
the Revolving Loans resulting from a change in the Base Rate shall be effective
as of the opening of business on the day on which such change is effective.
(b) LIBOR Rate. In the event the Borrowers shall effect a LIBOR
----------
Conversion in accordance with the provisions of Section 3.8 of this Agreement or
obtain a Revolving Loan that shall bear interest initially at the Applicable
LIBOR Rate as provided in Section 2.2(a) hereof, the aggregate principal amount
of the Revolving Loans that are the subject of such LIBOR Conversion or
Borrowing Notice, as the case may be, shall bear interest at a rate per annum
equal to the Applicable LIBOR Rate. Any change in the Applicable LIBOR Rate
resulting from a change in the Consolidated Leverage Ratio shall be effective
five (5) Business Days after receipt of Borrowers' financial statements
reflecting such ratio; provided, however, that if such financial statements are
-------- -------
not delivered when due, then the highest Applicable LIBOR Rate shall apply.
Section 3.2 Regulatory Changes. If, after the date of this
------------------
Agreement, any Regulatory Change:
(a) shall subject any Lender to any tax, duty or other charge with
respect to its obligation to make or maintain any Loan or its Commitment, or
shall change the basis of taxation of payments to such Lender of the principal
of or interest on the Loans or in respect of any other amounts due under this
Agreement in respect of its obligation to make any Loan or maintain its
Commitment (except for changes in the rate of tax on the overall net income of
such Lender); or
(b) shall impose, modify or deem applicable any reserve, assessment,
special deposit, capital adequacy, capital maintenance or similar requirement
against assets of, deposits with or for the account of, or credit extended by,
such Lender or shall impose on such Lender any other condition affecting (i) the
obligation of the Lender to make or maintain the Loans or its Commitment, or
(ii) the Revolving Notes or
32
the Swing Line Note; and the result of any of the foregoing is to increase the
cost to such Lender of making or maintaining any Loan or maintaining its
Commitment or to reduce the amount of any sum received or receivable by such
Lender under, or the rate of return attributable to, this Agreement or under the
Revolving Notes or the Swing Line Note, such Lender shall, within 30 days after
the effective date of such Regulatory Change, provide written notice to the
Borrowers of such Regulatory Change (it being agreed by the parties hereto that
if such notice is given after 30 days' of the effective date of such Regulatory
Change, the Borrowers shall be liable to the Lenders for the additional amounts
payable pursuant to this Section 3.2 only to the extent such additional amounts
accrue from and after the date of the giving of such notice), together with a
certificate describing in reasonable detail such increase or reduction, as the
case may be, then, within 30 days after delivery of such notice by such Lender
to the Borrowers if such Regulatory Change shall impose costs in excess of those
costs, or reduce the amount of any such sum or rate of return below the amount
or rate, applicable on the date of this Agreement, the Borrowers, shall pay to
the Agent for the account of such Lender for the account of such Lender such
additional amount or amounts as will compensate such Lender for such increase or
reduction. A certificate of such Lender setting forth the basis for the amount
of said increase or reduction, as the case may be, shall be conclusive in the
absence of manifest error.
Section 3.3 Interest After Due Date. In the event the Borrowers
-----------------------
fail to make any payment of the principal amount of or interest on any of the
Revolving Loans or Swing Line Loans, or of the Facility Fee, the Administrative
Fee, the L/C Fee or the L/C Fronting Fee, in each case within four (4) Business
Days after due (whether by demand, acceleration or otherwise), the Borrowers,
shall pay to the Agent for the account of the Lenders interest on such unpaid
amount, payable from time to time on demand, from the expiration of such four
(4) Business Day period following the date such amount shall have become due to
the date of payment thereof, accruing on a daily basis, at a per annum rate (the
"Default Rate") equal to the sum of (a) the greater of the Base Rate and
Applicable LIBOR Rate determined on and, in the case of any continuing default,
from time to time after the date of such default plus (b) two percent (2%).
----
Section 3.4 Payment and Computations.
------------------------
(a) Payments. All payments required or permitted to be made to the
--------
Agent, to the Agent for the account of the Lenders, or to any Lender under this
Agreement or under any Note shall be made in Dollars (i) if to the Agent, at the
-
Lending Office of the Agent in immediately available funds and (ii) if to any
--
Lender, to it in immediately available funds at an account specified by such
Lender in writing to the
33
Borrowers. If payments are not received by the fourth Business Day following the
due date, the Borrowers hereby irrevocably instruct and authorize the Agent to
effect each payment of interest on the Loans as of the close of business on the
fourth Business Day following each Interest Payment Date, and of each payment of
the Facility Fee and the Administrative Fee due as of the close of business on
the fourth Business Day following the applicable Fee Payment Date, by effecting
Revolving Loans bearing interest at the Base Rate in an amount sufficient to
make such payments. If the amount of such payments is greater than the aggregate
Lender Availability, the Borrowers hereby irrevocably instruct and authorize the
Agent to effect such payments by debiting the Borrowers' Account on such
Interest Payment Date or Fee Payment Date, as the case may be, with the
aggregate amount thereof, in each case, after giving effect to the crediting to
the Borrowers' Account of the proceeds of the Revolving Loan, if any, made on
such Interest Payment Date or Fee Payment Date, as the case may be, in
accordance with Section 2.1(b) of this Agreement. The Agent shall provide to the
Borrowers an invoice showing the amount of such Revolving Loan or debit, as the
case may be, and the manner in which it was calculated.
(b) Computations. Interest on the unpaid portion of the Revolving
------------
Loans, the Swing Line Loans, the Facility Fee and the Administrative Fee shall
each be calculated for the actual number of days (including the first day but
excluding the last day) elapsed and shall be computed on the basis of a year of
360 days.
(c) Interest and Fee Payment Dates. The Facility Fee and interest on
------------------------------
the Loans shall be payable in arrears (i) in the case of the Revolving Loans and
-
Swing Line Loans, on each Interest Payment Date and (ii) in the case of the
--
Facility Fee, on each Fee Payment Date. The Administrative Fee and the L/C
Fronting Fee shall be payable in advance on each Fee Payment Date. The L/C Fee
shall be payable in arrears as provided in Section 2.3(b) hereof.
(d) Application of Payments; Apportionment.
--------------------------------------
(i) Unless a Lender shall be in default of its obligations to
advance any Revolving Loan or reimburse the Agent as provided herein, all
payments and prepayments of principal and interest in respect of
outstanding Revolving Loans and all payments of fees (other than the
Administrative Fee and the L/C Fronting Fee) and all other payments in
respect of any other Obligations (other than with respect to Swing Line
Loans) shall be allocated among (and paid over promptly after receipt
thereof to) such of the Lenders as are entitled thereto in proportion to
their respective Pro Rata Shares. All payments and prepayments of
principal and interest and other amounts in respect of the Swing
34
Line Loans that have not been converted to Revolving Loans, and all
payments of the Administrative Fee and the L/C Fronting Fee, shall be
allocated only to the Swing Line Lender.
(ii) Upon the occurrence and during the continuance of an Event
of Default, the Agent shall, unless otherwise specified by the Required
Lenders as provided in the last paragraph of this clause (ii), apply all
payments in respect of any Obligations:
(A) first to pay interest on and then principal of any portion
of the Loans which the Agent may have advanced on behalf of any Lender
for which the Agent has not then been reimbursed by such Lender or the
Borrowers;
(B) second, to pay Obligations in respect of any fees, expense
reimbursement or indemnities due to the Agent;
(C) third, to pay Obligations in respect of any fees, expense
reimbursement, indemnities, increased costs or breakage then due to
the Lenders, pro rata;
(D) fourth, to the ratable payment of overdue interest or late
charges, if any, then due the Lenders;
(E) fifth, to the ratable payment of interest due in respect of
the Revolving Loans and Swing Line Loans;
(F) sixth, to the ratable payment or prepayment of principal due
in respect of the Revolving Loans and Swing Line Loans; and
(G) seventh, to the ratable payment of all other Obligations;
provided, however, that no Lender which shall be in default of its obligations
-------- -------
to fund Revolving Loans or reimburse the Agent as provided herein shall be
entitled to its ratable share of payments in respect of any Obligations prior to
the payment to all non-defaulting Lenders of all amounts due such Lenders as
provided herein.
The order of priority set forth in this Section 3.4(d)(ii) is set
forth solely to determine the rights and priorities of the Agent and the Lenders
as among themselves. The order of priority set forth in clauses (C) through (G)
of this Section 3.4(d)(ii) may at any time and from time to time be changed by
the Required Lenders without necessity of notice to or consent of or approval by
the Borrowers, or any other Person.
35
The order of priority set forth in clauses (A) and (B) of this Section
3.4(d)(ii) may be changed only with the prior written consent of the Agent.
Section 3.5 Payment at Maturity. Any outstanding principal amount
-------------------
of the Revolving Notes or the Swing Line Note theretofore not repaid, together
with any accrued and unpaid Facility Fee, Administrative Fee, L/C Fee or L/C
Fronting Fee, any accrued and unpaid interest thereon, together with any other
amounts due and payable in accordance with the provisions hereof (including
pursuant to Section 9.10 hereof) shall be due and payable in full on the
Maturity Date (unless sooner accelerated pursuant to the terms hereof), and this
Agreement shall not terminate until all Obligations shall have been paid in
full.
Section 3.6 Prepayments; Certain Early Repayments.
-------------------------------------
(a) Mandatory Prepayment of Loans and Standby Letters of Credit.
-----------------------------------------------------------
(i) Upon the termination of this Agreement pursuant to the first
sentence of Section 9.3 of this Agreement (supervening illegality), the
Borrowers shall on the Prepayment Date (x) prepay the Loans in full
-
together with interest accrued on the aggregate principal amount of the
Loans to the Prepayment Date, and (y) pay to the Agent, for the account of
-
the Lenders all other amounts payable pursuant to Sections 3.9 and 9.3 of
this Agreement.
(ii) If at any time the Total Outstanding Amount shall be greater
than the Aggregate Commitment, the Borrowers shall, without notice from the
Lender, prepay that portion of the Loans and/or the Standby Letters of
Credit, as the case may be, in an amount equal to such excess.
(b) Optional Prepayments of Revolving Loans. Subject to the terms and
---------------------------------------
conditions of clause (c) below and Section 3.9 hereof, the Borrowers may, at
their sole option, prepay the principal amount of the Revolving Loans (whether
bearing interest at the Base Rate or Applicable LIBOR Rate) in whole or in part
(in an amount of $500,000 or more and in multiples of $100,000) at any time and
from time to time, without premium or penalty.
(c) Optional Prepayment Procedure. In respect of each Optional
-----------------------------
Prepayment of Revolving Loans (whether bearing interest at the Base Rate or
Applicable LIBOR Rate) proposed to be made by the Borrowers, the right of the
Borrowers to make such Optional Prepayment is subject to the Agent's receipt
from the Borrowers, no later than 10:00 A.M. (Eastern Time) on the Business Day
specified therein as the date on which such Optional Prepayment is to be made
(unless such
36
Optional Prepayment shall relate to LIBOR Loans, in which case such notice shall
be given no later than 10:00 A.M. (Eastern time) at least three (3) Business
Days prior to the date of prepayment, of a written notice (which shall be
irrevocable) specifying (i) that the Borrowers desire to prepay the Revolving
-
Loans, (ii) the principal amount of such Optional Prepayment, and (iii) the date
-- ---
(which shall be a Business Day or, if such Optional Prepayment relates to a
LIBOR Loan, a LIBOR Business Day) on which such Optional Prepayment will be
made. Any Optional Prepayment of Revolving Loans made by the Borrowers as
permitted hereunder shall be paid to the Agent for the account of the Lenders no
later than 12:00 P.M. (Eastern Time) on the applicable prepayment date (except
that any prepayment of a LIBOR Loan shall be paid no later than 10:00 A.M.
(Eastern Time) on the applicable prepayment date).
Section 3.7 Facility Fee, Administrative Fee, and Letter of Credit
------------------------------------------------------
Fees.
----
(a) Facility Fee. For each Fiscal Quarter (or part thereof) during
------------
the period from the Effective Date until the Maturity Date, the Borrowers shall
pay to the Agent for the account of the Lenders pro rata based upon each
Lender's Pro Rata Share of the Revolving Loan Commitment, a Facility Fee (the
"Facility Fee") determined based upon the Aggregate Commitment without regard to
outstanding amounts of Revolving Loans and Standby Letters of Credit. The
Facility Fee shall be computed at a rate per annum equal to the Applicable
Facility Fee. The Facility Fee shall be due and payable in arrears on the Fee
Payment Date to which such Facility Fee relates and on the Maturity Date, and
shall be calculated on the basis of a 360 day year and the actual days elapsed.
(b) Administrative Fee. The Borrowers shall pay to the Agent, as
------------------
compensation for the services of the Agent hereunder, a fee (the "Administrative
Fee") in an amount separately agreed to by the Borrowers, Crestar Bank and the
Agent in that certain letter agreement dated June 18, 1998 (the "Administrative
Fee Letter"). The Administrative Fee payable by the Borrowers as contemplated by
this clause (b) shall be due on the applicable Fee Payment Date (and the
Borrowers shall not be entitled to any credit if any Lender as to which such fee
shall have been paid ceases to be a Lender hereunder for the entire year in
respect of which such fee shall have been due and payable; provided that if the
--------
Agent resigns as such during any year as to which the Administrative Fee has
been paid by the Borrowers, the Agent shall reimburse the Borrowers for the
portion of such Administrative Fee related to the period for which the Agent
will not continue to serve as Agent, calculated on the basis of a 360-day year
and the actual days elapsed).
37
(c) Letter of Credit Fees. The Borrowers shall pay the L/C Fee and
---------------------
the L/C Fronting Fee in accordance with the provisions of Section 2.3(b) hereof.
Section 3.8 LIBOR Conversion
----------------
(a) Conversion. So long as no Event of Default or Potential Event of
----------
Default shall have occurred and be continuing, the Borrowers shall have the
right to convert all or part of the outstanding Revolving Loans bearing interest
at the then Base Rate to loans bearing interest at the then Applicable LIBOR
Rate (such conversion, a "LIBOR Conversion"); provided, however, that (i) the
-------- -------
LIBOR Period to which such LIBOR Conversion shall relate will not extend beyond
the Maturity Date and (ii) there shall not be outstanding at any one time more
than eight (8) LIBOR Loans. In order to effect a LIBOR Conversion, the
Borrowers shall give the Agent irrevocable written notice (such notice, a "LIBOR
Conversion Notice") prior to 10:00 A.M. (Eastern time), at least three LIBOR
Business Days prior to the first day of the LIBOR Period to which such LIBOR
Conversion shall apply, stating that (i) the Borrowers wish to effect a LIBOR
Conversion, (ii) the aggregate principal amount of outstanding Revolving Loans
which the Borrowers wish to bear interest at the Applicable LIBOR Rate (it being
understood and agreed that no LIBOR Conversion shall be permitted in an amount
less than $3,000,000.00 and shall be in multiples of $500,000.00), (iii) the
applicable LIBOR Period being elected by the Borrowers (it being understood that
no change in LIBOR with respect to any LIBOR Loans may be effected during any
applicable LIBOR Period) and (iv) the Business Day on which the LIBOR Period is
to be effective.
(b) Notice of LIBOR to Borrowers. In the event the Borrowers have
----------------------------
requested a LIBOR Conversion, the Agent shall give written notice to the
Borrowers and the Lenders of LIBOR as promptly as reasonably possible after such
rate is determined. The Agent's determination of LIBOR shall be conclusive in
the absence of manifest error.
(c) Successive Notice of LIBOR Conversion. Subject to the provisions
-------------------------------------
of clause (a) of this Section 3.8, the Borrowers may, by executing a LIBOR
Conversion Notice at least three LIBOR Business Days prior to the first day of
the LIBOR Period to which such LIBOR Conversion Notice shall apply, execute
successive LIBOR Conversions with respect to any Revolving Loan then outstanding
and bearing interest at the Base Rate together with any then outstanding LIBOR
Loans the LIBOR Period in respect of which is scheduled to expire on or before
the start of the LIBOR Period specified in such LIBOR Conversion Notice. If,
with respect to any LIBOR Loans, the Agent shall not have received a LIBOR
Conversion Notice for the next immediately succeeding LIBOR Period which
complies with the provisions of clause (a) of this Section 3.8, such LIBOR
38
Loans shall, immediately upon the expiration of the then current LIBOR Period
and without any notice to the Borrowers, bear interest at the Base Rate in
accordance with the provisions of Section 3.1(a) of this Agreement.
(d) Market Disruption, etc. In the event that the Agent (i) shall
----------------------
have determined (which determination shall be conclusive and binding upon the
Borrowers) that by reason of circumstances affecting the London interbank market
either adequate or reasonable means do not exist for ascertaining LIBOR elected
by the Borrowers pursuant to the terms hereof or (ii) the Agent shall have
determined (which determination shall be conclusive and binding on the
Borrowers) that the applicable LIBOR will not adequately and fairly reflect the
cost to the Agent of maintaining or funding loans bearing interest based on such
LIBOR rate, with respect to any portion of the Revolving Loans that the
Borrowers have requested be made as a LIBOR Loan (each, an "Affected Advance"),
the Agent shall promptly notify the Borrowers (by telephone or otherwise, to be
promptly confirmed in writing), with a copy to the Lenders, of such
determination. If the Agent shall give such notice, (x) any Affected Advances
shall be made as advances which shall bear interest at the Base Rate, and (y)
any outstanding LIBOR Loan shall, from and after the last day of the then
current LIBOR Period applicable thereto, bear interest at the Base Rate or, if
requested by Borrowers in accordance with Section 3.8(a) and the disruption
referred to in clause (i) or (ii) of this Section 3.8(d), as the case may be, is
no longer in existence, at the Applicable LIBOR Rate following conversion in
accordance with Section 3.8(a). Until any notice under clause (i) or (ii) of
this Section 3.8(d) has been withdrawn by the Agent, no amounts outstanding or
to be advanced hereunder shall bear interest based upon LIBOR.
Section 3.9 Breakage, etc. In the event of the prepayment of any
--------------
LIBOR Loan (whether by way of acceleration or otherwise or due to an Optional
Prepayment of any LIBOR Loan pursuant to Section 3.6(b) hereof), the Borrowers
shall pay to the Agent for the account of each Lender whose LIBOR Loan has been
so prepaid any loss or expense which such Lender may incur or sustain directly
as a result of such prepayment, including without limitation, an amount equal to
(a) an amount of interest which would have accrued on the amount so prepaid for
the period beginning on the date of such prepayment and ending on the last day
of the applicable LIBOR Period (such period, the "Breakage Period"), at the
Applicable LIBOR Rate minus (b) the amount of interest (as reasonably determined
by each affected Lender) which would have accrued to such Lender on such amount
by placing such amount on deposit for the Breakage Period with leading banks in
the London interbank market, in each case, as evidenced by a certificate
delivered to the Borrowers by each affected Lender, which certificate shall be
binding upon the Borrowers in the absence of manifest error.
39
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.1 Conditions Precedent The Revolving Loan Commitment of
--------------------
the Lenders hereunder shall become effective only on the day (the "Effective
Date") on which all of the following additional conditions precedent shall have
been fulfilled to the satisfaction of the Lenders; provided, however, that in
-------- -------
the event the Effective Date shall have not occurred on or prior to August 15,
1998, the Lenders shall have no further obligations hereunder:
(a) The Agent, on behalf of the Lenders, shall have received from the
Borrowers the following instruments, agreements, certificates and payments, as
the case may be, on or prior to the Effective Date:
(i) A Revolving Note, dated the Effective Date, payable to
the order of each of Lender in the amount of such Lender's Pro Rata Share
of the Revolving Loan Commitment and duly executed by the Borrowers;
(ii) A Swing Line Note, dated the Effective Date, payable to
the order of Crestar Bank in the amount of $10,000,000.00 and duly executed
by the Borrowers;
(iii) An opinion or opinions of counsel to the Borrowers, in
form and substance satisfactory to the Lenders;
(iv) A certified copy of the resolutions of the Board of
Directors of each of the Borrowers authorizing the execution and delivery
of this Agreement and/or the other Loan Documents to which they are a
party;
(v) A copy of the charter documents and by-laws of each of
the Borrowers and any Subsidiaries thereof, together with all amendments
thereto, certified by the Secretaries of the applicable Borrower or
Subsidiary as being true, complete and correct and in effect as of the
Effective Date;
(vi) By wire transfer of immediately available funds, the
Borrowers shall have paid to the Agent, on behalf of the Agent and the
Lenders, as applicable, the underwriting fee payable to the Agent and the
Lenders in accordance with the Administrative Fee Letter, which fee shall
be nonrefundable;
40
(vii) A certificate of an Authorized Officer of each of the
Borrowers, dated the Effective Date, certifying that the matters contained
in clauses (b), (c) and (d) of Section 4.2 hereof are true and correct;
(viii) A certificate of an Authorized Officer of the Borrowers,
dated the Effective Date, certifying, in form and substance satisfactory to
the Lenders, the Borrowers' compliance with Section 6.1(i) hereof, having
attached to such certificate a summary in reasonable detail of the
Borrowers' and their Subsidiaries' insurance coverage. Upon request of the
Lenders, the Borrowers shall deliver an insurance report of an independent
insurance broker as to due compliance with Section 6.1(i) hereof; and
(ix) The results of a search, upon the records maintained with
the appropriate Secretary of State and county or city recorder offices of
all jurisdictions deemed advisable by the Lenders, regarding liens, if any,
on file with such offices and naming any of the Borrowers or any Subsidiary
as a debtor, which results shall be satisfactory to the Lenders.
(b) The Parent Borrower Public Offering shall have been completed by
August ___, 1998 [5 business days after signing and deposit in escrow] and
resulted in the Parent Borrower's receipt of net proceeds of not less than
$300,000,000;
(c) The Parent Borrower shall have acquired OHI and Operating
Borrower on terms satisfactory to the Agent, which terms shall not include the
incurrence of more than $105,000,000 of Indebtedness in connection with such
acquisition (other than Indebtedness not to exceed $5,000,000 in the aggregate
representing any balance of intercompany amounts due from Operating Borrower to
Union Pacific Corporation that may result from the closing of such acquisition);
(d) The Borrowers shall have delivered to the Lenders (i) the Final
Prospectus and (ii) the unaudited consolidated financial statements of the
Borrowers' and their Consolidated Subsidiaries as of June 30, 1998, together
with, in each case, an officer's certificate, dated the Effective Date, from an
Authorized Officer of each of the Borrowers, stating that, to their personal
knowledge after having performed such due diligence as would customarily be
performed by a corporate officer in their position, such Prospectus and
unaudited financial statements, if any, attached thereto as of the Effective
Date do not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading;
41
(e) All legal matters incident to this Agreement shall be
satisfactory to counsel for the Lenders, and the Borrowers shall have reimbursed
the Lenders for their fees and expenses and the reasonable fees and expenses of
the Lenders' counsel in connection with the preparation or review, as the case
may be, of the Loan Documents and all matters incident thereto (it being
understood that such statement may not reflect the final statement of fees and
expenses incurred by the Lenders' counsel in connection with such preparation or
review);
(f) The Borrowers shall have disclosed to the Lenders promptly from
time to time any material developments or changes in the Borrowers and their
Subsidiaries', taken as a whole, business, assets, results of operations,
condition (financial or otherwise), including without limitation amendments to
their charter documents or the Parent Borrower's filings with the SEC and the
exhibits thereto, and any material amendments, changes or terminations of any
material contracts or the award of or loss of any material bid or proposal. Any
such material developments, changes or amendments shall not have had a material
adverse effect on the assumptions contained in the credit analysis of the
Borrowers performed by the Lenders prior to the execution of this Agreement or
resulted in a material adverse change since June 30, 1998 in the business,
assets, results of operations, condition (financial or otherwise) of the
Borrowers and their Subsidiaries, taken as a whole;
(g) All Schedules delivered hereunder by the Borrowers shall be in
form and substance satisfactory to the Lenders;
(h) By wire transfer of immediately available funds, the Agent shall
have received the Administrative Fee due and payable to the Agent pursuant to
the Administrative Fee Letter, which fee shall be nonrefundable; and
(i) The Lenders shall have received such other documents,
instruments, certificates, opinions, agreements and information as the Lenders
or their counsel shall reasonably request in their discretion in connection with
the consummation of the transactions contemplated by this Agreement (including,
without limitation, current consolidated financial statements of the Borrowers
and their Subsidiaries).
Section 4.2 Further Conditions Precedent to Loans and Standby
-------------------------------------------------
Letters of Credit. The obligation of the Agent, on behalf of the Lenders, to
-----------------
make any Revolving Loan, and the obligation of the Swing Line Lender to make any
Swing Line Loan, and the obligation of the Issuing Lender to issue any Standby
Letter of Credit shall be subject to the fulfillment to the satisfaction of the
Lenders, in the case of Revolving
42
Loans and Standby Letters of Credit, and the Swing Line Lender, in the case of
Swing Line Loans, of the further conditions precedent that, on the Funding Date
for such Revolving Loan or Swing Line Loan or the issuance date for such Standby
Letter of Credit, as the case may be:
(a) The Agent shall have received a Borrowing Notice (except as
otherwise provided in the last sentence of Section 2.2(a) of this Agreement) in
accordance with Section 2.2(a) or the Swing Line Lender shall have received a
Swing Line Borrowing Notice in accordance with Section 2.4(c) or the Issuing
Lender shall have received a request for a Standby Letter of Credit in
accordance with Section 2.3(c), as the case may be, in each case executed by an
Authorized Officer of the Borrowers (or other officer of the Borrowers
designated by such Authorized Officer as having authority to execute such
notice);
(b) The representations and warranties of the Borrowers contained in
Article V of this Agreement (except to the extent such representations or
warranties relate to a specific prior date) shall be true and correct as of such
Funding Date (or, in the case of Standby Letters of Credit, the date of issuance
thereof) as though made on and as of such Funding Date (or, in the case of
Standby Letters of Credit, the date of issuance thereof) (and, if any such
representation and warranty shall not be true and correct, the Borrowers shall
describe in writing to the Agent the nature of such misrepresentation and
warranty);
(c) No event shall have occurred and be continuing, or shall result
from such Revolving Loan or Swing Line Loan after giving effect to the
application of the proceeds therefrom or from the issuance of such Standby
Letter of Credit if the beneficiary thereof were to fully draw upon such Standby
Letter of Credit on the date of issuance, which constitutes an Event of Default
or would constitute a Potential Event of Default; and
(d) The Agent shall have received a certificate, addressed to the
Lenders (or, in the case of a Swing Line Loan, the Swing Line Lender), of an
Authorized Officer of the Borrowers, dated the date of the Borrowing Notice,
certifying that the matters contained in clauses (b) (if applicable) and (c) of
this Section 4.2 are true and correct.
43
ARTICLE V
REPRESENTATIONS
In order to induce the Lenders and the Agent to enter into this
Agreement and make the Loans contemplated by the terms hereof, each of the
Borrowers represents and warrants with respect to itself and its Subsidiaries,
as the context shall require, as of the date hereof and as of the Effective Date
that:
Section 5.1 Existence, Power and Authority. The Borrowers and each
------------------------------
Subsidiary thereof are corporations duly incorporated, validly existing and in
good standing under the laws of the jurisdictions of their incorporation, with
full corporate power and authority to carry on their business as currently
conducted and to own or hold under lease their property; the Borrowers and
each Subsidiary thereof are duly qualified to do business as a foreign
corporation in good standing in each other jurisdiction in which the conduct of
their business or the maintenance of their property requires them to be so
qualified and where the failure to be so qualified would have a material adverse
effect on the financial condition, business or operation of the Borrowers or
such Subsidiary; and the Borrowers and their Subsidiaries have full corporate
power and authority to execute and deliver the Loan Documents to which they are
a party and to carry out the transactions contemplated thereby.
Section 5.2 Authorization; Enforceable Obligations. As of the
--------------------------------------
Effective Date and thereafter, the Loan Documents to which the Borrowers and
their Subsidiaries are a party have been duly authorized, executed and delivered
by the Borrowers and such Subsidiaries and constitute legal, valid and binding
obligations of the Borrowers and such Subsidiaries, enforceable against the
Borrowers and such Subsidiaries in accordance with their respective terms
(except as such enforceability may be limited by general principles of the law
of equity or by any applicable bankruptcy, reorganization, insolvency,
moratorium or similar laws and laws affecting creditors' rights generally).
Section 5.3 No Legal Bar. The execution, delivery and performance
------------
by the Borrowers and their Subsidiaries of the Loan Documents to which they are
a party in accordance with their respective terms (a) do not violate the
articles of incorporation, by-laws or any preferred stock provision of the
Borrowers or such Subsidiaries, (b) do not violate or conflict with any law,
governmental rule or regulation, or any judgment, writ, order, injunction, award
or decree of any court, arbitrator, administrative agency or other Governmental
Authority applicable to the Borrowers or such Subsidiaries or any indenture,
mortgage, contract, agreement or other undertaking or instrument to which the
Borrowers or such Subsidiaries are a party or by which their respective property
44
may be bound and/or (c) do not and will not result in the creation or imposition
of any Lien on any of their property pursuant to the provisions of any such
indenture, mortgage, contract, agreement or other undertaking or instrument.
Section 5.4 Consents. The execution, delivery and performance by
--------
the Borrowers of the Loan Documents to which they are a party does not require
any consent, which has not been obtained, of any other Person, including,
without limitation, stockholders of the Borrowers or any consent, license,
permit, authorization or other approval of, any giving of notice to, exemption
by, any registration, declaration or filing with, or any taking of any
other action in respect of, any court, arbitrator, administrative agency or
other Governmental Authority.
Section 5.5 Litigation. Except as set forth on Schedule 5.5 hereto,
----------
there is no action, suit, investigation or proceeding by or before any court,
arbitrator, administrative agency or other Governmental Authority pending or, to
the knowledge of the Borrowers, threatened (a) which involves any of the
transactions contemplated by this Agreement or (b) to which the Borrowers or any
Subsidiary thereof is a party and which could in the reasonable judgment of the
Borrowers materially adversely affect the financial condition, business or
operation of the Borrowers or any Subsidiary thereof.
Section 5.6 No Default. Except as set forth on Schedule 5.6 hereto
----------
in writing, as of the Effective Date neither any Borrower nor any Subsidiary
thereof is in default under any material order, writ, injunction, award or
decree of any court, arbitrator, administrative agency or other Governmental
Authority binding upon it or its property, or any material indenture, mortgage,
contract, agreement or other undertaking or instrument to which it is a party or
by which its property may be bound, and nothing has occurred which would
materially adversely affect the ability of any of the Borrowers or their
Subsidiaries to carry on their respective business or perform their respective
obligations under any such material order, writ, injunction, award or decree or
any such material indenture, mortgage, contract, agreement or other undertaking
or instrument.
Section 5.7 Financial Condition. The financial statements of the
-------------------
Borrowers and their Subsidiaries as of June 30, 1998, copies of which have been
furnished to the Lenders, were prepared in accordance with GAAP and are complete
and correct and fairly and accurately present the financial condition of the
Borrowers and their Subsidiaries (taken as a whole) as of their dates and the
results of their operations for the periods then ended, subject to normal year-
end adjustments. There has been no material adverse change in the financial
condition of the Borrowers (taken
45
as a whole) or the results of their operations since the date of such financial
statements.
Section 5.8 Use of Proceeds. None of the proceeds of any Loan have
---------------
been or will be used to purchase or carry, or reduce or retire or refinance any
credit incurred to purchase or carry, any margin stock (within the meaning of
Regulations G, U and X of the Board of Governors of the Federal Reserve System)
or to extend credit to others for the purchasing or carrying of any margin
stock. Neither the Borrowers nor any of their Subsidiaries are engaged in
the business of extending credit for the purpose of purchasing or carrying any
margin stock.
Section 5.9 Borrowers Not Investment Companies. Neither the
----------------------------------
Borrowers nor any of their Subsidiaries are an "investment company", or a
company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended.
Section 5.10 Taxes. The Borrowers and their Subsidiaries have filed
-----
or caused to be filed all tax returns which are required by applicable law to be
filed by them and have paid or caused to be paid all taxes which have been shown
to be due and payable by such returns or tax assessments received by the
Borrowers or any Subsidiary thereof to the extent that such taxes have become
due and payable, except (a) for those taxes or tax assessments that are not
delinquent, (b) to the extent such taxes or tax assessments are being contested
in good faith and for the payment of which reserves required by GAAP have been
provided, and (c) in any given instance or in the aggregate do not involve a
potential tax liability in excess of $1,000,000.
Section 5.11 Subsidiaries. As of the Effective Date there will be
------------
no Affiliates or Subsidiaries (consolidated or otherwise, direct or indirect) of
the Borrowers other than (a) the Subsidiaries set forth on Schedule 5.11 hereto
and (b) in the case of Affiliates, certain other Persons disclosed in writing to
the Lenders prior to the date hereof. Except as set forth on Schedule 5.11, the
Borrowers are the holder (either directly or indirectly) of all of the
outstanding shares of Capital Stock of each Subsidiary.
Section 5.12 Permits, Licenses, Etc. Each of the Borrowers and each
----------------------
Subsidiary possesses all permits, licenses, franchises, trademarks, trade names,
copyrights and patents necessary to the conduct of its business as presently
conducted, except where the failure to possess the same would not have a
material effect on the financial condition, operations or assets of Borrowers
and their Subsidiaries taken as a whole.
46
Section 5.13 Compliance With Laws.
---------------------
(a) Compliance - General. Each of the Borrowers and their Subsidiaries
--------------------
are in compliance in all material respects with all Regulations required by
applicable law for it to conduct its business (including obtaining all
authorizations, consents, approvals, orders, licenses, exemptions from, and
making all filings or registrations or qualifications with, any court or
governmental department, public body or authority, commission, board, bureau,
agency, instrumentality or other Governmental Authority), the noncompliance with
which could have a material adverse effect on the business, operations, assets
or condition (financial or otherwise) of the Borrowers and their Subsidiaries
taken as a whole.
(b) Hazardous Wastes, Substances and Petroleum Products.
---------------------------------------------------
(i) The Borrowers and each Subsidiary: (x) have received all
permits and filed all material notifications necessary to carry on their
respective business(es) under, and (y) are in compliance in all material
respects with, all Environmental Control Statutes.
(ii) Neither the Borrowers nor any Subsidiary has given any
written or oral notice, nor has it failed to give required notice, to the
Environmental Protection Agency or any state or local agency with regard to
any actual or imminently threatened Release of Hazardous Substances on
properties owned, leased or operated by Borrowers or any Subsidiary or used
in connection with the conduct of its business and operations, which
Release of Hazardous Substance could have a material adverse effect on the
business, operations, assets or condition of the Borrowers and their
Subsidiaries taken as a whole.
(iii) Neither the Borrowers nor any Subsidiary has received
notice that it is potentially responsible for costs of clean-up or
remediation of any actual or imminently threatened Release of Hazardous
Substances pursuant to any Environmental Control Statute, which costs could
have a material adverse effect on the business, operations, assets or
condition of the Borrowers and their Subsidiaries taken as a whole.
(iv) To the knowledge of the Borrowers, no real property owned or
leased by the Borrowers or any Subsidiary is in material violation of any
Environmental Control Statutes, no Hazardous Substances are present on such
real property that would give rise to a material liability under applicable
Environmental Control Statutes, and neither the Borrowers nor any
Subsidiary has been identified in any litigation, administrative
proceedings or investigation
47
as a potentially responsible party for any liability under any
Environmental Control Statutes that could have a material adverse effect on
the business, operations, assets or condition of the Borrowers and their
Subsidiaries taken as a whole.
Section 5.14 OHI. As of the Effective Date one hundred percent
---
(100%) of the outstanding Capital Stock of OHI will be owned by Parent Borrower,
and OHI will in turn own one hundred percent (100%) of the outstanding Capital
Stock of Operating Borrower. Except for the ownership of Capital Stock of
Operating Borrower, as of the Effective Date OHI will not own any assets and
will not engage in any business activities.
Section 5.15 Amounts Owed to or from Affiliates; Intercompany
------------------------------------------------
Agreements.
----------
(a) Affiliates. Except as disclosed on Schedule 5.15, as of the
----------
Effective Date there will not be outstanding and unpaid any debt, loan, advance,
guaranty or investment (i) by any Borrower or any Subsidiary to or for the
benefit of any Subsidiary or Affiliate of Borrower or (ii) to any Borrower or
any Subsidiary from any Subsidiary or Affiliate of Borrower (collectively,
"Intercompany Debt"), and there will not have been paid (x) by any Borrower to
or for the benefit of any Affiliate of Borrowers or (y) to any Borrower or any
Subsidiary from any Subsidiary or Affiliate of Borrowers, any amount for
management, administrative, operational, consulting, brokerage or other
services. As of the Effective Date, neither any Borrower nor any Subsidiary
will have prepaid to or for the benefit of any Subsidiary or Affiliate of
Borrowers any Intercompany Debt or amount for management, administrative,
operational, consulting, brokerage or other services.
(b) Intercompany Agreements. Except as disclosed on Schedule 5.15
-----------------------
hereto, as of the Effective Date there will not be any agreements between any
Borrower or any Subsidiary and any Subsidiary or Affiliate of Borrowers relating
to the extension of any funds to any Borrower, the sharing of any costs among
Borrowers and any Subsidiary or Affiliate of Borrowers or the provision of any
management, administrative, operational, consulting, brokerage or other services
to Borrowers ("Intercompany Agreements").
Section 5.16 Maintenance of Insurance. The Borrowers and their
-------------------------
Subsidiaries maintain insurance with financially sound and reputable insurance
companies or associations in such amounts and covering such risks as are usually
48
carried by companies engaged in the same or a similar business and similarly
situated, which insurance may provide for reasonable deductibility from coverage
thereof.
Section 5.17 Properties. Each Borrower and each of their
----------
Subsidiaries has such title to the real property owned by it as is necessary or
desirable to the conduct of its business and valid and legal title to all of its
material personal property and assets, subject to the Permitted Liens.
Section 5.18 Change. No material adverse change has occurred in the
------
business, operations, property, financial condition or prospects of the
Borrowers and their Subsidiaries since June 30, 1998.
Section 5.19 Outstanding Letters of Credit, Suretyship Agreements and
--------------------------------------------------------
Similar Arrangements. Except as disclosed on Schedule 5.19, there are no
--------------------
outstanding letters of credit, suretyship agreements or similar arrangements in
respect of which one or more of the Borrowers or any of their Subsidiaries have
reimbursement or indemnification obligations. Schedule 5.19 includes a
description of the amounts and principal terms, or copies of, all such letters
of credit, suretyship agreements and similar arrangements.
Section 5.20 Disclosure Generally. All written information, reports
--------------------
and other papers and data produced by or on behalf of the Borrowers or any
Subsidiary and furnished to the Lenders were, at the time they were so
furnished, and, except to the extent that they have been updated or supplemented
by additional written information, reports or other papers and data produced by
the Borrowers or any Subsidiary and furnished to the Lenders on or before the
Effective Date, are, as of the Effective Date, complete and correct in all
material respects to the extent necessary to give the recipient a true and
accurate knowledge of the subject matter. No document furnished or written
statement made to the Agent or the Lenders by the Borrowers or any Subsidiary in
connection with the negotiation, preparation or execution of this Agreement or
any of the Loan Documents contains any untrue statement of a fact material to
the creditworthiness of the Borrowers or any of their Subsidiaries or omits to
state a fact necessary in order to make the statements contained therein not
misleading in any material respect.
Section 5.21 Year 2000 Compliance. The Borrowers have (a) initiated
--------------------
a review and assessment of all areas within their and each of the Subsidiaries'
business and operations (including those affected by suppliers and vendors) that
could be adversely affected by the risk that computer applications used by the
Borrowers or any of their Subsidiaries (or their suppliers and vendors) may be
unable to recognize and
49
perform properly date-sensitive functions involving certain dates prior to and
any date after December 31, 1999 (the "Year 2000 Problem"), (b) developed a plan
and timeline for addressing the Year 2000 Problem on a timely basis, and (c) to
date, implemented that plan in accordance with that timetable. The Borrowers
reasonably believe that all computer applications (including those of their
suppliers and vendors) that are material to them or any of their Subsidiaries'
business and operations will on a timely basis be able to perform properly date-
sensitive functions for all dates before and after January 1, 2000 (such
compliance, "Year 2000 Compliant"), except to the extent that a failure to do so
could not reasonably be expected to have a material adverse effect on the
Borrowers and their Subsidiaries, taken as a whole.
ARTICLE VI
COVENANTS
Section 6.1 Affirmative Covenants. The Borrowers covenant and
---------------------
agree for themselves and their Subsidiaries (in which case the Borrowers shall
cause such Subsidiaries to take or refrain from taking the actions described
below) that, so long as this Agreement shall remain in effect or any Obligation
shall remain unpaid:
(a) Information. The Borrowers shall deliver to the Agent and each
-----------
Lender:
(i) Audited Annual Financials. As soon as available but within
-------------------------
ninety-five (95) days of the end of each fiscal year of the Borrowers
ending December 31 (each such year, a "Fiscal Year"), a full and complete
set of the annual audited consolidated financial statements (including
statements of financial condition, income, cash flows and changes in
shareholders' equity), together with all notes thereto, of the Borrowers
and their Consolidated Subsidiaries prepared in accordance with GAAP and
certified by an independent accounting firm of national recognition
reasonably acceptable to the Required Lenders (which certificate shall be
accompanied by an unqualified opinion of such accounting firm of such
statements).
(ii) Quarterly Financial Statements. As soon as available but
------------------------------
within fifty (50) days following the end of each of the Borrowers' Fiscal
Quarters, internally prepared consolidated financial statements of the
Borrowers and their Consolidated Subsidiaries (including a balance sheet,
income statement and statement of cash flows). The financial statements
required to be delivered
50
under this clause (ii) shall be accompanied by a certificate of an
Authorized Officer of the Borrowers to the effect that the information
contained therein is true and accurate as of the date of such certificate.
(iii) Exchange Act and Securities Act Filings. Within five (5)
---------------------------------------
days following the filing with the SEC, copies of all filings by it or any
of its Subsidiaries under the Exchange Act (including reports on Forms 10-
Q, 10-K and 8-K) and registration statements filed with the SEC under
either the Securities Act or the Exchange Act. The Parent Borrower shall
deliver to each Lender and the Agent copies of all of the Parent Borrower's
Annual Reports and Proxy Statements and, at the request of such Lender, any
other shareholder communication.
(iv) No Default. Within fifty (50) calendar days after the
----------
end of each of the first three Fiscal Quarters of each Fiscal Year and
within ninety-five (95) calendar days after the end of each Fiscal Year, a
certificate signed by an Authorized Officer of Parent Borrower certifying
that, to the best of such officer's knowledge, after due inquiry, (x) the
Borrowers and each Subsidiary have complied with all covenants, agreements
and conditions in each Loan Document, and (y) no event has occurred and is
continuing which constitutes an Event of Default or Potential Default, or
describing each such event and the remedial steps being taken by Borrower.
(v) Compliance. Within forty-five (45) calendar days after
----------
the end of each of the first three Fiscal Quarters of each Fiscal Year and
within ninety (90) calendar days after the end of each Fiscal Year, a
certificate signed by an Authorized Officer of Parent Borrower
demonstrating compliance with all financial covenants (including all
relevant calculations) and representations contained in this Agreement as
of the end of such period. Such certificate will be in such form as the
Agent may reasonably request from time to time. Upon the request of the
Agent, the Authorized Officer shall provide any and all reports, audits,
and such other information upon which said officer may have relied in
signing such certificate.
(vi) ERISA. Within fifteen (15) Business Days of filing, all
-----
reports and forms filed with respect to all Benefit Plans, except as filed
in the normal course of business and that would not result in an adverse
action to be taken under ERISA, and details of related information of a
Reportable Event.
51
(vii) Material Changes. Within five (5) Business Days of the
----------------
occurrence thereof, notice of any litigation, administrative proceeding,
investigation, business development, or change in financial condition which
could reasonably be expected to have an effect of $5,000,000 or more on
the business, operations, assets or condition (financial or otherwise) of
the Borrowers and their Subsidiaries taken as a whole.
(viii) Other Information. All material press releases promptly
------------------
following release. In addition, promptly upon request by the Agent or the
Lenders from time to time, the Parent Borrower shall provide such other
information and reports regarding the operations, business affairs,
prospects and financial condition of Borrowers and their Subsidiaries as
the Agent or the Lenders may reasonably request.
(b) Financial Covenants.
-------------------
(i) Consolidated Indebtedness to Consolidated Cash Flow Ratio.
---------------------------------------------------------
The Borrowers and their Subsidiaries, taken as a whole, shall maintain, for
(and at all times during) each Fiscal Quarter beginning with the Fiscal
Quarter ending June 30, 1998 (the "Initial Fiscal Quarter"), a ratio of
Consolidated Indebtedness to Consolidated Cash Flow of not greater than
3.00 to 1.00. For purposes of this clause (b)(i), Consolidated
Indebtedness shall include the present value (discounted at 10%) of the
future minimum operating lease requirements of the Borrowers and their
Consolidated Subsidiaries. The ratio contemplated by this clause (b)(i)
shall be computed on a rolling four quarter basis and shall include the
Fiscal Quarter for which such ratio shall be determined plus the
immediately preceding three Fiscal Quarters.
(ii) Consolidated Fixed Charge Ratio. The Borrowers and their
-------------------------------
Subsidiaries, taken as a whole, shall at all times maintain, for (and at
all times during) each Fiscal Quarter beginning with the Initial Fiscal
Quarter, a ratio of (x) Consolidated Cash Flow to (y) interest charges plus
rental expenses under operating leases of not less than 3.25 to 1.00. The
ratio contemplated by this clause (b)(ii) shall be computed on a rolling
four quarter basis and shall include the Fiscal Quarter for which such
ratio shall be determined plus the immediately preceding three Fiscal
Quarters.
(iii) Consolidated Tangible Net Worth Ratio. The Borrowers and
-------------------------------------
their Subsidiaries, taken as a whole, shall maintain, for (and at all times
during) each Fiscal Quarter beginning with the Initial Fiscal Quarter, a
Consolidated
52
Tangible Net Worth of not less than (w) eighty-five percent (85%) of
Consolidated Tangible Net Worth as of the Effective Date plus (x) eighty-
----
five percent (85%) of the net proceeds resulting from any exercise of the
underwriters' overallotment option in connection with the Parent Borrower
Public Offering plus (y) fifty percent (50%) of Consolidated Net Income
----
(computed on a cumulative basis for each Fiscal Quarter during the term of
this Agreement, from the Initial Fiscal Quarter to the date of
determination plus (z) one hundred percent (100%) of the net proceeds from
----
the issuance for cash of any Capital Stock of the Borrowers, after the
later of the Effective Date and the closing of any exercise of the
underwriters' overallotment option in connection with the Parent Borrower
Public Offering.
(c) Proceeds. The Borrowers shall use the proceeds of the Loans and
--------
the Standby Letters of Credit for the Permitted Uses and for no other purpose.
(d) Payment of Debts and Taxes. The Borrowers and their
--------------------------
Subsidiaries shall pay all debts, liabilities, taxes, assessments and other
governmental charges when due in the ordinary course; provided, however, that no
-------- -------
such debt, liability, tax, assessment or other governmental charge need be paid
if such is being contested in good faith by appropriate legal proceedings and if
such reserves or other appropriate provision, if any, as shall be required by
GAAP shall have been made therefor.
(e) ERISA. (i) The Borrowers and their Subsidiaries shall comply in
-----
all material respects with the provisions of ERISA to the extent applicable to
any Benefit Plan maintained for the employees of the Borrowers, any Subsidiary
or any ERISA Affiliate; (ii) do or cause to be done all such acts and things
that are required to maintain the qualified status of each Benefit Plan and tax
exempt status of each trust forming part of such Benefit Plan; (iii) not incur
any material Accumulated Funding Deficiency or any material liability to the
PBGC; (iv) permit any event to occur (x) as described in Section 4042 of ERISA
or (y) which may result in the imposition of a Lien on its properties or assets;
and (v) notify Lenders in writing promptly after it has come to the attention of
senior management of the Borrowers of the assertion or threat of any Reportable
Event or other event described in Section 4042 of ERISA (relating to the
soundness of a Benefit Plan) or the PBGC's ability to assert a material
liability against it or impose a lien on any Borrower's, any Subsidiary's, or
any ERISA Affiliate's properties or assets; and (f) refrain from engaging in any
Prohibited Transactions or actions causing possible liability under Section 502
of ERISA.
(f) Conduct and Maintenance of Business. The Borrowers and their
-----------------------------------
Subsidiaries shall continue to engage in business of the same general type as
now
53
conducted by the Borrowers and their Subsidiaries. The Borrowers and their
Subsidiaries will conduct and manage their respective businesses and affairs in
the ordinary course, and shall take all steps necessary and reasonable for the
purpose of preserving the value of their respective businesses and assets.
(g) Preservation of Corporate Existence. The Borrowers and their
-----------------------------------
Subsidiaries shall at all times preserve and keep in full force and effect their
respective corporate existence and their respective rights, privileges, licenses
and franchises which are necessary in the normal conduct of their business.
(h) Books and Records. The Borrowers and their Subsidiaries shall
-----------------
at all times keep and maintain complete and accurate books, accounts and records
of their operations and affairs in accordance with GAAP and customary and sound
business practices, and shall permit each Lender and the Agent and their
respective officers, employees, agents and representatives to, from time to time
upon reasonable notice, have access to its place of business, examine such
books, accounts and records and make copies thereof and discuss the affairs and
finances of the Borrowers or their Subsidiary with any of their respective
officers or directors.
(i) Insurance. The Borrowers and their Subsidiaries shall maintain
---------
in full force and effect policies of insurance with responsible and reputable
insurance companies or associations in such amounts as are within an acceptable
range for and covering such risks as are usually and customarily insured against
by companies engaged in similar businesses and owning similar properties in the
same general area in which the Borrowers and their Subsidiaries are engaged.
(j) Compliance with Laws. The Borrowers and their Subsidiaries
--------------------
shall comply with all applicable Regulations a breach of which could have a
material adverse effect on the financial condition or business of the Borrowers
and their Consolidated Subsidiaries (taken as a whole).
(k) Compliance with Loan Documents. The Borrowers and their
------------------------------
Subsidiaries shall comply with the terms and agreements contained in each Loan
Document to which they are a party.
(l) Lending Relationship with the Agent. The Borrowers shall
-----------------------------------
maintain with the Agent the Borrowers' Account.
(m) Ownership of Operating Borrower. The Parent Borrower will at all
-------------------------------
times own directly, or indirectly through Parent Borrower's ownership of one
hundred
54
percent (100%) of each class of Capital Stock of OHI, all of the shares of each
class of Capital Stock of the Operating Borrower.
(n) Notice of Default. The Borrowers shall, promptly after becoming
-----------------
aware thereof, deliver to each Lender and the Agent notice of any Event of
Default and Potential Event of Default.
(o) Notice of Environmental Claims. The Borrowers shall deliver to
------------------------------
each Lender and the Agent a copy of any notice or other communication (i)
alleging any material violation by the Borrowers or their Subsidiaries of any
Environmental Control Statutes or (ii) under which the Borrowers or their
Subsidiaries shall admit to any such material violation. Each copy of any such
notice shall be delivered to the Lenders and the Agent promptly following the
receipt or issuance thereof by the Borrowers or such Subsidiary.
(p) Payments Pari Passu. Under applicable laws in force from time
-------------------
to time, the claims and rights of the Lenders and the Agent against the
Borrowers and their Subsidiaries under the Loan Documents will not be
subordinate to, and will rank at least pari passu with, the claims and rights of
each other unsecured creditor of the Borrowers and their Subsidiaries.
(q) Year 2000 Compliance. The Borrowers will promptly notify the
--------------------
Agent in the event the Borrowers discover or determine that any computer
application (including those of their suppliers and vendors) that is material to
them or any of their Subsidiaries' business and operations will not be Year 2000
Compliant on a timely basis, except to the extent that such failure could not
reasonably be expected to have a material adverse effect upon the Borrowers and
their Subsidiaries, taken as a whole.
(r) Further Assurances. The Borrower shall do such further acts and
------------------
things and execute and deliver to the Agent such additional assignments,
agreements, powers and instruments, as the Lenders may reasonably require or
reasonably deem advisable to carry into affect the purposes of this Agreement or
to better assure and confirm unto them their rights, powers and remedies
hereunder.
Section 6.2 Negative Covenants. The Borrowers covenant and agree
------------------
for themselves and their Subsidiaries (in which case the Borrowers shall cause
such Subsidiaries to take or refrain from taking the actions described below),
that, so long as this Agreement shall remain in effect or any Obligation shall
remain unpaid:
55
(a) Liens. The Borrowers and their Subsidiaries shall not,
-----
directly or indirectly, create, incur, assume, grant, pledge or permit to exist
any Lien on the property or assets of the Borrowers and their Subsidiaries other
than Permitted Liens.
(b) Indebtedness. Neither the Borrowers nor any of their
------------
Subsidiaries shall, directly or indirectly, create, incur, assume or otherwise
become or remain directly or indirectly liable with respect to, any
Indebtedness, other than:
(i) the Indebtedness incurred by the Borrowers hereunder and
evidenced by the Revolving Notes and the Swing Line Note;
(ii) the Indebtedness evidenced by the Standby Letters of
Credit, if any, issued by the Lenders in accordance with Section 2.3
hereof;
(iii) Indebtedness of the type secured by Permitted Liens which
does not exceed (in each case and in the aggregate and as to the Borrowers
and their Subsidiaries, taken as a whole) the respective amounts set forth
in the definition of Permitted Liens;
(iv) Indebtedness in the form of (x) any guarantee, suretyship
agreement, or similar arrangement effecting the assumption of a debt or
obligation of the Borrowers or any Subsidiary as to which one or more of
the Borrowers or any Consolidated Subsidiary has a reimbursement or
indemnification obligation, or the endorsement of any promissory note or
other instrument of obligation of any other Subsidiary thereof, in each
case which is entered into in the ordinary course of the Borrower's or
Subsidiary's business and are necessary and beneficial in connection with
the operation thereof, or (y) any guarantee, suretyship agreement, or
similar arrangement effecting the assumption of a debt or obligation of any
Person (other than the Borrowers or a Subsidiary thereof) as to which one
or more of the Borrowers or any Subsidiary has a reimbursement or
indemnification obligation, or the endorsement of any promissory note or
other instrument of obligation of any Person (other than the Borrowers or a
Subsidiary thereof), in each case which is entered into in the ordinary
course of the Borrower's or Subsidiary's business, are necessary and
beneficial in connection with the operation thereof and the aggregate
amount of all such guarantees, suretyship agreements, or other similar
arrangements shall not exceed in the aggregate $1,000,000.00;
(v) Indebtedness of the types described in clauses (ii) and
(iv) of this Section 6.2(b) that, together with any other letters of credit
issued for the account of one or more of the Borrowers or any Subsidiary
thereof as to which
56
one or more of the Borrowers or any Subsidiary thereof have reimbursement
or indemnification obligations, does not exceed $85,000,000 in the
aggregate; and
(vi) Indebtedness in the form of trade debt, accounts payable
and other similar Indebtedness incurred in the ordinary course of the
Borrowers' or their Subsidiaries' business.
(c) Capital Stock. Without the prior written consent of the
-------------
Required Lenders, neither the Borrowers nor any Subsidiary thereof shall,
directly or indirectly, repurchase, redeem or retire any of their Capital Stock,
declare or pay any cash dividends on their Capital Stock, except that the
Borrowers may:
(i) declare and pay dividends or make other distributions on
their Capital Stock if the Borrowers would be in compliance with all
provisions of this Agreement, including without limitation the financial
ratios contained in Section 6.1 hereof after giving effect to the payment
or distribution thereof; and
(ii) repurchase, redeem or retire Capital Stock of the Parent
Borrower at an aggregate cost of up to (x) $4,000,000.00 per Fiscal Year
and (y) a total of $15,000,000 following the Effective Date.
(d) Loans. Neither the Borrowers nor any Subsidiary thereof shall,
-----
directly or indirectly, make any loans or advances to any corporate officers or
directors, or any employees, or any insiders or Affiliates or to any Subsidiary
of the Borrowers, other than:
(i) travel, relocation and other salary advances made in the
ordinary course of the Borrowers' or their Subsidiaries' business;
(ii) loan the proceeds of the Revolving Loans or Swing Line
Loans to any Subsidiary of the Borrowers for the purpose of financing the
acquisition of any Target as contemplated by, and in accordance with the
limitations contained in, Section 6.2(e) hereof; and
(iii) loans to any officer of the Borrowers and their
Subsidiaries for the purpose of enabling such officer to purchase
securities of the type described in Section 6.2(c)(ii) hereof, provided
--------
that the aggregate amount of all loans made pursuant to this clause and
outstanding from time to time shall not exceed $500,000.00.
57
(e) No Merger or Acquisition. Without the prior written consent of
------------------------
the Required Lenders, neither the Borrowers nor any Subsidiary thereof shall
acquire, whether by stock or asset purchase, merger, consolidation or other
business combination, any corporation, partnership, limited liability company,
joint venture or other business organization that, as a result of such
transaction, becomes a Subsidiary of the Borrowers or one or more of their
Subsidiaries (any such entity, the "Target"); provided, however, that the
-------- -------
Borrowers or any direct or indirect Consolidated Subsidiary thereof may acquire,
either by way of stock or asset acquisition, merger, consolidation or otherwise,
one or more Targets involved in a line of business similar to the line of
business of the Borrowers if:
(i) for any calendar year during the term of this Agreement,
the aggregate consideration (whether such consideration shall consist of
stock, cash, the assumption of debt, or otherwise, and whether or not paid
at closing or deferred) (any such consideration, "Acquisition
Consideration") paid for all Targets acquired during such Fiscal Year shall
not exceed $50,000,000;
(ii) for any calendar year during the term of this Agreement,
the cash component (which, for the purposes of this clause (ii), shall
include all cash and cash equivalents and the assumption of debt, whether
or not paid at closing or deferred) of Acquisition Consideration paid for
all Targets acquired during such Fiscal Year shall not exceed $15,000,000;
(iii) the Borrowers and their Subsidiaries shall, after giving
effect to the acquisition of any such Target as provided above, be in
compliance with all of the terms of this Agreement including the financial
covenants described in Section 6.1(b) hereof as determined on a pro forma
basis;
(iv) such acquisition, merger, consolidation (or otherwise) is
not hostile or pursued by way of tender offer, proxy contest or other
contested manner (unless the Required Lenders shall have waived in writing
compliance with this clause (v));
(v) for any calendar year during the term of this Agreement
(including the calendar year beginning January 1, 1998), Targets that are
not organized under the laws of a state of the United States of America or
the District of Columbia or of Canada or any province thereof may not be so
acquired; and
(vi) three (3) Business Days prior to consummation thereof, the
Borrowers shall have delivered to the Agent (which shall promptly deliver a
copy
58
to the Lenders) a certificate, executed by an Authorized Officer of
the Borrowers, demonstrating in sufficient detail compliance with the
financial covenants contained in this Section 6.2(e) and, further,
certifying that, after giving effect to the consummation of such
acquisition, merger, consolidation (or otherwise), the representations and
warranties of the Borrowers contained herein will be true and correct and
that the Borrowers, as of the date of such consummation, will be in
compliance with all other terms and conditions contained herein.
(f) Accounting Policies; Fiscal Year. The Borrowers and their
--------------------------------
Subsidiaries shall not, without the prior written consent of the Required
Lenders, make any material change in accounting policies or reporting practices
not required by GAAP as applied in the Borrowers' industry, including a change
in their Fiscal Year.
(g) Disposition of Assets. Neither the Borrowers nor any
---------------------
Subsidiary thereof shall, without the prior written consent of the Required
Lenders, sell, transfer or otherwise dispose of (including by way of a sale and
leaseback transaction) any its assets (whether real or personal) other than in
the ordinary and usual course of its business.
(h) Permitted Investments. Neither the Borrowers nor any
---------------------
Subsidiary thereof shall, without the prior written consent of the Required
Lenders, make any Investment except for Permitted Investments (it being
understood and agreed that this clause (h) shall not prohibit the investment in
any Target to the extent permitted by the provisions of Section 6.2(e) hereof).
ARTICLE VII
EVENTS OF DEFAULT
Section VII.1 Events of Default. If one or more of the following
-----------------
events or conditions (each, an "Event of Default") shall occur and be
continuing, that is to say:
(a) the Borrowers default in the payment of principal of any Revolving
Note or the Swing Line Note when due; or
(b) the Borrowers default in the payment of interest on any Loan, or
of the Facility Fee, the Administrative Fee, any L/C Fee, the L/C Fronting Fee,
or of any other fee, expense or other amount payable hereunder after the same
becomes due
59
and payable for more than four (4) Business Days after notice thereof has been
given by the Agent to the Borrowers (which notice may be telephonic); or
(c) the Borrowers or any Subsidiary default in any payment of
principal of or interest on, or fees and expenses relating to any other
obligation for borrowed money beyond any period of grace provided with respect
thereto or in the performance of any other agreement, term or condition
contained in any instrument or agreement evidencing, securing, guaranteeing or
otherwise relating to any such obligation and shall not have cured such default
within any period of grace provided by such agreement and such obligation,
either individually or in the aggregate, is for an amount in excess of
$2,500,000 of the Indebtedness of the Borrowers; or
(d) any written representation or warranty made by the Borrowers in or
pursuant to this Agreement or any other Loan Document or in any other documents,
certificates, financial statements or reports furnished by the Borrowers or any
Subsidiary of any thereof in connection with the transactions contemplated
hereby shall prove to have been false or misleading in any material respect as
of the time made or furnished or deemed made or furnished; or
(e) (i) the Borrowers shall default in the performance or observance
of any covenant, condition or agreement contained in clause (a)(iii) (ix), (c),
(d), (e), (f), (g), (h), (i), (o) (p) or (r) of Section 6.1 and such default
shall remained unremedied for more than ten (10) Business Days, or (ii) the
Borrowers shall default in the performance or observance of any other covenant,
condition or agreement contained in Section 6.1 or any covenant, condition or
agreement contained in Section 6.2; or
(f) the Borrowers shall default in the performance or observance of
any other covenant, condition or provision hereof or in any other Loan Document
and such default shall not be remedied within thirty (30) days after written
notice thereof is received by the Borrowers from any Lender or the Agent; or
(g) a proceeding (other than a proceeding commenced by the Borrowers
or any Subsidiary thereof, as the case may be) shall have been instituted in a
court having jurisdiction in the premises seeking a decree or order for relief
in respect of the Borrowers or such Subsidiary in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or for the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of the Borrowers or such
Subsidiary or for any substantial part of its total assets, or for the winding-
up or liquidation of its affairs and such proceedings shall remain undismissed
or unstayed and in effect for a period of forty-five (45) consecutive
60
days or such court shall enter a decree or order granting the relief sought in
such proceeding; or
(h) the Borrowers or any Subsidiary thereof, as the case may be, shall
commence a voluntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, shall consent to the entry of an order
for relief in an involuntary case under any such law, or shall consent to the
appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator (or other similar official) of the Borrowers or
such Subsidiary or for any substantial part of their total assets, or shall make
a general assignment for the benefit of creditors, or shall fail generally to
pay their debts as they become due, or shall take any corporate action in
furtherance of any of the foregoing; or
(i) a judgment or order shall be entered against the Borrowers or any
Subsidiary thereof, by any court, and (i) in the case of a judgment or order for
the payment of money, either (a) such judgment or order shall continue
undischarged and unstayed for a period of thirty (30) days in which the
aggregate amount of all such judgments and orders exceeds $1,000,000.00 or (b)
enforcement proceedings shall have been commenced upon such judgment or order
and (ii) in the case of any judgment or order for other than the payment of
money, such judgment or order could, in the reasonable judgment of any Lender,
together with all other such judgments or orders, have a materially adverse
effect on the Borrowers and their Subsidiaries taken as a whole; or
(j) the representations set forth in Section 5.14 shall cease to be
true and correct; or
(k) (i) any Termination Event shall occur with respect to any Benefit
Plan, (ii) any Accumulated Funding Deficiency, whether or not waived, shall
exist with respect to any Benefit Plan, (iii) any Person shall engage in any
Prohibited Transaction involving any Benefit Plan, (iv) the Borrowers or any
ERISA Affiliate shall be in "default" (as defined in ERISA Section 4219(c)(5))
with respect to payments owing to a Multiemployer Benefit Plan as a result of
the Borrowers' or any ERISA Affiliate's complete or partial withdrawal (as
described in ERISA Section 4203 or 4205) from such Multiemployer Benefit Plan,
(v) the Borrowers or any ERISA Affiliate shall fail to pay when due an amount
that is payable by it to the PBGC or to a Benefit Plan under Title IV of ERISA,
or (vi) a proceeding shall be instituted by a fiduciary of any Benefit Plan
against the Borrowers or any ERISA Affiliate to enforce ERISA Section 515 and
such proceeding shall not have been dismissed within 30 days thereafter, except
that no event or condition referred to in clauses (i) through (vi) shall
constitute an Event of
61
Default if it, together with all other such events or conditions at the time
existing, has not had, and in the reasonable determination of the Required
Lenders will not have, a materially adverse effect on the Borrowers and their
Subsidiaries, taken as whole; or
(l) the occurrence of a Change in Control;
then, and upon any such event, the Agent, with the consent of the Required
Lenders, may (i) upon notice to the Borrowers declare the entire outstanding
principal amount, if any, of the Revolving Notes, the Swing Line Note, any and
all accrued and unpaid interest thereon, the aggregate amount outstanding under
all Standby Letters of Credit, any and all accrued and unpaid Facility Fee,
Administrative Fee, L/C Fees, the L/C Fronting Fee and any and all other amounts
payable by the Borrowers to the Lenders or the Agent under this Agreement or the
Revolving Notes or the Swing Line Note to be forthwith due and payable,
whereupon the entire outstanding principal amount, if any, of the Revolving
Notes and the Swing Line Note, together with any and all accrued and unpaid
interest thereon, the aggregate amount outstanding under all Standby Letters of
Credit, any and all accrued and unpaid Facility Fee, Administrative Fee, the
fees in respect of Standby Letters of Credit, and any and all other such amounts
and such reimbursement 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 Borrowers; provided, however, that in the event
-------- -------
of the entry of an order for relief with respect to the Borrowers or their
Subsidiary under the Bankruptcy Code, any principal amount of the Revolving
Notes and the Swing Line Note then outstanding, together with any and all
accrued and unpaid interest thereon, the aggregate amount outstanding under all
Standby Letters of Credit, any and all accrued and unpaid Facility Fee,
Administrative Fee and any fee in respect of any Standby Letter of Credit, and
any and all such other amounts shall thereupon automatically become and be due
and payable without presentment, demand, protest or notice of any kind, all of
which are hereby expressly waived by the Borrowers; (ii) terminate or reduce the
Revolving Loan Commitment; and (iii) exercise any rights and remedies available
to it under any Loan Document or under applicable laws.
ARTICLE VIII
THE AGENT
Section 8.1 Appointment of Agent.
--------------------
62
(a) Appointment Generally. Each of the Lenders hereby designates and
---------------------
appoints Crestar Bank as the Agent of such Lender under this Agreement and the
other Loan Documents, and each of the Lenders hereby irrevocably authorizes the
Agent to take such action on its behalf under the provisions of this Agreement
and the other Loan Documents and to exercise such powers as are set forth herein
and therein, together with such other powers as are incidental thereto. The
Agent agrees to act as such on the express conditions contained in this Article
VIII.
(b) Agent Acts for Lenders. The provisions of this Article VIII are
----------------------
solely for the benefit of the Agent and the Lenders and the Borrowers shall have
no right (including as third party beneficiary) to rely on or enforce any of the
provisions hereof. In performing its functions and other duties under this
Agreement and the other Loan Documents, the Agent shall act solely as agent for
the Lenders and does not assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with or for the Borrowers
or any of their Affiliates.
Section 8.2 Nature of Duties; Non-Reliance on Agent and other
-------------------------------------------------
Lenders.
-------
(a) The Agent shall not have any duties or responsibilities except
those expressly set forth in this Agreement or in the other Loan Documents. The
duties of the Agent shall be mechanical and administrative in nature. The Agent
shall not have by reason of this Agreement or any other Loan Document a
fiduciary relationship in respect of any Lender and is not a trustee for the
Lenders. Nothing in this Agreement or any of the other Loan Documents, expressed
or implied, is intended to or shall be construed to impose upon the Agent any
obligations in respect of this Agreement or any of the other Loan Documents
except as expressly set forth herein and therein. If the Agent seeks the consent
or approval of the Lenders to the taking or refraining from taking of any action
hereunder, the Agent shall send notice thereof to each Lender. The Agent shall
promptly notify each Lender at any time the Required Lenders or all of the
Lenders, as the case may be, have instructed the Agent to act or refrain from
acting pursuant hereto. The Agent may execute any of its duties hereunder or
under any other Loan Document by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Agent shall not be responsible for the negligence or misconduct of
any agents or attorneys-in-fact selected by it with reasonable care.
(b) Each Lender expressly acknowledges that neither the Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or Affiliates
has made any representations or warranties to it and that no act by the Agent
or any Affiliate thereof hereinafter taken, including any review of the affairs
of the Borrowers or any
63
Subsidiary thereof, shall be deemed to constitute any representation or warranty
by the Agent to any Lender. Each Lender represents to the Agent that it has,
independently and without reliance upon the Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, assets, operations, property,
financial and other conditions, prospects and creditworthiness of the Borrowers
and their Subsidiaries and made its own decision to make its Loans and issue or
participate in the issuance of Standby Letters of Credit hereunder and enter
into this Agreement and the other Loan Documents to which it is a party. Each
Lender covenants that it will, independently and without reliance upon the Agent
or any other Lender, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement or
any other Loan Document to which it is a party, and to make such investigations
as it deems necessary to inform itself as to the business, assets, operations,
property, financial and other conditions, prospects and creditworthiness of the
Borrowers and their Subsidiaries. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the Agent
hereunder, the Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
assets, property, financial and other conditions, prospects or creditworthiness
of the Borrowers and their Subsidiaries which may come into the possession of
the Agent or any of its officers, directors, employees, agents, attorneys-in-
fact or Affiliates.
Section 8.3 Rights, Exculpation, Etc. Neither the Agent nor any
------------------------
of its Affiliates nor any of their respective officers, directors, employees,
agents, attorneys or consultants shall be liable to any Lender for any action
taken or omitted by it or such Person hereunder or under any of the other Loan
Documents, or in connection herewith or therewith, except that (a) the Agent
shall be obligated on the terms set forth herein for performance of its express
obligations hereunder, and (b) neither the Agent nor any such other Person shall
have any liability hereunder or under any other Loan Document except to the
extent arising out of its own gross negligence or willful misconduct (as
determined by the final judgment of a court of competent jurisdiction). The
Agent shall not be liable for any apportionment or distribution of payments made
by it in good faith pursuant to the terms of this Agreement and if any such
apportionment or distribution is subsequently determined to have been made in
error the sole recourse of any Lender to whom payment was due, but not made,
shall be to recover from other Lenders any payment in excess of the amount to
which they are determined to have been entitled. The Agent shall not be
responsible to any Lender for any recitals, statements, representations or
warranties made by the Borrowers or Subsidiary thereof in this Agreement or in
any other Loan Document or in any other document, certificate report
64
or financial statement delivered by the Borrowers or any Subsidiary thereof in
connection herewith or therewith or for the execution, effectiveness,
genuineness, validity, enforceability, collectibility, or sufficiency of this
Agreement or any of the other Loan Documents, or any of the transactions
contemplated thereby, or for the financial condition of the Borrowers or any of
their Subsidiaries. The Agent shall not be required to make any inquiry
concerning conditions of this Agreement or any of the Loan Documents or the
financial condition of the Borrowers or their Subsidiaries or the existence or
possible existence of any Potential Event of Default or Event of Default. The
Agent may at any time request instructions from the Lenders with respect to any
actions or approvals which by the terms of this Agreement or of any of the other
Loan Documents the Agent is permitted or required to take or to grant, and if
such instructions are promptly requested, the Agent shall be absolutely entitled
to refrain from taking any action or to withhold any approval and shall not
incur any liability whatsoever to any Person for refraining from any action or
withholding any approval under any of the Loan Documents until it shall have
received such instructions from the Required Lenders or, to the extent
specifically provided herein, all the Lenders or unless it shall first be
indemnified by the Lenders against any and all liability and expense which may
be incurred by it by reason of refraining to take any action or withholding any
approval. Without limiting the foregoing, no Lender shall have any right of
action whatsoever against the Agent as a result of the Agent acting or
refraining from acting under this Agreement or any of the other Loan Documents
in accordance with the instructions of the Required Lenders or, to the extent
specifically provided herein, all the Lenders, and such instructions shall be
binding upon all Lenders (including their successors and assigns).
Section 8.4 Reliance; Notice of Default.
---------------------------
(a) The Agent shall be entitled to rely upon any written notice,
statement, certificate, order, letter, cablegram, telegram, telecopy, telex or
teletype message, statement or other document or any telephone message believed
by it in good faith to be genuine and correct and to have been signed or made by
the proper Person, and with respect to all matters pertaining to this Agreement
or any of the other Loan Documents and its duties hereunder or thereunder, upon
advice of legal counsel (including counsel for the Borrowers), independent
public accountants and other experts selected by it with reasonable care. The
Agent may deem and treat each Lender as the owner of its interests hereunder for
all purposes unless and until the Agent shall have received a duly executed
instrument of assignment as contemplated by Section 9.8(c) hereof and the other
conditions to assignment, to the extent applicable, shall have been satisfied.
65
(b) The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Event of Default or Potential Event of Default unless the
Agent has received notice from a Lender or the Borrowers referring to this
Agreement, describing such Event of Default or Potential Event of Default and
stating that such notice is a "notice of Event of Default" of "notice of
Potential Event of Default", as the case may be. The Agent shall take such
action with respect to such Event of Default or Potential Event of Default as
shall be reasonably directed by the Required Lenders.
Section 8.5 Indemnification. To the extent that the Agent is not
---------------
reimbursed and indemnified by the Borrowers or the Borrowers fail upon demand by
the Agent to perform their obligations to reimburse or indemnify the Agent, the
Lenders will severally reimburse and indemnify the Agent for and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever which
may be imposed on, incurred by, or asserted against the Agent in any way
relating to or arising out of this Agreement or any of the other Loan Documents
or any action taken or omitted by the Agent under this Agreement or any of the
other Loan Documents, in proportion to each Lender's Pro Rata Share; provided,
--------
that no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the Agent's gross negligence or willful misconduct
(as determined by the final judgment of a court of competent jurisdiction). The
obligations of the Lenders under this Section 8.5 shall survive the payment in
full of the Revolving Loans and the Swing Line Loans and the termination of this
Agreement.
Section 8.6 The Agent Individually. With respect to its Pro Rata
----------------------
Share hereunder and the Revolving Loans, Swing Line Loans, if any, and Standby
Letters of Credit made by it, the Agent shall have and may exercise the same
rights and powers hereunder and is subject to the same obligations and
liabilities as and to the extent set forth herein for any other Lender. The
term "Lenders" or "Required Lenders" or any similar terms shall, unless the
context clearly otherwise indicates, include the Agent in its individual
capacity as a Lender. The Agent and its Affiliates may accept deposits from,
lend money to, and generally engage in any kind of banking, trust or other
business with the Borrowers as if it were not acting as Agent pursuant hereto.
Section 8.7 Successor Agent; Resignation of Agent.
-------------------------------------
(a) The Agent may resign from the performance of its functions and
duties hereunder at any time by giving at least twenty (20) days' prior written
notice to the Lenders and the Borrowers. In the event that the Agent gives
notice of its desire to resign from the performance of its functions and duties
as Agent, any such resignation
66
shall take effect only upon (i) the repayment of any portion of the fees
received by the Agent required by Section 3.7(c) and (ii) the acceptance by a
successor Agent of appointment pursuant to clauses (b) and (c) below.
(b) The Required Lenders shall jointly appoint a successor Agent,
which shall be a Lender hereunder. A successor Agent that is not one of the
original Lenders under this Agreement shall be reasonably acceptable to the
Borrowers, such acceptance not to be unreasonably withheld, delayed or
conditioned. Unless the Borrowers object to the appointment of a successor Agent
within five (5) Business Days after receipt of notice thereof, the Borrowers
shall be conclusively presumed to have consented to the appointment of the
successor Agent.
(c) If a successor Agent shall not have been so appointed within said
twenty (20) day period, the retiring Agent shall then appoint a successor Agent
who shall serve as Agent until such time, if any, as the Lenders appoint a
successor Agent as provided above, it being understood and agreed that any
successor Agent so appointed by the retiring Agent pursuant to this clause (c)
need not be, notwithstanding the provisions of clause (b) above, a Lender
hereunder so long as such successor Agent is a commercial bank organized under
the laws of the United States of America or of any State thereof or of the
District of Columbia and has a combined capital and surplus of at least
$1,000,000,000.00.
(d) Upon the appointment of a successor Agent, the term "Agent" shall,
for all purposes of this Agreement and the other Loan Documents, thereafter
include such successor Agent, the retiring Agent shall be discharged from its
duties and obligations as Agent, as appropriate, under this Agreement and the
other Loan Documents and the successor Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
Agent, except that the retiring Agent shall reserve all rights as to obligations
accrued or due to it, in its capacity as such, at the time of such succession
and all rights (whenever arising) under Section 9.10 hereof.
Section 8.8 Certain Matters Requiring the Consent of all Lenders.
----------------------------------------------------
Subject to the provisions of Section 8.9(b) hereof, the consent of all the
Lenders shall be required for taking any of the following required or permitted
actions hereunder:
(a) any decrease or increase in any interest rate or margin applicable
to any Loan or in any fee payable hereunder, or change in the method of
computing the interest rate or margin applicable to any Loan or in any fee
payable hereunder;
(b) any change in the Maturity Date;
67
(c) any increase in the Aggregate Commitment;
(d) any increase or decrease in the Commitment of any Lender;
(e) any change in the definition of Required Lenders;
(f) any assignment or delegation of Borrowers' Obligations and rights
hereunder;
(g) any change in the definition of Pro Rata Share;
(h) any amendment, modification or waiver of this Section 8.8; and
(i) any postponement of the date of payment of any principal, interest
or fees (other than the Administrative Fee, which may be postponed or waived at
the sole discretion of the Agent) due hereunder.
For the avoidance of doubt, all other actions, consents, waivers and amendments
permitted or required hereunder by the Lenders shall be by the Required Lenders
(unless such action, consent, waiver or amendment shall relate only to an
individual Lender, in which case such action may be taken by such Lender
individually).
Section 8.9 Defaulting Lenders Vote Not Counted. Whenever the
-----------------------------------
"Required Lenders" or "all the Lenders" shall be required or permitted to take
any action pursuant to the provisions of any Loan Document, for so long as a
Lender shall be in default of its obligation to advance its Pro Rata Share of
any Loan or advance any other funds to the Agent or any other Lender as required
hereunder:
(a) until the earlier of the cure of such default and the termination
of the Revolving Loan Commitment, the term Required Lenders for purposes of this
Agreement shall mean Lenders (excluding all Lenders whose default shall have
not been cured) whose Pro Rata Shares represent more than sixty-six and two-
thirds percent (66K%) of the aggregate Pro Rata Shares of such Lenders; and
(b) until the earlier of the cure of such default and the termination
of the Revolving Loan Commitment, the term "all the Lenders" for purposes of
this Agreement shall mean Lenders (excluding all Lenders whose default shall
have not been cured) whose Pro Rata Shares represent one hundred percent (100%)
of the aggregate Pro Rata Shares of such Lenders.
68
ARTICLE IX
MISCELLANEOUS
Section 9.1 Amendments and Waivers; Cumulative Remedies. No delay
-------------------------------------------
or failure of any Lender or the Agent or the holder of any the Revolving Notes
or the Swing Line Note in exercising any right, power or privilege hereunder or
under any other Loan Document shall affect such right, power or privilege; nor
shall any single or partial exercise thereof or any abandonment or
discontinuance of steps to enforce such a right, power or privilege preclude any
further exercise thereof or of any other right, power or privilege. The rights
and remedies of any Lender or the Agent or any other holder of the Revolving
Notes or the Swing Line Note are cumulative and not exclusive of any rights or
remedies which any of them would otherwise have. Neither this Agreement or any
other Loan Document, nor any term, condition, representation, warranty, covenant
or agreement hereof or thereof, may be changed, waived, discharged or terminated
orally but only by an instrument in writing executed by the party against whom
such change, waiver, discharge or termination is sought. Any waiver, permit,
consent or approval of any kind or character (whether involving a breach,
default, provision, condition or term hereof or otherwise) on the part of any
Lender or the Agent or any other holder of any Note, or of the Borrowers under
this Agreement, or under any other Loan Document shall be effective only in the
specific instance and for the purpose for which given and only to the extent set
forth specifically in writing. No notice or demand given hereunder shall entitle
the recipient thereof to any other or further notice or demand in similar or
other circumstances.
Section 9.2 Survival of Representations and Warranties. All
------------------------------------------
representations, warranties, covenants and agreements of the Borrowers contained
herein or made in writing in connection herewith shall survive the execution and
delivery of this Agreement, the making of Loans hereunder and the issuance of
the Notes.
Section 9.3 Supervening Illegality . If, after the Effective Date,
----------------------
as the result of (a) the adoption of any law, rule or regulation by any
Governmental Authority, (b) any change in the existing laws, rules and
regulations of any Governmental Authority, (c) the issuance of any order or
decree by any Governmental Authority, (d) any change in the interpretation or
administration of any applicable law, rule, regulation, order or decree by any
Governmental Authority (including any central bank or similar agency) charged
with the interpretations or administration thereof, or (e) compliance by any
Lender with any request or directive (whether or not having the force of law) of
any Bank Governmental Body, it shall be unlawful or impossible for any
69
Lender to maintain the Revolving Loans or the Swing Line Loans, such Lender
shall so notify the Borrowers and the Agent and such Lender, by giving the
Borrowers at least one hundred twenty (120) Business Days' prior written notice,
may require the Borrowers to prepay the aggregate principal amount of, and all
accrued and unpaid Facility Fee and all other fees and all accrued and unpaid
interest on, the Revolving Loans and the Swing Line Loans, as the case may be
(together with any other amounts that may become payable hereunder as a result
thereof, including all amounts pursuant to Section 9.10 of this Agreement), on a
Business Day (the "Prepayment Date") specified in such notice. If after the date
of this Agreement and prior to the initial Funding Date it shall become unlawful
for any Lender to make any Revolving Loans or Swing Line Loans hereunder or to
maintain its Commitment, this Agreement shall terminate forthwith with respect
to such Lender and neither such Lender nor the Borrowers shall have any further
rights or obligations under this Agreement, provided, however, that the
Borrowers, in the event of any termination pursuant to this second sentence of
Section 9.3, shall pay to such Lender the amount of all accrued and unpaid fees,
if any, together with all amounts then due pursuant to Section 9.10 hereof. If
it shall become unlawful for any such Lender to make any Revolving Loans or
Swing Line Loans as provided in this Section 9.3, the Revolving Loan Commitment
shall automatically be deemed to be decreased in the amount of such Lender's Pro
Rata Share, and the Commitment of each such other Lender shall be adjusted
accordingly.
Section 9.4 No Reduction in Payments. All payments due to the
------------------------
Lenders hereunder, and all other terms, conditions, covenants and agreements to
be observed and performed by the Borrowers hereunder, shall be made, observed or
performed by the Borrowers without any reduction or deduction whatsoever,
including any reduction or deduction for any set-off, recoupment, counterclaim
(whether sounding in tort, contract or otherwise) or tax.
Section 9.5 Stamp Taxes. The Borrowers agree to pay, and to save
-----------
each Lender harmless from all liability for, any State or Federal stamp,
transfer, documentary or similar taxes, assessments or charges (herein "Stamp
Taxes"), and any penalties or interest (excluding any penalties or interest
resulting from the willful misconduct or gross negligence of any Lender or the
Agent) with respect thereto, which may be assessed, levied, collected or imposed
by or upon such Lender, or otherwise become payable by such Lender, in
connection with the execution and delivery of this Agreement or the other Loan
Documents.
Section 9.6 Notices. Any notice, statement, request or demand
-------
required or permitted hereunder to be in writing may be given by telecopy,
telex, cable or other customary means of electronic communication or by
registered or certified mail (return
70
receipt requested) or express courier, postage prepaid. All notices, statements,
requests and demands given to or made upon any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given or made, in
the case of telephonic notice (to the extent expressly permitted hereunder) when
made, or in the case of any other type of notice, when actually received, if:
to the Borrowers, to it at:
Overnite Corporation
0000 Xxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (804) _____________
with a copy to:
Overnite Corporation
0000 Xxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxx, XX 00000
Attention: General Counsel
Telephone: (804) ____________
Telecopy: (804) _____________
if to the Agent, to it at:
Crestar Bank
000 Xxxx Xxxx Xxxxxx
X.X. Xxx 00000
Xxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
71
and if to any Lender, to it at its
address specified opposite its
name on the signature pages
hereto.
or such other address for notice as any party hereto may designate for itself in
a notice to the other party, except in cases where it is expressly provided
herein that such notice, statement, request or demand shall not be effective
until received by the party to whom it is addressed.
Section 9.7 Governing Law. THIS AGREEMENT AND THE OTHER LOAN
-------------
DOCUMENTS SHALL BE DEEMED TO BE CONTRACTS UNDER THE LAWS OF THE COMMONWEALTH OF
VIRGINIA AND, FOR ALL PURPOSES, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF VIRGINIA WITHOUT REGARD TO THE CONFLICTS OF
LAWS PRINCIPLES.
Section 9.8 Successors and Assigns; Participations; Assignments.
---------------------------------------------------
(a) Successors and Assigns. This Agreement shall be binding upon and
----------------------
inure to the benefit of and be enforceable by the respective permitted
successors and assigns of the parties hereto, provided that the Borrowers may
--------
not assign or transfer any of its interest hereunder without the prior written
consent of the Lenders and the Agent.
(b) Participations. Any Lender may sell participation in all or any
--------------
part of the Revolving Loans made by it or its Commitment or any other interest
herein or in its Revolving Note or in any other document delivered or instrument
delivered in connection herewith to another bank or other entity. In the case
of such participation by a Lender, (i) the participant shall not have any rights
under this Agreement or the applicable Revolving Note or any other document or
instrument delivered in connection herewith (the participant's rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the participant relating thereto),
(ii) all amounts payable by the Borrowers shall be determined as if such
Lender had not sold such participation and (iii) the Borrowers shall continue to
deal directly with such Lender with respect to the transactions contemplated
hereby.
(c) Assignments. Each Lender may assign any of its rights or
-----------
interests under the Loan Documents to one or more financial institutions,
provided that:
--------
(i) each such assignment shall be in an amount not less than
$10,000,000.00 (or such lesser amount if, after giving effect to such
assignment
72
and all other assignments by such Lender occurring substantially
simultaneously therewith, such assigning Lender shall hold no Commitment or
any Revolving Loan);
(ii) each such assignment by a Lender of its Commitment or
Revolving Loans shall be made in such manner so that the same portion of
such Lender's Commitment, Revolving Loans, Revolving Note and obligations
in respect of any Standby Letter of Credit is assigned to the respective
assignee Lender;
(iii) the assigning Lender shall pay to the Agent a one-time fee
in the amount of $3,000.00; and
(iv) the Parent Borrower and the Agent shall have consented to
such Assignment, which consent shall not be unreasonably withheld or
delayed; provided that no consent of the Parent Borrower shall be required
--------
for assignments (x) to a Lender or an Affiliate of a Lender or (y) during
the continuance of an Event of Default.
Upon execution and delivery by the assignee to the Borrowers and the Agent of an
instrument in writing pursuant to which such assignee agrees to be a "Lender"
hereunder (if not already a Lender) having the Commitment and Revolving Loans
specified in such assignment, and upon the consent of the Parent Borrower or the
Agent to the extent required above, the assignee shall have, to the extent of
such assignment, the rights, benefits and obligations of a Lender hereunder
holding the Commitment, Revolving Loans (or portions thereof) and Standby
Letters of Credit or deemed participations therein, as applicable, assigned to
it pursuant to such assignment (in addition to the Commitment, Revolving Loans
(or portions thereof) and Standby Letters of Credit or deemed participations
therein, as applicable, theretofore held by such assignee), and the assigning
Lender shall, to the extent of such assignment, be relieved from its Commitment
(or portion thereof) and other obligations hereunder so assigned.
Section 9.9 Affirmative Rate of Interest Permitted by Law. Nothing
---------------------------------------------
in this Agreement or in any Note shall require the Borrowers to pay interest to
the Agent for the account of the Lenders at a rate exceeding the maximum rate
permitted by applicable law to be charged or received by the Lenders, it being
understood that this Section 9.9 is not intended to make the criminal laws of
any jurisdiction applicable in circumstances in which they would not otherwise
apply. If the rate of interest specified herein, in any Revolving Note or in
the Swing Line Note would otherwise exceed the maximum rate so permitted to be
charged or received with respect to any amounts
73
outstanding hereunder or under such Revolving Note or the Swing Line Note, the
rate of interest required to be paid to the Agent for the account of the Lenders
shall be automatically reduced to such maximum rate.
Section 9.10 Costs and Expenses; Indemnification.
-----------------------------------
(a) Without regard to whether the Effective Date shall have come into
existence or whether any Revolving Loan or Swing Line Loan or Standby Letter of
Credit shall have been made or issued hereunder, the Borrowers shall pay to each
Lender and the Agent, as the case may be, and reimburse each Lender and the
Agent for, as the case may be, and save each Lender and the Agent, as the case
may be, harmless from and indemnify each Lender and the Agent, as the case may
be, against losses from: (i) all out-of-pocket costs and expenses of the Agent
and the Lenders (including such costs and expenses incurred by the Agent on
behalf of the Lenders) in connection with the preparation, execution, delivery,
waiver, modification and amendment of this Agreement and any other Loan Document
(to the extent applicable) and any other document or instrument delivered in
connection with the transactions contemplated hereby, including, without
limitation, the reasonable fees and expenses of counsel for the Agent with
respect thereto, and (ii) all reasonable out-of-pocket costs and expenses, if
any (including, without limitation, reasonable counsel fees and expenses), of
the Agent in such capacity (including such costs and expenses incurred by the
Agent on behalf of the Lenders) in connection with the enforcement (whether
through negotiations, legal proceedings or otherwise) of this Agreement and any
other Loan Document and any other document or instrument delivered in connection
with the transactions contemplated hereby, including, for the avoidance of doubt
and without limitation, reasonable counsel fees and expenses in connection with
the enforcement of rights under this Section 9.10(a); provided, that,
--------
notwithstanding the foregoing, the Borrowers shall not be obligated to pay costs
and expenses referred to in this Section 9.10(a) to the extent that such costs
and expenses directly result from the gross negligence or willful misconduct of
a Lender or the Agent.
(b) The Borrowers shall jointly and severally indemnify and hold
harmless each Lender, the Agent and their respective affiliates, officers,
directors, employees, agents and advisors (each, an "Indemnified Person") from
and against, and pay and reimburse each Indemnified Person for, any and all
claims, damages, losses, liabilities and expenses (including, without
limitation, reasonable fees and disbursements of counsel) which may be incurred
by or asserted or awarded against any Indemnified Person 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 this Agreement, the
74
Revolving Notes, the Swing Line Note and any other document or instrument
delivered in connection with the transactions contemplated hereby, whether or
not an Indemnified Person is a party hereto or thereto and whether or not the
Effective Date shall have come into existence or any Revolving Loan or Swing
Line Loan or Standby Letter of Credit has been made or issued under this
Agreement; provided, however, that the Borrowers shall have no obligation to
-------- -------
indemnify or hold harmless any Indemnified Person for liability or expenses to
the extent arising out of such Indemnified Person's gross negligence or willful
misconduct.
(c) All amounts payable by the Borrowers under this Section 9.10 shall
be immediately due upon written request by a Lender or Agent, as the case may
be, for the payment thereof. The obligations of the Borrowers under this
Section 9.10 shall survive the payment of the Revolving Notes and the Swing Line
Note.
Section 9.11 Set-Off; Suspension of Payment and Performance. Each
----------------------------------------------
Lender and the Agent is hereby authorized by the Borrowers, at any time and from
time to time, without notice (a) during any Event of Default, to set off
against, and to appropriate and apply to the payment of, the liabilities of the
Borrowers then due under this Agreement and any other Loan Document any and all
liabilities owing by any Lender or the Agent or any of their Affiliates to the
Borrowers (whether payable in Dollars or any other currency, whether matured or
unmatured and, in the case of liabilities that are deposits (including, without
limitation, any funds from time to time on deposit in the Borrowers' Account or
other account maintained with any Lender or the Agent Lender, whether general or
special, time or demand and however evidenced and whether maintained at a branch
or office located within or without the United States), and (b) during any Event
of Default, to suspend the payment and performance of such liabilities owing by
such Person or its Affiliates and, in the case of liabilities that are deposits,
to return as unpaid for insufficient funds any and all checks and other items
drawn against such deposits.
Section 9.12 Sharing of Collections, Proceeds and Set-Offs;
----------------------------------------------
Application of Payments.
-----------------------
(a) If any Lender, by exercising any right of set-off, counterclaim,
foreclosure or otherwise, receives payment of principal or interest or other
amount due on any Loan or Standby Letter of Credit which is greater than the Pro
Rata Share of such Lender, the Lender receiving such proportionately greater
payment shall purchase such participations in the Loans and Standby Letter of
Credit reimbursement obligations held by the other Lenders, and such other
adjustments shall be made as may be required, so that all such payments shall be
shared by the Lenders on the basis of their
75
respective Pro Rata Shares; provided that if all or any portion of such
--------
proportionately greater payment of such indebtedness is thereafter recovered
from, or must otherwise be restored by, such purchasing Lender, the purchase
shall be rescinded and the purchase price restored to the extent of such
recovery, but without interest being paid by such purchasing Lender. Borrowers
agree, to the fullest extent they may effectively do so under applicable law,
that any holder of a participation in a Loan or reimbursement obligation,
whether or not acquired pursuant to the foregoing arrangements, may exercise
rights of set-off or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of Borrowers in the amount of such participation. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a set-off to which this Section would apply, such
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders entitled
under this Section to share in the benefits of any recovery on such secured
claim.
(b) If an Event of Default or a Potential Event of Default shall have
occurred and be continuing, the Agent and each Lender and Borrowers agree that
all payments on account of the Loans and Standby Letters of Credit shall be
applied by the Agent and the Lenders as follows:
(i) First, to the Agent for any fees then due and payable to the
Agent under this Agreement until such fees are paid in full;
(ii) Second, to the Agent for any fees, costs or expenses
(including expenses described in Section 9.10) incurred by the Agent under
any of the Loan Documents or this Agreement, then due and payable and not
reimbursed by Borrowers or the Lenders until such fees, costs and expenses
are paid in full;
(iii) Third, to the Lenders for their Pro Rata Shares of the
Facility Fee then due and payable under this Agreement until such fee is
paid in full;
(iv) Fourth, to the Lenders for their respective shares of all
costs, expenses and fees then due and payable from Borrowers until such
costs, expenses and fees are paid in full;
(v) Fifth, to the Lenders for their Pro Rata Shares of all
interest then due and payable from Borrowers until such interest is paid in
full; and
76
(vi) Sixth, to the Lenders for their Pro Rata Shares of the
principal amount of the Loans and reimbursement obligations with respect to
Standby Letters of Credit then due and payable from Borrowers until such
principal is paid in full, which percentage shares shall be calculated by
determining each Lender's Pro Rata Share.
Section 9.13 Lenders' Obligations Several; Independent Nature of
---------------------------------------------------
Lenders' Rights. The obligation of each Lender hereunder is several and not
---------------
joint, and no Lender shall be the agent of any other (except to the extent the
Agent is authorized to act as such hereunder). No Lender shall be responsible
for the obligation or commitment of any other Lender hereunder. In the event
that any Lender at any time should fail to make a Loan as herein provided, the
other Lenders, or any of them as may then be agreed upon, at their sole option,
may make the Loan that was to have been made by the Lender so failing to make
such Loan. Nothing contained in any Loan Document and no action taken by Agent
or any Lender pursuant hereto or thereto shall be deemed to constitute Lenders
to be a partnership, an association, a joint venture or any other kind of
entity. The amounts payable at any time hereunder to each Lender shall be a
separate and independent debt.
Section 9.14 Judicial Proceedings; Waiver of Jury Trial. Any
------------------------------------------
judicial proceeding brought against the Borrowers with respect to any Credit
Agreement Related Claim may be brought in any court of competent jurisdiction in
the Commonwealth of Virginia, and, by execution and delivery of this Agreement,
the Borrowers (a) accepts, generally and unconditionally, the nonexclusive
jurisdiction of such courts and any related appellate court and irrevocably
agrees to be bound by any judgment rendered thereby in connection with any
Credit Agreement Related Claim and (b) irrevocably waives any objection it may
now or hereafter have as to the venue of any such proceeding brought in such a
court or that such a court is an inconvenient forum. The Borrowers hereby
waives personal service of process and consents that service of process upon it
may be made by certified or registered mail, return receipt requested, at its
address specified or determined in accordance with the provisions of Section 9.6
of this Agreement, and service so made shall be deemed completed on the earlier
of (i) the receipt thereof and (ii) the fifth (5th) Business Day after such
service is deposited in the mail. Nothing herein shall affect the right of any
Lender, the Agent or any other Indemnified Person to serve process in any other
manner permitted by law or shall limit the right of any Lender, the Agent or any
other Indemnified Person to bring proceedings against the Borrowers in the
courts of any other jurisdiction. Any judicial proceeding by the Borrowers
against any Lender or the Agent involving any Credit Agreement Related Claim
shall be brought only in a court located in the Commonwealth of Virginia. THE
BORROWERS AND THE LENDERS AND THE AGENT HEREBY WAIVE
77
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING TO WHICH THEY ARE PARTIES INVOLVING ANY
CREDIT AGREEMENT RELATED CLAIM.
Section 9.15 Integration. This Agreement and the other Loan
-----------
Documents constitute the entire agreement of the Agent, the Lenders and the
Borrowers with respect to the subject matter hereof and thereof, and there are
no promises, undertakings, representations or warranties by the Agent or any
Lender relative to the subject matter hereof or thereof not expressly set forth
or referred to herein or in the other Loan Documents.
Section 9.16 Further Acts and Assurances. The Borrowers shall
---------------------------
promptly and duly execute and deliver to a Lender or the Agent, as the case may
be, and to such other persons as such Lender or the Agent shall designate, such
further instruments and shall take such further action as may be required by law
or as such Lender or the Agent may from time to time request in order more
effectively to carry out and accomplish the intent and purpose of this Agreement
and the other Loan Documents and to establish and protect the rights and
remedies created or intended to be created in favor of the Lender hereunder or
under any other Loan Document.
Section 9.17 No Fiduciary Relationship. The Borrowers acknowledges
-------------------------
that no provision of this Agreement or in any of the other Loan Documents, and
no course of dealing between any Lender or the Agent and any Borrowers shall be
deemed to create any fiduciary duty by the Agent or any Lender to the Borrowers.
Section 9.18 Severability. The provisions of this Agreement are
------------
severable, and if any clause or provision of this Agreement shall be held
invalid or unenforceable in whole or in part in any jurisdiction, then such
clause or provision shall, as to such jurisdiction, be ineffective to the extent
of such invalidity or unenforceability without in any manner affecting the
validity or enforceability of such clause or provision in any other jurisdiction
or the remaining provisions hereof in any jurisdiction.
Section 9.19 Counterparts. This Agreement may be executed in any
------------
number of counterparts and by different parties hereto on separate counterparts,
each complete set of which, when so executed and delivered by all parties, shall
be an original, but all such counterparts shall together constitute but one and
the same instrument.
Section 9.20 Headings, Bold Type and Table of Contents. The
-----------------------------------------
section headings, subsection headings, and bold type used herein and the Table
of Contents hereto have been inserted for convenience of reference only and do
not constitute matters to be considered in interpreting this Agreement.
78
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto
duly authorized, have executed this Agreement as of the day and year first above
written.
BORROWERS
OVERNITE CORPORATION
By:__________________________
Name:_____________________
Title:____________________
OVERNITE TRANSPORTATION COMPANY
By:__________________________
Name:_____________________
Title:____________________
AGENT
CRESTAR BANK
By:_________________________
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President
LENDERS
Address: CRESTAR BANK
000 Xxxx Xxxx Xxxxxx By:________________________
X.X. Xxx 00000 Name: Xxxxx X. Xxxxxxx
Xxxxxxxx, XX 00000 Title: Senior Vice President
Attention: Xxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
79
Exhibit A to
Revolving Credit Agreement
FORM OF
REVOLVING NOTE
--------------
REVOLVING NOTE
U.S.$_________________ Dated: August __, 1998
FOR VALUE RECEIVED, the undersigned, Overnite Corporation, a Virginia
corporation, and Overnite Transportation Company, a Virginia corporation
(collectively, the "Borrowers"), hereby promise to pay on August __, 2003 (the
"Maturity Date") to the order of [CRESTAR BANK] (the "Lender") the principal
amount of the lesser of (x) __________ MILLION UNITED STATES DOLLARS
-
($___________) and (y) the aggregate amount of Revolving Loans made by the
-
Lender to the Borrowers pursuant to the Agreement (as hereinafter defined) and
remaining outstanding on such date. Capitalized terms used (but not defined) in
this Revolving Note shall have the meanings given to them in the Agreement (as
hereinafter defined).
The Borrowers promise to pay interest from the initial Funding Date of
such Revolving Loans until the Maturity Date on the principal amount of this
Revolving Note from time to time outstanding at the rate, and in the manner,
prescribed in the Agreement. Any principal amount of, or any interest accrued
on, this Revolving Note which is not paid on the date due shall bear interest
from such due date until paid in full at the Default Rate. In no event shall the
rate of interest borne by this Revolving Note at any time exceed the maximum
rate of interest permitted at that time under applicable law.
Payments of the principal amount of and interest on this Revolving
Note shall be made in lawful money of the United States of America to the
Lending Office of the Agent on behalf of the Lender as provided in the
Agreement.
1
This Revolving Note is one of the Revolving Notes referred to in the
Credit Agreement, dated as of August __, 1998 (the "Agreement"), among the
Lender, the other financial institutions from time to time a party thereto, the
Borrowers and the Agent. The Lender is entitled to the rights and benefits of
the Agreement and the other Loan Documents. The Agreement, among other things,
contains provisions for optional and mandatory prepayments on account of the
principal of this Revolving Note by the Borrowers and for acceleration of the
maturity of this Revolving Note upon the terms and conditions therein specified.
THIS REVOLVING NOTE IS BEING ISSUED IN THE COMMONWEALTH OF VIRGINIA
AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE COMMONWEALTH OF VIRGINIA WITHOUT REGARD TO THE CONFLICTS OF LAWS
PRINCIPLES.
OVERNITE CORPORATION
By:________________________________________
Name:___________________________________
Title:__________________________________
OVERNITE TRANSPORTATION COMPANY
By:________________________________________
Name:___________________________________
Title:__________________________________
2
Exhibit B to
Revolving Credit Agreement
FORM OF
SWING LINE NOTE
---------------
SWING LINE NOTE
U.S.$10,000,000 Dated: August __, 1998
FOR VALUE RECEIVED, the undersigned, Overnite Corporation, a Virginia
corporation, and Overnite Transportation Corporation, a Virginia corporation
(collectively, the "Borrowers"), hereby promise to pay on August __, 2003 (the
"Maturity Date") to the order of CRESTAR BANK (the "Lender") the principal
amount of the lesser of (x) TEN MILLION UNITED STATES DOLLARS ($10,000,000.00)
-
and (y) the aggregate amount of Swing Line Loans made by the Lender to the
-
Borrowers pursuant to the Agreement (as hereinafter defined) and remaining
outstanding on such date. Capitalized terms used (but not defined) in this
Swing Line Note shall have the meanings given to them in the Agreement (as
hereinafter defined).
The Borrowers promise to pay interest from the initial Funding Date of
such Swing Line Loans until the Maturity Date on the principal amount of this
Swing Line Note from time to time outstanding at the rate, and in the manner,
prescribed in the Agreement. Any principal amount of, or any interest accrued
on, this Swing Line Note which is not paid on the date due shall bear interest
from such due date until paid in full at the Default Rate. In no event shall the
rate of interest borne by this Swing Line Note at any time exceed the maximum
rate of interest permitted at that time under applicable law.
Payments of the principal amount of and interest on this Swing Line
Note shall be made in lawful money of the United States of America to the
Lending Office of the Agent on behalf of the Lender as provided in the
Agreement.
This Swing Line Note is the Swing Line Note referred to in the Credit
Agreement, dated as of August __, 1998 (the "Agreement"), among the Lender, the
1
other financial institutions from time to time a party thereto, the Borrowers
and the Agent. The Lender is entitled to the rights and benefits of the
Agreement and the other Loan Documents. The Agreement, among other things,
contains provisions for optional and mandatory prepayments on account of the
principal of this Swing Line Note by the Borrowers and for acceleration of the
maturity of this Swing Line Note upon the terms and conditions therein
specified.
THIS SWING LINE NOTE IS BEING ISSUED IN THE COMMONWEALTH OF VIRGINIA
AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE COMMONWEALTH OF VIRGINIA WITHOUT REGARD TO THE CONFLICTS OF LAWS
PRINCIPLES.
OVERNITE CORPORATION
By:_____________________________________
Name:________________________________
Title:_______________________________
OVERNITE TRANSPORTATION COMPANY
By:______________________________________
Name:_________________________________
Title:________________________________
2
Exhibit C to
Revolving Credit Agreement
FORM OF
BORROWING REQUEST
REVOLVING LOANS
_______________ ___, 1998
Crestar Bank, as Agent
000 Xxxx Xxxx Xxxxxx
X.X. Xxx 00000
Xxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx,
Senior Vice President
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of August ___, 1998
as hereafter amended from time to time (the "Credit Agreement") among the
undersigned, the lenders from time to time parties thereto (the "Lenders") and
Crestar Bank, as Agent for the Lenders and for itself, providing for certain
Revolving Loans and Standby Letters of Credit subject to the terms and
conditions specified therein. Capitalized terms used herein and not otherwise
defined shall have the respective meanings assigned to such terms in the Credit
Agreement.
In accordance with the Credit Agreement the undersigned hereby request
that the Lenders [make, convert or renew] a Revolving Loan, in the aggregate
amount of $__________ [at least $3,000,000, in multiples of $500,000], to be
[made, converted or renewed] on _______________ ___, 19__. The undersigned
hereby request that such Revolving Loan be made as follows:
(a) Interest Rate Option
[Base Rate or Applicable LIBOR Rate]
1
(b) LIBOR Period of LIBOR Loan (if applicable)
[One, two, three or six months]
The undersigned hereby certify that (a) since the date of the most
recent financial statements provided to the Lenders, there has been no material
adverse change in the Borrowers' or their Consolidated Subsidiaries' (taken as a
whole) financial condition or in the Borrowers' or their Consolidated
Subsidiaries' (taken as a whole) assets, (b) the representations and warranties
of the Borrowers contained in the Credit Agreement are true and correct as of
the date hereof as though made on and as of the date hereof, (c) no event has
occurred and is continuing, or shall result from the Revolving Loan requested
hereby after giving effect to the application of the proceeds therefrom, which
constitutes an Event of Default or would constitute a Potential Event of
Default, and (d) the amount of the requested Revolving Loan, when added to the
outstanding balances of the Revolving Loans and outstanding Standby Letters of
Credit, will not exceed the Aggregate Commitment on the date of such Loan.
Very truly yours,
OVERNITE CORPORATION
By:_____________________________________
Name:______________________________
Title:_____________________________
OVERNITE TRANSPORTATION COMPANY
By:_____________________________________
Name:______________________________
Title:_____________________________
2
SCHEDULE I TO
THE REVOLVING CREDIT AGREEMENT
Name of Lender Commitment (in Dollars)
-------------- -----------------------
Crestar Bank $______________________
-i-
Schedule 1.1
Existing Liens
--------------
---------------------------------------------------------------------------------------------------------
DEBTOR/ CREDITOR/ GENERAL DESCRIPTION GENERAL NATURE OUTSTANDING ANNUAL MATURITY
OBLIGOR OBLIGEE OF PROPERTY OF LIEN PRINCIPAL PRINCIPAL
---------------------------------------------------------------------------------------------------------
(e.g., Overnite (e.g., Capital
Transportation) Lease, mortgage,
purchase money
security interest)
-------------------------------------------------------------------------------------------------------
-i-
Schedule 5.11
Subsidiaries
------------
-i-
Schedule 5.5
Litigation
----------
-ii-
Schedule 5.6
Defaults
--------
-iii-
Schedule 5.15
Intercompany Debts and Intercompany Agreements
----------------------------------------------
-iv-
Schedule 5.19
Letters of Credit, Suretyship Agreements and Similar Arrangements
-----------------------------------------------------------------
-v-
SCHEDULES
---------
Schedule I -- Lender Commitments
Schedule 1.1 -- Existing Liens
Schedule 5.5 -- Litigation
Schedule 5.6 -- Defaults
Schedule 5.11 -- Subsidiaries
Schedule 5.15 -- Intercompany Debts and Intercompany Agreements
Schedule 5.19 -- Letters of Credit, Suretyship Agreements and
Similar Arrangements
EXHIBITS
--------
Exhibit A Form of Revolving Note
Exhibit B Form of Swing Line Note
Exhibit C Form of Borrowing Notice
-vi-
