EXHIBIT 10.27
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CREDIT AGREEMENT
among
ABLE TELCOM HOLDING CORP., as Borrower
NATIONSBANK, N.A., as Administrative Agent
and
The Several Lenders
from Time to Time Parties Hereto
Dated June 11, 1998
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TABLE OF CONTENTS
PAGE
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SECTION 1. DEFINITIONS .......................................................1
1.1 Defined Terms .......................................................1
1.2 Other Definitional Provisions ......................................26
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS ..................................27
2.1 Revolving Credit Facility ..........................................27
2.2 Procedure for Revolving Credit Borrowings ..........................28
2.3 Repayment of Loans .................................................28
SECTION 3. LETTERS OF CREDIT ................................................29
3.1 L/C Commitment .....................................................29
3.2 Procedure for Issuance of Letters of Credit ........................29
3.3 Letter of Credit Participations ....................................30
3.4 Reimbursement Obligation of the Borrower ...........................31
3.5 Obligations Absolute ...............................................32
3.6 Letter of Credit Payments ..........................................32
3.7 L/C Application ....................................................32
SECTION 4. GENERAL PROVISIONS APPLICABLE TO LOANS ...........................33
4.1 Interest Rates and Payment Dates ..................................33
4.2 Optional and Mandatory Prepayments and Commitment Reductions ......33
4.3 Fees ..............................................................35
4.4 Computation of Interest and Fees ..................................36
4.5 Conversion and Continuation Options ...............................36
4.6 Minimum Amounts of Tranches .......................................37
4.7 Inability to Determine Interest Rate ..............................37
4.8 Treatment and Payments ............................................38
4.9 Requirements of Law ...............................................39
4.10 Taxes .............................................................40
4.11 Indemnity .........................................................42
4.12 Change of Lending Offce ...........................................43
4.13 Replacement of Lenders under Certain Circumstances ................43
SECTION 5. REPRESENTATIONS AND WARRANTIES ...................................43
5.1 Financial Condition ...............................................43
5.2 Financial Statements/No Change ....................................45
5.3 Existence; Compliance with Law ....................................45
5.4 Power; Authorization; Enforceable Obligations .....................45
5.5 No Legal Bar ......................................................46
5.6 No Material Litigation ............................................46
5.7 No Default ........................................................46
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5.8 Ownership of Property; Intellectual Property ......................46
5.9 No Burdensome Restrictions ........................................47
5.10 Taxes .............................................................47
5.11 Federal Regulations ...............................................47
5.12 ERISA .............................................................48
5.13 Investment Company Act; Other Regulations .........................48
5.14 Subsidiaries ......................................................48
5.15 Purpose of Loans ..................................................48
5.16 Certain Regulatory Matters ........................................49
5.17 Environmental Matters .............................................49
5.18 Security Documents ................................................50
5.19 Solvency ..........................................................50
5.20 Year 2000 Matters .................................................51
SECTION 6. CONDITIONS PRECEDENT .............................................51
6.1 Conditions to Initial Loans .......................................51
6.2 Conditions to Each Loan for a Subject Acquisition .................56
6.3 Conditions to all Letters of Credit ...............................57
6.4 Conditions to all Loans ...........................................58
6.5 Conditions to Conversions or Continuations ........................58
SECTION 7. AFFIRMATIVE COVENANTS ............................................59
7.1 Financial Statements ..............................................59
7.2 Certificates; Other Information ...................................60
7.3 Payment of Obligations ............................................61
7.4 Conduct of Business and Maintenance of Existence, etc. ............61
7.5 Maintenance of Property; Insurance ................................61
7.6 Inspection of Property; Books and Records; Discussions ............62
7.7 Notices ...........................................................62
7.8 Environmental Laws ................................................63
7.9 Collateral ........................................................63
7.10 Compliance Certificates ...........................................64
SECTION 8. NEGATIVE COVENANTS ...............................................64
8.1 Financial Covenants ...............................................64
8.2 Limitation on Indebtedness ........................................65
8.3 Limitation on Liens ...............................................66
8.4 Limitation on Fundamental Changes .................................66
8.5 Limitation on Sale of Assets ......................................66
8.6 Limitation on Restricted Payments. ................................67
8.7 Limitation on Issuances of Capital Securities. ....................67
8.8 Limitation on Acquisitions, Investments, Loans and Advances .......67
8.9 Limitation on Optional Payments of Indebtedness ...................68
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8.10 Limitation on Modifications of Certain Agreements ................69
8.11 Limitation on Transactions with Affiliates .......................69
8.12 Limitation on Sales and Leasebacks ...............................69
8.13 Limitation on Changes in Fiscal Year .............................69
8.14 Limitation on Negative Pledge Clauses ............................70
8.15 Certain Intercompany Matters .....................................70
8.16 Limitation on Restrictions on Subsidiary Distributions ...........70
8.17 Limitation on Lines of Business ..................................71
SECTION 9. EVENTS OF DEFAULT ................................................71
SECTION 10. THE ADMINISTRATIVE AGENT ........................................74
10.1 Appointment ......................................................74
10.2 Delegation of Duties .............................................74
10.3 Exculpatory Provisions ...........................................75
10.4 Reliance by Administrative Agent .................................75
10.5 Notice of Default ................................................75
10.6 Non-Reliance on Administrative Agent and Other Lenders ...........76
10.7 Indemnification ..................................................76
10.8 Administrative Agent in Its Individual Capacity ..................77
10.9 Successor Administrative Agent ...................................77
SECTION 11. MISCELLANEOUS ...................................................77
11.1 Amendments and Waivers ...........................................77
11.2 Notices ..........................................................78
11.3 No Waiver; Cumulative Remedies ...................................79
11.4 Survival of Representations and Warranties .......................80
11.5 Payment of Expenses and Taxes ....................................80
11.6 Successors and Assigns; Participations and Assignments ...........81
11.7 Application of Proceeds after Default; Adjustments; Set-off ......83
11.8 Counterparts; When Effective .....................................84
11.9 Severability .....................................................85
11.10 Integration ......................................................85
11.11 Governing Law ....................................................85
11.12 Submission To Jurisdiction; Waivers ..............................85
11.13 Acknowledgments ..................................................86
11.14 Confidentiality ..................................................86
11.15 Waivers of Jury Trial ............................................87
11.16 Maximum Interest Rate ............................................87
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ANNEX l Lender Commitments
EXHIBITS
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Exhibit A Revolving Credit Note
Exhibit B Assignment and Acceptance
Exhibit C Compliance Certificate
Exhibit D Guaranty Agreement
Exhibit E Intercompany Note
Exhibit F Notice of Borrowing
Exhibit G Notice of Conversion/Continuation
Exhibit H Notice of Letter of Credit Request
Exhibit I Perfection Certificate
Exhibit J-1 Form of Pledge Agreement [Borrower]
Exhibit J-2 Form of Pledge Agreement [Subsidiary]
Exhibit K Intentionally Deleted
Exhibit L-1 Form of Security Agreement [Borrower]
Exhibit L-2 Form of Security Agreement [Subsidiary]
Exhibit M Intentionally Deleted
Exhibit N Closing Certificate
Exhibit O Opinion of Gunster, Yoakley, Xxxxxx-Xxxxx & Xxxxxxx
SCHEDULES
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Schedule 1.1 Non-Restricted Subsidiaries
Schedule 5.1(a-1) Additional Financial Statement Disclosure
Schedule 5.1(a-2) Material Changes Since October 31, 1997
Schedule 5.1(b) Pro Forma Financial Statements, Budgets and Projections
Schedule 5.6 Material Litigation
Schedule 5.14 Subsidiaries
Schedule 8.14 Agreements Containing Negative Pledges
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CREDIT AGREEMENT, dated June 11, 1998, among ABLE TELCOM HOLDING
CORP., a Florida corporation (the "BORROWER"), the several lenders from time to
time parties to this Credit Agreement (the "LENDERS") and NATIONSBANK, N.A., as
Administrative Agent for the Lenders hereunder.
RECITALS
The Borrower and the subsidiaries of Borrower desire that the Lenders
furnish the extensions of credit provided for herein, which the Borrower will
use (a) to refinance existing indebtedness of the Borrower and the NationsBank
Existing Credits (identified below), and (b) for general corporate purposes of
the Borrower and the subsidiaries of Borrower, including, without limitation,
working capital, capital expenditures and Subject Acquisitions (as such term is
hereinafter defined).
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. DEFINITIONS
1.1 DEFINED TERMS. As used in this Agreement, the following terms have
the meanings assigned to them below:
"ABR": for any day, the rate per annum (rounded upwards, if
necessary, to the next 1/lOOth of 1%) equal to the greater of (a) the
Prime Rate in effect on such day and (b) the Federal Funds Rate in
effect on such day, plus 1/2 of 1%. For purposes hereof: "PRIME RATE"
means the rate of interest per annum publicly announced from time to
time by the Administrative Agent as its U.S. dollar prime commercial
lending rate (which rate may or may not be the lowest rate of interest
charged by the Administrative Agent); and "FEDERAL FUNDS RATE" means,
for any day, the weighted average of the rates on overnight federal
funds transactions with members of the Federal Reserve System arranged
by federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average of the
quotations for the day of such transactions received by the
Administrative Agent from three federal funds brokers of recognized
standing selected by it. Any change in the ABR due to a change in the
Prime Rate or the Federal Funds Rate shall be effective as of the
opening of business on the effective day of such change in the Prime
Rate or the Federal Funds Rate, respectively.
"ABR LOAN": any Loan that bears interest computed on the basis
of the ABR.
"ACQUISITION CRITERIA": with respect to any proposed Subject
Acquisition, the following criteria:
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(a) no Default shall have occurred and be continuing
(i) on the date the acquisition agreements (including but not
limited to option agreements and agreements to enter into
option agreements) for such Subject Acquisition are executed
and delivered by the Borrower, directly or indirectly through
a Wholly Owned Subsidiary, or (ii) on the date the Subject
Acquisition is consummated and, in each case, no Default would
occur after giving effect to the consummation of such Subject
Acquisition and the transactions contemplated thereby,
including, without limitation, pro forma compliance with
Section 8.1;
(b) such Subject Acquisition (i) is the acquisition
of assets or rights to acquire or use assets (including
pursuant to an option agreement) of a Person engaged in a
Permitted Line of Business or (ii) is the acquisition of not
less than 80% of the Capital Securities of a Person engaged in
a Permitted Line of Business and, if such acquisition is for
less than 100% of the Capital Securities of such Person, such
acquisition, including the terms of the Capital Securities
that are not acquired directly or indirectly by the Borrower
or that are issued to other Persons in connection with such
acquisition, shall be acceptable to the Administrative Agent;
(c) the operations of the enterprise constituting
such Subject Acquisition shall (i) have generated positive
EBITDA for the period of twelve consecutive calendar months
ending immediately prior to the date of the closing of the
Subject Acquisition (the "TEST PERIOD") or (ii) have generated
positive EBITDA on a pro forma basis as of the end of such
test period after taking into account scheduled adjustments to
EBITDA acceptable to the Administrative Agent; and
(d) if such Subject Acquisition is or is made
pursuant to an option agreement, such option agreement is on
terms and conditions which are acceptable to the
Administrative Agent.
"ADMINISTRATIVE AGENT": NationsBank of Texas, N.A. in its
capacity as Administrative Agent for the Lenders pursuant to this
Agreement and any successor Administrative Agent appointed pursuant to
Section 10.9.
"AFFILIATE": of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such Person. "Affiliate" shall be deemed
to include, without limiting the application of the preceding sentence,
any Person owning, directly or indirectly, 5% or more of the voting
common stock of such Person and any relative of such Person and any
trust in which such Person and such Person's relatives own beneficially
a 10% or greater interest. For the purposes of this definition,
"control" when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled"
have meanings correlative to the foregoing.
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"AGREEMENT": this Credit Agreement, as amended, supplemented
and otherwise modified from time to time, including, without
limitation, all extensions, renewals, restatements, rearrangements and
refundings hereof and increases of any Facility provided for herein.
"APPLICABLE MARGIN": with respect to each Loan at any date,
the applicable percentage per annum set forth below based upon the
Status on such date:
APPLICABLE MARGIN
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STATUS EURODOLLAR LOANS ABR LOANS
---------- ---------------- ---------
Level I 1.250% 0.250%
Level II 1.500% 0.500%
Level III 1.750% 0.750%
Level IV 2.000% 1.000%
"ASSET SALE": any Disposition (whether in one transaction or a
series of related transactions) by the Borrower or any Subsidiary,
except for (a) Dispositions pursuant to Section 8.5(a),(b) or (c);(b)
Dispositions in an amount less than or equal to [$1,000,000], PROVIDED
that such Dispositions are in the ordinary course of business, and (c)
Dispositions to the Borrower or any Wholly Owned Subsidiary.
"ASSIGNEE": as defined in Section 11.6(c).
"ASSIGNMENT AND ACCEPTANCE": an Assignment and Acceptance
substantially in the form of Exhibit B.
"AUTHORIZATION": any filing, recording and registration with,
and any validation or exemption, approval, order, authorization,
consent, License, certificate, franchise and permit from, any
Governmental Authority.
"AVAILABLE REVOLVING CREDIT COMMITMENT": as to any Revolving
Credit Lender at any time, an amount equal to the excess, if any, of
(a)the amount of such Revolving Credit Lender's Revolving Credit
Commitment at such time, over (b) the sum of such Revolving Credit
Lender's aggregate outstanding (i) Revolving Credit Loans and (ii)
participations in L/C Obligations at such time.
"BOARD": the Board of Governors of the Federal Reserve System
or any successor.
"BOARD OF DIRECTORS": either the board of directors of the
Borrower or any duly authorized committee of that board.
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"BOARD RESOLUTION": a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Borrower to have been duly
adopted by requisite action by the Board of Directors and to be in full
force and effect on the date of such certification, and delivered to
the Administrative Agent.
"BORROWER": as defined in the preamble hereto.
"BORROWER CAPITAL SECURITY": (a) any Capital Security (i) of
any type referred to in clause (a) of the definition of "Capital
Security" contained in this Section 1 and (ii) of which the Borrower is
the issuer and (b) any Capital Security of any type referred to in
clause (b) of such definition of "Capital Security" which is
convertible into or exchangeable for or exercisable to acquire any
Borrower Capital Security of any type referred to in clause (a) of this
definition.
"BORROWING DATE": any Business Day specified in a notice
pursuant to Section 2.2 as a date on which the Borrower requests the
Lenders to make Loans hereunder.
"BUSINESS DAY": any day other than a Saturday, Sunday or day
on which commercial banks in New York City or Dallas, Texas are
authorized or required by law to close; PROVIDED, HOWEVER, that when
used in connection with a Eurodollar Loan, the term "Business Day"
shall also exclude any day on which banks are not open for dealings in
Dollar deposits in the London interbank market.
"CAPITAL EXPENDITURES": as of the last day of any fiscal
quarter of the Borrower, the aggregate amount of expenditures made by
the Borrower and the Subsidiaries during the period of four fiscal
quarters of the Borrower ending on such day which are or should be
capitalized in accordance with GAAP as in effect on the date of this
Agreement.
"CAPITAL LEASE": a lease of (or other agreement conveying the
right to use) real or personal property that is required to be
classified and accounted for as a capital lease under GAAP as in effect
on the date of this Agreement and, for purposes of this Agreement, the
amount of any Capital Lease obligation at any date shall be the
capitalized amount thereof at such date as determined in accordance
with GAAP as in effect on the date of this Agreement.
"CAPITAL SECURITY": (a) any capital stock, partnership,
membership, joint venture or other ownership or equity interest,
participation or securities (whether voting or non-voting, whether
preferred, common or otherwise, and including any stock appreciation,
contingent interest or similar right) and (b) any option, warrant,
security or other right (including debt securities or other evidence of
Indebtedness) directly or indirectly convertible into or exercisable or
exchangeable for, or otherwise to acquire directly or indirectly, any
stock, interest, participation or security described in clause (a)
above.
"CASH EQUIVALENTS": (a) securities with maturities of one year
or less from the date of acquisition issued or fully guaranteed or
insured by the United States Government or any
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agency thereof, (b) certificates of deposit and Eurodollar time
deposits with maturities of one year or less from the date of
acquisition and overnight bank deposits of any Lender or of any
commercial bank having capital and surplus in excess of $500,000,00O,
(c) repurchase obligations of any Lender or of any commercial bank
satisfying the requirements of clause (b) of this definition, having a
term of not more than 30 days, with respect to securities issued or
fully guaranteed or insured by the United States Government or any
agency thereof, (d) in addition to the Cash Equivalents permitted by
clauses (b) and (c) above, certificates of deposits and Eurodollar time
deposits with maturities of one year or less from the date of
acquisition, overnight bank deposits and repurchase obligations having
a term of not more than 30 days with respect to securities issued or
fully guaranteed or insured by the United States government or any
agency thereof, in each case, of any other commercial bank having
capital and surplus in excess of $100,000,000, PROVIDED, that such Cash
Equivalents do not exceed $1,000,000 in the aggregate at any time
outstanding, (e) commercial paper of a domestic issuer at the time of
acquisition having a rating of at least A-1 by Standard and Poor's
Ratings Group ("S&P") or P-1 by Xxxxx'x Investors Service, Inc.
("MOODY'S"), (f) securities with maturities of one year or less from
the date of acquisition issued or fully guaranteed by any state,
commonwealth or territory of the United States, or by any political
subdivision or taxing authority of any such state, commonwealth or
territory, the securities of which state, commonwealth, territory,
political subdivision or taxing authority (as the case may be) are
rated at least A by S&P or A by Moody's, or (g) shares of money market
mutual or similar funds which invest exclusively in assets satisfying
the requirements of clauses (a), (b), (c), (e) or (f) of this
definition.
"CHANGE OF CONTROL": the acquisition by a person or group of
persons acting in concert in one or more transactions of the ability to
vote or control the voting of more than 30% of the equity interests of
the Borrower, provided, however that exercise of the WorldCom Option
will not be deemed to be a Change of Control.
"CHARTER DOCUMENTS": with respect to any Person, (a) the
articles or certificate of formation, incorporation or organization (or
the equivalent organizational documents) of such Person, (b) the
bylaws, partnership agreement, limited liability company agreement or
regulations (or the equivalent governing documents) of such Person and
(c) each document setting forth the designation, amount and relative
rights, limitations and preferences of any class or series of such
Person's Capital Securities or of any rights in respect of such
Person's Capital Securities.
"CODE": the Internal Revenue Code of 1986.
"COMMITMENT": as to any Lender on any day, the sum of the
Revolving Credit Commitments of such Lender.
"COMMONLY CONTROLLED ENTITY": an entity, whether or not
incorporated, which is under common control with the Borrower within
the meaning of Section 4001 of ERISA or
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is part of a group which includes the Borrower and which is treated as
a single employer under Section 414 of the Code.
"COMPLETED ACQUISITION": an acquisition (including the entry
into an option agreement) by the Borrower, directly or indirectly
through a Wholly Owned Subsidiary, consummated in accordance with
Section 8.8 and, if applicable, Section 6.2.
"COMPLIANCE CERTIFICATE": a certificate of the Chief Executive
Officer or Chief Financial Officer of the Borrower (unless any or
another Responsible Officer of the Borrower is provided for herein),
substantially in the form of Exhibit C.
"CONTRACTUAL OBLIGATION": as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or
other undertaking to which such Person is a party and is bound to
perform any duty or obligation thereunder or by which it or any of its
property or assets is bound.
"CURRENT ASSETS": with respect to the Borrower and its
Restricted Subsidiaries, consolidated current assets as determined in
accordance with GAAP as in effect on the date of this Agreement.
"CURRENT LIABILITIES": with respect to the Borrower and its
Restricted Subsidiaries, consolidated current liabilities as determined
in accordance with GAAP as in effect on the date of this Agreement.
"CURRENT RATIO": as of the last day of any fiscal quarter, the
ratio of (a) Current Assets as of such day to (b) Current Liabilities
as of such day.
"DEBT SERVICE": for any period with respect to the Borrower
and its Restricted Subsidiaries, determined on a consolidated basis in
accordance with GAAP as in effect on the date of this Agreement, the
sum of, without duplication, (a) Cash Interest Expense, (b) scheduled
payments of principal on Indebtedness, including, without limitation,
mandatory prepayments, if any, required as a result of the reductions
in the aggregate amount of the Total Revolving Credit Commitment
mandated by Section 4.2(b) (but excluding any payments required
pursuant to Section 4.2(c) other than payments made pursuant to Section
4.2(c) solely as a result of the operation of Section 4.2(b), (d) or
(e), (c) to the extent not included in (a) or (b), scheduled payments
in respect of Capital Leases and (d) net obligations of the Borrower
for such period under Interest Rate Hedge Agreements, in each case paid
during such period.
"DEFAULT": any of the events specified in Section 9, whether
or not any requirement for the giving of notice, the lapse of time, or
both, has been satisfied.
"DISPOSITION": as defined in Section 8.5.
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"DISQUALIFIED STOCK": any Capital Security which, by its terms
(or by the terms of any security into which it is convertible or for
which it is exchangeable), at the option of the holder thereof or upon
the happening of any event, matures or is mandatorily redeemably
pursuant to a sinking fund obligation or otherwise, or is redeemable,
at the option of the holder thereof, in whole or in part.
"DOLLARS" and "$": dollars in lawful currency of the United
States of America.
"EBITDA": for the period of twelve consecutive months next
preceding the date of any determination thereof with respect to the
Borrower and its Subsidiaries, Net Income for such period plus, without
duplication, for such period, (a) Interest Expense to the extent
deducted in determining such Net Income, (b) Income Tax Expenses to the
extent deducted in determining such Net Income, and (c) depreciation
and amortization for such period.
"EFFECTIVE DATE": as defined in Section 11.8.
"ENVIRONMENTAL CLAIMS": any written accusation, allegation,
notice of violation, claim, demand, order, directive, cost recovery
action or other cause of action by, or on behalf of, any Governmental
Authority or any Person for damages, injunctive or equitable relief,
personal injury (including sickness, disease or death), Remedial Action
costs, tangible or intangible property damage, natural resource
damages, nuisance, pollution, any adverse effect on the environment
caused by any Hazardous Material, or for files, penalties or
restrictions, resulting from or based upon: (a) the existence or the
continuation of the existence, of a Release (including sudden or
non-sudden, accidental or non-accidental Releases); (b) exposure to any
Hazardous Material; (c) the presence, use, handling, transportation,
storage, treatment or disposal of any Hazardous Material; or (d) the
violation or alleged violation of any Environmental Law or
Environmental Permit.
"ENVIRONMENTAL LAWS": any and all foreign, Federal, state,
local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority
or other Requirements of Law (including common law) regulating,
relating to or imposing liability or standards of conduct concerning
protection of human health or the environment, as now or may at any
time hereafter be in effect.
"ENVIRONMENTAL PERMIT": any applicable permit, approval,
authorization, certificate, license, variance, filing or permission
required by or from any Governmental Authority pursuant to any
Environmental Law.
"ERISA": the Employee Retirement Income Security Act of 1974.
"EUROCURRENCY RESERVE REQUIREMENTS": for any day as applied to
a Eurodollar Loan, the aggregate (without duplication) of the rates
(expressed as a decimal fraction) of the maximum reserve requirements
in effect on such day (including, without limitation, basic,
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supplemental, marginal and emergency reserves under any regulations of
the Board or other Governmental Authority having jurisdiction with
respect thereto) dealing with reserve requirements prescribed for
Eurocurrency funding (currently referred to as "EUROCURRENCY
LIABILITIES" in Regulation D of the Board) maintained by a member bank
of the Federal Reserve System.
"EURODOLLAR BASE RATE": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, the per annum rate of
interest quoted by the Administrative Agent at which Dollar deposits
are offered by the Administrative Agent to prime banks at or about
10:00 A.M., New York City time, two Business Days prior to the
beginning of such Interest Period in the interbank Eurodollar market
where the Eurodollar and foreign currency and exchange operations in
respect of its Eurodollar Loans are then being conducted for delivery
on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of its
Eurodollar Loan to be outstanding during such Interest Period.
"EURODOLLAR LOANS": any Loan that bears interest computed on
the basis of the Eurodollar Rate.
"EURODOLLAR RATE": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, a rate per annum
determined for such day in accordance with the following formula
(rounded upward to the nearest 1/lOOth of 1%):
Eurodollar Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"EVENT OF DEFAULT": any of the events specified in Section 9,
PROVIDED, that any requirement for the giving of notice, the lapse of
time, or both, or any other condition, has been satisfied.
"EXISTING BANK FACILITY": that certain Senior Secured
Revolving Credit Facility dated as of April 6, 1998, by and among the
Borrower, SunTrust Bank, South Florida, National Association and Bank
of America, FSB, as amended from time to time.
"EXTENDED REINVESTMENT DEADLINE": as defined in the definition
of "Reinvestment Notice."
"FAIR MARKET VALUE": as to any property or assets of the
Borrower or any Subsidiary or any property or assets proposed to be
acquired by the Borrower or any Subsidiary, the fair market value of
such property or assets as determined by the unanimous resolution of
the board of directors of the Borrower with respect to the property or
assets of the Borrower or any Subsidiary or the property or assets to
be acquired by the Borrower or any Subsidiary, as the case may be.
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"FEE LETTER": the letter agreement dated June ll, 1998
between NationsBank, N.A. and NationsBanc Xxxxxxxxxx Securities LLC, on
the one hand, and the Borrower, on the other hand, respecting certain
fees payable by such latter Person in connection with this Agreement
and the L/C Fee Letter.
"FINANCIAL STATEMENTS": the financial statements required to
be delivered to the Administrative Agent pursuant to Section 7.1.
"FIRST YEAR INTEREST EXPENSE": as of the date of any
determination with respect to any Person and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP as in effect
on the Effective Date, (a) for the period commencing on the date next
succeeding the Effective Date and ending on such date of determination,
all interest expense and commitment fees with respect to Total Debt for
such period, whether accrued or paid, including, without limitation,
imputed interest on obligations under Capital Leases, less (b) all
interest income received during such period.
"FIXED CHARGE RATIO": as of the last day of any fiscal
quarter, the ratio of (a) EBITDA for the twelve consecutive calendar
months ending on such day, minus Income Tax Expense for the four
consecutive fiscal quarters ending on such day for such four fiscal
quarters, to (b) Fixed Charges for such four fiscal quarters.
"FIXED CHARGES": for the period of the four consecutive fiscal
quarters ending on any day, with respect to the Borrower and its
Subsidiaries, determined on a consolidated basis in accordance with
GAAP as in effect on the Effective Date, the sum of (a) Debt Service
for such period, and (b) Capital Expenditures during such period.
"GAAP": generally accepted accounting principles and practices
as in effect from time to time and concurred in by the independent
certified accountants certifying the Financial Statements required by
Section 7.1(a), applied on a basis consistent (except for changes
concurred in by such independent certified public accountants and
disclosed therein) with the most recent audited Financial Statements
delivered to the Lenders, except as otherwise specifically provided
herein.
"GOVERNMENTAL AUTHORITY": any Federal, state, local or foreign
government, or other entity (including, without limitation, any
governmental or quasi-governmental agency or authority) exercising
executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"GUARANTEE OBLIGATION": for any Person, without duplication,
any liability, contingent or otherwise, of such Person guaranteeing or
otherwise becoming liable for any obligation of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, and
including, without limitation, any liability of such Person, direct or
indirect, (a) to purchase or pay (or advance or supply funds for the
purchase or payment of) such obligation or to
9
purchase (or to advance or supply funds for the purchase of any
security for the payment of such obligation, (b) to purchase property,
securities or services for the purpose of assuming the owner of such
obligation of the payment of such obligation or (c) to maintain working
capital, equity capital or other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to
pay such obligation; PROVIDED, that the term "Guarantee Obligation"
does not include endorsements for collection or deposit in the ordinary
course of the endorser's business. With respect to the Borrower and the
Subsidiaries, the amount of any Guarantee Obligation shall be deemed to
be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Guarantee Obligation is made or, if
not stated or determinable, the maximum reasonably anticipated
liability in respect thereof, as determined in good faith by the
Borrower with respect to any Guarantee Obligation of the Borrower or
any Subsidiary, as the case may be.
"GUARANTY AGREEMENT": a Guaranty Agreement substantially in
the form of Exhibit D, as the same may be amended, supplemented and
otherwise modified from time to time.
"HAZARDOUS MATERIALS": all explosive or radioactive substances
or wastes, hazardous or toxic substances or wastes, pollutants, solid,
liquid or gaseous wastes, including petroleum or petroleum distillates,
friable asbestos or asbestos-containing materials, polychlorinated
biphenyls ("PCBs") or PCB-containing materials or equipment, radon gas,
infectious or medical wastes regulated pursuant to any Environmental
Law and all other substances or wastes of any nature regulated pursuant
to any Environmental Law.
"HIGHEST LAWFUL RATE": with respect to any Lender at the
particular time in question, the maximum rate of interest which, under
applicable Requirements of Law, such Lender is then permitted to charge
on the Obligations owing to it. If the maximum rate of interest which,
under applicable Requirements of Law, such Lender is permitted to
charge on such Obligations shall change after the date hereof, the
Highest Lawful Rate shall be automatically increased or decreased, as
the case may be, from time to time as of the effective time of each
change in the Highest Lawful Rate without notice to the Borrower or any
other Loan Party.
"INCOME TAX EXPENSE": all cash income taxes paid by the
Borrower and the Subsidiaries during the relevant period of
determination.
"INDEBTEDNESS": with respect to any Person, without
duplication, (a) all obligations of such Person for borrowed money, (b)
all obligations of such Person evidenced by bonds, debentures, notes or
similar instruments, including obligations incurred in connection with
the acquisition of property, assets or businesses, (c) all obligations
of such Person under conditional sale or other title retention
agreements relating to property or assets purchased by such Person, (d)
all obligations of such Person issued or assumed as the deferred
purchase price of property, assets or services (excluding trade
accounts payable, and accrued expenses
10
incurred or arising in the ordinary course of business, payable in
accordance with customary practices and not more than 90 days past
due), (e) all Indebtedness of other Persons secured by (or for which
the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on property or assets (including
revenues, income and profit) owned or acquired by such Person, whether
or not the obligations secured thereby have been assumed, (f) all
Guarantee Obligations of such Person, (g) all obligations in respect of
Capital Leases of such Person, (h) all obligations of such Person in
respect of Interest Rate Hedge Agreements (i) every reimbursement
obligation of such Person with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of such Person
and (j) Disqualified Stock. The Indebtedness of any Person shall
include the Indebtedness of any partnership or joint venture in which
such Person is a general partner or member, other than to the extent
that the instrument or agreement evidencing such Indebtedness expressly
limits the liability of such Person in respect thereof pursuant to
provisions and terms reasonably satisfactory to the Administrative
Agent.
"INDEBTEDNESS FOR BORROWED MONEY": all Indebtedness of a
Person of the types described in clauses (a), (b), (c), (d) and (i) of
the definition of "Indebtedness" contained in this Section 1 and,
without duplication of the types of Indebtedness described in such
clauses (a), (b), (c), (d) and (i), the type of Indebtedness described
in clause (e) of such definition to the extent that any such
Indebtedness constitutes Indebtedness of the type described in clause
(a), (b), (c), (d) or (i) of such definition of "Indebtedness" assumed
by such Person.
"INDEMNIFIED PERSON": as defined in Section 11.5.
"INFORMATION": written information (other than financial
statements, budgets, projections and similar financial data),
including, without limitation, certificates, reports, statements and
documents.
"INSOLVENCY": with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section
4245 of ERISA.
"INSOLVENT": pertaining to a condition of Insolvency.
"INTERCOMPANY NOTES": promissory notes, substantially in the
form of Exhibit E, evidencing the intercompany loans made by the
Borrower directly or indirectly to any of the Subsidiaries.
"INTEREST COVERAGE RATIO": commencing with the fiscal quarter
ending April 30, 1998, as of the last day of any fiscal quarter, the
ratio of (i) EBITDA for the twelve consecutive calendar months ending
on such day, to (ii) Interest Expense for the four consecutive fiscal
quarters ending on such day.
11
"INTEREST EXPENSE": as of the date of any determination with
respect to any Person and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP as in effect on the date of
this Agreement, (a) all interest expense and commitment fees with
respect to Total Debt during the four consecutive fiscal quarters of
such Person most recently ended, whether accrued or paid, including,
without limitation, imputed interest on obligations under Capital
Leases, less (b) all interest income received during such period.
"INTEREST PAYMENT DATE": (a) as to any ABR Loan, (i) the last
day of each March, June, September and December prior to the maturity
date thereof and (ii) such maturity date, (b) as to any Eurodollar Loan
having an Interest Period of three months or less, the last day of such
Interest Period, (c) as to any Eurodollar Loan having an Interest
Period longer than three months, (i) each day which is three months or
a whole multiple thereof, after the first day of such Interest Period
and (ii) the last day of such Interest Period and (d) as to any portion
of any Revolving Loan being repaid on a scheduled payment date in
respect thereof, or being prepaid pursuant to Section 4.2, the date of
such repayment or prepayment.
"INTEREST PERIOD": with respect to any Eurodollar Loan:
(i) initially, the period commencing on the borrowing
or conversion date, as the case may be, with respect to such
Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the Borrower in its Notice of
Borrowing or Notice of Conversion/Continuation, as the case
may be, given with respect thereto; and
(ii) thereafter, each period commencing on the last
day of the next preceding Interest Period applicable to such
Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the Borrower by irrevocable notice
to the Administrative Agent not less than three Business Days
prior to the last day of the then current Interest Period with
respect thereto;
PROVIDED, all of the foregoing provisions relating to Interest Periods
are subject to the following:
(1) if any Interest Period would otherwise end on a
day that is not a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless the result
of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period
shall end on the immediately preceding Business Day;
(2) any Interest Period that would otherwise extend
beyond the Revolving Credit Termination Date shall end on the
Revolving Credit Termination Date or such due date, as
applicable;
12
(3) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
(4) the Borrower shall use reasonable efforts to
select Interest Periods so as not to require a payment or
prepayment of any Eurodollar Loan during an Interest Period
for such Loan.
"INTEREST RATE HEDGE AGREEMENT": any interest rate protection
agreement, interest rate futures contract, interest rate option,
interest rate cap or other interest rate hedge arrangement, to or under
which the Borrower is a party or a beneficiary.
"INVESTMENTS": as defined in Section 8.8.
"ISSUING LENDER": NationsBank, PROVIDED, in the event that
NationsBank shall be replaced as the Administrative Agent pursuant to
Section 10.9, (a) no Letter of Credit shall be issued by NationsBank on
or after the date of such replacement and (b) the replacement
Administrative Agent shall be an Issuing Lender from and after the date
of such replacement.
"L/C APPLICATION": an application, in form and substance
satisfactory to the Issuing Lender, requesting the Issuing Lender to
issue a Letter of Credit.
"L/C FEE LETTER": the letter agreement dated the date of this
Agreement between NationsBank of Texas, N.A. and the Borrower,
respecting fees payable by the Borrower in connection with Letters of
Credit issued for its account under Section 3.
"L/C FEE PAYMENT DATE": the last day of each March, June,
September and December.
"L/C OBLIGATIONS": at any time, an amount equal to the sum of
(a) the aggregate undrawn and unexpired amount of the then outstanding
Letters of Credit and (b) the aggregate amount of all unpaid
Reimbursement Obligations.
"LENDERS": as defined in the preamble hereto and such term
shall also include the Issuing Lender.
"LETTERS OF CREDIT": as defined in Section 3.1(a).
13
"LEVEL": as of any date of determination, the Level set forth
below then in effect, as determined in accordance with the following
provisions of this definition:
LEVEL TOTAL LEVERAGE RATIO
----- --------------------
I Less than 1.50 to 1.00
II Less than 2.50 to 1.00 but greater or equal
to 1.50 to 1.00
III Less than 3.00 to 1.00 but greater or equal
to 2.50 to 1.00
IV Less than 3.50 to 1.00 but greater or equal
to 3.00 to 1.00
For the purposes of this definition, the Level shall be determined as
at the end of each of the first three fiscal quarters of each fiscal
year of the Borrower and as at the end of each fiscal year of the
Borrower, based on the relevant Financial Statements delivered pursuant
to Section 7.1(a) or 7.1(b); changes in the Level shall become
effective on the date on which such financial statements are delivered
to the Administrative Agent (with sufficient copies for each of the
Lenders) and shall remain in effect until the next change to be
effected pursuant to this definition; PROVIDED, that (a) until the
first such financial statements are delivered after the date hereof,
the Level shall be the Level determined and set forth in the Compliance
Certificate delivered pursuant to Section 6.1(v) and (b) if any
financial statements referred to above are not delivered within the
time periods specified in Section 7.1, then, for the period from and
including the date on which such financial statements are required to
be delivered to but not including the date on which such financial
statements are delivered, the Level as at the end of the fiscal period
that would have been covered thereby shall be deemed to be Level IV.
"LICENSE": as to any Person, any license, registration,
permit, authorization, certification, approval, or grant of rights by
any Governmental Authority or other Person necessary or appropriate for
such Person to own, maintain, or operate its business or property.
"LIEN": with respect to any property or asset (or any
revenues, income or profits therefrom) of any Person (in each case
whether the same is consensual or nonconsensual or arises by contract,
operation of law, legal process or otherwise), (a) any mortgage, lien,
security interest, pledge, attachment, levy or other charge or
encumbrance of any kind thereupon or in respect thereof or (b) any
other arrangement under which the same is transferred, sequestered or
otherwise identified with the intention of subjecting the same to,
14
or making the same available for, the payment or performance of any
liability in priority to the payment of the ordinary, unsecured
creditors of such Person. For the purposes of this Agreement, a Person
shall be deemed to own subject to a Lien any asset that it has acquired
or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, Capital Lease or other title retention
agreement relating to such asset; PROVIDED, that any financing
statement or filing naming a Person shall not constitute a Lien with
respect to such Person if it does not relate to security for an
obligation of such Person.
"LITIGATION": any case, proceeding, claim, grievance, lawsuit
or investigation or inquiry conducted by or pending before any
Governmental Authority or any arbitration proceeding.
"LOAN": any loan made by any Lender pursuant to this
Agreement.
"LOAN DOCUMENTS": this Agreement, the Notes, the Intercompany
Notes, each Guaranty Agreement or Supplement to Guaranty, the Security
Documents, each L/C Application, the Fee Letter, all agreements between
the Borrower and/or any Subsidiary and any Lender respecting fees
payable in connection with this Agreement or any other Loan Document
hereafter executed between or among any such Persons and all other
written agreements, documents, instruments and certificates now or
hereafter executed and delivered by the Borrower, any Subsidiary or any
other Person to or for the benefit of any Lender pursuant to or in
connection with any of the foregoing, and any and all amendments,
supplements and other modifications thereof and all renewals,
extensions, restatements, rearrangements or substitutions from time to
time of all or any part of the foregoing.
"LOAN PARTIES": the collective reference to the Borrower and
the Subsidiaries and any other Person hereafter executing and
delivering a Security Document or a Guaranty Agreement or Supplement to
Guaranty or any equivalent document for the benefit of the Lenders.
"MAJORITY LENDERS": at any time, Lenders whose respective
Revolving Credit Facility Percentages aggregate 66 2/3% or more.
"MARGIN STOCK": has the meaning assigned to such term in
Regulation U of the Board.
"MATERIAL ADVERSE EFFECT": a material adverse effect on (a)
the financial condition, business, operations or prospects of the
Borrower and the Subsidiaries taken as a whole, (b) the ability of any
Loan Party to perform its obligations under the Loan Documents to which
it is a party or (c) the validity or enforceability of this Agreement
or any other Loan Document or the rights or remedies of the
Administrative Agent or the Lenders under this Agreement or any of the
other Loan Documents.
"MFSNT": MFS Network Technologies, Inc. a Delaware
corporation.
15
"MFSNT ACQUISITION": the acquisition by the Borrower of the
Capital Securities of MFSNT.
"MULTIEMPLOYER PLAN": a Plan which is a multiemployer plan as
defined in Section 4001 (a)(3) of ERISA.
"NAIC": the collective reference to the National Association
of Insurance Commissioners, and any successor thereto, and all other
similar insurance industry regulatory bodies having regulatory
jurisdiction over insurance companies generally.
"NATIONSBANK EXISTING CREDITS": those two certain credit
facilities, in the original principal amounts of $5,000,000 and
$4,200,000, advanced for the purpose of financing a portion of the
initial costs of the MFSNT Acquisition, payable by Xxxxxxx Xxxxxx and
Xxxxxx Xxxxxx, including all principal thereof and all interest thereon
and all fees and other expenses payable in connection therewith.
"NET CASH PROCEEDS": (a) in connection with any Asset Sale
(whether in one transaction or a series of related transactions) or
Recovery Event (whether one such event or a series of related events),
all proceeds thereof in the form of cash and Cash Equivalents
(including any such proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable, purchase price
adjustment receivable, escrow termination or otherwise, but only as and
when received), if any, net of reasonable attorneys' fees, accountants'
fees, investment banking fees, amounts required to be applied to the
repayment of Indebtedness secured by a Permitted Lien on any asset
which is the subject of such Asset Sale or Recovery Event (other than
any Lien in favor of the Administrative Agent for the benefit of the
Lenders) and other reasonable fees and expenses actually incurred in
connection therewith and net of taxes paid or reasonably estimated to
be payable as a result thereof, including, without limitation, transfer
and withholding taxes (after taking into account any available tax
credits or deductions and any tax sharing arrangements) and all costs
reasonably estimated to be payable in connection with discontinued
operations or shutdowns resulting from the disposition or loss of the
assets or properties which are the subject of such Asset Sale or
Recovery Event; and (b) in connection with any Specified Offering, the
cash proceeds received therefrom, net of reasonable attorneys' fees,
investment banking fees, accountants' fees, underwriting discounts and
commissions and other reasonable fees and expenses actually incurred in
connection therewith.
"NET INCOME": for any period with respect to any Person, the
net income (or loss) of such Person and its Subsidiaries, determined on
a consolidated basis in accordance with GAAP as in effect on the date
of this Agreement; PROVIDED, HOWEVER, there shall be excluded, without
duplication, (a) income (or loss) of any Subsidiary of such Person
which is not a Wholly Owned Subsidiary of such Person, except to the
extent of the amount of any dividends or other distributions actually
paid to such Person or any Wholly Owned Subsidiary of such Person
during such period, (b) income (or loss) of any Person accrued
16
prior to the date such Person becomes a Subsidiary of such Person or is
merged into such Person or any Subsidiary of such Person or the assets
of any Person are acquired by such Person or any Subsidiary of such
Person, (c) the income of any Subsidiary of such Person during such
period to the extent that the declaration or payment of dividends or
similar distributions by that Subsidiary of such income is not at the
time permitted by operation of the terms of its Charter Documents or
any other agreement binding on such Subsidiary or any Requirement of
Law applicable to such Subsidiary or such Person or any of its other
Subsidiaries, (d) any after-tax gains and after-tax losses attributable
to extraordinary and non-recurring items, including Recovery Events
and Dispositions outside the ordinary course of business and any
after-tax gains on pension reversions received by such Person or its
Subsidiaries and (e) to the extent included in calculating such Net
Income, non-cash revenue and non-cash expenses earned or incurred by
such Person or any of its Subsidiaries.
"NON-EXCLUDED TAXES": as defined in Section 4.10(a).
"NON-U.S. LENDER": as defined in Section 4.10(b).
"NOTES": the Revolving Credit Notes.
"NOTICE OF BORROWING": a written notice substantially in the
form of Exhibit F delivered by the Borrower to the Administrative Agent
in accordance with Section 2.2.
"NOTICE OF CONVERSION/CONTINUATION": a written notice in the
form of Exhibit G, delivered by the Borrower to the Administrative
Agent in accordance with Section 4.5.
"NOTICE OF LETTER OF CREDIT REQUEST": a written notice in the
form of Exhibit H delivered by the Borrower to the Issuing Lender in
accordance with Section 3.2.
"OBLIGATIONS": the unpaid principal of and interest on
(including, without limitation, interest accruing after the maturity of
the Loans and interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding)
the Loans and all other obligations and liabilities of the Loan Parties
to the Administrative Agent or to any Lender (or, in the case of any
Interest Rate Hedge Agreement, any affiliate of any Lender), whether
direct or indirect, absolute or contingent, due or to become due, or
now existing or hereafter incurred, which may arise under, out of, or
in connection with, this Agreement, any other Loan Document, any
Letters of Credit, any Interest Rate Hedge Agreement entered into with
any Lender (or any affiliate of any Lender) or any other document made,
delivered or given in connection herewith or therewith, whether on
account of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including, without limitation, all fees,
charges and disbursements of counsel to the Administrative Agent, the
Issuing Lender or to any Lender that are required to be paid by any
Loan Party pursuant hereto) or otherwise.
17
"PARTICIPANT": as defined in Section 11.6(b).
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"PERFECTION CERTIFICATE": a certificate of the Borrower and/or
each Subsidiary, substantially in the form of Exhibit I and, with
respect to a newly organized, created or acquired Subsidiary, a
certificate of such Subsidiary substantially in the form of Exhibit I.
"PERMITTED LIENS": as applied to the property or assets of any
Person (or any revenues, income or profits of such Person therefrom):
(a) Liens for Taxes not yet due or payable or (if foreclosure,
distraint, sale or other similar proceedings have not been commenced
or, if commenced, have been stayed) which are being contested in good
faith by appropriate proceedings, PROVIDED, that adequate reserves with
respect thereto are maintained on the books of such Person in
conformity with GAAP; (b) statutory Liens of carriers, warehousemen,
mechanics, materialmen, repairmen or other like Liens arising in the
ordinary course of business for sums not yet due or (if foreclosure,
distraint, sale or other similar proceedings have not been commenced
or, if commenced, have been stayed) which are being contested in good
faith by appropriate proceedings, PROVIDED, that adequate reserves with
respect thereto are maintained by such Person in conformity with GAAP;
(c) Liens (other than pursuant to ERISA or Section 412(n) of the
Code), pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation; (d)(i)
bankers' Liens in respect of deposit accounts, (ii) statutory
landlords' Liens and rights of tenants under leases and subleases
granted by such Person to others, in each case not interfering in any
material respect with the business of such Person and its Subsidiaries
and arising in the ordinary course of business and (iii) deposits to
secure the performance of bids, trade contracts, government contracts,
operating leases, statutory obligations, surety and appeal bonds,
performance and return-of-money bonds or to secure liabilities to
insurance carriers under insurance or self-insurance arrangements and
other obligations of a like nature, so long as, in each case with
respect to this clause (d), such Liens (x) do not secure obligations
constituting Indebtedness and (y) are incurred in the ordinary course
of business; (e) easements, rights-of-way, restrictions (including
zoning restrictions), reservations, permits, servitudes, minor defects
or irregularities of title and other similar encumbrances incurred or
existing on property in the ordinary course of business which, in the
aggregate, are not substantial in amount and which do not materially
interfere with the ordinary conduct of the business of the Borrower or
any of its Subsidiaries; (f) to the extent the Indebtedness secured
thereby is permitted under Section 8.2(c), Liens securing obligations
of the Borrower and the Subsidiaries under Capital Leases and Liens
securing other Indebtedness to finance the acquisition of assets,
PROVIDED, that (i) such Liens shall be created substantially
simultaneously with the acquisition of such assets, (ii) such Liens do
not at any time encumber any assets other than the assets financed by
such Indebtedness and proceeds of any such assets, (iii) the principal
amount of Indebtedness secured thereby is not increased and (iv) the
principal amount of Indebtedness secured by any such Lien shall at no
18
time exceed 100% of the original purchase price of such assets; (g)
Liens created pursuant to the Security Documents; (h) Liens arising
from any judgment, decree or other order in existence, PROVIDED, that
any such judgment, decree or order shall have been vacated, discharged
or bonded on or prior to the first to occur of (i) the last day upon
which such judgment or decree becomes final and nonappealable and (ii)
the day which is 60 days after the entry thereof and no Event of
Default has occurred pursuant to Section 9(h); and (i) other Liens, so
long as the obligations secured thereby do not exceed $1,000,000 in the
aggregate at any time.
"PERMITTED LINE OF BUSINESS": as defined in Section 8.17.
"PERSON": an individual, sole proprietorship, partnership,
corporation, limited liability company, business trust, joint stock
company, mutual company, trust, unincorporated association, estate,
joint venture, union, employee organization, Governmental Authority or
other entity of whatever nature.
"PLAN": any employee benefit pension plan which is covered by
ERISA and in respect of which the Borrower or a Commonly Controlled
Entity is (or, if such plan were terminated at such time, would under
Section 4069 of ERISA be deemed to be) a "contributing sponsor" as
defined in Section 4001(a)(13) of ERISA or a member of such
contributing sponsor's "control group" as defined in Section 4001
(a)(14) of ERISA.
"PLEDGE AGREEMENT": a Pledge Agreement substantially in the
form of Exhibit X-x or J-2, as the same may be amended, supplemented
and otherwise modified from time to time.
"PRIME RATE": as defined in the definition of "ABR."
"PRO FORMA COMPLIANCE CERTIFICATE": a Compliance Certificate
giving effect to the relevant proposed transaction for which the
Compliance Certificate is being delivered and any other transactions
relating thereto (as though such transactions had taken place as of the
beginning of the period or on the date being tested, as applicable)
based on the financial information of the Borrower and the Subsidiaries
set forth in the Financial Statements most recently delivered to the
Lenders pursuant to Section 7.1(a) or (b) and demonstrating that no
Default exists both before and after giving effect to such proposed
transactions.
"PROPERTIES": as defined in Section 5.17(a).
"RECOVERY EVENT": any settlement of or payment in respect of a
condemnation or taking or a property insurance claim or casualty
insurance claim relating to any property or asset or rights therein of
the Borrower or any of the Subsidiaries (other than proceeds from
key-man insurance which are used to repurchase the stock of any
deceased or disabled executive) greater than $1,000,000 individually or
in the aggregate in any fiscal year;
19
provided, however, that for purposes of Section 7.7(e) and for
determining Net Income, Recovery Event shall mean any or all of such
settlements or payments regardless of amount.
"REGISTER": as defined in Section 11.6(d).
"REIMBURSEMENT OBLIGATIONS": the obligations of the Borrower
to reimburse the Issuing Lender pursuant to Section 3.4 for amounts
drawn under Letters of Credit.
"REINVESTMENT DEADLINE": as defined in the definition of
"Reinvestment Notice."
"REINVESTMENT DEFERRED AMOUNT": with respect to any
Reinvestment Event, the aggregate Net Cash Proceeds received by the
Borrower or any Subsidiary in connection therewith which are not
applied to prepay the Revolving Credit Loans and to permanently reduce
the Total Revolving Credit Commitment pursuant to Sections 4.2(d)(i)
AND 4.2(d)(ii) as a result of the delivery of a Reinvestment Notice.
"REINVESTMENT EVENT": any Asset Sale, Recovery Event or
Specified Offering in respect of which the Borrower has delivered a
Reinvestment Notice.
"REINVESTMENT NOTICE": a written notice executed by a
Responsible Officer of the Borrower stating that no Default has
occurred and is continuing and that the Borrower (directly or
indirectly through a Wholly Owned Subsidiary), in good faith, intends
and expects to contractually commit to use all or a specified portion
of the Net Cash Proceeds of an Asset Sale, Recovery Event or Specified
Offering to make a Subject Acquisition or, in the case of a Recovery
Event or a Specified Offering, to restore or replace the assets in
respect of which a Recovery Event has occurred on or prior to the
earlier of (a) the date which is 180 days after the date of such Asset
Sale, Recovery Event or Specified Offering and (b) the date on which
such proceeds would be required to be applied, or to be offered to be
applied, to prepay, redeem or defease any Indebtedness of the Borrower
or any Subsidiary (other than Indebtedness under this Agreement) if not
applied as described above (such earlier date, the "REINVESTMENT
DEADLINE").
"REINVESTMENT PREPAYMENT AMOUNT": with respect to any
Reinvestment Event, the Reinvestment Deferred Amount relating thereto,
less any amount expended prior to the relevant Reinvestment Prepayment
Date to make a Subject Acquisition or restore or replace assets in
respect of which a Recovery Event has occurred.
"REINVESTMENT PREPAYMENT DATE": with respect to any
Reinvestment Event, the earliest of (a) the first date occurring after
such Reinvestment Event on which a Default shall have occurred, (b) the
relevant Reinvestment Deadline or Extended Reinvestment Deadline, (c)
the date on which the Borrower shall have made a final determination
not to apply the relevant Net Cash Proceeds in the manner contemplated
by the relevant Reinvestment Notice and (d) 30 days after the
termination or consummation of, or amendment to reduce the
20
purchase price under, any definitive acquisition agreement described in
the definition in the definition of Reinvestment Notice.
"RELEASE": any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping,
disposing or depositing, or threat thereof, of any Hazardous Material
in, into, onto or through the environment.
"REMEDIAL ACTION": (a) "remedial action" as such term is
defined in CERCLA, 42 U.S.C. Section 9601(24) and (b) all other actions
required by any Governmental Authority or voluntarily undertaken to (i)
clean up, remove, treat, xxxxx or in any other way address any
Hazardous Material in the environment, (ii) prevent the Release or
threat of Release, or minimize the further Release of any Hazardous
Material so it does not migrate or endanger or threaten to endanger
public health, welfare or the environment or (iii) perform studies and
investigations in connection with, or as a precondition to, actions
described in clauses (i) or (ii) above.
"REORGANIZATION": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of
Section 4241 of ERISA.
"REPORTABLE EVENT": any of the events set forth in Section
4043(b) or (c) of ERISA, other than those events described in Section
4043(b) as to which notice is waived by applicable PBGC regulation or
those events described in Section 4043(c) as to which the thirty-day
notice period is waived under subsection .13, .14, .16, .18, .19 or .20
of PBGC Reg. /section/ 2615.
"REQUIREMENT OF LAW": as to any Person, (a) the Charter
Documents of such Person and (b) any law, statute, code, ordinance,
order, rule, regulation, judgment, decree, injunction, writ, edict,
award, authorization or other requirement of any Governmental Authority
or any obligation included in any Authorization or resulting from
binding arbitration, including, without limitation, any requirement
under common law, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its
property is subject.
"RESPONSIBLE OFFICER": the chief executive officer, the
president, the chief financial officer, the chief legal officer or any
vice president of the Borrower or any Subsidiary or any other Loan
Party.
"RESTRICTED PAYMENTS": as defined in Section 8.6.
"RESTRICTED SUBSIDIARY": any Subsidiary of the Borrower other
than those listed on SCHEDULE 1.1 and those additional Subsidiaries of
the Borrower, added by a supplement to such SCHEDULE 1.1 whose assets
either: (i) are not located in, or income attributable to sources other
than, the United States, the pledge of the stock or assets of which
would be treated as
21
a repatriation of the earnings or income thereof or taxable dividend to
the Borrower under /section/957 of the Code ("Controlled Foreign
Corporations"); or (ii) consist solely of Capital Securities of
Controlled Foreign Corporations.
"REVOLVING CREDIT COMMITMENT": as to any Lender, its
obligation, if any, to make Revolving Credit Loans to, or issue or
participate in Letters of Credit issued on behalf of, the Borrower in
an aggregate amount not to exceed at any one time outstanding the
amount set forth opposite such Revolving Credit Lender's name in Annex
l under the heading "Revolving Credit Commitment" or, in the case of
any Lender that is an Assignee, the amount of the assigning Lender's
Revolving Credit Commitment assigned to such Assignee pursuant to
Section 11.6(c) and set forth in the applicable Assignment and
Acceptance (in each case, as the same may be increased, reduced or
otherwise adjusted from time to time as provided herein).
"REVOLVING CREDIT COMMITMENT PERIOD": the period from and
including the Effective Date to, but not including, the Revolving
Credit Termination Date.
"REVOLVING CREDIT FACILITY": the credit facility provided for
in Section 2.1.
"REVOLVING CREDIT FACILITY PERCENTAGE": at any time, as to any
Revolving Credit Lender, the percentage of the aggregate outstanding
Revolving Credit Loans and L/C Obligations then constituted by such
Lender's outstanding Revolving Credit Loans and participations in L/C
Obligations (or obligations held by the Issuing Lender in respect of
L/C Obligations, in the case of the Issuing Lender); PROVIDED, if no
Revolving Credit Loans or L/C Obligations are outstanding, the
Revolving Credit Facility Percentage for any Lender shall be the
percentage of the aggregate Revolving Credit Commitments then
constituted by such Lender's Revolving Credit Commitment.
"REVOLVING CREDIT LENDER": each Lender which has a Revolving
Credit Commitment or which has Revolving Credit Loans outstanding.
"REVOLVING CREDIT LOANS": as defined in Section 2.1.
"REVOLVING CREDIT NOTE": a promissory note of the Borrower in
the form of Exhibit A.
"REVOLVING CREDIT TERMINATION DATE": the earliest of (a)
June 30, 2006 and (b) the date on which the Revolving Credit Loans
become due and payable in full, pursuant to acceleration or otherwise.
"SECURED PARTIES": as defined in the Security Documents.
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"SECURITY AGREEMENT": a Security Agreement substantially in
the form of Exhibit L-1 or L-2, as amended, supplemented and otherwise
modified from time to time.
"SECURITY DOCUMENTS": the collective reference to each Pledge
Agreement, the Security Agreement, and any other security documents
hereafter delivered to the Administrative Agent granting a Lien on any
asset or assets of any Person to secure the respective obligations and
liabilities of the Borrower hereunder and the Borrower and the
Subsidiaries under any of the other Loan Documents or to secure any
guaranty of any such obligations and liabilities.
"SENIOR FUNDED DEBT": as of any date of determination with
respect to the Borrower and its Subsidiaries, Total Funded Debt as of
such date, minus Indebtedness that is effectively subordinated in right
of payment and security to the Notes.
"SENIOR LEVERAGE RATIO": as of the last day of any fiscal
quarter, the ratio of (a) Senior Funded Debt as of such day to (b)
EBITDA for the twelve consecutive calendar months ending on such day.
"SENIOR SUBORDINATED NOTES": the Senior Subordinated Notes of
the Borrower in original aggregate principal amount no greater than
$140,000,000, subordinated to the satisfaction of the Administrative
Agent to the Notes (both in right of payment and in security), and
having such other terms, conditions and provisions as may be
satisfactory to the Administrative Agent in its sole discretion.
"SINGLE EMPLOYER PLAN": any Plan which is covered by Title IV
of ERISA, but which is not a Multiemployer Plan.
"SOLVENT": when used with respect to any Person, means that,
as of any date of determination, (a) the amount of the "fair value" or
"present fair saleable value" of the assets of such Person (on a
going-concern basis) will, as of such date, exceed the amount of all
"liabilities of such Person, contingent or otherwise," as of such date,
as such quoted terms are determined in accordance with applicable
federal and state laws governing determinations of the insolvency of
debtors, (b) such fair value or present fair saleable value of the
assets of such Person (on a going-concern basis) will, as of such date,
be greater than the amount that will be required to pay the liability
of such Person on its debts as such debts become absolute and matured,
(c) such Person will not have, as of such date, an unreasonably small
amount of capital with which to conduct its business, and (d) such
Person will be able to pay its debts as they mature. For purposes of
this definition, (i) "debt" means liability on a "claim," (ii) "claim"
means any (x) right to payment, whether or not such a right is reduced
to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (y) right to an equitable remedy for breach of performance if such
breach gives rise to a right to payment, whether or not such right to
an equitable remedy is reduced to judgment, fixed, contingent, matured
23
or unmatured, disputed, undisputed, secured or unsecured and (iii)
unliquidated, contingent, disputed and unmatured claims shall be valued
at the amount that can be reasonably expected to be actual and matured.
"SPECIFIED OFFERING": any issuance or sale of Borrower Capital
Securities by the Borrower or any incurrence of Indebtedness by the
Borrower or any Subsidiary, excluding:
(a) any incurrence of Indebtedness of the Borrower or any
Subsidiary which is permitted by Section 8.2;
(b) any issuance or sale of Borrower Capital Securities of the
type described in clause (a) of the definition thereof (i) to
directors, officers or employees of the Borrower or a Subsidiary by
reason of their employment or (ii) the Net Cash Proceeds of which the
Borrower uses to purchase or redeem all or any portion of the 12%
Senior Subordinated Notes;
(c) any issuance or sale of Borrower Capital Securities of the
type described in clause (a) of the definition thereof for the
simultaneous repurchase or redemption of other Borrower Capital
Securities, subject to the provisions of Sections 8.7 OR 8.6.;
(d) the Senior Subordinated Notes; and
(e) the WorldCom Option.
"SPECIFIED TAXES": as defined in Section 4.10.
"STATUS": the existence of Level I Status, Level II Status,
Level III Status on Level IV Status, as the case may be.
"SUBJECT ACQUISITION": a proposed acquisition (including the
entry into an option agreement) by the Borrower, directly or indirectly
through a Wholly Owned Subsidiary, that satisfies, in the reasonable
opinion of the Administrative Agent, the Acquisition Criteria.
"SUBSIDIARY": as to any Person, a corporation, partnership or
other entity 50% or more of the outstanding Voting Stock of which is at
the time owned, or the management or policies of which are otherwise
controlled, directly or indirectly through one or more intermediaries,
or both, by such Person. Unless otherwise qualified, all references to
a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a
Subsidiary or Subsidiaries of the Borrower.
"SUPPLEMENT TO GUARANTY": a Supplement to Guaranty in
substantially the form attached as Exhibit A to the Guaranty Agreement.
24
"TAXES": all taxes, assessments, fees, levies, imposts,
duties, deductions, withholdings or other similar charges of any nature
whatsoever from time to time or at any time imposed by any Governmental
Authority.
"TERMINATION DATE": June 11, 2001.
"TOTAL DEBT": as of any date of determination with respect to
the Borrower and its Subsidiaries, the sum of, without duplication, (a)
all Indebtedness for Borrowed Money, (b) all obligations in respect of
Capital Leases and (c) all Guarantee Obligations in respect of
Indebtedness for Borrowed Money of any other Person, all determined on
a consolidated basis in accordance with GAAP as in effect on the date
of this Agreement.
"TOTAL FUNDED DEBT": as of any date of determination with
respect to the Borrower and its Subsidiaries, Total Debt as of such
date having a maturity of not less than one year.
"TOTAL LEVERAGE RATIO": as of the last day of any fiscal
quarter, the ratio of (a) Total Funded Debt as of such day to (b)
EBITDA for the twelve consecutive calendar months ending on such day.
"TOTAL REVOLVING CREDIT COMMITMENT": the aggregate of all
Revolving Lenders (as the same may be increased, reduced or otherwise
adjusted from time to time).
"TRANCHE": the collective reference to Eurodollar Loans made
by the Revolving Credit Lenders, the then current Interest Periods with
respect to all of which begin on the same date and end on the same
later date, whether or not such Loans shall originally have been made
on the same day.
"TRANSFEREE": as defined in Section 11.6(f).
"TRIGGER DATE": the earlier of (a) the date on which the Loans
and all other Obligations owing under this Agreement shall have become
or been declared to be due and payable pursuant to Section 9 and (b)
the date on which the Majority Lenders shall have notified the
Administrative Agent after the occurrence of an Event of Default that
amounts are to be shared pursuant to Section 11.7(a).
"12% SUBORDINATED NOTES": Borrower's 12% Senior Subordinated
Notes Due January 6, 2005 issued in the original aggregated principal
amount of $10,000,000 pursuant to a Securities Purchase Agreement dated
as of January 6, 1998.
"TYPE": as to any Loan, its nature as an ABR Loan or a
Eurodollar Loan.
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"UNIFORM CUSTOMS": the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500, as the same may be amended from time to time.
"VOTING STOCK": with respect to any Person, the Capital
Securities of such Person of the class or classes pursuant to the terms
of which the holders thereof have the general voting power under
ordinary circumstances to elect members of the board of directors,
managers or trustees (or Persons performing equivalent functions) of
such Person, irrespective of whether or not at the time Capital
Securities of such Person of any other class or classes shall have or
might have voting power by reason of the happening of any contingency.
"WHOLLY OWNED SUBSIDIARY": as to any Person, any other Person
100% of the Capital Securities of which (other than directors'
qualifying shares required by law) is owned by such Person directly or
indirectly through one or more other Wholly Owned Subsidiaries.
"WORLDCOM OPTION": the option granted by the Borrower to MFS
Communications Company, Inc. to purchase up to 2,000,000 shares of the
common stock of the Borrower having a cash exercise price of $7.00 per
share, subject to adjustment granted in connection with the MFSNT
Acquisition.
"WORKING CAPITAL": as of any day, the aggregate amount of all
current assets reduced by the aggregate amount of all current
liabilities (other than the current portion of long-term Indebtedness
(including mandatory prepayments with respect to such Indebtedness),
accrued Interest Expense and accrued or deferred income tax expense),
all determined as of such day for the Borrower and the Subsidiaries on
a consolidated basis in accordance with GAAP as in effect on the
Effective Date.
1.2 OTHER DEFINITIONAL PROVISIONS. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in any other Loan Document or any certificate or other document made
or delivered pursuant hereto or thereto.
(b) Unless otherwise specified herein, all accounting terms used herein
(and in any other Loan Document and any certificate or other document made or
delivered pursuant hereto or thereto) shall be interpreted, all accounting
determinations shall be made, and all financial statements required to be
delivered hereunder shall be prepared, in accordance with GAAP as in effect from
time to time; PROVIDED, HOWEVER, that if the Borrower notifies the
Administrative Agent that the Borrower wishes to amend any covenant in Section 8
to eliminate the effect of any change in GAAP on the operation of such covenant
(or if the Administrative Agent notifies the Borrower that the Majority Lenders
wish to amend Section 8 for such purpose), then compliance with such covenant
shall be determined on the basis of GAAP in effect immediately before the
relevant change in GAAP became effective, until either such notice is withdrawn
or such covenant is amended in a manner satisfactory to the Borrower and the
Majority Lenders.
26
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of thiS Agreement, and Section, Annex, Schedule
and Exhibit references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(e) References in this Agreement or any other Loan Document to
knowledge by the Borrower of events or circumstances shall be deemed to refer to
events or circumstances of which a Responsible Officer has actual knowledge or
reasonably should have knowledge.
(f) References in this Agreement or any other Loan Document to
financial statements shall be deemed to include all related schedules and notes
thereto.
(g) Except as otherwise specified herein, all references to any
Governmental Authority or Requirement of Law defined or referred to herein shall
be deemed references to such Governmental Authority or Requirement of Law or any
successor Governmental Authority or Requirement of Law, and any rules or
regulations promulgated thereunder from time to time, in each case as the same
may have been or may be amended or supplemented from time to time.
(h) References herein to a certification or statement of an officer or
other individual shall mean a certification or statement of the Borrower which
is executed on behalf of the Borrower by such individual in his or her capacity
as an officer of the Borrower.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 REVOLVING CREDIT FACILITY. (a) The aggregate amount ofthe Revolving
Credit Commitments on the date of this Agreement equals $35,000,000. Subject to
the terms and conditions hereof, each Revolving Credit Lender severally agrees
to make revolving credit loans ("REVOLVING CREDIT LOANS") to the Borrower from
time to time during the Revolving Credit Commitment Period, PROVIDED, that in no
event shall the sum of the aggregate outstanding (i) Revolving Credit Loans and
(ii) participations in L/C Obligations of any Revolving Credit Lender at any
time exceed such Revolving Credit Lender's Revolving Credit Commitment. During
the Revolving Credit Commitment Period the Borrower may borrow, prepay the
Revolving Credit Loans in whole or in part, and reborrow under this Section 2.1,
all in accordance with the terms and conditions of this Agreement. The Revolving
Credit Loans of each Revolving Credit Lender shall be evidenced by a Revolving
Credit Note payable to its or its nominee's order on or before the Revolving
Credit Termination Date.
(b) The Revolving Credit Loans may from time to time be (i) Eurodollar
Loans, (ii) ABR Loans or (iii) a combination thereof, as determined by the
Borrower and notified to the Administrative Agent in accordance with Section 2.2
or Section 4.5.
27
2.2 PROCEDURE FOR REVOLVING CREDIT BORROWINGS. Subject to the terms and
conditions hereof, the Borrower may borrow under the Revolving Credit Facility
during the Revolving Credit Commitment Period on any Business Day, provided,
that the Borrower shall give the Administrative Agent an irrevocable Notice of
Borrowing (which notice must be received by the Administrative Agent prior to
11:00 A.M., Dallas, Texas time, together with a Pro Forma Compliance
Certificate, giving effect to the requested borrowing, (a) three Business Days
prior to the requested Borrowing Date, if all or any part of the requested
Revolving Credit Loans are to be initially Eurodollar Loans, or (b) one Business
Day prior to the requested Borrowing Date, otherwise), specifying (i) the amount
to be borrowed, (ii) the requested Borrowing Date, (iii) whether the borrowing
is to be of Eurodollar Loans, ABR Loans or a combination thereof and (iv) if the
borrowing is to be entirely or partly of Eurodollar Loans, the respective
amounts of each Tranche and the respective lengths of the initial Interest
Periods therefor. Each borrowing under the Revolving Credit Facility shall be in
an amount equal to (x) in the case of ABR Loans, $1,000,000 or a whole multiple
of $500,000 in excess thereof (or, if the then Available Revolving Credit
Commitments are less than $500,000, such lesser amount) and (y) in the case of
Eurodollar Loans, each Tranche shall be $1,000,000 or a whole multiple of
$500,000 in excess thereof. Upon receipt of any such Notice of Borrowing and
Compliance Certificate from the Borrower, the Administrative Agent shall
promptly notify each Revolving Credit Lender thereof. Each such Lender will make
the amount of its pro rata share of each borrowing available to the
Administrative Agent for the account of the Borrower at the office of the
Administrative Agent specified in Section 11.2 prior to ll:OO A.M., Dallas,
Texas time, on the Borrowing Date requested by the Borrower in funds immediately
available to the Administrative Agent. Such borrowing will then be made
available to the Borrower at the office of the Administrative Agent by the
Administrative Agent crediting the account of the Borrower on the books of such
office with the aggregate of the amounts made available to the Administrative
Agent by the Lenders and in like funds as received by the Administrative Agent.
2.3 REPAYMENT OF LOANS. (a) The Borrower hereby unconditionally
promises to pay to the Administrative Agent for the account of each Revolving
Credit Lender, the then unpaid principal amount of each Revolving Credit Loan of
such Lender, on or before the Revolving Credit Termination Date. The Borrower
hereby further agrees to pay interest on the unpaid principal amount of the
Loans from time to time outstanding from the date hereof until payment in full
thereof at the rates per annum, and on the dates, set forth in Section 4.1.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Borrower to such Lender
resulting from each Loan of such Lender from time to time, including the amounts
of principal and interest payable and paid to such Lender from time to time
under this Agreement.
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(c) The Administrative Agent shall maintain the Register pursuant to
Section 11.6(d), and a subaccount therein for each Lender, in which shall be
recorded (i) the amount of each Loan made hereunder, the Type thereof and each
Interest Period, if any, applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) both the amount of any sum received by the
Administrative Agent hereunder from the Borrower and each Lender's share
thereof.
(d) The entries made in the Register shall, to the extent permitted by
applicable Requirements of Law, be PRIMA FACIE evidence of the existence and
amounts of the obligations of the Borrower therein recorded; PROVIDED, HOWEVER,
that the failure of the Administrative Agent to maintain the Register, or any
error therein, shall not in any manner affect the obligation of the Borrower to
repay (with applicable interest) the Loans made to the Borrower by any Lender in
accordance with the terms of this Agreement and the Notes.
SECTION 3. LETTERS OF CREDIT
3.1 L/C COMMITMENT. (a) Subject to the terms and conditions hereof, the
Issuing Lender, in reliance on the agreements of the other Revolving Credit
Lenders set forth in Section 3.3(a), agrees to issue letters of credit ("LETTERS
OF CREDIT") for the account of the Borrower on any Business Day in such form as
may be approved from time to time by the Issuing Lender; provided, that the
Issuing Lender shall not issue any Letter of Credit if, after giving effect to
such issuance, (i) the outstanding L/C Obligations would exceed $5,000,000 or
(ii) the aggregate amount of all outstanding L/C Obligations and Revolving
Credit Loans would exceed the aggregate Available Revolving Credit Commitments.
Each Letter of Credit shall (i) be denominated in Dollars, (ii) be a standby
letter of credit issued for the account of the Borrower, which finances the
working capital and business needs of the Borrower and the Wholly Owned
Subsidiaries, including, without limitation, good faith deposits in connection
with Subject Acquisitions, and (iii) expire no later than the earlier of (x) the
Revolving Credit Termination Date and (y) the date which is 12 months after its
date of issuance. Any request by the Borrower to renew or extend an existing
Letter of Credit, or any renewal of any existing Letter of Credit pursuant to
the terms thereof, shall be deemed to be, for all purposes of this Agreement,
the issuance of a new Letter of Credit hereunder and each such renewal or
extension shall be subject to, and the Issuing Lender shall be entitled to the
benefits of, this Section 3.
(b) Each Letter of Credit shall be subject to the Uniform Customs and,
to the extent not inconsistent therewith, the laws of the State of Texas.
(c) The Issuing Lender shall not at any time be obligated to issue any
Letter of Credit hereunder if such issuance would conflict with, or cause the
Issuing Lender or any other Revolving Credit Lender to exceed any limits imposed
by, any applicable Requirement of Law.
3.2 PROCEDURE FOR ISSUANCE OF LETTERS OF CREDIT. The Borrower may from
time to time request that the Issuing Lender issue a Letter of Credit (or that
an existing Letter of Credit be
29
renewed or extended) by delivering to the Issuing Lender and the Administrative
Agent a Notice of Letter of Credit Request, a Compliance Certificate, giving
effect to the requested Letter of Credit, and an L/C Application therefor,
completed to the reasonable satisfaction of the Issuing Lender, and such other
certificates, documents and other papers and information as the Issuing Lender
may reasonably request. Upon receipt of any Notice of Letter of Credit Request,
Compliance Certificate and L/C Application, the Issuing Lender will notify the
Revolving Credit Lenders thereof and process such L/C Application and the
certificates, documents and other papers and information delivered to it in
connection therewith in accordance with its customary procedures and shall
promptly issue the Letter of Credit requested thereby (but in no event shall the
Issuing Lender be required to issue any Letter of Credit earlier than three
Business Days after its receipt of the L/C Application therefor and all such
other certificates, documents and other papers and information relating thereto)
by issuing the original of such Letter of Credit to the beneficiary thereof or
as otherwise may be agreed by the Issuing Lender and the Borrower. The Issuing
Lender shall furnish a copy of such Letter of Credit to the Borrower and each
Revolving Credit Lender promptly following the issuance thereof.
3.3 LETTER OF CREDIT PARTICIPATIONS. (a) The Issuing Lender irrevocably
agrees to grant and hereby grants to each Revolving Credit Lender, and, to
induce the Issuing Lender to issue Letters of Credit hereunder, each Revolving
Credit Lender irrevocably agrees to accept and purchase and hereby accepts and
purchases from the Issuing Lender, on the terms and conditions hereinafter
stated, for such Revolving Credit Lender's own account and risk an undivided
interest equal to such Revolving Credit Lender's Revolving Credit Facility
Percentage in the Issuing Lender's obligations and rights under each Letter of
Credit issued by the Issuing Lender and the amount of each draft paid by the
Issuing Lender thereunder. Each Revolving Credit Lender unconditionally and
irrevocably agrees with the Issuing Lender that, if a draft is paid under any
Letter of Credit issued by the Issuing Lender for which the Issuing Lender is
not reimbursed in full by the Borrower in accordance with Section 3.4(a), such
Revolving Credit Lender shall pay to the Issuing Lender upon demand at the
Issuing Lender's address for notices specified herein an amount equal to such
Revolving Credit Lender's Revolving Credit Facility Percentage of the amount of
such draft, or any part thereof, which is not so reimbursed.
(b) If any amount required to be paid by any Revolving Credit Lender to
the Issuing Lender pursuant to Section 3.3(a) in respect of any unreimbursed
portion of any payment made by the Issuing Lender under any Letter of Credit is
paid to the Issuing Lender within three Business Days after the date such
payment is due, such Revolving Credit Lender shall pay to the Issuing Lender on
demand an amount equal to the product of (i) such amount, times (ii) the daily
average Federal Funds Rate during the period from and including the date such
payment is required to the date on which such payment is immediately available
to the Issuing Lender, times (iii) a fraction the numerator of which is the
number of days that elapse during such period and the denominator of which is
360. If any such amount required to be paid by any Revolving Credit Lender
pursuant to Section 3.3(a) is not in fact made available to the Issuing Lender
by such Revolving Credit Lender within three Business Days after the date such
payment is due, the Issuing Lender shall be entitled to recover from such
Revolving Credit Lender, on demand, such amount
30
with interest thereon calculated from such due date at a rate per annum equal to
the ABR, plus the Applicable Margin for ABR Loans. A certificate of the Issuing
Lender submitted to any Revolving Credit Lender with respect to any amounts
owing under this Section 3.3 shall be conclusive in the absence of manifest
error.
(c) Whenever, at any time after the Issuing Lender has made payment
under any Letter of Credit and has received from any Revolving Credit Lender its
pro rata share of such payment in accordance with Section 3.3(A), the Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise, including proceeds of Collateral applied thereto
by the Issuing Lender), or any payment of interest on account thereof, the
Issuing Lender will, if such payment is received prior to 12:00 p.m., Dallas,
Texas time, on a Business Day, distribute to such Lender its pro rata share
thereof on the same Business Day or if received later than 12:00 p.m. on the
next succeeding Business Day; PROVIDED, HOWEVER, that in the event that any such
payment received by the Issuing Lender shall be required to be returned by the
Issuing Lender, such Revolving Credit Lender shall return to the Issuing Lender
the portion thereof previously distributed by the Issuing Lender to it.
(d) Notwithstanding anything to the contrary in this Agreement, each
Revolving Credit Lender's obligation to make the Loans referred to in Section
3.4(B) and to purchase and fund participating interests pursuant to Section
3.3(a) shall be absolute and unconditional and shall not be affected by any
circumstance, including, without limitation, (i) any setoff, counterclaim,
recoupment, defense or other right which such Revolving Credit Lender or the
Borrower may have against the Issuing Lender, the Borrower or any other Person
for any reason whatsoever; (ii) the occurrence or continuance of a Default or
the failure to satisfy any of the other conditions specified in Section 6; (iii)
any adverse change in the condition (financial or otherwise) of any Loan Party;
(iv) any breach of this Agreement or any other Loan Document by any Loan Party
or any Revolving Credit Lender; or (v) any other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing.
3.4 REIMBURSEMENT OBLIGATION OF THE BORROWER. (a) The Borrower agrees
to reimburse the Issuing Lender (it being understood that such reimbursement
shall be effected by means of a borrowing of Loans unless the Administrative
Agent shall determine in its sole discretion that such Loans may not be made for
such purpose as a result of a Default pursuant to Section 9(F)), upon receipt of
notice from the Issuing Lender of the date and amount of a draft presented under
any Letter of Credit and paid by the Issuing Lender, for the amount of (i) such
draft so paid and (ii) any taxes, fees, charges or other costs or expenses
incurred by the Issuing Lender in connection with such payment. Each such
payment shall be made to the Issuing Lender, at its address for notices
specified herein in Dollars and in immediately available funds, on the date on
which the Borrower receives such notice, if received prior to 11:00 a.m.,
Dallas, Texas time, on a Business Day and otherwise on the next succeeding
Business Day.
(b) Interest shall be payable on any and all amounts remaining unpaid
by the Borrower under this Section 3.4, (i) from the date the draft presented
under the affected Letter of
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Credit is paid to the date on which the Borrower is required to pay such amounts
pursuant to paragraph (a) above at a rate per annum equal to the ABR, plus the
Applicable Margin and (ii) thereafter until payment in full at the rate
specified in Section 4.1(C)(I)(Y). Except as otherwise specified in Section
3.4(a), each drawing under any Letter of Credit shall constitute a request by
the Borrower to the Administrative Agent for a borrowing of Revolving Credit
Loans that are ABR Loans pursuant to Section 2.2 in the amount of such drawing.
The Borrowing Date with respect to such borrowing shall be the date of payment
of such drawing and the proceeds of such Loans shall be applied by the
Administrative Agent to reimburse the Issuing Lender for the amounts paid under
such Letter of Credit.
3.5 OBLIGATIONS ABSOLUTE. Subject to the penultimate sentence of this
Section 3.5, the Borrower's obligations under this Section 3 shall be absolute
and unconditional under any and all circumstances and irrespective of any
set-off, counterclaim or defense to payment which the Borrower may have or have
had against the Issuing Lender, any Revolving Credit Lender or any beneficiary
of a Letter of Credit. The Borrower also agrees with the Issuing Lender that the
Issuing Lender and the Revolving Credit Lenders shall not be responsible for,
and the Borrower's Reimbursement Obligations under Section 3.4(A) shall not be
affected by, among other things, (i) the validity or genuineness of documents or
of any endorsements thereon, even though such documents shall in fact prove to
be invalid, fraudulent or forged, or (ii) any dispute between or among the
Borrower and any beneficiary of any Letter of Credit or any other party to which
such Letter of Credit may be transferred or (iii) any claims whatsoever of the
Borrower against any beneficiary of such Letter of Credit or any such
transferee. The Issuing Lender and the Revolving Credit Lenders shall not be
liable for any error, omission, interruption or delay in transmission, dispatch
or delivery of any message or advice, however transmitted, in connection with
any Letter of Credit, except for errors or omissions caused by such Person's
gross negligence or willful misconduct. The Borrower agrees that any action
taken or omitted by the Issuing Lender under or in connection with any Letter of
Credit or the related drafts or documents, if done in the absence of gross
negligence or willful misconduct and in accordance with the standards of care
specified in Section 5-109 of the Uniform Commercial Code of the State of Texas,
shall be binding on the Borrower and shall not result in any liability of either
the Issuing Lender or any Revolving Credit Lender to the Borrower.
3.6 LETTER OF CREDIT PAYMENTS. If any draft shall be presented for
payment under any Letter of Credit, the Issuing Lender shall promptly notify the
Borrower and the Revolving Credit Lenders of the date and amount thereof.
Subject to Section 3.5, the responsibility of the Issuing Lender to the Borrower
in connection with any draft presented for payment under any Letter of Credit
shall, in addition to any payment obligation expressly provided for in such
Letter of Credit, be limited to determining that the documents (including each
draft) delivered under such Letter of Credit in connection with such presentment
appear on their face to be in conformity with such Letter of Credit.
3.7 L/C APPLICATION. To the extent that any provision of any L/C
Application related to any Letter of Credit is inconsistent with the provisions
of this Agreement, the provisions of this Agreement shall apply.
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SECTION 4. GENERAL PROVISIONS APPLICABLE TO LOANS
4.1 INTEREST RATES AND PAYMENT DATES. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the lesser of (i) the Highest Lawful Rate and (ii) the
Eurodollar Rate determined for such day, plus the Applicable Margin in effect
for such day.
(b) Each ABR Loan shall bear interest for each day that it is
outstanding at a rate per annum equal to the lesser of (i) the Highest Lawful
Rate and (ii) the ABR for such day, plus the Applicable Margin in effect for
such day.
(c) (i) If an Event of Default shall occur and be continuing, all Loans
and Reimbursement Obligations shall bear interest at a rate per annum which is
equal to (x) in the case of the Loans, the lesser of (A) the Highest Lawful Rate
and (B) the rate that would otherwise be applicable thereto pursuant to the
foregoing provisions of this Section 4.1, plus 2% and (y) in the case of
Reimbursement Obligations, at a rate per annum equal to the lesser of (A) the
Highest Lawful Rate and (B) the ABR, plus the Applicable Margin for ABR Loans,
plus 2% and (ii) if such Event of Default relates to the nonpayment when due
(whether at the stated maturity, by acceleration or otherwise) of any interest
payable on any Loan or any commitment fee or other amount payable hereunder or
under any other Loan Document, to the extent permitted by applicable
Requirements of Law, such overdue amount shall bear interest at the lesser of
(A) the Highest Lawful Rate and (B) the ABR, plus the Applicable Margin for ABR
Loans, plus 2%, in each case, with respect to clauses (i) and (ii) above, from
the date of any such Event of Default until the earliest of (x) the waiver of
such Event of Default by the requisite number of Lenders, (y) the cure of such
Event of Default to the reasonable satisfaction of the requisite Lenders and (z)
the payment in full of the Obligations (as well after as before judgment).
(d) Interest shall be payable in arrears on each Interest Payment Date,
PROVIDED, that interest accruing pursuant to paragraph (c) of this Section 4.1
shall be payable from time to time on demand.
4.2 OPTIONAL AND MANDATORV PREPAVMENTS AND COMMITMENT REDUCTIONS. (a)
The Borrower shall prepay the Loans as and when required by Section 4.2(b),
4.2(c) and 4.2(d), and the Borrower may at any time and from time to time prepay
the Revolving Credit Loans, in whole or in part, without premium or penalty (it
being understood that amounts payable pursuant to Section 4.11 do not constitute
premium or penalty). Each such prepayment shall be made upon at least three
Business Days' irrevocable notice to the Administrative Agent (in the case of
Eurodollar Loans), at least one Business Day's irrevocable notice to the
Administrative Agent (in the case of ABR Loans), specifying the date and amount
of prepayment and whether the prepayment is (i) of Revolving Credit Loans, and
(ii) of Eurodollar Loans, ABR Loans or a combination thereof, and, in each case
if a combination thereof, the principal amount allocable to each; provided,
however, if such prepayment is anticipated to be made from Net Cash Proceeds to
be received at the time of the consummation of any Asset Sale, Specified
Offering or Recovery Event, the Borrower may
33
withdraw any such notice of prepayment on or before the proposed date of such
prepayment if for any reason the Borrower's receipt of the proceeds of such
Asset Sale, Specified Offering or Recovery Event has been terminated or
postponed. Upon the receipt of any such notice the Administrative Agent shall
promptly notify each affected Lender thereof. If any such notice is given and
not withdrawn as provided above, the amount specified in such notice shall be
due and payable on the date specified therein, together with (if a Eurodollar
Loan is prepaid other than at the end of the Interest Period applicable thereto)
any amounts payable pursuant to Section 4.11. Partial prepayments of Loans
outstanding under the Revolving Credit Facility not required to be made under
Section 4.2(C), 4.2(D) OR 4.2(E), shall be in an aggregate principal amount of
$500,000 or a whole multiple of $500,000 in excess thereof or such amount as may
then be outstanding under the Revolving Credit Facility.
(b) The Borrower shall have the right, upon not less than three
Business Days' notice to the Administrative Agent (which will promptly notify
the Lenders thereof), to terminate the Commitments or, from time to time, to
reduce the amount of such Commitments; PROVIDED, that no such termination or
reduction of Revolving Credit Commitments shall be permitted if, after giving
effect thereto and to any prepayments of the Revolving Credit Loans made on the
effective date thereof, the sum of the aggregate outstanding Revolving Credit
Loans would exceed the aggregate Revolving Credit Commitments then in effect.
Any such reduction shall be in a minimum amount of $500,000 or a whole multiple
of $500,000 in excess thereof and shall reduce permanently the relevant
Commitments then in effect. Any Commitment reductions under this Section 4.2(B)
shall not affect the amount of the percentage reductions required under Section
4.2(C).
(c) If at any time the sum of the aggregate outstanding Revolving
Credit Loans of all Revolving Credit Lenders exceeds the Total Revolving Credit
Commitment then in effect, the Borrower shall, without notice or demand,
immediately repay the Revolving Credit Loans in an aggregate principal amount
equal to such excess, together with accrued and unpaid interest on the principal
amount so paid or prepaid to the date of such payment or prepayment and any
amounts payable under Section 4.11.
(d) (i) If the Borrower or any Subsidiary shall consummate a
Specified Offering, except to the extent a Reinvestment Notice is
delivered in respect thereof, an amount equal to 100% of the Net Cash
Proceeds thereof shall be applied no later than the date of the
consummation of such Specified Offering toward the prepayment of the
Revolving Credit Loans and a corresponding permanent reduction of the
Total Revolving Credit Commitment as set forth in Section 4.2(e);
PROVIDED, that notwithstanding the foregoing, on each Reinvestment
Prepayment Date, an amount equal to the Reinvestment Prepayment Amount
with respect to the relevant Reinvestment Event shall be applied toward
the prepayment of the Revolving Credit Loans and a corresponding
permanent reduction of the Total Revolving Credit Commitment as set
forth in Section 4.2(e).
(ii) If on any date the Borrower or any Subsidiary shall
receive Net Cash Proceeds from any Asset Sale or from any Recovery
Event then, except to the extent a Reinvestment
34
Notice is delivered with respect to all or a specified portion of the
Net Proceeds in respect thereof, an amount equal to 100% of such Net
Cash Proceeds (not so specified in a Reinvestment Notice) shall be
applied no later than the date of such receipt toward the prepayment of
the Revolving Credit Loans and a corresponding permanent reduction of
the Total Revolving Credit Commitment as set forth in Section 4.2(e);
PROVIDED, that notwithstanding the foregoing, on each Reinvestment
Prepayment Date, an amount equal to the Reinvestment Prepayment Amount
with respect to the relevant Reinvestment Event shall be applied toward
the prepayment of the Revolving Credit Loans and a corresponding
permanent reduction of the Total Revolving Credit Commitment as set
forth in Section 4.2(E).
(iii) If, but for this Section 4.2(D)(III), the Borrower or
any Subsidiary would be required to make any payment on account of,
make an offer to purchase or set apart assets for a sinking or other
analogous fund for the purchase, redemption, defeasance, retirement or
other acquisition of, any Indebtedness of the Borrower or any
Subsidiary from the proceeds of any Asset Sale, Recovery Event or
Specified Offering, other than amounts payable in respect of the
Obligations pursuant to this Agreement and amounts required to be
applied to the repayment of Indebtedness secured by a Permitted Lien on
any property or asset which is the subject of such Asset Sale or
Recovery Event (other than any Lien in favor of the Administrative
Agent for the benefit of the Secured Parties), then an amount equal to
100% of such proceeds shall be applied no later than 10 days prior to
the date any such payment, offer to purchase or setting apart of such
assets would be required under the terms of any indenture or other
agreement evidencing, creating or governing such Indebtedness toward
the prepayment of the Revolving Credit Loans and corresponding
permanent reductions of and the Total Revolving Credit Commitment as
set forth in Section 4.2(E).
(e) Amounts to be applied in connection with prepayments and Commitment
reductions required by Sections 4.2(E) shall be applied, pro rata (based on the
then total amount of the Total Revolving Credit Commitment) to reduce
permanently the Total Revolving Credit Commitment. In the case of any reduction
of the Total Revolving Credit Commitment the Borrower shall, if applicable,
comply with the requirements of Section 4.2(D). The application of any
prepayment to the Loans pursuant to this Section 4.2 shall be made first to ABR
Loans and second to Eurodollar Loans. Each prepayment of the Loans under this
Section 4.2 shall be accompanied by accrued and unpaid interest to the date of
such prepayment on the amount prepaid and any amounts payable under Section
4.11.
4.3 FEES. (a) The Borrower agrees to pay to the Administrative Agent
for the account of each relevant Lender, a commitment fee equal to 0.375% of the
average daily amount of the Available Revolving Credit Commitment of such
Lender.
Such commitment fee shall be (i) payable quarterly in arrears on the last
Business Day of each March, June, September and December and on the Revolving
Credit Termination Date and (ii) fully earned and non-refundable upon payment
thereof.
35
(b) The Borrower shall pay (without duplication of any fee payable
under Section 4.3(A)) to the Administrative Agent the fees provided for in the
Fee Letter on the dates and in the amounts provided for therein.
(c) The Borrower shall pay to the Administrative Agent, for the account
of each Revolving Credit Lender, a letter of credit fee with respect to each
Letter of Credit, computed for the period from and including the date of
issuance of such Letter of Credit to the date such Letter of Credit is no longer
outstanding, computed at a percentage rate per annum equal to the Applicable
Margin from time to time applicable to Revolving Credit Loans bearing interest
at the Eurodollar Rate, calculated on the basis of a 360-day year, consisting of
twelve 30-day months, of the aggregate average daily amount available to be
drawn under such Letter of Credit for the period as to which payment of such fee
is made, payable on each L/C Fee Payment Date to occur while such Letter of
Credit remains outstanding and on the date such Letter of Credit expires, is
canceled or is drawn upon. Such fee shall be nonrefundable. In addition to the
foregoing fees, the Borrower shall pay to the Issuing Lender the fees provided
for in the L/C Fee Letter, in the amounts and on the dates provided for therein.
4.4 COMPUTATION OF INTEREST AND FEES. Interest (other than interest
based on the Eurodollar Rate) and commitment fees shall be calculated on the
basis of a 365- (or 366-, as the case may be) day year for the actual days
elapsed; and interest based on the Eurodollar Rate shall be calculated on the
basis of a 360-day year, consisting of twelve 30-day months. The Administrative
Agent shall as soon as practicable notify the Borrower and the affected Lenders
of each determination of a Eurodollar Rate. Any change in the interest rate on a
Loan resulting from a change in the ABR or the Eurocurrency Reserve Requirement
shall become effective as of the opening of business on the day on which such
change becomes effective. The Administrative Agent shall as soon as practicable
notify the Borrower and the affected Lenders of the effective date and the
amount of each such change in interest rate. Each determination of an interest
rate by the Administrative Agent pursuant to any provision of this Agreement
shall be conclusive and binding on the Borrower and the Lenders in the absence
of manifest error.
4.5 CONVERSION AND CONTINUATION OPTIONS. (a) Subject to the terms and
conditions hereof, the Borrower may elect from time to time to convert
Eurodollar Loans to ABR Loans by giving the Administrative Agent an irrevocable
Notice of Conversion/Continuation at least one Business Day prior to the
effective date of such election, which date shall be the last day of the
applicable Interest Period for such Loans. The Borrower may elect from time to
time to convert ABR Loans to Eurodollar Loans by giving the Administrative Agent
an irrevocable Notice of Conversion/Continuation at least three Business Days
prior to the effective date of such election. Any such Notice of
Conversion/Continuation concerning conversions to Eurodollar Loans shall specify
the length of the initial Interest Period or Interest Periods therefor. Upon
receipt of any such Notice, the Administrative Agent shall promptly notify each
relevant Lender thereof. All or any part outstanding Eurodollar Loans and ABR
Loans may be converted as provided herein.
36
(b) Any Eurodollar Loans may be continued as such upon the expiration
of the then current Interest Period with respect thereto by the Borrower giving
to the Administrative Agent an irrevocable Notice of Conversion/Continuation,
specifying therein the length of the next Interest Period to be applicable to
such Loans, determined in accordance with the applicable provisions of the term
"Interest Period" set forth in Section l.l; PROVIDED, that if the Borrower
shall fail to give any such Notice, such Loans shall be automatically converted
to ABR Loans on the last day of such then expiring Interest Period. Upon receipt
of any such Notice of Conversion/Continuation pursuant to this Section 4.5(b),
the Administrative Agent shall promptly notify each relevant Lender thereof.
4.6 MINIMUM AMOUNTS OF TRANCHES. All borrowings, conversions,
continuations and payments of Loans hereunder and all selections of Interest
Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, the aggregate principal amount
of the Eurodollar Loans comprising each Tranche shall be equal to $500,000 or a
whole multiple of $500,000 in excess thereof. In no event shall there be more
than [5] Tranches outstanding at any time.
4.7 INABILITY TO DETERMINE INTEREST RATE/ILLEGALITY. (a) If prior to
the first day of any Interest Period:
(i) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that,
by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate for
such Interest Period, or
(ii) the Administrative Agent shall have received notice from
the Majority Lenders that the Eurodollar Rate determined or to be
determined for such Interest Period will not adequately and fairly
reflect the cost to such Lenders (as conclusively certified by such
Lenders) of making or maintaining their affected Loans during such
Interest Period,
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as practicable thereafter. If such notice is
given (x) any Eurodollar Loans requested to be made on the first day of such
Interest Period shall be made as ABR Loans, unless the Borrower withdraws its
request on or before 2:00 p.m., Dallas, Texas time, on the Business Day next
preceding the first day of the proposed Interest Period, (y) any Loans that were
to have been converted on the first day of such Interest Period to Eurodollar
Loans shall be continued as ABR Loans and (z) any outstanding Eurodollar Loans
shall be converted, on the first day of such Interest Period, to ABR Loans.
Until such notice has been withdrawn by the Administrative Agent, no further
Eurodollar Loans shall be made or continued as such, nor shall the Borrower have
the right to convert Loans to Eurodollar Loans.
37
(b) Notwithstanding any other provision of this Agreement, if, after
the date hereof, any change in any Requirement of Law or in the interpretation
thereof by any Governmental Authority charged with the administration or
interpretation thereof shall make it unlawful for any Lender to make or maintain
any Eurodollar Loan or to give effect to its obligations as contemplated hereby
with respect to any Eurodollar Loan, then, by written notice to the Borrower and
to the Administrative Agent such Lender may:
(i) declare that Eurodollar Loans will not thereafter (for the
duration of such unlawfulness) be made by such Lender hereunder (or be
continued for additional Interest Periods and ABR Loans will not
thereafter (for such duration) be converted into Eurodollar Loans),
whereupon any request for Eurodollars (or to convert ABR Loans to
Eurodollar Loans or to continue Eurodollar Loans for an additional
Interest Period) shall, as to such Lender only, be deemed a request for
an ABR Loan (or request to continue an ABR Loan as such for an
additional Interest Period or to convert a Eurodollar Loan into an ABR
Loan, as the case may be), unless such declaration shall be
subsequently withdrawn); and
(ii) require that all outstanding Eurodollar Loans made by
it be converted to ABR Loans, in which event all such Eurodollar Loans
shall be automatically converted to ABR Loans as of the effective date
of such notice as provided below.
In the event any Lender shall exercise its rights under clause (i) or (ii) of
this Section 4.7(B), all payments and prepayments of principal that would
otherwise have been applied to repay the Eurodollar Loans that would have been
made by such Lender or the converted Eurodollar Loans of such Lender shall
instead be applied to repay the ABR Loans made by such Lender in lieu of, or
resulting from the conversion of, such Eurodollar Loans. For purposes of this
Section 4.7(B), a notice to the Borrower by any Lender shall be effective as to
each Eurodollar Loan, if lawful, on the last day of the Interest Period
currently applicable to such Eurodollar Loan; in all other cases such notice
shall be effective on the date of receipt by the Borrower.
4.8 TREATMENT AND PAYMENTS. (a) Each borrowing of Loans by the Borrower
hereunder shall be made, each payment by the Borrower on account of any fees
payable to the Lenders pursuant to Section 4.3(A) shall be allocated by the
Administrative Agent, and any reduction of the Commitments shall be allocated by
the Administrative Agent, according to the respective Revolving Credit Facility
Percentages of the relevant Lenders. Subject only to Section 4.2(E), each
payment (including each prepayment) by the Borrower on account of principal of
and interest on any Revolving Credit Loans shall be allocated by the
Administrative Agent according to the respective outstanding principal amounts
of such Revolving Credit Loans then held by the Revolving Credit Lenders. All
payments (including prepayments) to be made by the Borrower hereunder and under
any Notes, whether on account of principal, interest, fees or otherwise, shall
be made without set-off or counterclaim and shall be made prior to 11:00 a.m.,
Dallas, Texas time, on the due date thereof to the Administrative Agent, for the
account of the Lenders holding the relevant Loans, as the case may be, at the
Administrative Agent's office specified in Section 11.2, in Dollars and in
immediately available funds. Payments received by the Administrative Agent after
such time shall be deemed
38
to have been received on the next Business Day. If any payment hereunder becomes
due and payable on a day other than a Business Day, the maturity of such payment
shall be extended to the next succeeding Business Day, (and, with respect to
payments of principal, interest thereon shall be payable at the then applicable
rate during such extension) unless, with respect to payments of Eurodollar Loans
only, the result of such extension would be to extend such payment into another
calendar month, in which event such payment shall be made on the immediately
preceding Business Day.
(b) Unless the Administrative Agent shall have been notified in writing
by any Lender prior to a borrowing that such Lender will not make the amount
that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Effective Rate for the period
until such Lender makes such amount immediately available to the Administrative
Agent. If such Lender's share of such borrowing is not made available to the
Administrative Agent by such Lender within three Business Days after such
Borrowing Date, the Administrative Agent shall notify the Borrower of the
failure of such Lender to make such amount available to the Administrative Agent
and the Administrative Agent shall also be entitled to recover from the
Borrower, on demand, such amount with interest thereon at the rate per annum
applicable to ABR Loans.
4.9 REQUIREMENTS OF LAW. (a) If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority or the NAIC made
subsequent to the date hereof:
(i) shall subject any Lender to any tax of any kind whatsoever
with respect to this Agreement, any Note or any Eurodollar Loan made by
it, or change the basis of taxation of payments to such Lender in
respect thereof;
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Eurodollar Rate; or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar
39
Loans or to reduce any amount receivable hereunder in respect thereof, then, in
any such case, the Borrower shall promptly pay such Lender such additional
amount or amounts as will compensate such Lender on an after tax basis for such
increased cost or reduced amount receivable.
(b) If any Lender shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority or the NAIC made subsequent to the date hereof shall have the effect
of reducing the rate of return on such Lender's or such corporation's capital as
a consequence of its obligations hereunder to a level below that which such
Lender or such corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such corporation's
policies with respect to capital adequacy) by an amount deemed by such Lender to
be material, then from time to time, the Borrower shall, within 30 calendar days
after demand by such Lender, pay to such Lender such additional amount or
amounts as will compensate such Lender on an after tax basis for such reduction.
(c) If any Lender becomes entitled to claim any additional amounts
pursuant to this Section 4.9, it shall promptly deliver a notice to the Borrower
(with a copy to the Administrative Agent), setting forth in reasonable detail an
explanation of the basis for requesting such compensation. Such notice as to any
additional amounts payable pursuant to this Section 4.9 submitted by such Lender
to the Borrower (with a copy to the Administrative Agent) shall be conclusive in
the absence of manifest error. The Borrower shall pay each Lender the amount
shown as due on any such certificate delivered by it within 30 calendar days
after the Borrower's receipt thereof. Notwithstanding any other provision of
this Section 4.9, each Lender shall be entitled to compensation under this
Section 4.9 for only such costs as are incurred or reductions as are suffered as
to which a certificate has been delivered in accordance with the terms of this
paragraph (c) within six months after such Lender obtained actual knowledge of
such costs or reductions. The agreements in this Section 4.9 shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
4.10 TAXES. (a) All payments made by the Borrower under this Agreement
and any Notes shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future Taxes, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental Authority,
excluding net income taxes and franchise taxes (imposed with respect to net
income) imposed on the Administrative Agent or any Lender as a result of a
present or former connection between the Administrative Agent or such Lender and
the jurisdiction of the Governmental Authority imposing such Tax or any taxing
authority thereof or therein (other than any such connection arising solely from
the Administrative Agent or such Lender having executed, delivered or performed
its obligations or received a payment under, or enforced, this Agreement or any
Note). If any such non-excluded Taxes ("NON-EXCLUDED TAXES") are required to be
withheld from any amounts payable to the Administrative Agent or any Lender
hereunder or under any Note, the amounts so payable to the Administrative Agent
or such Lender shall be increased to the extent
40
necessary to yield to the Administrative Agent or such Lender (after payment of
all Non-Excluded Taxes) interest or any such other amounts payable hereunder at
the rates or in the amounts specified in this Agreement; PROVIDED, that the
Borrower shall not be required to increase amounts payable to any Non-U.S.
Lender (as defined below) if (i) at the time such Non-U.S. Lender becomes a
party to this Agreement, such Non-U.S. Lender fails or is not legally able to
comply with the requirements of Section 4.10(B) or (ii) after such Non-U.S.
Lender becomes a party to this Agreement such Non- U.S. Lender fails to comply
with the requirements of Section 4.10(B) and is legally able to do so. Whenever
any Non-Excluded Taxes are payable by the Borrower, as promptly as possible
thereafter the Borrower shall send to the Administrative Agent for its own
account or for the account of such Lender, as the case may be, a certified copy
of an original of ficial receipt (to the extent the relevant taxing authority
issues such receipts) received by the Borrower or other evidence of payment
thereof. If, when the Borrower is required by this Section 4.10(A) to pay any
Non-Excluded Taxes, the Borrower fails to pay such Non-Excluded Taxes when due
to the appropriate taxing authority or fails to remit to the Administrative
Agent the required receipts or other required documentary evidence, the Borrower
shall indemnify the Administrative Agent and the Lenders for any incremental
Taxes, interest or penalties that may become payable by the Administrative Agent
or any Lender as a result of any such failure.
(b) Each Lender (or Transferee) that is not a citizen or resident of
the United States of America, a corporation, partnership or other entity created
or organized in or under the laws of the United States of America, or any estate
or trust that is subject to federal income taxation regardless of the source of
its income (a "NON-U.S. LENDER") shall deliver to the Borrower and the
Administrative Agent (or, in the case of a Participant, to the Lender from which
the related participation shall have been purchased) two copies of either U.S.
Internal Revenue Service Form 1001 or Form 4224, or, in the case of a Non-U.S.
Lender claiming exemption from U.S. federal withholding tax under Section 871
(h) or 88 l(c) of the Code with respect to payments of "portfolio interest,"
Form W-8, or any subsequent versions thereof or successors thereto (and, if such
Non-U.S. Lender delivers Form W-8, an annual certificate representing that such
Non-U.S. Lender (i) is not a "bank" for purposes of Section 881(c) of the Code
(and is not subject to regulatory or other legal requirements as a bank in any
jurisdiction, and has not been treated as a bank in any filing with or
submission made to any Governmental Authority or rating agency), (ii) is not a
10-percent shareholder (within the meaning of Section 871 (h)(3)(B) of the Code)
of the Borrower and (iii) is not a controlled foreign corporation related to the
Borrower (within the meaning of Section 864(d)(4) of the Code)), in each case
properly completed and duly executed by such Non-U.S. Lender claiming complete
exemption from, U.S. federal withholding tax on all payments of principal and
interest by the Borrower under this Agreement and the other Loan Documents,
along with such other additional forms as the Borrower or the Administrative
Agent (or, in the case of a Participant, the Lender from which the related
participation shall have been purchased) may reasonably request to establish the
availability of such complete exemption. Such forms shall be delivered by each
Non-U.S. Lender on or before the date it becomes a party to this Agreement (or,
in the case of any Participant, on or before the date such Participant purchases
the related participation). In addition, each Non-U.S. Lender shall deliver such
forms promptly upon the obsolescence or invalidity of any form previously
delivered by such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify
the Borrower at
41
any time it determines that it is no longer in a position to provide any
previously delivered certificate to the Borrower (or any other form of
certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other provision of this Section 4.10, a Non-U.S. Lender that
appropriately delivered the requisite forms to the Borrower and the
Administrative Agent pursuant to this Section 4.10(B) at the time it became a
party to this Agreement shall not be required to deliver any other forms
pursuant to this Section 4.10(b) that such Non-U.S. Lender is not thereafter
legally able to deliver.
(c) The agreements in this Section 4.10 shall survive the termination
of this Agreement and the payment of the Loans and all other amounts payable
hereunder.
4.11 INDEMNITY. THE BORROWER AGREES TO INDEMNIFY EACH LENDER AND TO
HOLD EACH LENDER HARMLESS FROM ANY LOSS OR EXPENSE WHICH SUCH LENDER MAY SUSTAIN
OR INCUR AS A CONSEQUENCE OF (A) THE FAILURE OF THE BORROWER TO MAKE A BORROWING
OF, CONVERSION INTO OR CONTINUATION OF EURODOLLAR LOANS AFTER THE BORROWER HAS
GIVEN A NOTICE REQUESTING THE SAME IN ACCORDANCE WITH THE PROVISIONS OF THIS
AGREEMENT, (B) THE FAILURE OF THE BORROWER TO MAKE ANY PREPAYMENT OF EURODOLLAR
LOANS AFTER THE BORROWER HAS GIVEN A NOTICE THEREOF IN ACCORDANCE WITH THE
PROVISIONS OF THIS AGREEMENT OR (C) THE MAKING OF A PREPAYMENT OF EURODOLLAR
LOANS ON A DAY WHICH IS NOT THE LAST DAY OF AN INTEREST PERIOD WITH RESPECT
THERETO, EXCEPT WHEN SUCH FAILURE OR PREPAYMENT IS REQUIRED BY SECTION 4.7 OR
SECTION 4.9. SUCH INDEMNIFICATION MAY INCLUDE AN AMOUNT EQUAL TO THE EXCESS, IF
ANY, OF (I) THE AMOUNT OF INTEREST WHICH WOULD HAVE ACCRUED ON THE AMOUNT SO
PREPAID, OR NOT SO BORROWED, CONVERTED OR CONTINUED, FOR THE PERIOD FROM THE
DATE OF SUCH PREPAYMENT OR OF SUCH FAILURE TO BORROW, CONVERT OR CONTINUE TO,
BUT NOT INCLUDING, THE LAST DAY OF SUCH INTEREST PERIOD (OR, IN THE CASE OF A
FAILURE TO BORROW, CONVERT OR CONTINUE, THE INTEREST PERIOD THAT WOULD HAVE
COMMENCED ON THE DATE OF SUCH FAILURE) IN EACH CASE AT THE APPLICABLE RATE OF
INTEREST FOR SUCH LOANS PROVIDED FOR HEREIN (EXCLUDING, HOWEVER, THE APPLICABLE
MARGIN INCLUDED THEREIN, IF ANY) OVER (II) THE AMOUNT OF INTEREST (AS REASONABLY
DETERMINED BY SUCH LENDER) WHICH WOULD HAVE ACCRUED TO SUCH LENDER ON SUCH
AMOUNT BY PLACING SUCH AMOUNT ON DEPOSIT FOR A COMPARABLE PERIOD WITH LEADING
BANKS IN THE INTERBANK EURODOLLAR MARKET. THIS COVENANT SHALL SURVIVE THE
TERMINATION OF THIS AGREEMENT AND THE PAYMENT OF THE LOANS AND ALL OTHER AMOUNTS
PAYABLE HEREUNDER; PROVIDED, THAT INVOICES IN RESPECT OF AMOUNTS PAYABLE
PURSUANT TO THIS SECTION 4.11 MUST BE SUBMITTED NO LATER THAN THE DATE WHICH IS
60 DAYS AFTER THE TERMINATION DATE AND THE PAYMENT OF THE LOANS.
42
4.12 CHANGE OF LENDING OFFICE. Each Lender agrees that if it makes any
demand for payment under Section 4.9 or 4.10, it will use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions and
so long as such efforts would not be legally, regulatorily or economically
disadvantageous to it, as determined by it in good faith) to designate a
different lending office if the making of such a designation would reduce or
obviate the need for the Borrower to make payments under Section 4.9 or 4.10 or
would eliminate or reduce the effect of any adoption or change described in
Section 4.9.
4.13 REPLACEMENT OF LENDERS UNDER CERTAIN CIRCUMSTANCES. The Borrower
shall be permitted to replace any Lender which (a) requests reimbursement for
amounts owing pursuant to Section 4.9 or 4.10, (b) fails to fund its pro rata
share of any payment to the Administrative Agent which such Lender is obligated
to fund pursuant to Section 4.8(B) fails to fund its pro rata share (if any) of
any borrowing requested by the Borrower which such Lender is obligated to fund
pursuant to this Agreement, in each case with a replacement lender; PROVIDED
that (i) such replacement does not conflict with any Requirement of Law, (ii) no
Default shall have occurred and be continuing at the time of such replacement,
(iii) prior to any such replacement, such Lender shall not have taken action
under Section 4.12 which is sufficient to eliminate the continued need for
payment of amounts owing pursuant to Section 4.9 or 4.10, (iv) the Borrower
shall repay (or the replacement lender shall purchase, at par) all Loans and
other amounts owing to such replaced Lender on or prior to the date of
replacement, (v) the Borrower shall be liable to such replaced Lender under
Section 4.11(C) if any Eurodollar Loan owing to such replaced Lender shall be
prepaid (or purchased) other than on the last day of the Interest Period
relating thereto unless such replacement is made under the circumstances
described in clause (b) above, (vi) the replacement lender, if not already a
Lender, shall be reasonably satisfactory to the Administrative Agent, (vii) the
replaced Lender shall be obligated to make such replacement in accordance with
the provisions of Section 11.6(C) (PROVIDED, that the Borrower shall be
obligated to pay the registration and processing fee referred to therein) and
(viii) until such time as such replacement shall be consummated, the Borrower
shall pay all additional amounts (if any) required pursuant to Section 4.9 or
4.10, as the case may be.
SECTION 5. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans and to issue Letters of Credit, the Borrower
hereby represents and warrants to the Administrative Agent and each Lender that:
5.1 FINANCIAL CONDITION. (a) The consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at October 31, 1997 and the
related consolidated statements of operations and of cash flows for the fiscal
years ended on such dates, reported on by Ernst & Young LLP, copies of which
have heretofore been furnished to the Administrative Agent (with copies for each
of the Lenders), present fairly in all material respects the consolidated
financial condition of the Borrower and its consolidated Subsidiaries as at such
dates, and the consolidated results of their operations and their consolidated
cash flows for the fiscal year then ended. The unaudited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at April 30, 1998 and
43
the related unaudited consolidated statements of operations and of cash flows
for the six-month period ended on such date (the "INTERIM STATEMENTS"), copies
of which have heretofore been furnished to the Administrative Agent (with copies
for each of the Lenders), present fairly in all material respects the
consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of their operations
and their consolidated cash flows for the nine-month period then ended (subject
to normal year-end audit adjustments and the absence of complete footnote
disclosure). All such financial statements, including the related schedules and
notes thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved. Except as set forth on Schedule 5.1(a-1),
neither the Borrower nor any of its consolidated Subsidiaries had, at the date
of the balance sheet which is part of the Interim Statements, any material
Guarantee Obligation, contingent liability or liability for Taxes, or any
long-term lease or unusual forward or long-term commitment, including, without
limitation, any interest rate or foreign currency swap or exchange transaction,
which is not reflected in the Interim Statements (including the schedules and
notes thereto) and which would be required by GAAP to be disclosed in any
audited fiscal year-end consolidated financial statements of the Borrower and
its Subsidiaries (including the schedules and notes thereto). Except as set
forth on Schedule 5.1 (a-2), during the period from October 31, 1997 to and
including the date hereof there has been no sale, transfer or other disposition
by the Borrower or any of its consolidated Subsidiaries of any material part of
its business or property and no purchase or other acquisition of any business or
property (including any Capital Security of any other Person) material in
relation to the consolidated financial condition of the Borrower and its
consolidated Subsidiaries at October 31, 1997. The foregoing representation and
warranty is made on the Effective Date only to the knowledge of the Borrower.
(b) (i) The pro forma financial information, budgets and projections
attached hereto as Schedule 5.1(b) furnished to the Administrative Agent or any
Lender by or on behalf of the Borrower or any of their respective Affiliates
prior to the date of this Agreement in connection with this Agreement, the MFSNT
Acquisition and the transactions contemplated hereby and thereby and (ii) all
pro forma financial information, budgets and projections furnished to the
Administrative Agent or any Lender in connection with or pursuant to this
Agreement or any other Loan Document after the date of this Agreement and on or
prior to the date on which this representation and warranty is made or deemed
made, were in each case prepared and furnished to the Administrative Agent or
such Lender in good faith and were based on estimates and assumptions that were
believed by the management of the Borrower to be reasonable in light of the then
current and foreseeable business conditions of the Borrower and the Subsidiaries
and represented the Borrower's management's good faith estimate of the
consolidated projected financial performance of the Borrower and the
Subsidiaries based on the information available to the Responsible Offcers at
the time so furnished. The Administrative Agent and the Lenders recognize that
such pro forma financial information, budgets and projections and the estimates
and assumptions on which they are based may or may not prove to be correct.
(c) All Information made available to the Administrative Agent or any
Lender by or on behalf of the Borrower or any of their respective Affiliates in
connection with or pursuant to this Agreement or any other Loan Document on or
prior to the date on which this representation
44
and warranty is made or deemed made did not, as of the date such Information was
made available, contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements contained therein,
taken as a whole, not materially misleading in light of the circumstances under
which such statements were made.
5.2 FINANCIAL STATEMENTS/NO CHANGE. (a) The Financial Statements
(including in each case the related schedules and notes) delivered to the
Administrative Agent present fairly, in all material respects, the consolidated
financial position of the Borrower and their respective Subsidiaries at the
respective dates of the balance sheets included therein and the consolidated
results of their operations and their consolidated cash flows for the respective
periods set forth therein and have been prepared in accordance with GAAP
(subject, in the case of interim financial statements, to normal year-end
adjustments and the absence of complete footnote disclosure). As of the date of
any balance sheet included in such Financial Statements, none of the Borrower or
any of their respective Subsidiaries had any material Guarantee Obligation,
contingent liability or liability for Taxes, or any long-term lease or unusual
forward or long-term commitment, including, without limitation, any interest
rate or foreign currency swap or exchange transaction, which is not reflected in
such Financial Statements or in the schedules or notes thereto and which, with
respect to any audited Financial Statements, would be required by GAAP to be
disclosed therein (or in the notes and schedules thereto), and which, with
respect to any interim Financial Statements, would be required by GAAP to be
disclosed in any audited fiscal year-end consolidated financial statements of
the Borrower and its Subsidiaries, as the case may be (or in the notes and
schedules thereto).
(b) Since October 31, 1997, except as set out in Schedule 5.6, there
has been no development or event which has had or could reasonably be expected
to have a Material Adverse Effect.
5.3 EXISTENCE; COMPLIANCE WITH LAW. The Borrower and the Subsidiaries
(a) is duly organized, validly existing and in good standing under the laws of
the jurisdiction of its organization, (b) has the corporate or partnership power
and authority, and the legal right, to own and operate its property, to lease
the property it operates as lessee and to conduct the business in which it is
currently engaged, (c) is duly qualified and in good standing under the laws of
each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, except where the failure to
so qualify or to be in good standing could not reasonably be expected to have a
Material Adverse Effect, and (d) is in compliance with all Requirements of Law
except to the extent that the failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
5.4 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS. Each Loan Party has
the power and authority, and the legal right, to make, deliver and perform each
of the Loan Documents to which it is a party and to grant any security interests
provided for therein and, in the case of the Borrower, to borrow hereunder, and
has taken all necessary action to authorize the execution, delivery and
performance of each of the Loan Documents to which it is a party and, in the
case of the Borrower, to authorize the borrowings on the terms and conditions of
this Agreement. No action,
45
consent or authorization of, registration or filing with, notice to or other act
by or in respect of, any Governmental Authority or any other Person (including,
without limitation, any shareholder of any Loan Party or any Affiliate of any
Loan Party) is required to be obtained or made by any Loan Party or any
Subsidiary of any Loan Party in connection with the borrowings hereunder or with
the execution, delivery, performance, validity or enforceability of the Loan
Documents other than (a) the filings and notices required by the Pledge
Agreements and Security Agreements in the filing offices identified therein or
to the Persons identified therein and (b) such as have been obtained or made and
are in full force and effect. Each Loan Document has been duly executed and
delivered on behalf of each Loan Party thereto. Each Loan Document constitutes a
legal, valid and binding obligation of each Loan Party thereto enforceable
against each such Loan Party in accordance with its terms, subject to the
effects of bankruptcy, insolvency, fraudulent transfer or conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and general equitable principles (whether considered
in a proceeding in equity or at law).
5.5 NO LEGAL BAR. The execution, delivery and performance of the Loan
Documents, the borrowings hereunder and the use of the proceeds thereof will not
violate any Requirement of Law or be in conflict with, result in a breach of,
constitute (alone or with notice or lapse of time or both) a default under or
give rise to any right to accelerate any material obligation under any
Contractual Obligation of the Borrower or of any Subsidiary and will not result
in, or require, the creation or imposition of any Lien on any of their
respective properties or any revenues, income or profits therefrom, whether now
owned or hereafter acquired, pursuant to any such Requirement of Law or
Contractual Obligation (other than pursuant to the Security Documents).
5.6 NO MATERIAL LITIGATION. Except as set out in Schedule 5.6, no
Litigation is pending or, to the knowledge of the Borrower, threatened by or
against the Borrower, or any Subsidiary or against any of their respective
properties, revenues, income or profits therefrom (a) with respect to any of the
Loan Documents or any of the transactions contemplated hereby or thereby, or (b)
as to which there is a reasonable possibility of an adverse determination and,
that if adversely determined, could, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
5.7 NO DEFAULT. Neither the Borrower nor any Subsidiary is in default
under or with respect to any of its Contractual Obligations in any respect which
could reasonably be expected to have a Material Adverse Effect. No Default has
occurred and is continuing.
5.8 OWNERSHIP OF PROPERTY; INTELLECTUAL PROPERTY. (a) Each of the
Borrower and the Subsidiaries has good record and indefeasible title in fee
simple to, or a valid leasehold interest in, all its real property, and good
title to, a valid leasehold interest in, or a valid right to use, all its other
property and assets which are material to the operations of its businesses, in
each case subject only to Permitted Liens.
46
(b) (i) Each of the Borrower and the Subsidiaries has complied with all
obligations under all leases to which it is a party and all such leases are in
full force and effect and (ii) each of the Borrower and the Subsidiaries enjoys
peaceful and undisturbed possession under all such leases under which it is a
tenant, in each case except where the failure to comply or to enjoy such
possession, individually or in the aggregate, could not reasonably be expected
to have a Material Adverse Effect.
(c) Each of the Borrower and the Subsidiaries owns, or otherwise has
the right to use, all trademarks, tradenames, copyrights, technology, know-how
and processes (the "INTELLECTUAL PROPERTY") necessary for the conduct of its
business as currently conducted except for those which the failure to own or
have the right to use could not reasonably be expected to have a Material
Adverse Effect. Except for such claims that, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect, no claim has
been asserted and is pending by any Person challenging or questioning the use of
any such Intellectual Property or the validity or effectiveness of any such
Intellectual Property, nor does the Borrower know of any valid basis for any
claim. Except for such infringements that, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect, to the
knowledge of the Borrower, the use of such Intellectual Property by the Borrower
and the Subsidiaries does not infringe on the rights of any Person.
5.9 NO BURDENSOME RESTRICTIONS. No Contractual Obligation of the
Borrower or any Subsidiary could reasonably be expected to have a Material
Adverse Effect and, since the date of this Agreement, there has been no adoption
of or any change in any Requirement of Law or in the interpretation or
application thereof which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
5.10 TAXES. (a) (i) The Borrower and the Subsidiaries has filed or
caused to be filed all income tax returns which, to the knowledge of the
Borrower, are required to be filed and has paid all Taxes shown to be due and
payable by it on said returns and all other material Taxes (collectively, the
"SPECIFIED TAXES") imposed on it or any of its property or assets due and
payable by it and (ii) to the knowledge of the Borrower, no material claim is
being asserted with respect to any Specified Tax, other than, in each case with
respect to this clause (a), Specified Taxes the amount or validity of which are
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or the relevant Subsidiary, as the case may be, and (b) no
Liens have been filed and remain of record with respect to any Taxes aggregating
$1,000,000 or more.
5.11 FEDERAL REGULATIONS. Neither the Borrower nor any Subsidiary is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying Margin Stock. No part
of the proceeds of any Loan has been or will be used by the Borrower or any
Subsidiary, whether directly or indirectly, and whether immediately,
incidentally or ultimately, (i) to purchase or carry Margin Stock or to extend
credit to others for the purpose of purchasing or carrying Margin Stock or to
refund indebtedness originally incurred for
47
such purpose, or (ii) for any purpose that entails a violation of, or that is
inconsistent with, the provisions of the regulations of the Board including
Regulations G, U and X. If requested by any Lender or the Administrative Agent,
the Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form
G-3 or FR Form U-l referred to in said Regulation G or Regulation U, as the case
may be.
5.12 ERISA. Except as, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect: (a) neither a
Reportable Event nor an "accumulated funding deficiency" (within the meaning of
Section 412 of the Code or Section 302 of ERISA) has occurred during the
six-year period prior to the date on which this representation is made or deemed
made with respect to any Plan, and each Plan has complied in all material
respects with the applicable provisions of ERISA and the Code; (b) no
termination of a Single Employer Plan has occurred, and no Lien in favor of the
PBGC or a Plan has arisen, during such six-year period; (c) the present value of
all accrued benefits under each Single Employer Plan (based on those assumptions
used to fund such Plans) did not, as of the last annual valuation date prior to
the date on which this representation is made or deemed made, exceed the value
of the assets of such Single Employer Plan allocable to such accrued benefits;
(d) neither the Borrower nor any Commonly Controlled Entity has had a complete
or partial withdrawal from any Multiemployer Plan, and neither the Borrower nor
any Commonly Controlled Entity would become subject to any liability under ERISA
if the Borrower or any such Commonly Controlled Entity were to withdraw
completely from all Multiemployer Plans as of the valuation date most closely
preceding the date on which this representation is made or deemed made; and (e)
no such Multiemployer Plan is in Reorganization or Insolvent.
5.13 INVESTMENT COMPANY ACT; OTHER REGULATIONS. No Loan Party is an
"investment company" which is required to be registered under, or a "person
directly or indirectly controlled by or acting of behalf of " and "investment
company" which is required to be registered under, the Investment Company Act of
1940. No Loan Party is a "holding company" within the meaning of, or subject to
regulation under, the Public Utility Company Act of 1935. No Loan Party is
subject to regulation under any other federal or state statute or regulation
which limits its ability to incur Indebtedness under this Agreement or the other
Loan Documents.
5.14 SUBSIDIARIES. All Subsidiaries of the Borrower (and the respective
direct or indirect ownership interests of the Borrower therein) as of the
Effective Date are listed on Schedule 5.14. Except as permitted by Section
8.15(c), each Subsidiary is a Wholly Owned Subsidiary.
5.15 PURPOSE OF LOANS. The proceeds of the Revolving Credit Loans will
be used by the Borrower to (i) repay all of the Indebtedness outstanding under
(and permanently terminate any commitments thereunder) the Existing Bank
Facility and the NationsBank Existing Credits; (iii) finance working capital,
Capital Expenditures, Subject Acquisitions and other lawful general corporate
purposes and (iv) such other purposes to which the Majority Lenders have given
their prior written consent; PROVIDED, however that not more than $3,500,000 in
the aggregate of Revolving Credit Loans will be used as Investments in, or to
finance working capital or be used for general
48
corporate purposes, of Subsidiaries other than Restricted Subsidiaries; and
provided, further, that not more than $5,000,000 in the aggregate of Revolving
Credit Loans may be used to finance Subject Acquisitions.
5.16 CERTAIN REGULATORY MATTERS. Except as, in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect:
(a) the Borrower and the Subsidiaries possess all
Authorizations necessary to own and operate their respective businesses
and are not in violation thereof. All such Authorizations are in full
force and effect and no event has occurred that permits, or after
notice or lapse of time could permit, the revocation, termination prior
to scheduled termination, or material and adverse modification, of any
such Authorizations;
(b) there is not pending or, to the best knowledge of the
Borrower, threatened, any action by the FCC to revoke, cancel, suspend
or refuse to renew any FCC License held by the Borrower or any
Subsidiary. There is not pending or, to the best knowledge of the
Borrower, threatened, any action by the FCC to modify adversely,
revoke, cancel, suspend or refuse to renew any other Authorization held
by the Borrower or any Subsidiary; and
(c) there is not issued or outstanding or, to the best
knowledge of the Borrower, threatened, any notice of any hearing,
violation or complaint against the Borrower or any Subsidiary with
respect to the operation of any portion of the their respective
businesses and Properties and the Borrower has no knowledge that any
Person intends to contest renewal of any Authorization.
5.17 ENVIRONMENTAL MATTERS. (a) The properties now or formerly owned or
operated by the Borrower and the Subsidiaries (the "PROPERTIES") do not, to the
best of the knowledge of the Borrower and its Subsidiaries, contain any
Hazardous Materials in amounts or concentrations which (i) constitute, or
constituted a violation of, or (ii) could give rise to liability under,
Environmental Laws resulting from any Release of Hazardous Materials during the
Borrower's or any Subsidiary's ownership or operation of the properties or, to
the knowledge of the Borrower, at any other time, which violations and
liabilities, in the aggregate, could reasonably be expected to result in a
Material Adverse Effect or (iii) could reasonably be expected to impair
materially the fair saleable value thereof.
(b) The Properties and all operations of the Borrower and the
Subsidiaries are in compliance, and, to the extent the Borrower or any
Subsidiary owned or operated such Properties in the past three years, in the
last three years have been in compliance, with all Environmental Laws and all
necessary Environmental Permits have been obtained are in effect, except to the
extent that such noncompliance or failure to obtain any necessary permits in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
49
(c) During the time of the Borrower's or any Subsidiary's ownership or
operation of the properties and, to the knowledge of the Borrower, at any other
time, there have been no Releases or threatened Releases at, from, under or
proximate to the Properties or otherwise in connection with the operations of
the Borrower or any Subsidiary, which Releases or threatened Releases, in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.
(d) Neither the Borrower nor any Subsidiary has received any
Environmental Claim in connection with the Properties or the operations of the
Borrower or any Subsidiary or with regard to any Person whose liabilities for
environmental matters the Borrower or any Subsidiary has retained or assumed, in
whole or in part, contractually, by operation of law or otherwise, which, in the
aggregate, could reasonably be expected to result in a Material Adverse Effect,
nor do the Borrower or any Subsidiary have reason to believe that any such
notice will be received or is being threatened.
(e) Hazardous Materials have not been transported from the Properties
by the Borrower or any Subsidiary or, to the knowledge of Borrower, any other
party, nor have Hazardous Materials been generated, treated, stored or disposed
of at, on or under any other Properties in a manner that could reasonably be
expected to give rise to liability under any Environmental Law that would
constitute a Material Adverse Effect, nor have the Borrower or any Subsidiary
retained or assumed any liability, contractually, by operation of law or
otherwise, with respect to the generation, treatment, storage or disposal of
Hazardous Materials, which transportation, generation, treatment, storage or
disposal, or retained or assumed liabilities, in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.
5.18 SECURITY DOCUMENTS. (a) Each Pledge Agreement is effective to
create in favor of the Administrative Agent, for the ratable benefit of the
Secured Parties named therein, a legal, valid and enforceable security interest
in the Pledged Securities (as defined in the Pledge Agreement) and proceeds
thereof and, when the Collateral is delivered to the Administrative Agent, such
Pledge Agreement shall constitute a fully perfected first priority Lien on, and
security interest in, all right, title and interest of the pledgors thereunder
in such Collateral and the proceeds thereof, in each case prior and superior in
right to any other Person.
(b) Each Security Agreement is effective to create in favor of the
Administrative Agent, for the ratable benefit of the Secured Parties named
therein, a legal, valid and enforceable security interest in the Collateral (as
defined in the Security Agreement) and proceeds thereof and, when financing
statements in appropriate form as filed in the offices specified in the
Perfection Certificates, such Security Agreement shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the grantors thereunder in such Collateral and the proceeds thereof, in each
case prior and superior in right to any other Person, other than with respect to
the rights of Persons pursuant to Liens expressly permitted by Section 8.3.
5.19 SOLVENCY. As of the date on which this representation and warranty
is made or deemed made, each Loan Party is Solvent, both before and after giving
effect to the transactions
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contemplated hereby consummated on such date and to the incurrence of all
Indebtedness and other obligations incurred on such date in connection herewith
and therewith.
5.20 YEAR 2000 MATTERS. (a) The Borrower has (i) begun analyzing the
operations of the Borrower and its Subsidiaries and Affiliates that could be
adversely affected by failure to become Year 2000 compliant (that is, that
computer applications, imbedded microchips and other systems will be able to
perform date-sensitive functions prior to and after December 31, 1999) and (ii)
developed a plan for becoming Year 2000 compliant in a timely manner, the
implementation of which is on schedule in all material respects. The Borrower
reasonably believes that it will become Year 2000 compliant for its operations
and those of its Subsidiaries and Affiliates on a timely basis except to the
extent that a failure to do so could not reasonably be expected to have a
Material Adverse Effect.
(b) The Borrower reasonably believes any suppliers and vendors that are
material to the operations of the Borrower and its Subsidiaries and Affiliates
will be Year 2000 compliant for their own computer applications except to the
extent that a failure to do so could not reasonably be expected to have a
Material Adverse Effect.
(c) The Borrower will promptly notify the Administrative Agent if the
Borrower determines that any computer application which is material to the
operations of the Borrower, its Subsidiaries or any of its material vendors or
suppliers will not be fully 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.
SECTION 6. CONDITIONS PRECEDENT.
6.1 CONDITIONS TO INITIAL LOANS. The obligation of each Lender to make
the initial Loans requested to be made by it and the obligation of the Issuing
Lender to issue any Letter of Credit are subject to (i) the representations and
warranties contained in Section 5 being true and correct in all material
respects on the date such Loans are made, (ii) receipt by the Administrative
Agent, prior to or concurrently with the making of such Loans, of the documents
described below, each (other than the L/C Fee Letter) in form and substance
satisfactory to the Lenders, and (iii) satisfaction, prior to or concurrently
with the making of such Loans, of the other conditions precedent set forth
below, each in a manner satisfactory to the Lenders:
(a) CREDIT AGREEMENT. This Agreement, duly executed and
delivered by the Borrower.
(b) NOTES. The Revolving Credit Notes, duly executed and
delivered by the Borrower and payable to the order of each Lender,
dated the date of this Agreement.
(c) GUARANTY AGREEMENT. The Guaranty Agreement, duly executed
and delivered by each Restricted Subsidiary.
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(d) SECURITY AGREEMENTS. The Security Agreements, duly
executed and delivered by the Borrower and each Restricted Subsidiary.
(e) PLEDGE AGREEMENTS. The Pledge Agreements and the
Acknowledgment and Consents and Notices to Issuer of Pledged Notes,
duly executed and delivered by the Borrower and each applicable
Restricted Subsidiary.
(f) INTERCOMPANY NOTES. The Intercompany Notes, each duly
executed by the applicable Subsidiary dated as of the date of this
Agreement, and all other promissory notes pledged under the Pledge
Agreements to the Administrative Agent for the benefit of the Secured
Parties, in each case duly endorsed in blank by the payee thereunder.
(g) PLEDGED STOCK; STOCK POWERS. Certificates representing
100% ofthe shares of Capital Securities pledged pursuant to the Pledge
Agreements, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the
applicable Loan Party.
(h) UCC FINANCING STATEMENTS. All UCC financing statements
deemed necessary or appropriate by the Administrative Agent to perfect
the Liens in favor of the Administrative Agent for the benefit of the
Secured Parties, duly executed by the appropriate Loan Party, to be
recorded with the appropriate filing offices.
(i) OTHER ACTIONS TO PERFECT LIENS. All other actions
necessary or, in the opinion of the Administrative Agent, desirable to
perfect the Liens in favor of the Administrative Agent for the benefit
of the Secured Parties shall have been completed.
(j) LIEN SEARCHES. The results of a recent search by a Person
satisfactory to the Administrative Agent of the UCC, judgment and tax
lien filings which may have been filed with respect to personal
property of the Borrower or its Subsidiaries in each of the
jurisdictions in which financing statements will be filed to perfect
the security interests granted pursuant to the Loan Documents, and such
search shall reveal that no judgment or state or federal tax Liens have
been filed and remain in effect against any Loan Party or any
Collateral, and that no UCC financing statements or other notifications
or filings have been filed and remain in effect against any Loan Party
or any Collateral, other than (i) those for which the Administrative
Agent has received an appropriate release, termination or satisfaction
or (ii) Permitted Liens.
(k) CANCELLATION OF LIENS. Evidence that all Liens other than
Permitted Liens have been canceled and released, including duly
executed releases and UCC-3 financing statements in recordable form and
otherwise in form and substance satisfactory to the Administrative
Agent.
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(1) EXISTENCE, GOOD STANDING AND AUTHORITY. Original
certificates of existence and good standing, dated not more than 10
days prior to the date hereof, as applicable from appropriate officials
of each Loan Party's respective state of incorporation and certificates
of good standing and authority to do business, dated not more than 10
days prior to Effective Date, from appropriate officials of any and all
jurisdictions where each Loan Party's property or business makes
qualification to transact business therein necessary and where the
failure to be so qualified could reasonably be expected to have a
Material Adverse Effect.
(m) RESOLUTIONS. Copies of resolutions of each Loan Party
approving this Agreement and the other Loan Documents to which such
Loan Party is a party and authorizing the transactions contemplated
herein and therein, duly adopted at a meeting of, or by the unanimous
written consent of, the Board of Directors of such Loan Party.
(n) CHARTER DOCUMENTS. A copy of all Charter Documents
(including, without limitation, all certificates of merger) of each
Loan Party. The articles/certificate of incorporation of each Loan
Party shall be accompanied by an original certificate issued by the
Secretary of the State of incorporation of such Loan Party, dated not
more than 10 days prior to the date hereof, certifying that such copy
is correct and complete.
(o) CLOSING CERTIFICATE. A Closing Certificate of each Loan
Party, dated the date of this Agreement, substantially in the form of
Exhibit N, together with the identified attachments, duly executed by a
Responsible Officer and the Secretary or any Assistant Secretary of the
applicable Loan Party.
(p) INSURANCE. Certificates of insurance naming the
Administrative Agent as loss payee for the benefit of the Lenders and
naming the Administrative Agent and the Lenders as additional insureds,
as required by Section 7.5.
(q) PERFECTION CERTIFICATE. A Perfection Certificate, dated
the date of this Agreement, duly executed by the Loan Parties.
(r) COMPLIANCE CERTIFICATE. A Compliance Certificate, dated
the date of this Agreement, duly executed by a Responsible Officer of
the Borrower, evidencing that no Default exists both before and after
giving effect to the transactions contemplated hereby.
(s) OPINIONS OF COUNSEL. Original executed opinions, dated
the date of this Agreement, (i) from Gunster, Yoakley, Xxxxxx-Xxxxx &
Xxxxxxx, counsel to the Borrower, substantially in the form of Exhibit
O, and (ii) from such local counsel to the Loan Parties as the
Administrative Agent may require in respect of the Security Documents,
each in form and substance satisfactory to the Administrative Agent.
(t) FEES. The Administrative Agent and the Lenders shall have
received (i) all fees and expenses that are due and payable on or
before the date such Loans are made
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pursuant to this Agreement or the Fee Letter and (ii) an amount equal
to the estimated fees and expenses of Xxxxx & Xxxxx, L.L.P. incurred in
connection with the preparation, examination, negotiation, execution
and delivery of this Agreement, the other Loan Documents and the
consummation of the transactions contemplated by the foregoing.
(u) L/C FEE LETTER. The L/C Fee Letter, duly executed and
delivered by the Borrower.
(v) PRO FORMA FINANCIAL STATEMENTS/PRO FORMA COMPLIANCE
CERTIFICATE. The Administrative Agent and the Lenders shall have
received pro forma financial statements for the Borrower based on the
preceding four fiscal quarters of the Borrower and its Subsidiaries,
giving effect to the borrowings requested under this Section 6.1, and
all transactions (including financings and fees and expenses) relating
to the foregoing, consisting of a consolidated balance sheet as at the
end of the most recently ended fiscal quarter of the Borrower and the
related consolidated statements of operations and cash flows for such
period of four fiscal quarters, together with a Pro Forma Compliance
Certificate, giving effect to the borrowings requested under this
Section 6.1 and all transactions relating to the foregoing.
(w) CONSENT AND WAIVER BY HOLDERS OF 12% SUBORDINATED NOTES.
The Administrative Agent shall have received a copy of the written
consent of the holders of the 12% Subordinated Notes to the
transactions contemplated hereby.
(x) REPAYMENT, REPURCHASE, REDEMPTION AND/OR CANCELLATION OF
INDEBTEDNESS. All Indebtedness and all other obligations outstanding
with respect to the Existing Bank Facility, and the NationsBank
Existing Credits and all other Indebtedness not permitted by Section
8.2 shall have been paid or otherwise discharged in full, and all Liens
created in connection therewith shall have been either terminated or
assigned to the Administrative Agent for the benefit of the Secured
Parties.
(y) GOVERNMENTAL AND THIRD PARTY APPROVALS. All material
Authorizations and third-party approvals in connection with the
transactions contemplated by the Loan Documents shall have been
obtained and shall be in full force and effect, and all applicable
waiting periods shall have expired without any action being taken or
threatened by any competent authority which would restrain, prevent or
otherwise impose materially adverse conditions on the transactions
contemplated by the Loan Documents and copies of all such
Authorizations and third-party approvals shall be delivered to the
Administrative Agent.
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(z) NO MATERIAL LITIGATION. Except as set out in Schedule 5.6,
no Litigation, including, without limitation, any injunction or
restraining order, shall be pending, entered or threatened in writing
which could reasonably be expected to (i) have a Material Adverse
Effect or (ii) materially and adversely affect the issuance of the
Notes or the Borrower's and its Subsidiaries' performance of their
obligations under the Loan Documents.
(aa) NO MATERIAL ADVERSE EFFECT. There shall not have occurred
any change, development or event which could reasonably be expected to
(i) have a Material Adverse Effect or (ii) materially and adversely
affect the issuance of the Notes or the Borrower's and its
Subsidiaries' performance of their obligations under the Loan
Documents.
(bb) NO MATERIAL ADVERSE INFORMATION. The Lenders shall not
have become aware of any previously undisclosed materially adverse
information with respect to the ability of the Loan Parties to perform
their respective obligations under the Loan Documents in any material
respect or the rights and remedies of the Lenders.
(cc) NO MATERIAL DEFAULT UNDER OTHER AGREEMENTS. There shall
exist no event of default (or condition which would constitute such an
event of default with the giving of notice or the passage of time)
under any Capital Security or any lease agreements or other material
Contractual Obligations of the Borrower or any of its Subsidiaries.
(dd) ADDITIONAL DOCUMENTATION. All other documentation,
including, without limitation, any employment agreement, management
compensation arrangement or other financing arrangement of the Borrower
or any Subsidiary shall be reasonably satisfactory in form and
substance to the Lenders.
(ee) ALL PROCEEDINGS SATISFACTORY. All corporate and other
proceedings taken prior to or at the closing in connection with the
transactions contemplated by this Agreement, the other Loan Documents
and all documents and evidences incident thereto shall be satisfactory
in form and substance to the Lenders, and the Lenders shall have
received such copies thereof and such other materials (certified, if
requested) as they may have reasonably requested in connection
therewith.
(ff) FINANCIAL STATEMENTS. A copy of the consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at October
31, 1997 and the related statements of operations, stockholders' equity
(deficit) and cash flows for such year (including consolidating
statements for the Borrower and its consolidated Subsidiaries), setting
forth, in each case in comparative form the figures for the previous
year, and the schedules and notes related thereto, prepared in
accordance with GAAP and reported on without qualification by an
independent certified public accounting firm of nationally recognized
standing.
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(gg) CIBC ASSIGNMENT AND ACCEPTANCE. Canadian Imperial Banking
Corporation (or an affiliate thereof) shall have executed and delivered
an Assignment and Acceptance (in the form attached hereto as Exhibit B)
covering 50% of the Commitments.
6.2 CONDITIONS TO EACH LOAN FOR A SUBJECT ACQUISITION. The obligation
of each applicable Lender to make Loans to finance any Subject Acquisition is
subject to the satisfaction, immediately prior to or concurrently with the
making of such Loans on the applicable funding date, of the following conditions
precedent, each in a manner reasonably satisfactory to the Lenders:
(a) INITIAL CONDITIONS SATISFIED. Each of the conditions set
forth in Section 6.1 shall have been satisfied and shall continue to be
satisfied on the date of such Loans.
(b) PRO FORMA FINANCIAL STATEMENTS/COMPLIANCE CERTIFICATE. The
Lenders (through the Administrative Agent) shall have received (i) pro
forma financial statements for the preceding four fiscal quarters of
the Borrower for which Financial Statements have then most recently
been delivered to the Lenders pursuant to Section 7.1(a) or (b), giving
effect to the Subject Acquisition, consisting of a consolidated balance
sheet as at the end of such four fiscal quarter period and the related
consolidated statements of operations and cash flows for such period of
four fiscal quarters and the notes related thereto, together with a Pro
Forma Compliance Certificate, giving effect to such Subject Acquisition
demonstrating that no Default exists both before and after giving
effect to the Subject Acquisition and the transactions contemplated
thereby and (ii) a "Sources and Uses" table.
(c) GOVERNMENTAL AND THIRD PARTY APPROVALS. All material
Authorizations and third party approvals necessary or appropriate in
connection with the Subject Acquisition shall have been obtained and be
in full force and effect, and all applicable waiting periods shall have
expired without any action being taken or threatened by any competent
authority which would restrain, prevent or otherwise impose materially
adverse conditions on the Subject Acquisition or the financing thereof.
(d) NO MATERIAL LITIGATION. No Litigation, injunction or
restraining order shall be pending, entered or threatened in writing
which would reasonably be expected to have a material adverse effect on
the Subject Acquisition.
(e) NO MATERIAL ADVERSE EFFECT. There shall not have occurred
any change, development or event which would reasonably be expected to
have a Material Adverse Effect and the applicable Lenders shall not
have become aware of any materially adverse information with respect to
the Subject Acquisition.
(f) ACQUISITION CRITERIA SATISFIED. All Acquisition Criteria
shall have been fully satisfied.
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(g) APPRAISALS. The applicable Lenders shall have copies of
all appraisals made available to the Borrower or conducted by or on
behalf of the Borrower with respect to the Subject Acquisition.
(h) ENVIRONMENTAL AUDITS. The Lenders shall have received
copies of all environmental audits made available to the Borrower or
conducted by or on behalf of the Borrower with respect to the Subject
Acquisition.
(i) CONSUMMATION OF ACQUISITION. The applicable Lenders shall
have received satisfactory evidence that the Subject Acquisition shall
have been consummated prior to or concurrently with the making of the
Revolving Loans or Acquisition Loans, as applicable.
(j) ADDITIONAL LOAN DOCUMENTS. The appropriate Persons shall
have executed and delivered to the Administrative Agent the Loan
Documents required by Section 7.9, together with certificates and
documents of the types described in Section 6.1(f), (g), (h), (i), (j),
(k), (l), (m), (n), (o), (p), (q), (r), (s), (t), (u), (v) and (x), as
applicable, with respect to the enterprise to be acquired and the
applicable Loan Parties.
(k) ALL PROCEEDINGS SATISFACTORY. All corporate and other
proceedings taken prior to or at the closing in connection with the
Subject Acquisition and all documents and evidences incident thereto
shall be reasonably satisfactory in form and substance to the
applicable Lenders, and such Lenders shall have received such copies
thereof and such other materials (certified, if requested) as they may
have reasonably requested in connection therewith.
(l) MAXIMUM UTILIZATION. After giving effect to the Loans to
finance the Subject Acquisition, the aggregate amount of Revolving
Credit Loans made for the purpose of financing Subject Acquisitions
does not exceed $5,000,000.
(m) OTHER CONDITIONS. The satisfaction of such other
conditions as the applicable Lenders may reasonably require, including,
without limitation, evidence satisfactory to the Administrative Agent
that such Indebtedness may be incurred under any debt security,
indenture or other agreement evidencing, creating or governing any
other Indebtedness of the Borrower or any Subsidiary.
6.3 CONDITIONS TO ALL LETTERS OF CREDIT. The agreement of the Issuing
Lender to issue the Letter of Credit requested to be issued by it on any date
(including, without limitation, the initial Letter of Credit) is subject to the
satisfaction of the following conditions precedent:
(a) INITIAL CONDITIONS SATISFIED. Each of the conditions
precedent set forth in Section 6.1 shall have been satisfied and shall
continue to be satisfied on the date of issuance of such Letter of
Credit.
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(b) REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties made by any Loan Party in or pursuant to
the Loan Documents shall be true and correct in all material respects
on and as of such date as if made on and as of such date, after giving
effect to such Letter of Credit and the proposed use thereof.
(c) NO DEFAULT. No Default shall have occurred and be
continuing on such date or would occur after the issuance of such
Letter of Credit on such date and after giving effect to the proposed
use thereof.
Upon the issuance of each Letter of Credit hereunder, the Borrower shall be
deemed to have represented and warranted as of the date of such issuance that
the conditions contained in this Section 6.3 have been satisfied.
6.4 CONDITIONS TO ALL LOANS. The agreement of each Lender to make any
Loan requested to be made by it on any date (including, without limitation, its
initial Loans) is subject to the satisfaction of the following conditions
precedent:
(a) INITIAL CONDITIONS SATISFIED. Each of the conditions set
forth in Section 6.1 shall have been satisfied and shall continue to be
satisfied on the date of such Loans.
(b) REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties made by any Loan Party in or pursuant to
the Loan Documents shall be true and correct in all material respects
on and as of such date as if made on and as of such date, both before
and after giving effect to the extension of credit requested to be made
on such date and the proposed use of the proceeds thereof.
(c) NO DEFAULT. No Default shall have occurred and be
continuing on such date or after the making of the Loans requested to
be made on such date and the proposed use of the proceeds thereof.
(d) NOTICE OF BORROWING/PRO FORMA COMPLIANCE CERTIFICATE. The
Borrower shall have submitted a Pro Forma Compliance Certificate and a
Notice of Borrowing in accordance with Section 2.2 and shall certify in
the Notice of Borrowing to the matters set forth in Section 6.4(A)
THROUGH (C).
Each borrowing by the Borrower hereunder (including the initial Loans) shall
constitute a representation and warranty by the Borrower as of the date such
Loans are made that the conditions contained in this Section 6.4 have been
satisfied.
6.5 CONDITIONS TO CONVERSIONS OR CONTINUATIONS. Eurodollar Loans may be
continued as Eurodollar Loans at the end of the applicable Interest Period and
ABR Loans may be converted to Eurodollar Loans, subject to the satisfaction of
the following conditions precedent (i)
58
on the last day of the applicable Interest Period or (ii) on the applicable
conversion date, as applicable:
(a) REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties made by any Loan Party in or pursuant to
the Loan Documents shall be true and correct in all material respects
on and as of such date as if made on and as of such date, after such
conversion or continuation.
(b) NO DEFAULT. No Default shall have occurred and be
continuing on such date.
SECTION 7. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as any Commitment remains in
effect, any Loan shall be outstanding or any other Obligation is due and payable
to any Lender or under any other Loan Document the Borrower shall and (except in
the case of Sections 7.1, 7.2, 7.7 and 7.10) shall cause each Subsidiary to:
7.1 FINANCIAL STATEMENTS. Furnish to the Administrative Agent (with
copies for each of the Lenders):
(a) as soon as available, but in any event within 90 days
after the end of each fiscal year of the Borrower, a copy of (i) the
consolidated balance sheet of the Borrower and its consolidated
Subsidiaries and (ii) the consolidated and consolidating balance sheet
of the Borrower and its consolidated Subsidiaries as at the end of such
year and the related statements of operations, stockholders' equity
(deficit) and cash flows for such year (including consolidating
statements for the Borrower and its consolidated Subsidiaries), setting
forth in each case in comparative form the figures for the previous
year, and the schedules and notes related thereto, prepared in
accordance with GAAP and reported on without qualification, by Ernst &
Young LLP or other independent certified public accountants of
nationally recognized standing;
(b) as soon as available, but in any event not later than 45
days after the end of each of the first three fiscal quarters of each
fiscal year of the Borrower, a copy of (i) the unaudited consolidated
balance sheet of the Borrower and its consolidated Subsidiaries and
(ii) the unaudited consolidated and consolidating balance sheets of the
Borrower and its consolidated Subsidiaries as at the end of such
quarter, and, in each case, the related unaudited statements of
operations, stockholders' equity and cash flows for such quarter and
the portion of the fiscal year ended with such quarter (including
consolidating statements for the Borrower and its consolidated
Subsidiaries), setting forth in each case in comparative form the
figures for the previous year, prepared in accordance with GAAP and
certified by the Chief Financial Officer of the Borrower as being
fairly stated in all material respects (subject to normal year-end
audit adjustments and the absence of complete footnote disclosure); and
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(c) as soon as available, but in any event not later than 45
days after the end of each calendar month (other than any January,
April, July and October), a copy of the unaudited consolidated and
consolidating balance sheets ofthe Borrower and its consolidated
Subsidiaries as at the end of such calendar month and the related
unaudited consolidated and consolidating statements of operations,
stockholders' equity and of cash flows for such month and the portion
of the fiscal year then ended with such month, setting forth in each
case in comparative form figures for the previous year, prepared in
accordance with GAAP and certified by the Chief Financial Officer of
the Borrower as being fairly stated in all material respects (subject
to normal year-end audit adjustments and the absence of complete
footnote disclosure).
7.2 CERTIFICATES; OTHER INFORMATION. Furnish to the Administration
Agent (with copies for each of the Lenders):
(a) concurrently with the delivery of the Financial Statements
referred to in Section 7.1(A), a certificate of the independent
certified public accountants reporting on such Financial Statements
stating that in making the examination necessary for such report
nothing has come to their attention that would lead them to believe
that any Default has occurred, except as specified in such certificate;
(b) concurrently with the delivery of the Financial Statements
referred to in Sections 7.1(A) AND (B), a Compliance Certificate
executed by the Chief Financial Of ficer of the Borrower, certifying as
to, among other matters, compliance by the Borrower with Sections 8.1,
8.2, 8.3 AND 8.8;
(c) not later than sixty (60) days after the end of each
fiscal year of the Borrower, a copy of the operating and capital budget
of the Borrower and the Subsidiaries for such fiscal year and a copy of
projections for operating performance and sources and uses of cash of
the Borrower and the Subsidiaries for the next succeeding four fiscal
years;
(d) without duplication of the Financial Statements delivered
pursuant to Section 7.1, within five days after the same are sent,
copies of all financial statements, reports and other materials which
the Borrower sends generally to the holders of any class of its debt or
equity securities in their capacities as such holders, and within five
days after the same are filed, copies of all financial statements,
reports and other materials which the Borrower may make to, or file
with, the Securities and Exchange Commission or any successor or
analogous Governmental Authority; and
(e) promptly, such additional financial and other information
as any Lender may (acting through the Administrative Agent) from time
to time reasonably request.
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7.3 PAYMENT OF OBLIGATIONS AND TAXES. Pay its Indebtedness and other
material obligations promptly and in accordance with their respective terms and
pay and discharge promptly when due all Taxes imposed upon it or upon its
revenues, income or profits or in respect of its property or assets, as well as
all lawful claims for labor, materials and supplies or otherwise that, if
unpaid, might give rise to a Lien upon such properties or any part thereof, in
each case before the same shall become delinquent or in default; PROVIDED,
HOWEVER, that such payment and discharge shall not be required with respect to
any such Tax or claim so long as the validity or amount thereof shall be
contested in good faith by appropriate proceedings and the Borrower shall have
set aside on its books adequate reserves with respect thereto in accordance with
GAAP.
7.4 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. ETC. (a) Subject
to Section 8.17 and except as otherwise permitted by Section 8.4, (i) continue
to engage in business of the same type as is contemplated to be conducted by it
and other Permitted Lines of Business, (ii) preserve, renew and keep in full
force and effect its organizational existence and (iii) take all reasonable
action to keep and maintain all material rights, privileges and franchises
necessary in the normal conduct of its business except to the extent that the
failure to keep and maintain individually or in the aggregate could not
reasonably be expected to have a Material Adverse Effect.
(b) Comply with all Contractual Obligations and applicable Requirements
of Law, except to the extent that failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
7.5 MAINTENANCE OF PROPERTY; INSURANCE. Cause all properties and assets
necessary for the conduct of its business or the business of any Subsidiary to
be maintained and kept in such condition, repair and working order as is
necessary for the conduct of its business and supplied with all necessary
equipment and cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, as promptly as is reasonably practicable;
PROVIDED, that nothing in this Section shall prevent the Borrower or any
Subsidiary from discontinuing the operation or maintenance of any such
properties if such discontinuance is, as determined by the Borrower or such
Subsidiary in good faith, desirable in the conduct of its business or the
business of any Subsidiary; maintain with financially sound and reputable
insurance companies insurance concerning its property and business in at least
such amounts and against at least such casualties, risks and contingencies as
are usually insured against in the same general area by companies engaged in the
same or a similar business; and furnish to the Administrative Agent, upon
written request, such information as to the insurance carried as is requested.
All policies of insurance shall be in such form and with such deductibles as are
satisfactory to the Administrative Agent. The Borrower shall deliver to the
Administrative Agent each year a certificate of insurance for each policy of
insurance and evidence of payment of all premiums therefor. With respect to
property or casualty policies, such policies of insurance and the certificates
evidencing the same shall contain endorsements, in form and substance acceptable
to the Administrative Agent, showing losses payable to the Administrative Agent
for the benefit of the Secured Parties, as its interest may appear. With respect
to liability policies, such policies of insurance and the certificates
evidencing the same shall contain endorsements listing the Administrative Agent
and the Secured Parties as additional insureds, as
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their respective interests may appear. Such endorsements or an independent
instrument furnished to the Administrative Agent shall provide that the
insurance companies providing such insurance will give the Administrative Agent
at least thirty days prior written notice before any such policy or policies of
insurance expire or before a payment is made in the case of loss or damage.
7.6 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS. Keep and
maintain a system of accounting established and administered in accordance with
good accounting practices and keep and maintain proper books of record and
accounts; and permit representatives of any Lender to visit and inspect any of
its properties and examine and make abstracts from any of its books and records
during normal business hours and as often as may reasonably be requested and
upon reasonable notice and to discuss the business, operations, properties and
financial and other condition of the Borrower and its Subsidiaries with of
ficers and employees of the Borrower and its Subsidiaries and with their
independent certified public accountants (PROVIDED, that the Borrower shall have
been given reasonable advance notice of, and an opportunity to have one or more
representatives designated by it participate in, any such discussion with any
such officer or independent accountant).
7.7 NOTICES. Promptly after the Borrower has knowledge thereof, give
notice to the Administrative Agent of:
(a) the occurrence of any Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any Subsidiary, (ii) Environmental Claim
or (iii) Litigation between the Borrower or any Subsidiary and any
Governmental Authority, which in any such case, or when aggregated with
all other such defaults, events of default, Environmental Claims or
Litigation matters, as the case may be, could reasonably be expected to
have a Material Adverse Effect;
(c) any Litigation affecting the Borrower or any Subsidiary
(i) which could reasonably be expected to result in an adverse judgment
of $1,000,000 or more and not covered by insurance or an indemnity
acceptable to the Administrative Agent or (ii) in which injunctive or
similar relief is sought which in the case of this clause (ii) could
reasonably be expected to materially interfere with the ordinary
conduct of business of the Borrower or any Subsidiary;
(d) the following events which individually or in the
aggregate could reasonably be expected to have a Material Adverse
Effect, as soon as possible and in any event within 30 days after the
Borrower knows thereof: (i) the occurrence of any Reportable Event with
respect to any Plan, a failure to make any required contribution to a
Plan, the creation of any Lien in favor of the PBGC or a Plan or any
withdrawal from, or the termination, Reorganization or Insolvency of,
any Multiemployer Plan or (ii) the institution of proceedings or the
taking of any other action by the PBGC or the Borrower or any
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Commonly Controlled Entity or any Multiemployer Plan with respect to
the withdrawal from, or the terminating, Reorganization or Insolvency
of, any Plan;
(e) any Recovery Event (whether one such event or a series of
related events) involving property and assets of the Borrower or any
Subsidiary having a Fair Market Value in excess of $500,000; and
(f) except for developments or events affecting the
communication network service business generally, any development or
event which could reasonably be expected to have a Material Adverse
Effect.
Each notice pursuant to this Section 7.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action is proposed to be taken with respect thereto.
7.8 ENVIRONMENTAL LAWS. (a) Comply with, and use reasonable efforts to
require compliance by all tenants and subtenants, if any, with, all applicable
Environmental Laws and obtain and comply with and maintain, and use reasonable
efforts to require that all tenants and subtenants obtain and comply with and
maintain, any and all Authorizations required by applicable Environmental Laws
except, in each case, to the extent that failure to do so could not be
reasonably expected to have a Material Adverse Effect.
(b) Comply with all orders and directives of all Governmental
Authorities regarding Environmental Laws, except to the extent that the same are
being contested in good faith by appropriate proceedings.
7.9 COLLATERAL. Execute any and all documents, financing statements,
agreements and instruments, and take all action (including filing Uniform
Commercial Code and other financing statements, mortgages and deeds of trust),
that may be required under any applicable Requirement of Law, or which the
Majority Lenders or the Administrative Agent may reasonably request in order to
effectuate the transactions contemplated by the Loan Documents and in order to
grant, preserve, protect and perfect the validity and first priority of the
security interests and Liens created or purported to be created by the Security
Documents. In addition, the Borrower will cause (i) each subsequently acquired
or organized Subsidiary (contemporaneously with such acquisition or
organization) to execute a Supplement to Guaranty in favor of the Administrative
Agent and (ii) at the cost and expense of the Borrower, cause such newly
acquired or organized Subsidiary and each existing Subsidiary acquiring any
assets or properties to secure the Obligations by pledging or creating, or
causing to be pledged or created, perfected security interests and Liens with
respect to such of its assets and properties as the Administrative Agent or the
Majority Lenders shall designate (it being understood that it is the intent of
the parties and the agreement of the Borrower that the Obligations shall be
secured by, among other things, substantially all the property and assets (now
or hereafter acquired) of the Borrower and the Subsidiaries (now or hereafter
acquired or created), including, without limitation, real and other properties
acquired subsequent to the Effective Date).
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Such security interests and Liens will be created under the Security Documents
and other security agreements, mortgages, deeds of trust and other instruments
and documents in form and substance reasonably satisfactory to the
Administrative Agent, and the Borrower will deliver or cause to be delivered to
the Administrative Agent, for the benefit of the Lenders, all such instruments
and documents (including, without limitation, a Perfection Certificate, legal
opinions, title insurance policies, surveys and lien searches) as the
Administrative Agent shall reasonably request to evidence compliance with this
Section 7.9. The Borrower agrees to provide from time to time such evidence as
the Administrative Agent shall reasonably request as to the perfection and
priority status of each such security interest and Lien.
7.10 COMPLIANCE CERTIFICATES. Any Compliance Certificate or Restricted
Payment Compliance Certificate delivered to the Administrative Agent pursuant to
this Agreement from and after the date of the execution and delivery of an
acquisition agreement for a Subject Acquisition, and prior to the consummation
of such Subject Acquisition (unless such Subject Acquisition has been
abandoned), shall be prepared on a pro forma basis, giving effect to such
Subject Acquisition.
SECTION 8. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as any Commitment remains in
effect, any Loan is outstanding, or any other Obligation is due and payable to
any Lender or under any other Loan Document, the Borrower shall not, and the
Borrower shall not permit any Subsidiary to, directly or indirectly:
8.1 FINANCIAL COVENANTS.
(a) LEVERAGE RATIOS. (i) Permit the Total Leverage Ratio of
the Borrower and its Subsidiaries at the end of any fiscal quarter of
the Borrower ending during any period set forth below to be greater
than the ratio set forth opposite such period below:
PERIOD RATIO
------ -----
Effective Date through 10/30/l998 3.70 to 1.00
10/31/1998 through 04/29/1999 3.50 to 1.00
04/30/1999 through 01/31/2000 3.25 to 1.00
2/01/2000 and thereafter 3.00 to 1.00
(ii) Permit the Senior Leverage Ratio of the Borrower and its
Subsidiaries at the end of any fiscal quarter of the Borrower ending
during any period set forth below to be greater than the ratio set
forth opposite such period below:
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PERIOD RATIO
------ -----
Effective Date through O4/29/1999 3.00 to 1.00
04/30/1999 through 01/31/2000 2.75 to 1.00
02/01/2000 and thereafter 2.50 to 1.00
(b) INTEREST COVERAGE. Permit the Interest Coverage Ratio of
the Borrower at the end of any fiscal quarter of the Borrower to be
less than 2.00 to 1.00.
(c) FIXED CHARGE RATIO. Permit the Fixed Charge Ratio of the
Borrower and its Subsidiaries at the end of any fiscal quarter of the
Borrower to be less than 1.50 to 1.00.
(d) CURRENT RATIO. Permit the Current Ratio of the Borrower
and its Restricted Subsidiaries at the end of any fiscal quarter of the
Borrower to be less than 2.50 to 1.00.
8.2 LIMITATION ON INDEBTEDNESS. Create, incur, assume or suffer to
exist any Indebtedness of the Borrower or any Subsidiary, except:
(a) Indebtedness under this Agreement and the Guarantee
Obligations of the Subsidiaries with respect thereto;
(b) Indebtedness of the Borrower or any Restricted Subsidiary
to the Borrower or any other Restricted Subsidiary of the Borrower;
PROVIDED, that any such Indebtedness shall (i) not be subordinated to
any other Indebtedness of the Borrower or such Restricted Subsidiary
other than the Obligations and (ii) be evidenced by an Intercompany
Note pledged to the Administrative Agent pursuant to the Borrower's
Pledge Agreement or a Subsidiary's Pledge Agreement, as applicable;
(c) Indebtedness of the Borrower and any Restricted Subsidiary
constituting obligations under Capital Leases or secured by Liens
permitted by clause (f) of the definition of "Permitted Liens"
contained in Section 1, in an aggregate principal amount at any one
time outstanding not to exceed $3,000,000.00.
(d) Interest Rate Hedge Agreements entered into by the
Borrower for the purpose of fixing or hedging interest rate risk with
respect to any floating rate Indebtedness of the Borrower that is
permitted by this Section 8.2; PROVIDED, that the notional principal
amount of the obligations under any such Interest Rate Hedge Agreement
does not exceed the principal amount of the Indebtedness to which such
Interest Rate Hedge Agreement relates;
(e) the 12% Subordinated Notes; and
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(f) other unsecured Indebtedness of the Borrower not in excess
of $1,000,000 outstanding at any time in the aggregate.
8.3 LIMITATION ON LIENS. Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except for Permitted Liens.
8.4 LIMITATION ON FUNDAMENTAL CHANGES. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution) or convey, sell, lease, assign, transfer
or otherwise dispose of, all or substantially all of its property, business or
assets, or, except with the prior consent of the Majority Lenders, make any
material change in its method of conducting business as of the Effective Date,
except:
(a) so long as no Default would occur after giving effect
thereto: (i) any Wholly Owned Subsidiary may be merged with or into the
Borrower (PROVIDED, that the Borrower shall be the continuing or
surviving Person) or with or into any other Wholly Owned Subsidiary;
and (ii) any consolidation of any Person with any Wholly Owned
Subsidiary or any merger of any Person with the Borrower or any Wholly
Owned Subsidiary (PROVIDED, that the Borrower or such Wholly Owned
Subsidiary, as the case may be, shall be the continuing or surviving
Person) in connection with the consummation of any Subject Acquisition
made in accordance with Section 8.8;
(b) so long as no Default would occur after giving effect
thereto, any Subsidiary of the Borrower may sell, lease, transfer or
otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) (i) to the Borrower or any Wholly Owned
Subsidiary or (ii) in a transaction permitted by Section 8.5; and
(c) the MFSNT Acquisition.
8.5 LIMITATION ON SALE OF ASSETS. Convey, sell, lease, assign,
exchange, transfer or otherwise dispose of (whether in one or a series of
transactions) any of its property, businesses assets or Capital Securities or
any interest in any of them (including, without limitation, any revenues, income
and profits and leasehold interests), whether now owned or hereafter acquired or
enter into any agreement to do any of the foregoing (a "Disposition," it being
understood that collateral assignments shall not constitute "Dispositions"),
except:
(a) the sale in the ordinary course of business of assets held
for resale in the ordinary course of business or the trade-in or
replacement of assets in the ordinary course of business;
(b) the issuance or sale by the Borrower of its Capital
Securities, subject to the provisions of Sections 4.2(D)(I) AND 8.7;
and
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(c) Dispositions pursuant to transactions permitted by Section
8.4 (other than subclause (ii) of clause (b) thereof).
8.6 LIMITATION ON RESTRICTED PAYMENTS. Declare or pay any distribution
in respect of, or make any payment on account of, or set apart assets for a
sinking or other analogous fund for, the purchase, redemption, defeasance,
retirement or other acquisition of, any shares of or interests in any class of
Capital Security of the Borrower or any Subsidiary, whether now or hereafter
outstanding, either directly or indirectly, whether in cash or property or in
obligations of the Borrower or any Subsidiary (collectively,"RESTRICTED
PAYMENTS"), except that any Subsidiary may make Restricted Payments to the
Borrower or to such Subsidiary's parent company (so long as, such Subsidiary's
parent company is a Wholly Owned Subsidiary).
8.7 LIMITATION ON ISSUANCES OF CAPITAL SECURITIES. Issue any Capital
Securities, except that (i) so long as no Default exists at the time of such
issuance or (ii) would exist after giving effect to such issuance or (iii) if
such issuance is of a type of Capital Security described in clause (b) of the
definition of "Capital Security" which is convertible, exchangeable or
exercisable prior to ten years after the Effective Date and, on a fully diluted
basis, assuming such Capital Securities were so converted, exchanged or
exercised on the date of issuance thereof, a Default would not occur pursuant to
Section 9(J), then (A) subject to Section 8.15(C), any Subsidiary may issue
Capital Securities to the Borrower or any Wholly Owned Subsidiary; (B) the
Borrower may issue other Borrower Capital Securities, PROVIDED, that the Net
Cash Proceeds from such issuance are applied in accordance with Section
4.2(D)(I), if applicable, and PROVIDED FURTHER that such other Borrower Capital
Securities (l) are not mandatorily redeemable, payable or required to be
repurchased or otherwise retired or extinguished prior to the tenth anniversary
of the Effective Date, (2) are not convertible into any Indebtedness or other
liability of the Borrower or any Subsidiary or (3) do not require the payment of
cash dividends or other cash distributions prior to the Termination Date.
8.8 LIMITATION ON ACQUISITIONS, INVESTMENTS, LOANS AND ADVANCES. Make
any advance, loan, extension of credit or capital contribution to, or purchase
or enter into any agreement or option to purchase any stock, bonds, notes,
debentures or other securities of or any assets of, or of a business unit of, or
make any other investment in, any Person (collectively, "INVESTMENTS"), except:
(a) accounts receivable that arise in the ordinary course of
business and adjustments to account debtors with respect thereto in the
ordinary course of business;
(b) Investments in cash and Cash Equivalents;
(c) (i) Investments of the Borrower and the Subsidiaries in
the Borrower and other Subsidiaries existing on the Effective Date and
listed in the Perfection Certificate and (ii) subject to Sections
8.15(B) AND 8.15(C), Investments after the Effective Date by the
Borrower or any Subsidiary in the Borrower or: (A) any Wholly Owned
Subsidiary; or (B)
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any Subsidiary that is not a Restricted Subsidiary, provided that such
Investments shall not exceed $3,500,000 in the aggregate.
(d) loans and advances to employees of the Borrower or any
Subsidiary for travel, entertainment and relocation expenses in the
ordinary course of business, in an aggregate principal amount for the
Borrower and the Subsidiaries for all loans and advances described in
this clause (d) not to exceed $500,000 at any time outstanding;
(e) Subject Acquisitions; PROVIDED, that (i) no such
acquisition may be made if a Default has occurred and is continuing or
would occur after giving effect thereto, (ii) the consideration for any
Subject Acquisition does not exceed the Fair Market Value of the
property and assets which are the subject thereof and (iii) the
Borrower has delivered to the Administrative Agent the information
required under or has otherwise complied with the provisions of
Sections 6.2(B), (C), (D), (E), (F), (G), (H), (I) AND (J), whether or
not the Borrower is requesting a Loan in connection with such Subject
Acquisition;
(f) the MFSNT Acquisition;
(g) Investments received in connection with the bankruptcy or
reorganization of any customer or supplier of the Borrower or any
Subsidiary or in connection with the settlement of delinquent
obligations;
(h) Investments consisting of promissory notes or Capital
Securities issued to the Borrower or any Wholly Owned Subsidiary in
connection with any Disposition made pursuant to, and to the extent
permitted by, Section 8.5(C);
(i) Investments consisting of Interest Rate Hedge Agreements
permitted by Section 8.2; and
(j) other Investments (not prohibited under Section 8.6 OR 8.9
or otherwise prohibited under any other covenant hereunder) in an
aggregate amount at any time outstanding not to exceed $500,000.
8.9 LIMITATION ON OPTIONAL PAYMENTS OF INDEBTEDNESS. Make any payment
on account of, make any offer to purchase or set apart assets for a sinking or
other analogous fund for, the purchase, redemption, defeasance, retirement or
other acquisition of, any Indebtedness of the Borrower or any Subsidiary other
than (a) the Obligations, (b) in connection with a Disposition, Indebtedness
required by its terms to be paid in connection with such Disposition that is
secured by a Permitted Lien on any asset which is the subject of such
Disposition, (c) with the proceeds of the issuance or sale of Borrower Capital
Securities of the type described in clause (a) of the definition thereof, so
long as the requirements of Sections 4.2(D)(I) AND 8.7 are also satisfied, and
(d) subject to Section 8.6, scheduled payments of principal, interest, fees and
other charges to the holders of such Indebtedness when due in accordance with
its terms.
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8.10 LIMITATION ON MODIFICATIONS OF CERTAIN AGREEMENTS. (a) Amend,
modify or change, or consent or agree to any amendment, modification or change
to, any of the terms of (i) the Bridge Financing, (ii) any Intercompany Notes,
(iii) any other Indebtedness of the Borrower or any Subsidiary having a
principal balance (or a Guarantee Obligation with respect to Indebtedness having
a principal balance) of more than $500,000, or (iv) any indenture or other
agreement evidencing, creating or governing any of the foregoing Indebtedness,
in each case (except for clause (ii)) other than any such amendment,
modification or change which (x) would extend the maturity or reduce the amount
of any payment of principal thereof or which would reduce the rate or extend the
date for payment of interest thereon or (y) is immaterial and not adverse to the
interests of the Lenders, so long as, in each case, no consent fee is payable in
connection therewith.
(b) Amend, modify or change, or consent or agree to any amendment,
modification or change to, any of the terms of the Charter Documents of the
Borrower or any Subsidiary, in each case other than any such amendment,
modification or change which is immaterial and not adverse to the interests of
the Lenders.
8.11 LIMITATION ON TRANSACTIONS WITH AFFILIATES. Enter into any
transaction (including, without limitation, any purchase, sale, lease or
exchange of property or the rendering of any service) or series of related
transactions with any Affiliate of the Borrower or any Subsidiary unless (i)
such transaction is otherwise expressly permitted under this Agreement and (ii)
(A) such transaction is in the ordinary course of the Borrower's or such
Subsidiary's business, (B) such transaction is upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary, as the case may be, than it
would obtain in a comparable transaction on an arm's length basis with a Person
which is not an Affiliate and (C) with respect to any transaction or series of
related transactions between the Borrower or any Subsidiary and any Affiliate of
the Borrower or any Subsidiary (other than a transaction involving no Person
other than the Borrower or any Wholly Owned Subsidiary) involving aggregate
payments in excess of $1,000,000, such transaction shall be approved in good
faith by a majority of the Board of Directors of the Borrower or the applicable
Subsidiary and evidenced by a Board Resolution from the Borrower or the
applicable Subsidiary, a copy of which shall have been previously delivered to
the Administrative Agent.
8.12 LIMITATION ON SALES AND LEASEBACKS. Enter into any arrangement
with any Person providing for the leasing by the Borrower or any Subsidiary of
real or personal property which has been or is to be sold or transferred by the
Borrower or such Subsidiary to such Person or to any other Person to whom funds
have been or are to be advanced by such Person on the security of such property
or rental obligations of the Borrower or such Subsidiary, unless the obligations
attributable thereto are treated as purchase money Indebtedness or Capital Lease
obligations, as applicable, and, as so treated, are permitted by Section 8.2(C).
8.13 LIMITATION ON CHANGES IN FISCAL YEAR. Permit the fiscal year of
the Borrower to end on a day other than October 31.
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8.14 LIMITATION ON NEGATIVE PLEDGE CLAUSES. Enter into or suffer to
exist any Contractual Obligation which in any way restricts the ability of the
Borrower or any Subsidiary to create, incur, assume or suffer to exist any Lien
upon any of its property, assets or revenues, whether now owned or hereafter
acquired, other than (a) this Agreement and the other Loan Documents, (b) any
agreement governing Indebtedness incurred pursuant to Section 8.2(C) (in which
case, any restriction shall only be effective against the assets financed
thereby) and (c) any agreement governing Indebtedness outstanding on the
Effective Date and listed on Schedule 8.14.
8.15 CERTAIN INTERCOMPANY MATTERS. (a) In the case of the Borrower and
the Subsidiaries, (i) fail to satisfy customary formalities with respect to
organizational separateness, including, without limitation, the maintenance of
separate books and records; (ii) fail to act solely in its own name and through
its authorized officers and agents; (iii) in the case of any Subsidiary, make
or agree to make any payment to a creditor of the Borrower; (iv) commingle any
money or other assets of the Borrower with any money or other assets of the
Borrower or any Subsidiary; or (v) take any action, or conduct its affairs in a
manner, which could reasonably be expected to result in the separate
organizational existence of the Borrower and the Subsidiaries being ignored
under any circumstance.
(b) In the case of the Borrower, (i) make any Investment in any
Subsidiary other than in the form of a loan evidenced by an Intercompany Note
pledged to the Administrative Agent pursuant to the Borrower's Pledge Agreement,
except for the capitalization of new Subsidiaries in an amount not to exceed
$10,000, in each case, (ii) permit any Person that is a Subsidiary to make any
Investment in any direct or indirect Subsidiary of such Person other than in the
form of a loan evidenced by an Intercompany Note pledged to the Administrative
Agent pursuant to such Person's Pledge Agreement except for the capitalization
of new Wholly Owned Subsidiaries of such Person in an amount not to exceed
$10,000 in each case, and (iii) cause any Subsidiary to maintain bank accounts
which are not separate and distinct from such accounts of the Borrower.
(c) In the case of the Borrower, (i) create, acquire or suffer to exist
any Subsidiary which is not a Wholly Owned Subsidiary, except Subsidiaries that
are Controlled Foreign Corporations (as such term is used in the definition of
"Restricted Subsidiaries" herein) or in connection with a Subject Acquisition,
or (ii) permit any Wholly Owned Subsidiary to cease to be a Wholly Owned
Subsidiary (other than in connection with (x) a transaction permitted by Section
8.4 or (y) a Disposition of all of the Capital Security of such Wholly Owned
Subsidiary.
8.16 LIMITATION ON RESTRICTIONS ON SUBSIDIARV DISTRIBUTIONS. Enter into
or suffer to exist or become effective any consensual encumbrance or restriction
on the ability of any Subsidiary to (a) pay dividends or make any other
distributions in respect of any Capital Security of such Subsidiary held by, or
pay any Indebtedness owed to, the Borrower or any other Subsidiary of the
Borrower, (b) make loans or advances to the Borrower or any other Subsidiary or
(c) transfer any of its assets to the Borrower or any other Subsidiary, except
for such encumbrances or restrictions existing under or by reason of (i) any
restrictions existing under the Loan Documents or
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any other agreements in effect on the date of this Agreement, (ii) any
restrictions with respect to a Subsidiary imposed pursuant to an agreement which
has been entered into in connection with the Disposition of all or substantially
all of the properties or assets of such Subsidiary or all of the Capital
Securities of such Subsidiary owned by the Borrower, directly or indirectly
through a Subsidiary, or (iii) any restrictions existing under any agreement
that amends, refinances or replaces any agreement containing the restrictions
referred to in clause (i) or (ii) above, PROVIDED, that the terms and conditions
of any such agreement are no less favorable to the Lenders than those under the
agreement so amended, refinanced or replaced.
8.17 LIMITATION ON LINES OF BUSINESS. Enter into any business, either
directly or through any Subsidiary, except for (a) those businesses in which the
Borrower and its Subsidiaries are engaged on the Effective Date and (b)
businesses which are reasonably similar or related thereto or reasonable
extensions thereof (each, a "PERMITTED LINE OF BUSINESS").
SECTION 9. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Loan
when due in accordance with the terms of this Agreement; or the
Borrower shall fail to pay any interest on any Loan, or any other
amount payable hereunder, on or prior to the date which is three
Business Days after any such interest or other amount becomes due and
payable in accordance with the terms of this Agreement; or
(b) Any representation or warranty made or deemed made by the
Borrower or any other Loan Party herein or in any other Loan Document
or which is contained in any Information furnished at any time under or
in connection with this Agreement or any such other Loan Document shall
be false or misleading in any material respect on or as of the date
made or deemed made; or
(c) The Borrower or any other Loan Party shall default in the
observance or performance of any agreement contained in Section 7.6 or
Section 8 or in Section 6(e) of the Security Agreements; or
(d) The Borrower or any other Loan Party shall fail to observe
or perform any other agreement contained in this Agreement or any other
Loan Document (other than as provided in paragraphs (a) through (c) of
this Section 9), and such failure shall continue unremedied for a
period of 30 days after the earlier of (i) a Responsible Officer has
knowledge thereof or (ii) notice thereof to the Borrower by the
Administrative Agent; or
(e) (i) The Borrower or any Subsidiary shall default in making
any payment of any principal of any Indebtedness (including, without
limitation, any Guarantee Obligation, but excluding the Loans) beyond
the period of grace or cure, if any, provided in the instrument
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or agreement under which such Indebtedness was created; or (ii) the
Borrower or any Subsidiary shall default in making any payment of any
interest on any such Indebtedness beyond the period of grace or cure,
if any, provided in the instrument or agreement under which such
Indebtedness was created; or (iii)(A) the Borrower or any Subsidiary
shall default in the observance or performance of any other agreement
or condition relating to any such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or
any other event shall occur or condition exist, the effect of which
default or other event or condition is to cause, or to permit the
holder or beneficiary of such Indebtedness (or a trustee or agent on
behalf of such holder or beneficiary) to cause, with the giving of
notice if required, such Indebtedness to become due prior to its stated
maturity (or, in the case of any such Indebtedness constituting a
Guarantee Obligation, to become payable prior to the stated maturity of
the primary obligation covered by such Guarantee Obligation) or (B) any
event occurs which gives rise to the right of the holder of any such
Indebtedness to require the Borrower or any Subsidiary to purchase or
offer to purchase any such Indebtedness; PROVIDED that a default, event
or condition described in clause (i), (ii) or (iii) ofthis paragraph
(e) shall not constitute an Event of Default under this Agreement
unless, at the time of such default, event or condition one or more
defaults, events or conditions of the type described in clauses (i),
(ii) and (iii) of this paragraph (e) shall have occurred and be
continuing with respect to Indebtedness the outstanding principal
amount of which exceeds in the aggregate $1,000,000; or
(f) (i) The Borrower or any Subsidiary shall commence any
case, proceeding or other action (A) under any existing or future law
of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate
it a bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment, winding-up, liquidation, dissolution, composition or other
relief with respect to it or its debts, or (B) seeking appointment of a
receiver, trustee, custodian, conservator or other similar official for
it or for all or any substantial part of its assets, or the Borrower or
any Subsidiary shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against the Borrower or any
Subsidiary any case, proceeding or other action of a nature referred to
in clause (i) above which (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains
undismissed, undischarged or unbonded for a period of 60 days; or (iii)
there shall be commenced against the Borrower or any Subsidiary any
case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets which results in the entry of an order
for any such relief which shall not have been vacated, discharged, or
stayed or bonded pending appeal within 60 days from the entry thereof;
or (iv) the Borrower or any Subsidiary shall take any action in
furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii), or
(iii) above; or (v) the Borrower or any Subsidiary shall generally not,
or shall be unable to, or shall admit in writing its inability to, pay
its debts as they become due; or
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(g) (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the
Code) involving any Plan, (ii) any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, shall exist
with respect to any Plan or any Lien in favor of the PBGC or a Plan
shall arise on the assets of the Borrower or any Commonly Controlled
Entity, (iii) a Reportable Event shall occur with respect to, or
proceedings shall commence to have a trustee appointed, or a trustee
shall be appointed, to administer or to terminate, any Single Employer
Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is, in the reasonable opinion of the Majority
Lenders, likely to result in the termination of such Plan for purposes
of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA or (v) the Borrower or any Commonly
Controlled Entity shall, or in the reasonable opinion of the Majority
Lenders is likely to, incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a
Multiemployer Plan; and in each case in clauses (i) through (v) above,
such event or condition, together with all other such events or
conditions, if any, could reasonably be expected to have a Material
Adverse Effect; or
(h) One or more judgments or decrees shall be entered against
the Borrower or any Subsidiary involving in the aggregate a liability
(not paid or fully covered by insurance) of $1,000,000 or more, and all
such judgments or decrees shall not have been vacated, discharged or
stayed or bonded pending appeal on or prior to the first to occur of
(i) the last day upon which such judgment or decree becomes final and
nonappealable and (ii) the day which is 30 days after the entry
thereof; or
(i) (i) Any provision of the Loan Documents shall cease, for
any reason, to be in full force and effect, or the Borrower or any
other Loan Party shall so assert or (ii) the Lien created by any of the
Security Documents shall cease to be enforceable and of the same effect
and priority purported to be created thereby; or
(j) A Change of Control shall occur;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) of this Section 9 with respect to the
Borrower, automatically the Commitments shall immediately terminate and the
Loans hereunder (with accrued and unpaid interest thereon) and all other amounts
owing under this Agreement and the other Loan Documents (including, without
limitation, all L/C Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented draw requests thereunder)
shall immediately become due and payable, and (B) if such event is any other
Event of Default, either or both of the following actions may be taken: (i) with
the consent of the Majority Lenders, the Administrative Agent may, or upon the
request of the Majority Lenders, the Administrative Agent shall, by notice to
the Borrower declare the Commitments to be terminated forthwith, whereupon such
Commitments shall immediately terminate; and (ii) with the consent of the
Majority Lenders, the Administrative Agent may, or upon the request of the
Majority Lenders, the Administrative Agent shall, by notice to the Borrower,
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declare the Loans hereunder (with accrued and unpaid interest thereon) and all
other Obligations owing under this Agreement and the other Loan Documents
(including, without limitation, all L/C Obligations, whether or not the
beneficiaries of the then outstanding Letters of Credit shall have presented
draw requests thereunder) to be due and payable forthwith, whereupon the same
shall immediately become due and payable. With respect to all outstanding
Letters of Credit with respect to which presentment for honor shall not have
occurred at the time of an acceleration pursuant to this paragraph, the Borrower
shall at such time deposit in a cash collateral account opened by the
Administrative Agent (and maintained under its sole dominion and control) an
amount equal to the aggregate then undrawn and unexpired amount of such Letters
of Credit. Amounts held in such cash collateral account shall be applied by the
Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
Obligations of the Borrower hereunder and under the other Loan Documents. After
all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied, all Loans shall have been
paid in full and no other Obligations shall be due and payable, the balance, if
any, in such cash collateral account shall be returned to the Borrower (or such
other Person as may be lawfully entitled thereto).
Except as expressly provided above in this Section 9, presentment,
demand, protest and all other notices of any kind are hereby expressly waived by
the Borrower.
SECTION 10. THE ADMINISTRATIVE AGENT
10.1 APPOINTMENT. (a) Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
(b) Notwithstanding any provision to the contrary elsewhere in this
Agreement or any other Loan Document, the Administrative Agent shall not have
any duties or responsibilities, except those expressly set forth herein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent.
10.2 DELEGATION OF DUTIES. The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.
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10.3 EXCULPATORY PROVISIONS. Neither the Administrative Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or affiliates
shall be (i) liable for any action lawfully taken or omitted to be taken by it
or such Person under or in connection with this Agreement or any other Loan
Document (except for its or such Person's own gross negligence or willful
misconduct) or (ii) responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by the Borrower or any
officer thereof contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or for any failure of the Borrower to perform its obligations hereunder
or thereunder. The Administrative Agent shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the Borrower.
10.4 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any Note,
writing, resolution, notice, consent, certificate, affidavit, letter, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement and the other Loan Documents in accordance with a request of the
Majority Lenders, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.
10.5 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to this Agreement, describing such Default and stating that such notice is a
"notice of default." In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default as
shall be reasonably directed by the Majority Lenders; PROVIDED that unless and
until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such
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action, or refrain from taking such action, with respect to such Default as it
shall deem advisable in the best interests of the Lenders.
10.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS. Each
Lender expressly acknowledges that neither the Administrative 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
Administrative Agent hereinafter taken, including any review of the affairs of
the Borrower, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative 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, operations, property, financial and other
condition and creditworthiness of the Borrower and made its own decision to make
its Loans hereunder and enter into this Agreement. Each Lender also represents
that it will, independently and without reliance upon the Administrative 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 and
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property or assets, condition (financial or
otherwise), prospects or creditworthiness of the Borrower which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates.
10.7 INDEMNIFICATION. THE LENDERS AGREE TO INDEMNIFY THE ADMINISTRATIVE
AGENT IN ITS CAPACITY AS SUCH (TO THE EXTENT NOT REIMBURSED BY THE BORROWER AND
WITHOUT LIMITING THE OBLIGATION OF THE BORROWER TO DO SO), RATABLY ACCORDING TO
THEIR RESPECTIVE REVOLVING CREDIT FACILITY PERCENTAGES IN EFFECT ON THE DATE ON
WHICH INDEMNIFICATION IS SOUGHT (OR, IF INDEMNIFICATION IS SOUGHT AFTER THE DATE
UPON WHICH THE LOANS SHALL HAVE BEEN PAID IN FULL, RATABLY IN ACCORDANCE WITH
THEIR REVOLVING CREDIT FACILITY PERCENTAGES IMMEDIATELY PRIOR TO SUCH DATE),
FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES,
PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS OF ANY
KIND WHATSOEVER WHICH MAY AT ANY TIME (INCLUDING, WITHOUT LIMITATION, AT ANY
TIME FOLLOWING THE PAYMENT OF THE LOANS) BE IMPOSED ON, INCURRED BY OR ASSERTED
AGAINST THE ADMINISTRATIVE AGENT IN ANY WAY RELATING TO OR ARISING OUT OF, THE
COMMITMENTS, THIS AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS OR ANY DOCUMENTS
CONTEMPLATED BY OR REFERRED TO HEREIN OR THEREIN OR THE
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TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR ANY ACTION TAKEN OR OMITTED BY
THE ADMINISTRATIVE AGENT UNDER OR IN CONNECTION WITH ANY OF THE FOREGOING;
PROVIDED, THAT NO LENDER SHALL BE LIABLE FOR THE PAYMENT PORTION OF SUCH
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGEMENTS,
SUITS, COSTS, EXPENSES OR DISBURSEMENTS RESULTING FROM THE ADMINISTRATIVE
AGENT'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. THE AGREEMENTS IN THIS SECTION
10.7 SHALL SURVIVE THE PAYMENT FO THE LOANS AND ALL OTHER AMOUNTS PAYABLE
HEREUNDER.
10.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. The
Administrative Agent and its affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower, and Subsidiary
or any of their respective Affiliates as though the Administrative Agent were
not serving in such capacity hereunder and under the other Loan Documents. With
respect to the Loans made by it, the Administrative Agent shall have the same
rights and powers under this Agreement and the other Loan Documents as any
Lender and may exercise the same as though it were not the Administrative Agent,
as the case may be, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.
10.9 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon 30 days' notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Majority Lenders, and, if
no Default has occurred and is continuing, with the approval of the Borrower
(which shall not be unreasonably withheld), shall appoint from among the Lenders
a successor agent for the Lenders, whereupon such successor agent shall succeed
to the rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights, powers
and duties as Administrative Agent will be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the other parties to this Agreement or any holders of the Loans. After any
retiring Administrative Agent's resignation as Administrative Agent, the
provisions of this Section 10 shall continue to inure to its benefit as to any
actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement and the other Loan Documents.
SECTION 11. MISCELLANEOUS
11.1 AMENDMENTS AND WAIVERS. Neither this Agreement nor any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 11.1. The
Majority Lenders and each relevant Loan Party may, or, with the written consent
of the Majority Lenders, the Administrative Agent and each relevant Loan Party
may, for time to time, (a) enter into written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights of the Lenders
77
or of the Loan Parties hereunder or thereunder or (b) waive, on such terms and
conditions as the Majority Lenders or the Administrative Agent, as the case may
be, may specify in such instrument, any of the requirements of this Agreement or
the other Loan Documents or any Default and its consequences; PROVIDED, HOWEVER,
that no such waiver and no such amendment, supplement or modification shall (i)
reduce the amount or extend the scheduled date of final maturity of any Loan or
reduce the stated rate of any interest or fee payable hereunder or increase the
amount or extend the expiration date of any Commitment of any Lender, or make
any change in the method of application of any payment of the Loans or the fees
specified in Section 4.8(a) or amend Section 11.7(a) without the consent of all
Lenders, (ii) reduce the amount of any installment payment on any Loan or extend
the scheduled date of any payment (other than the final maturity date) or
mandatory prepayment of any Loan or waive or extend the date of any mandatory
prepayment of any Loan pursuant to Section 4.2(c), (d) or (e) or waive any
Commitment reduction, pursuant to Section 4.2(b) (c), (d) or (e) or make any
change in the method of application of any payment of the Loans specified in
Section 4.2(e) without the consent of all Lenders, (iii) amend, modify or waive
any provision of this Section 11.1 or reduce any percentage specified in the
definition of Majority Lenders or consent to the assignment or transfer by any
Loan Party of any of its rights and obligations under this Agreement and the
other Loan Documents or release any Subsidiary from its obligations under the
Guaranty Agreement or release all or substantially all of the collateral
security for the Obligations, in each case without the written consent of all
Lenders, (iv) amend, modify or waive any condition precedent to any extension of
credit set forth in Section 6.2 without the written consent of the Majority
Lenders or (v) amend, modify or waive any provision of Section 10 without the
written consent of the Administrative Agent. Any such waiver and any such
amendment, supplement or modification shall apply equally to each of the Lenders
and shall be binding upon the Loan Parties, the Lenders, the Administrative
Agent and all future holders of the Notes. In the case of any waiver, the Loan
Parties and the Lenders and the Administrative Agent shall be restored to their
former position and rights hereunder and under the other Loan Documents, and any
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default, or impair any right
consequent thereon.
11.2 NOTICES. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile transmission) and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made (a) in the case of delivery by hand,
when delivered, (b) in the case of delivery by mail, three Business Days after
being deposited in the mails, postage prepaid, or (c) in the case of delivery by
facsimile transmission, when sent and receipt has been confirmed, addressed as
follows in the case of the Borrower, the Administrative Agent and the Issuing
Lender, and as set forth in Annex 1 (or, with respect to any Lender that is an
Assignee, in the applicable Assignment and Acceptance) in the case of the other
parties hereto, or to such other address as may be hereafter notified by the
respective parties hereto:
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Borrower: Able Telcom Holding Corp.
0000 Xxxxx Xxxxx, Xxxxx 0000
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxx, Chief Financial Officer
Telephone: 000-000-0000
Fax: 000-000-0000
with a copy to:
Gunster, Yoakley, Vales-Fauli & Xxxxxxx, P.C.
Xxxxxxxx Point, Suite 500 East
000 Xxxxx Xxxxxxx Xxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxx
Administrative
Agent: NationsBank, N.A.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxxxx Xxxx
Telephone: 000-000-0000
Fax: 000-000-0000
Issuing Lender: NationsBank, N.A.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxxxx Xxxx
Telephone: 000-000-0000
Fax: 000-000-0000
PROVIDED, any notice, request or demand to or upon the Administrative Agent, the
Issuing Lender or the Lenders pursuant to Section 2 OR 4 shall not be effective
until received.
11.3 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Loan Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by any
Requirement of Law.
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11.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made hereunder, in the other Loan Documents and in any
certificate or other written statement delivered pursuant hereto or in
connection herewith shall survive the execution and delivery of this Agreement
and the making of the Loans hereunder.
11.5 PAYMENT OF EXPENSES AND TAXES. THE BORROWER AGREES (A) TO PAY OR
REIMBURSE THE ADMINISTRATIVE AGENT FOR ALL ITS REASONABLE OUT-OF-POCKET COSTS
AND EXPENSES INCURRED IN CONNECTION WITH THE PREPARATION, NEGOTIATION, EXECUTION
AND DELIVERY AND SYNDICATION OF, THIS AGREEMENT, TOGETHER WITH ANY AMENDMENT,
SUPPLEMENT OR MODIFICATION TO THIS AGREEMENT, AND THE OTHER LOAN DOCUMENTS AND
ANY OTHER DOCUMENTS PREPARED IN CONNECTION HEREWITH OR THEREWITH, AND THE
CONSUMMATION AND ADMINISTRATION OF THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY, INCLUDING, WITHOUT LIMITATION, THE REASONABLE FEES AND DISBURSEMENTS OF
XXXXX & XXXXX, L.L.P., COUNSEL TO THE ADMINISTRATIVE AGENT, OR SUCH OTHER
COUNSEL AS SUCH PERSONS MAY SELECT, AND ANY LOCAL COUNSEL RETAINED BY SUCH
COUNSEL OR SUCH PERSONS IN CONNECTION WITH ANY OF THE FOREGOING, (B) TO PAY OR
REIMBURSE EACH LENDER AND THE ADMINISTRATIVE AGENT FOR ALL THEIR RESPECTIVE
COSTS AND EXPENSES INCURRED IN CONNECTION WITH THE ENFORCEMENT OR PRESERVATION
OF ANY RIGHTS UNDER THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND ANY SUCH OTHER
DOCUMENTS, INCLUDING, WITHOUT LIMITATION, THE REASONABLE FEES AND DISBURSEMENTS
OF ANY COUNSEL TO ANY OF THE ADMINISTRATIVE AGENT AND THE LENDERS, (C) WITHOUT
DUPLICATION OF AMOUNTS PAID PURSUANT TO SECTIONS 4.9 AND 4.10, TO PAY,
INDEMNIFY, AND HOLD EACH LENDER AND THE ADMINISTRATIVE AGENT HARMLESS FROM, ANY
AND ALL RECORDING AND FILING FEES AND ANY AND ALL LIABILITIES WITH RESPECT TO,
OR RESULTING FROM ANY DELAY IN PAYING, STAMP, EXCISE AND OTHER TAXES, IF ANY,
WHICH MAY BE PAYABLE OR DETERMINED TO BE PAYABLE IN CONNECTION WITH THE
EXECUTION AND DELIVERY OF, OR CONSUMMATION OR ADMINISTRATION OF ANY OF THE
TRANSACTIONS CONTEMPLATED BY, OR ANY AMENDMENT, SUPPLEMENT OR MODIFICATION OF,
OR ANY WAIVER OR CONSENT UNDER OR IN RESPECT OF, THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS AND ANY SUCH OTHER DOCUMENTS, AND (D) WITHOUT DUPLICATION OF AMOUNTS
PAID PURSUANT TO SECTIONS 4.9 AND 4.10, TO PAY, INDEMNIFY, AND HOLD EACH LENDER
AND THE ADMINISTRATIVE AGENT AND THEIR RESPECTIVE OFFICERS, DIRECTORS, TRUSTEES,
EMPLOYEES, AFFILIATES, ADVISORS, AGENTS AND CONTROLLING PERSONS (EACH, AN
"INDEMNIFIED PERSON"), HARMLESS FROM AND AGAINST ANY AND ALL OTHER LIABILITIES,
OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS,
EXPENSES OR DISBURSEMENTS OF ANY KIND OR
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NATURE WHATSOEVER WITH RESPECT TO THE EXECUTION, DELIVERY, ENFORCEMENT,
PERFORMANCE AND ADMINISTRATION OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND
ANY SUCH OTHER DOCUMENTS, ANY SUBJECT ACQUISITION OR THE USE OF THE PROCEEDS OF
THE LOANS IN CONNECTION WITH THE MFSNT ACQUISITION, ANY SUBJECT ACQUISITION OR
OTHERWISE (ALL THE FOREGOING IN THIS CLAUSE (D), COLLECTIVELY, THE "INDEMNIFIED
LIABILITIES"), PROVIDED, THAT THE BORROWER SHALL HAVE NO OBLIGATION HEREUNDER TO
ANY INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES ARISING FROM THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PERSON. THE
AGREEMENTS IN THIS SECTION 11.5 SHALL SURVIVE REPAYMENT OF THE LOANS AND ALL
OTHER AMOUNTS PAYABLE HEREUNDER.
11.6 SUCCESSORS AND ASSIGNS; PARTICIPATIONS AND ASSIGNMENTS. (a) This
Agreement shall be binding upon and inure to the benefit of the Borrower, the
Lenders, the Administrative Agent and their respective successors and assigns,
except that the Borrower may not assign or transfer any of its rights or
obligations under this Agreement without the prior written consent of each
Lender.
(b) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to one or more banks or other
entities ("PARTICIPANTS") participating interests in any Loan owing to such
Lender, any Commitment of such Lender or any other interest of such Lender
hereunder and under the other Loan Documents. In the event of any such sale by a
Lender of a participating interest to a Participant, such Lender's obligations
under this Agreement to the other parties to this Agreement shall remain
unchanged, such Lender shall remain solely responsible for the performance
thereof, such Lender shall remain the holder of any such Loan for all purposes
under this Agreement and the other Loan Documents, and the Borrower and the
Administrative Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents. In no event shall any Participant under any such
participation have any right to approve any amendment or waiver of any provision
of any Loan Document, or any consent to any departure by any Loan Party
therefrom, except to the extent that such amendment, waiver or consent would
reduce the principal of, or interest on, the Loans or any fees payable
hereunder, or postpone the date of the final scheduled maturity of the Loans, in
each case to the extent subject to such participation. The Borrower agrees that
if amounts outstanding under this Agreement are due or unpaid, or shall have
been declared or shall have become due and payable upon the occurrence of an
Event of Default, each Participant shall, to the maximum extent permitted by
applicable law, be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement, PROVIDED, that in purchasing such participating
interest, such Participant shall be deemed to have agreed to share with the
Lenders the proceeds thereof as provided in Section 11.7(B) as fully as if it
were a Lender hereunder. The Borrower also agrees that each Participant shall be
entitled to the benefits of Sections 4.9, 4.10 AND 4.11 with respect to its
participation in the
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Commitments and the Loans outstanding from time to time, and shall be subject to
the requirements of Section 4.12, as if it were a Lender; PROVIDED, that in the
case of Section 4.10, such Participant shall have complied with the requirements
of said Section; PROVIDED FURTHER, that no Participant shall be entitled to
receive any greater amount pursuant to any such Section than the transferor
Lender would have been entitled to receive in respect of the amount of the
participation transferred by such transferor Lender to such Participant had no
such transfer occurred.
(c) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time and from time to time assign to any
Person (an "ASSIGNEE") all or any part of its rights and obligations under this
Agreement and the other Loan Documents pursuant to an Assignment and Acceptance
executed by such Assignee and such assigning Lender and delivered to the
Administrative Agent for its acceptance and recording in the Register (with a
copy to the Borrower); PROVIDED, (i) except in the case of an assignment of all
of a Lender's interests under this Agreement and the Notes, no such assignment
(other than to any Lender or any affiliate thereof) shall be in an aggregate
principal amount of less than $5,000,000 and (ii) each such assignment shall be
subject to the prior written consent of the Borrower and the Administrative
Agent (which consent in each case shall not be unreasonably withheld or
delayed), except that no consent of the Borrower shall be required in the case
of an assignment to any other Lender or any affiliate thereof or an assignment
consummated while an Event of Default shall have occurred and be continuing.
Such assignment need not be ratable as among any Revolving Credit Commitments
and/or Revolving Credit Loans of the assigning Lender. Upon such execution,
delivery, acceptance and recording, from and after the effective date determined
pursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be
a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder with a Commitment as set
forth therein, and (y) the assigning Lender thereunder shall, to the extent
provided in such Assignment and Acceptance, be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering
all or the remaining portion of an assigning Lender's rights and obligations
under this Agreement, such assigning Lender shall cease to be a party hereto).
(d) The Administrative Agent, on behalf of the Borrower, shall maintain
at the address of the Administrative Agent referred to in Section 11.2 a copy of
each Assignment and Acceptance delivered to it and a register (the "REGISTER")
for the recordation of the names and addresses of the Lenders and/or any
nominees thereof and the Commitments of, and principal amounts of the Loans
owing to, each Lender from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders shall treat each Person whose name is
recorded in the Register as the owner of a Loan or other obligation hereunder as
the owner thereof for all purposes of this Agreement and the other Loan
Documents. Any assignment of any Loan or other obligation hereunder shall be
effective only upon appropriate entries with respect thereto being made in the
Register. The Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon reasonable prior
notice.
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(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an Assignee, together with payment to the Administrative
Agent of a registration and processing fee of $1,500 if such Assignee is a
Lender or an affiliate of a Lender, and, in all other cases, $3,000, the
Administrative Agent shall (i) promptly accept such Assignment and Acceptance
and (ii) on the effective date determined pursuant thereto record the
information contained therein in the Register and give notice of such acceptance
and recordation to the Lenders and the Borrower.
(f) The Borrower authorizes each Lender to disclose to any Participant
or Assignee (each, a "TRANSFEREE") and any prospective Transferee any and all
financial information in such Lender's possession concerning the Borrower and
its Affiliates which has been delivered to such Lender by or on behalf of the
Borrower pursuant to this Agreement or which has been delivered to such Lender
by or on behalf of the Borrower in connection with such Lender's credit
evaluation of the Borrower and its Affiliates prior to becoming a party to this
Agreement, subject to Section 11.14(E).
(g) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this Section 11.6 concerning assignments of Loans and
Notes relate only to absolute assignments and that such provisions do not
prohibit assignments creating security interests, including, without limitation,
any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve
Bank in accordance with applicable Requirements of Law.
11.7 APPLICATION OF PROCEEDS AFTER DEFAULT; ADJUSTMENTS; SET-OFF. (a)
Notwithstanding Section 4.8, from and after the Trigger Date (so long as any
Event of Default is continuing), all payments in respect of the Obligations and
all proceeds of any collateral security for or guaranty of the Obligations
received by the Administrative Agent shall be applied by the Administrative
Agent to the Obligations, as follows: (i) first, to pay interest on and the
principal of any Loan which the Administrative Agent has advanced on behalf of
any Lender for which the Administrative Agent has not then been reimbursed by
any Lender or the Borrower; (ii) second, to the reasonable out-of-pocket costs
and expenses of the Administrative Agent in connection with the retaking,
holding, preparing for sale or lease, selling or leasing or other disposition of
any collateral security for the Obligations, including, without limitation, all
court costs and the reasonable fees and expenses of its agents and legal
counsel; (iii) third, to the payment in full of the Obligations or in the event
that such proceeds are insufficient to pay in full the Obligations, equally and
ratably in accordance with each Lender's respective amounts owing to it under or
pursuant to this Agreement or under or pursuant to any Interest Rate Hedge
Agreement (as to each Lender, applied first to fees and expense reimbursements
then due to such Lender, then to interest due to such Lender, then to pay or
prepay principal of the Loans owing to, or to reduce the "credit exposure" of,
such Lender under such Interest Rate Hedge Agreement, as the case may be); (iv)
fourth, without duplication of any amounts paid pursuant to clause (iii) above,
to the Indemnified Persons to the extent of any amounts owing pursuant to
Section 11.5; (v) fifth, to any Persons entitled to such amounts pursuant to
Section 9-504(a)(c) of the Uniform Commercial Code; and (vi) sixth, to the
Borrower, or its successors and assigns, or as a court of competent jurisdiction
may direct, of any surplus then remaining. For purposes of this Agreement, the
"credit exposure" at any time of any Lender under
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an Interest Rate Hedge Agreement to which such Lender is a party shall be
determined at such time in accordance with the customary methods of calculating
credit exposure under similar arrangements by the counterparty to such
arrangements, taking into account potential interest rate movements and the
respective termination provisions and notional principal amount and term of such
Interest Rate Hedge Agreement. The Borrower shall remain liable to the
Administrative Agent the Lenders for any deficiency. If the Administrative Agent
has funds available to apply to a portion of, but not all of, one of the amounts
described in clauses (i) through (iv) above, then the Administrative Agent shall
apply such funds to the applicable parties in proportion to the amounts to which
such parties would have been entitled if the entire amount described in any such
clause had been available.
(b) Except to the extent that this Agreement specifies provisions for
scheduled payments and optional and mandatory payments to be allocated to
Revolving Credit Loans, if any Lender (a "BENEFITTED LENDER") shall at any time
receive any payment of all or part of its Loans, or interest thereon, or receive
any collateral in respect thereof (whether voluntarily or involuntarily, by
set-off, pursuant to events or proceedings of the nature referred to in Section
9(F), or otherwise), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of such other
Lender's Loans, or interest thereon, such Benefitted Lender shall purchase for
cash from the other Lenders a participating interest in such portion of each
such other Lender's Loan, or shall provide such other Lenders with the benefits
of any such collateral, or the proceeds thereof, as shall be necessary to cause
such Benefitted Lender to share the excess payment or benefits of such
collateral or proceeds ratably with each of the Lenders; PROVIDED, HOWEVER, that
if all or any portion of such excess payment or benefits is thereafter recovered
from such Benefitted Lender, such purchase shall be rescinded, and the purchase
price and benefits returned, to the extent of such recovery, but without
interest.
(c) In addition to any rights and remedies of the Lenders provided by
law (including, without limitation, other rights of set-off), each Lender shall
have the right, without prior notice to the Borrower, any such notice being
expressly waived by the Borrower to the extent permitted by applicable law, upon
any Obligation becoming due and payable by the Borrower (whether at the stated
maturity, by acceleration or otherwise) to set-off and appropriate and apply
against such amount, to the extent permitted by applicable law, any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any branch or agency
thereof to or for the credit or the account of the Borrower, whether or not the
Administrative Agent or any Lender has made any demand for payment. Each Lender
agrees promptly to notify the Borrower, as applicable, and the Administrative
Agent after any such set-off and application made by such Lender, provided that,
to the extent permitted by applicable law, the failure to give such notice shall
not affect the validity of such set-off and application.
11.8 COUNTERPARTS; WHEN EFFECTIVE. This Agreement may be executed by
one or more of the parties to this Agreement on any number of separate
counterparts (including by facsimile transmission), and all of said counterparts
taken together shall be deemed to constitute one and the
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same instrument. A set of the copies of this Agreement signed by all the parties
shall be lodged with the Borrower and the Administrative Agent. This Agreement
shall become effective when the Administrative Agent has received counterparts
hereof executed by the Borrower, the Administrative Agent and each Lender (such
date herein referred to as the "EFFECTIVE DATE").
11.9 SEVERABILITY. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
11.10 INTEGRATION. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.
11.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF TEXAS, WITHOUT GIVING EFFECT TO ITS
CONFLICT OF LAW PRINCIPLES.
11.12 SUBMISSION TO JURISDICTION; WAIVERS. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to
which it is a party, or for recognition and enforcement of any
judgement in respect thereof, to the non-exclusive general jurisdiction
of the Courts of the State of Texas, the courts of the United States of
America for the Southern District of New York, and appellate courts
from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or
that such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;
(c) designates and appoints as agent to receive for and on
behalf of Borrower service of process the Person identified with the
Borrower's state of incorporation as its registered agent for service
of process. In the event that such Person resigns or ceases to serve as
the Borrower's agent for service of process hereunder, the Borrower
agrees forthwith (i) to designate another agent for service of process
and (ii) to give prompt written notice to the Administrative Agent of
the name and address of such agent. In addition, the
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Borrower agrees that service of process in any such action or
proceeding may also be effected by mailing a copy thereof by registered
or certified mail (or any substantially similar form of mail), postage
prepaid, to it at its address set forth in Section 11.2 or at such
other address of which the Administrative Agent shall have been
notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall
limit the right to xxx in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding
referred to in this Section 11.12 any special, exemplary, punitive or
consequential damages.
11.l3 ACKNOWLEDGMENTS. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Lender has any
fiduciary relationship with or duty to the Borrower arising out of or
in connection with this Agreement or any of the other Loan Documents,
and the relationship between Administrative Agent and Lenders, on one
hand, and the Borrower, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Lenders or among the Borrower and the
Lenders.
11.14 CONFIDENTIALITY. Each of the Lenders agrees that it will use
reasonable efforts not to disclose without the prior consent of the Borrower
(other than to its employees, auditors, counsel or other professional advisors,
affiliates, or other Lenders, if the disclosing Person reasonably determines
that it is appropriate that such other Person have access to such information)
any information with respect to the Borrower or any Subsidiary which is
furnished pursuant to or in connection with this Agreement or any other Loan
Document; PROVIDED, that any Lender may disclose any such information (a) as has
become generally available to the public, (b) as may be required or appropriate
in any report, statement or testimony submitted to the NAIC or any Governmental
Authority having or claiming to have jurisdiction over such Lender (including
the Board and the Federal Deposit Insurance Corporation or any similar
organization (whether in the United States or elsewhere) and their respective
successors), (c) as may be required or appropriate in response to any summons or
subpoena or in connection with any litigation, (d) to comply with any
Requirement of Law applicable to it, or (e) to any prospective Transferee which
is not at the time a Lender, if such prospective Transferee has agreed in
writing to be bound by the provisions of this Section 11.14 to the same extent
as the disclosing Person.
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11.15 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT AND
THE LENDERS HEREBY KNOWINGLY AND INTENTIONALLY IRREVOCABLY AND UNCONDITIONALLY
WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
11.16 MAXIMUM INTEREST RATE. Regardless of any provision contained in
any of the Loan Documents, no Lender shall ever be entitled to contract for,
charge, take, reserve, receive, or apply, as interest on the Obligations, or any
part thereof, any amount in excess of the Highest Lawful Rate, and, in the event
any Lender ever contracts for, charges, takes, reserves, receives, or applies as
interest any such excess, it shall be deemed a partial prepayment of principal
and treated hereunder as such and any remaining excess shall be refunded to the
Borrower.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGES FOLLOW.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
ABLE TELCOM HOLDING CORP.
By: /S/ XXXXXXX X. XXXXXX
-------------------------------------
Xxxxxxx X. Xxxxxx
President
THE ADMINISTRATIVE AGENT
AND THE LENDERS:
NATIONSBANK, N.A.,
as Administrative Agent, the Issuing Lender
and as a Lender
By: /S/ XXXXXXX XXXX
------------------------------------
Xxxxxxx Xxxx
Vice President
