CREDIT AGREEMENT
Dated as of June 9, 1998
among
NAVIGANT INTERNATIONAL, INC.,
as Borrower,
Certain Subsidiaries and Affiliates,
as Guarantors,
THE LENDERS NAMED HEREIN
AND
NATIONSBANK, N.A.,
as Administrative Agent
TABLE OF CONTENTS
SECTION 1 DEFINITIONS...................................................................................... 1
1.1 Definitions.................................................................................... 1
1.2 Computation of Time Periods.................................................................... 23
1.3 Accounting Terms............................................................................... 23
SECTION 2 CREDIT FACILITIES................................................................................. 24
2.1 Revolving Loans................................................................................ 24
2.2 Letter of Credit Subfacility................................................................... 26
2.3 Swingline Loan Subfacility..................................................................... 31
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES.................................................... 33
3.1 Default Rate................................................................................... 33
3.2 Extension and Conversion....................................................................... 33
3.3 Prepayments.................................................................................... 34
3.4 Termination and Reduction of Commitments....................................................... 34
3.5 Fees........................................................................................... 35
3.6 Capital Adequacy............................................................................... 36
3.7 Inability To Determine Interest Rate........................................................... 36
3.8 Illegality..................................................................................... 36
3.9 Requirements of Law............................................................................ 37
3.10 Taxes......................................................................................... 38
3.11 Indemnity..................................................................................... 40
3.12 Pro Rata Treatment............................................................................ 40
3.13 Sharing of Payments........................................................................... 41
3.14 Payments, Computations, Etc................................................................... 42
3.15 Evidence of Debt.............................................................................. 43
SECTION 4 GUARANTY.......................................................................................... 44
4.1 The Guarantee.................................................................................. 44
4.2 Obligations Unconditional...................................................................... 45
4.3 Reinstatement.................................................................................. 46
4.4 Certain Additional Waivers..................................................................... 46
4.5 Remedies....................................................................................... 46
4.6 Rights of Contribution......................................................................... 46
4.7 Continuing Guarantee........................................................................... 47
SECTION 5 CONDITIONS........................................................................................ 47
5.1 Conditions to Closing.......................................................................... 47
5.2 Conditions to All Extensions of Credit......................................................... 49
SECTION 6 REPRESENTATIONS AND WARRANTIES.................................................................... 50
6.1 Financial Condition............................................................................ 50
6.2 No Changes or Restricted Payments.............................................................. 50
i
6.3 Organization; Existence; Compliance with Law................................................... 51
6.4 Power; Authorization; Enforceable Obligations.................................................. 51
6.5 No Legal Bar................................................................................... 51
6.6 No Material Litigation......................................................................... 52
6.7 No Default..................................................................................... 52
6.8 Ownership of Property; Liens................................................................... 52
6.9 Intellectual Property.......................................................................... 52
6.10 No Burdensome Restrictions.................................................................... 53
6.11 Taxes......................................................................................... 53
6.12 ERISA......................................................................................... 53
6.13 Governmental Regulations, Etc................................................................. 54
6.14 Subsidiaries.................................................................................. 55
6.15 Purpose of Extensions of Credit............................................................... 55
6.16 Environmental Matters......................................................................... 55
SECTION 7 AFFIRMATIVE COVENANTS............................................................................. 56
7.1 Financial Statements........................................................................... 56
7.2 Certificates; Other Information................................................................ 57
7.3 Notices........................................................................................ 58
7.4 Payment of Obligations......................................................................... 59
7.5 Conduct of Business and Maintenance of Existence............................................... 60
7.6 Maintenance of Property; Insurance............................................................. 60
7.7 Inspection of Property; Books and Records; Discussions......................................... 60
7.8 Environmental Laws............................................................................. 60
7.9 Financial Covenants............................................................................ 61
7.10 Administrative Fees........................................................................... 62
7.11 Additional Guaranties and Stock Pledges....................................................... 62
7.12 Ownership of Subsidiaries..................................................................... 63
7.13 Use of Proceeds............................................................................... 63
SECTION 8 NEGATIVE COVENANTS................................................................................ 63
8.1 Indebtedness................................................................................... 63
8.2 Liens.......................................................................................... 64
8.3 Nature of Business............................................................................. 64
8.4 Consolidation, Merger, Sale or Purchase of Assets, Capital Expenditures, etc................... 64
8.5 Advances, Investments and Loans................................................................ 66
8.6 Transactions with Affiliates................................................................... 66
8.7 Ownership of Equity Interests.................................................................. 66
8.8 Fiscal Year.................................................................................... 66
8.9 Prepayments of Indebtedness, etc............................................................... 67
8.10 Restricted Payments........................................................................... 67
8.11 Sale Leasebacks............................................................................... 67
8.12 No Further Negative Pledges................................................................... 67
SECTION 9 EVENTS OF DEFAULT................................................................................ 68
ii
9.1 Events of Default.............................................................................. 68
9.2 Acceleration; Remedies......................................................................... 70
SECTION 10 AGENCY PROVISIONS................................................................................ 71
10.1 Appointment................................................................................... 71
10.2 Delegation of Duties.......................................................................... 71
10.3 Exculpatory Provisions........................................................................ 71
10.4 Reliance on Communications.................................................................... 72
10.5 Notice of Default............................................................................. 72
10.6 Non-Reliance on Administrative Agent and Other Lenders........................................ 73
10.7 Indemnification............................................................................... 73
10.8 Administrative Agent in its Individual Capacity............................................... 74
10.9 Successor Administrative Agent................................................................ 74
SECTION 11 MISCELLANEOUS.................................................................................... 75
11.1 Notices....................................................................................... 75
11.2 Right of Set-Off.............................................................................. 76
11.3 Benefit of Agreement.......................................................................... 76
11.4 No Waiver; Remedies Cumulative................................................................ 79
11.5 Payment of Expenses, etc...................................................................... 79
11.6 Amendments, Waivers and Consents.............................................................. 80
11.7 Counterparts.................................................................................. 81
11.8 Headings...................................................................................... 81
11.9 Survival...................................................................................... 81
11.10 Governing Law; Submission to Jurisdiction; Venue............................................. 81
11.11 Severability................................................................................. 82
11.12 Entirety..................................................................................... 82
11.13 Binding Effect; Termination.................................................................. 82
11.14 Confidentiality.............................................................................. 83
11.15 Source of Funds.............................................................................. 83
11.16 Conflict..................................................................................... 84
iii
SCHEDULES
Schedule 2.1(a) Lenders and Commitments
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Note
Schedule 2.2(b)-1 Existing Letters of Credit
Schedule 2.2(b)-2 Form of Notice of Request for Letter of Credit
Schedule 3.2 Form of Notice of Extension/Conversion
Schedule 5.1(i)(v) Form of Officer's Certificate
Schedule 6.6 Description of Legal Proceedings
Schedule 6.8 Existing Liens
Schedule 6.14 Subsidiaries
Schedule 7.2(b) Form of Officer's Compliance Certificate
Schedule 7.11-1 Form of Joinder Agreement
Schedule 8.1 Indebtedness
Schedule 8.5 Existing Investments
Schedule 11.1 Lenders and Addresses
Schedule 11.3(b) Form of Assignment and Acceptance
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT dated as of June 9, 1998 (the "Credit Agreement"), is
----------------
by and among NAVIGANT INTERNATIONAL, INC., a Delaware corporation (the
"Borrower"), and the subsidiaries and affiliates identified on the signature
--------
pages hereto and such other subsidiaries and affiliates as may from time to time
become Guarantors hereunder in accordance with the provisions hereof (the
"Guarantors"), the lenders named herein and such other lenders as may become a
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party hereto (the "Lenders"), and NATIONSBANK, N.A., as Administrative Agent (in
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such capacity, the "Administrative Agent").
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W I T N E S S E T H
WHEREAS, the Borrower has requested that the Lenders provide up to a $75
million credit facility for the purposes hereinafter set forth;
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrower on the terms and conditions hereinafter set forth;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
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1.1 Definitions.
-----------
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Additional Credit Party" means each Person that becomes a Guarantor
-----------------------
after the Closing Date by execution of a Joinder Agreement.
"Administrative Agent" shall have the meaning assigned to such term in
--------------------
the heading hereof, together with any successors or assigns.
"Administrative Agent's Fee Letter" means that certain letter
---------------------------------
agreement, dated as of April 28, 1998, between the Administrative Agent and
the Borrower, as amended, modified, supplemented or replaced from time to
time.
"Administrative Agent's Fees" shall have the meaning assigned to such
---------------------------
term in Section 3.5(c).
1
"Affiliate" means, with respect to any Person, any other Person (i)
---------
directly or indirectly controlling or controlled by or under direct or
indirect common control with such Person or (ii) directly or indirectly
owning or holding five percent (5%) or more of the equity interest in such
Person. For purposes of this definition, "control" when used with respect
to any 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.
"Agency Services Address" means NationsBank, N.A., NC1-001-15-04, 101
-----------------------
Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attn: Agency
Services, or such other address as may be identified by written notice from
the Administrative Agent to the Borrower.
"Aggregate Revolving Committed Amount" means the aggregate amount of
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Revolving Commitments in effect from time to time, being initially SIXTY
MILLION DOLLARS ($60,000,000), subject to an increase up to SEVENTY-FIVE
MILLION DOLLARS ($75,000,000) in accordance with the provisions of Section
2.1(g).
"Applicable Percentage" means for any day, the rate per annum set
---------------------
forth below opposite the applicable Consolidated Leverage Ratio then in
effect, it being understood that the Applicable Percentage for (i) Base
Rate Loans shall be the percentage set forth under the column "Base Rate
Margin", (ii) Eurodollar Loans shall be the percentage set forth under the
column "Eurodollar Margin and Letter of Credit Fee", (iii) the Letter of
Credit Fee shall be the percentage set forth under the column "Eurodollar
Margin and Letter of Credit Fee", and (iv) the Commitment Fee shall be the
percentage set forth under the column "Commitment Fee":
Consolidated Eurodollar
Pricing Leverage Base Rate Margin and Commitment
Level Ratio Margin Letter of Credit Fee Fee
----- ----- ------ -------------------- ---
I more than 1.5 0% 1.00% .25%
II less than or equal to 1.5 but more than 2.0 .10% 1.35% .30%
III less than equal to 2.0 but more than 2.5 .50% 1.75% .375%
IV less than equal to 2.5 .75% 2.00% .425%
The Applicable Percentage shall be determined and adjusted quarterly on the
date (each a "Rate Determination Date") five (5) Business Days after the
-----------------------
date by which the annual and quarterly compliance certificates and related
financial statements and information are required in accordance with the
provisions of Sections 7.1(a) and (b) and Section 7.2(b), as applicable;
provided that:
--------
(i) the initial Applicable Percentages shall be 1.50% in the
case of the Eurodollar Margin and Letter of Credit Fee, 0.25% in the
case of the Base Rate Margin, and 0.375% in the case of the Commitment
Fee and shall remain in effect
2
until the first Rate Determination Date to occur after the date six
months from the Closing Date; and
(ii) in the event an annual or quarterly compliance certificate
and related financial statements and information are not delivered
timely to the Agency Services Address by the date required by Sections
7.1(a) and (b) and Section 7.2(b), as applicable, the Applicable
Percentages shall be based on Pricing Level IV until such time as an
appropriate compliance certificate and related financial statements
and information are delivered, whereupon the applicable Pricing Level
shall be adjusted based on the information contained in such
compliance certificate and related financial statements and
information.
Each Applicable Percentage shall be effective from a Rate Determination
Date until the next such Rate Determination Date. The Administrative Agent
shall determine the appropriate Applicable Percentages in the pricing
matrix promptly upon receipt of the quarterly or annual compliance
certificate and related financial information and shall promptly notify the
Borrower and the Lenders of any change thereof. Such determinations by the
Administrative Agent shall be conclusive absent manifest error.
Adjustments in the Applicable Percentages shall be effective as to existing
Extensions of Credit as well as new Extensions of Credit made thereafter.
"Approved Bank" shall have the meaning given such term in the
-------------
definition of "Cash Equivalents".
"Asset Disposition" means, other than a Securitization Transaction and
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the Excluded Asset Dispositions, (i) the sale, lease or other disposition
of any property or asset by any member of the Consolidated Group, other
than any such sale permitted by Sections 8.4(b) and other than to the
extent permitted by Section 8.5, and (ii) receipt by any member of the
Consolidated Group of any cash insurance proceeds or condemnation award
payable by reason of theft, loss, physical destruction or damage, taking or
similar event with respect to any of their property or assets.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
---------------
States Code, as amended, modified, succeeded or replaced from time to time.
"Bankruptcy Event" means, with respect to any Person, the occurrence
----------------
of any of the following with respect to such Person: (i) a court or
governmental agency having jurisdiction in the premises shall enter a
decree or order for relief in respect of such Person in an involuntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of such Person or
for any substantial part of its Property or ordering the winding up or
liquidation of its affairs; or (ii) there shall be commenced against such
Person an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or any case, proceeding or
other action for the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar
3
official) of such Person or for any substantial part of its Property or for
the winding up or liquidation of its affairs, and such involuntary case or
other case, proceeding or other action shall remain undismissed,
undischarged or unbonded for a period of sixty (60) consecutive days; or
(iii) such Person shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consent to the entry of an order for relief in an involuntary case under
any such law, or consent to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of such Person or for any substantial part of its
Property or make any general assignment for the benefit of creditors; or
(iv) such Person shall be unable to, or shall admit in writing its
inability to, pay its debts generally as they become due.
"Base Rate" means, for any day, the rate per annum (rounded upwards,
---------
if necessary, to the nearest whole multiple of 1/100 of 1%) equal to the
greater of (a) the Federal Funds Rate in effect on such day plus 1/2 of 1%
----
or (b) the Prime Rate in effect on such day. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable after due inquiry to
ascertain the Federal Funds Rate for any reason, including the inability or
failure of the Administrative Agent to obtain sufficient quotations in
accordance with the terms hereof, the Base Rate shall be determined without
regard to clause (a) of the first sentence of this definition until the
circumstances giving rise to such inability no longer exist. Any change in
the Base Rate due to a change in the Prime Rate or the Federal Funds Rate
shall be effective on the effective date of such change in the Prime Rate
or the Federal Funds Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate determined
--------------
by reference to the Base Rate.
"Borrower" means Navigant International, Inc., a Delaware corporation,
--------
as referenced in the opening paragraph, its successors and permitted
assigns.
"Business Day" means a day other than a Saturday, Sunday or other day
------------
on which commercial banks in Charlotte, North Carolina or New York, New
York are authorized or required by law to close, except that, when used in
------ ----
connection with a Eurodollar Loan, such day shall also be a day on which
dealings between banks are carried on in U.S. dollar deposits in London,
England.
"Capital Expenditures" means, for any period, without duplication, all
--------------------
expenditures (whether paid in cash or other consideration) during such
period that, in accordance with GAAP, are or should be included in
additions to property, plant and equipment or similar items reflected in
the consolidated statement of cash flows for such period; provided, that
--------
Capital Expenditures shall not include, for purposes hereof, (i)
expenditures of proceeds of insurance settlements, condemnation awards and
other settlements in respect of lost, destroyed, damaged or condemned
assets, equipment or other property to the extent such expenditures are
made to replace or repair such lost, destroyed, damaged or condemned
assets, equipment or other property or other otherwise
4
to acquire assets or properties useful in the business of the members of
the Consolidated Group within 12 months of receipt of such proceeds.
"Capital Lease" means, as applied to any Person, any lease of any
-------------
Property (whether real, personal or mixed) by that Person as lessee which,
in accordance with GAAP, is or should be accounted for as a capital lease
on the balance sheet of that Person.
"Capital Lease Obligation" means the capital lease obligations
------------------------
relating to a Capital Lease determined in accordance with GAAP.
"Cash Equivalents" means (a) securities issued or directly and fully
----------------
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the
United States of America is pledged in support thereof) having maturities
of not more than twelve months from the date of acquisition, (b) U.S.
dollar denominated time deposits and certificates of deposit of (i) any
Lender, or (ii) any domestic commercial bank of recognized standing (y)
having capital and surplus in excess of $500,000,000 and (z) whose short-
term commercial paper rating from S&P is at least A-1 or the equivalent
thereof or from Xxxxx'x is at least P-1 or the equivalent thereof (any such
bank being an "Approved Bank"), in each case with maturities of not more
-------------
than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by,
any domestic corporation rated A-1 (or the equivalent thereof) or better by
S&P or P-1 (or the equivalent thereof) or better by Moody's and maturing
within six months of the date of acquisition, (d) repurchase agreements
entered into by a Person with a bank or trust company (including any of the
Lenders) or recognized securities dealer having capital and surplus in
excess of $500,000,000 for direct obligations issued by or fully guaranteed
by the United States of America in which such Person shall have a perfected
first priority security interest (subject to no other Liens) and having, on
the date of purchase thereof, a fair market value of at least 100% of the
amount of the repurchase obligations, (e) obligations of any State of the
United States or any political subdivision thereof, the interest with
respect to which is exempt from federal income taxation under Section 103
of the Code, having a long term rating of at least AA- or Aa-3 by S&P or
Moody's, respectively, and maturing within three years from the date of
acquisition thereof, (f) Investments in municipal auction preferred stock
(i) rated AAA (or the equivalent thereof) or better by S&P or Aaa (or the
equivalent thereof) or better by Moody's and (ii) with dividends that reset
at least once every 365 days and (g) Investments, classified in accordance
with GAAP as current assets, in money market investment programs registered
under the Investment Company Act of 1940, as amended, which are
administered by reputable financial institutions having capital of at least
$100,000,000 and the portfolios of which are limited to Investments of the
character described in the foregoing subdivisions (a) through (f).
"Change of Control" means the occurrence of any of the following
-----------------
events: (i) any Person or two or more Persons acting in concert shall have
acquired beneficial ownership, directly or indirectly, of, or shall have
acquired by contract or otherwise, or shall have
5
entered into a contract or arrangement that, upon consummation, will result
in its or their acquisition of or control over, Voting Stock of the
Borrower (or other securities convertible into such Voting Stock)
representing 35% or more of the combined voting power of all Voting Stock
of the Borrower, or (ii) during any period of up to 24 consecutive months,
commencing after the Closing Date, individuals who at the beginning of such
24 month period were directors of the Borrower (together with any new
director whose election by the Borrower's Board of Directors or whose
nomination for election by the Borrower's shareholders was approved by a
vote of at least two-thirds of the directors then still in office who
either were directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the directors of the Borrower then in office. As
used herein, "beneficial ownership" shall have the meaning provided in Rule
13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934.
"Closing Date" means the date hereof.
------------
"Code" means the Internal Revenue Code of 1986, as amended, and any
----
successor statute thereto, as interpreted by the rules and regulations
issued thereunder, in each case as in effect from time to time. References
to sections of the Code shall be construed also to refer to any successor
sections.
"Commitment" means the Revolving Commitment, the LOC Commitment and
----------
the Swingline Commitment.
"Commitment Fee" shall have the meaning given such term in Section
--------------
3.5(a).
"Commitment Percentage" means the Revolving Commitment Percentage.
---------------------
"Commitment Period" means the period from and including the Closing
-----------------
Date to but not including the earlier of (i) the Termination Date, or (ii)
the date on which the Commitments terminate in accordance with the
provisions of this Credit Agreement.
"Consolidated EBITDA" means for any period for the Consolidated Group,
-------------------
the sum of Consolidated Net Income plus Consolidated Interest Expense plus
---- ----
all provisions for any Federal, state or other domestic and foreign income
taxes plus depreciation and amortization plus one-time non-recurring
---- ----
restructuring charges deducted in calculating Consolidated Net Income, in
each case on a consolidated basis determined in accordance with GAAP, but
including pro forma historical EBITDA from acquisitions adjusted for
salaries, owners' perks and other items reasonably eliminated pursuant to
contractual provisions and excluding for purposes hereof extraordinary
gains and losses and related tax effects thereon. Except as otherwise
expressly provided, the applicable period shall be for the four consecutive
fiscal quarters ending as of the date of determination.
6
"Consolidated EBITDAR" means, for any period, the sum of (i)
--------------------
Consolidated EBITDA for such period plus (ii) to the extent deducted in
determining Consolidated EBITDA for such period, Consolidated Rental
Expense for such period.
"Consolidated Fixed Charge Coverage Ratio" means for any period, the
----------------------------------------
ratio of Consolidated EBITDAR to Consolidated Fixed Charges.
"Consolidated Fixed Charges" means for any period for the Consolidated
--------------------------
Group, the sum of Consolidated Interest Expense plus Consolidated Rental
----
Expense, in each case on a consolidated basis determined in accordance with
GAAP. Except as otherwise expressly provided, the applicable period shall
be for the four consecutive fiscal quarters ending as of the date of
determination.
"Consolidated Funded Debt" means Funded Debt of the Consolidated Group
------------------------
determined on a consolidated basis in accordance with GAAP.
"Consolidated Group" means the Borrower and its consolidated
------------------
subsidiaries, as determined in accordance with GAAP.
"Consolidated Interest Expense" means for any period for the
-----------------------------
Consolidated Group, all interest expense, including the amortization of
debt discount and premium, the interest component under Capital Leases and
the implied interest component under Securitization Transactions, in each
case on a consolidated basis determined in accordance with GAAP. Except as
expressly provided otherwise, the applicable period shall be for the four
consecutive quarters ending as of the date of determination.
"Consolidated Leverage Ratio" means, as of the last day of any fiscal
---------------------------
quarter, the ratio of Consolidated Funded Debt on such day to Consolidated
EBITDA for the period of four consecutive fiscal quarters ending as of such
day.
"Consolidated Net Income" means for any period for the Consolidated
-----------------------
Group, net income on a consolidated basis determined in accordance with
GAAP. Except as expressly provided otherwise, the applicable period shall
be for the four consecutive quarters ending as of the date of
determination.
"Consolidated Net Worth" means, as for any date for the Consolidated
----------------------
Group, shareholders' equity or net worth as determined in accordance with
GAAP.
"Consolidated Rental Expense" means, for any period, rental expense
---------------------------
under Operating Leases of the Consolidated Group on a consolidated basis
for such period, as determined in accordance with GAAP.
"Contractual Obligation" means, as to any Person, any provision of any
----------------------
security issued by such Person or of any material agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
7
"Credit Documents" means a collective reference to this Credit
----------------
Agreement, the Notes, the LOC Documents, the Pledge Agreement, the Security
Agreement, each Joinder Agreement, the Administrative Agent's Fee Letter,
and all other related agreements and documents issued or delivered
hereunder or thereunder or pursuant hereto or thereto.
"Credit Party" means any of the Borrower and the Guarantors.
------------
"Default" means any event, act or condition which with notice or lapse
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of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, at such time,
-----------------
(i) has failed to make an Extension of Credit required pursuant to the
terms of this Credit Agreement, (ii) has failed to pay to the
Administrative Agent or any Lender an amount owed by such Lender pursuant
to the terms of the Credit Agreement or any other of the Credit Documents,
or (iii) has been deemed insolvent or has become subject to a bankruptcy or
insolvency proceeding or to a receiver, trustee or similar proceeding.
"Dollars" and "$" means dollars in lawful currency of the United
------- -
States of America.
"Domestic Credit Party" means any Credit Party which is incorporated
---------------------
or organized under the laws of any State of the United States or the
District of Columbia.
"Domestic Subsidiary" means any Subsidiary which is incorporated or
-------------------
organized under the laws of any State of the United States or the District
of Columbia.
"Environmental Laws" means any and all lawful and applicable Federal,
------------------
state, local and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions relating to the
environment or to emissions, discharges, releases or threatened releases of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes into the environment including, without limitation,
ambient air, surface water, ground water, or land, or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of pollutants, contaminants, chemicals, or
industrial, toxic or hazardous substances or wastes.
"Equity Transaction" means, with respect to any member of the
------------------
Consolidated Group, any issuance of shares of its capital stock or other
equity interest, other than an issuance (i) to a member of the Consolidated
Group, (ii) in connection with a conversion of debt securities to equity or
(iii) in connection with exercise by a present or former employee, officer
or director under a stock incentive plan, stock option plan or other
equity-based compensation plan or arrangement.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, and any successor statute thereto, as interpreted by the rules and
regulations
8
thereunder, all as the same may be in effect from time to time. References
to sections of ERISA shall be construed also to refer to any successor
sections.
"ERISA Affiliate" means an entity which is under common control with
---------------
any Credit Party within the meaning of Section 4001(a)(14) of ERISA, or is
a member of a group which includes the Borrower and which is treated as a
single employer under Sections 414(b) or (c) of the Code.
"ERISA Event" means (i) with respect to any Plan, the occurrence of a
-----------
Reportable Event or the substantial cessation of operations (within the
meaning of Section 4062(e) of ERISA); (ii) the withdrawal by the Borrower,
any Subsidiary of the Borrower or any ERISA Affiliate from a Multiple
Employer Plan during a plan year in which it was a substantial employer (as
such term is defined in Section 4001(a)(2) of ERISA), or the termination of
a Multiple Employer Plan; (iii) the distribution of a notice of intent to
terminate or the actual termination of a Plan pursuant to Section
4041(a)(2) or 4041A of ERISA; (iv) the institution of proceedings to
terminate or the actual termination of a Plan by the PBGC under Section
4042 of ERISA; (v) any event or condition which would reasonably be
expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan;
(vi) the complete or partial withdrawal of the Borrower, any Subsidiary of
the Borrower or any ERISA Affiliate from a Multiemployer Plan; (vii) the
conditions for imposition of a lien under Section 302(f) of ERISA exist
with respect to any Plan; or (vii) the adoption of an amendment to any Plan
requiring the provision of security to such Plan pursuant to Section 307 of
ERISA.
"Eurodollar Loan" means any Loan bearing interest at a rate determined
---------------
by reference to the Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each Eurodollar
---------------
Loan comprising part of the same borrowing (including conversions,
extensions and renewals), a per annum interest rate determined pursuant to
the following formula:
Eurodollar Rate = Interbank Offered Rate
-------------------------------------
1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means for any day, that percentage
-----------------------------
(expressed as a decimal) which is in effect from time to time under
Regulation D of the Board of Governors of the Federal Reserve System (or
any successor), as such regulation may be amended from time to time or any
successor regulation, as the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurocurrency liabilities as
that term is defined in Regulation D (or against any other category of
liabilities that includes deposits by reference to which the interest rate
of Eurodollar Loans is determined), whether or not Lender has any
Eurocurrency liabilities subject to such reserve requirement at that time.
Eurodollar Loans shall be deemed to constitute Eurocurrency liabilities and
as such shall be deemed subject to reserve requirements without benefits of
credits for proration, exceptions or offsets that may
9
be available from time to time to a Lender. The Eurodollar Rate shall be
adjusted automatically on and as of the effective date of any change in the
Eurodollar Reserve Percentage.
"Event of Default" means such term as defined in Section 9.1.
----------------
"Excess Funding Guarantor" shall have the meaning given such term in
------------------------
Section 4.6.
"Excess Payment" shall have the meaning given such term in Section
--------------
4.6.
"Excluded Asset Disposition" means the real property owned by the
--------------------------
Borrower and commonly known as 00 Xxxxxx Xxxxxx X.X., Xxxxx Xxxxxx, XX
00000, and 000 Xxxxxxxx Xxxxxx, Xxxxxxxx, XX 00000.
"Existing Letters of Credit" means those Letters of Credit outstanding
--------------------------
on the Closing Date and identified on Schedule 2.2(b)-1.
-----------------
"Extension of Credit" means, as to any Lender, the making of, or
-------------------
participation in, a Loan by such Lender or the issuance or extension of, or
participation in, a Letter of Credit.
"Fees" means all fees payable pursuant to Section 3.5.
----
"Federal Funds Rate" means, for any day, the rate of interest per
------------------
annum (rounded upwards, if necessary, to the nearest whole multiple of
1/100 of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers on such day, as published by the Federal
Reserve Bank of New York on the Business Day next succeeding such day,
provided that (A) if such day is not a Business Day, the Federal Funds Rate
--------
for such day shall be such rate on such transactions on the next preceding
Business Day and (B) if no such rate is so published on such next preceding
Business Day, the Federal Funds Rate for such day shall be the average rate
quoted to the Administrative Agent on such day on such transactions as
determined by the Administrative Agent.
"Foreign Credit Party" means a Credit Party which is not a Domestic
--------------------
Credit Party.
"Foreign Subsidiary" means a Subsidiary which is not a Domestic
------------------
Subsidiary.
"Funded Debt" means, with respect to any Person, without duplication,
-----------
(i) all Indebtedness of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily made, (iii)
all purchase money Indebtedness (including for purposes hereof,
indebtedness and obligations described in clauses (iii) and (iv) of the
definition of "Indebtedness") of such Person, including without limitation
the principal
10
portion of all obligations of such Person under Capital Leases, (iv) all
Support Obligations of such Person with respect to Funded Indebtedness of
another Person, (v) the maximum available amount of all standby letters of
credit or acceptances issued or created for the account of such Person,
(vi) all Funded Debt of another Person secured by a Lien on any Property of
such Person, whether or not such Funded Indebtedness has been assumed,
provided that for purposes hereof the amount of such Funded Debt shall be
--------
limited to the greater of (A) the amount of such Funded Debt as to which
there is recourse to such Person and (B) the fair market value of the
property which is subject to the Lien, (vii) the outstanding attributed
principal amount under any Securitization Transaction, and (viii) the
principal balance outstanding under any synthetic lease, tax retention
operating lease, off-balance sheet loan or similar off-balance sheet
financing product to which such Person is a party, where such transaction
is considered borrowed money indebtedness for tax purposes but is
classified as an operating lease in accordance with GAAP. The Funded Debt
of any Person shall include the Funded Debt of any partnership or joint
venture in which such Person is a general partner or joint venturer, but
only to the extent to which there is recourse to such Person for the
payment of such Funded Debt.
"GAAP" means generally accepted accounting principles in the United
----
States applied on a consistent basis and subject to the terms of Section
1.3 hereof.
"Governmental Authority" means any Federal, state, local or foreign
----------------------
court or governmental agency, authority, instrumentality or regulatory
body.
"Guarantor" means each of those Persons identified as a "Guarantor" on
---------
the signature pages hereto, and each other Person which may hereafter
become a Guarantor by execution of a Joinder Agreement, together with their
successors and permitted assigns.
"Guaranteed Obligations" means, as to each Guarantor, without
----------------------
duplication, (i) all obligations of the Borrower (including interest
accruing after a Bankruptcy Event, regardless of whether such interest is
allowed as a claim under the Bankruptcy Code) to the Lenders and the
Administrative Agent, whenever arising, under this Credit Agreement, the
Notes or the Credit Documents, and (ii) all liabilities and obligations,
whenever arising, owing from the Borrower to any Lender, or any Affiliate
of a Lender, arising under any Hedging Agreement relating to Obligations
hereunder.
"Hedging Agreements" means any interest rate protection agreement or
------------------
foreign currency exchange agreement between the Borrower and any Lender, or
any Affiliate of a Lender.
"Indebtedness" of any Person means (i) all obligations of such Person
------------
for borrowed money, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, or upon which interest payments
are customarily made, (iii) all obligations of such Person under
conditional sale or other title retention agreements relating to Property
purchased by such Person (other than customary reservations or retentions
of title under agreements with suppliers entered into in the ordinary
course of business), (iv) all
11
obligations of such Person issued or assumed as the deferred purchase price
of Property or services purchased by such Person (other than trade debt
incurred in the ordinary course of business and due within six months of
the incurrence thereof) which would appear as liabilities on a balance
sheet of such Person, (v) all obligations of such Person under take-or-pay
or similar arrangements or under commodities agreements, (vi) all
Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien on, or payable out of the proceeds of production from,
Property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, provided that for purposes hereof the
--------
amount of such Indebtedness shall be limited to the greater of (A) the
amount of such Indebtedness as to which there is recourse to such Person
and (B) the fair market value of the property which is subject to the Lien,
(vii) all Support Obligations of such Person, (viii) the principal portion
of all obligations of such Person under Capital Leases, (ix) all
obligations of such Person in respect of interest rate protection
agreements, foreign currency exchange agreements, commodity purchase or
option agreements or other interest or exchange rate or commodity price
hedging agreements (including, but not limited to, the Hedging Agreements),
(x) the maximum amount of all standby letters of credit issued or bankers'
acceptances facilities created for the account of such Person and, without
duplication, all drafts drawn thereunder (to the extent unreimbursed), (xi)
all preferred stock issued by such Person and required by the terms thereof
to be redeemed, or for which mandatory sinking fund payments are due, by a
fixed date, (xii) the outstanding attributed principal amount under any
Securitization Transaction and (xiii) the principal balance outstanding
under any synthetic lease, tax retention operating lease, off-balance sheet
loan or similar off-balance sheet financing product to which such Person is
a party, where such transaction is considered borrowed money indebtedness
for tax purposes but is classified as an operating lease in accordance with
GAAP. The Indebtedness of any Person shall include the Indebtedness of any
partnership or joint venture in which such Person is a general partner or a
joint venturer, but only to the extent to which there is recourse to such
Person for payment of such Indebtedness.
"Intellectual Property" shall have the meaning given such term in
---------------------
Section 6.9.
"Interbank Offered Rate" means, for the Interest Period for each
----------------------
Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%) equal
to the rate of interest, determined by the Administrative Agent on the
basis of the offered rates for deposits in dollars for a period of time
corresponding to such Interest Period (and commencing on the first day of
such Interest Period), appearing on Telerate Page 3750 (or, if, for any
reason, Telerate Page 3750 is not available, the Reuters Screen LIBO Page)
as of approximately 11:00 A.M. (London time) two (2) Business Days before
the first day of such Interest Period. As used herein, "Telerate Page
3750" means the display designated as page 3750 by Dow Xxxxx Markets, Inc.
(or such other page as may replace such page on that service for the
purpose of displaying the British Bankers Association London interbank
offered rates) and "Reuters Screen LIBO Page" means the display designated
as page "LIBO" on the Reuters Monitor Money Rates Service (or such
12
other page as may replace the LIBO page on that service for the purpose of
displaying London interbank offered rates of major banks).
"Interest Payment Date" means (i) as to any Base Rate Loan, the last
---------------------
day of each March, June, September and December, the date of repayment of
principal of such Loan and the Termination Date and (ii) as to any
Eurodollar Loan and Swingline Loan, the last day of each Interest Period
for such Loan, the date of repayment of principal of such Loan and the
Termination Date, and in addition where the applicable Interest Period is
more than three months, then also on the date three months from the
beginning of the Interest Period, and each three months thereafter. If an
Interest Payment Date falls on a date which is not a Business Day, such
Interest Payment Date shall be deemed to be the next succeeding Business
Day.
"Interest Period" means (i) as to any Eurodollar Loan, a period of
---------------
one, two, three or six month's duration, as the Borrower may elect,
commencing in each case, on the date of the borrowing (including
conversions, extensions and renewals), and (ii) as to any Swingline Loan, a
period of such duration, not to exceed 30 days, as the Borrower may request
and the Swingline Lender may agree in accordance with the provisions of
Section 2.2(b)(i), commencing in each case, on the date of borrowing,;
provided, however, (A) if any Interest Period would end on a day which is
-------- -------
not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that in the case of Eurodollar Loans where
the next succeeding Business Day falls in the next succeeding calendar
month, then on the next preceding Business Day), (B) no Interest Period
shall extend beyond the Termination Date, and (C) in the case of Eurodollar
Loans, where an Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month in which the Interest
Period is to end, such Interest Period shall end on the last day of such
calendar month.
"Investment", in any Person, means any loan or advance to such Person,
----------
any purchase or other acquisition of any capital stock, warrants, rights,
options, obligations or other securities of, or equity interest in, such
Person, any capital contribution to such Person or any other investment in
such Person, including, without limitation, any Support Obligation incurred
for the benefit of such Person.
"IPO" means the completion of the initial public offering of common
---
stock, par value $.001 per share, of the Borrower.
"Issuing Lender" means, initially, NationsBank and, hereafter, any
--------------
Lender which the Borrower may request and such Lender may agree.
"Issuing Lender Fees" shall have the meaning assigned to such term in
-------------------
Section 3.5(b)(ii).
13
"Joinder Agreement" means a Joinder Agreement substantially in the
-----------------
form of Schedule 7.11-1 hereto, executed and delivered by an Additional
---------------
Credit Party in accordance with the provisions of Section 7.11.
"Lenders" means each of the Persons identified as a "Lender" on the
-------
signature pages hereto, and their successors and assigns.
"Letter of Credit" means the Existing Letters of Credit and any letter
----------------
of credit issued by the Issuing Lender for the account of the Borrower in
accordance with the terms of Section 2.2.
"Letter of Credit Fee" shall have the meaning given such term in
--------------------
Section 3.5(b)(i).
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
----
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind (including any agreement to give
any of the foregoing, any conditional sale or other title retention
agreement, any financing or similar statement or notice filed under the
Uniform Commercial Code as adopted and in effect in the relevant
jurisdiction or other similar recording or notice statute, and any lease in
the nature thereof).
"Loan" or "Loans" means the Revolving Loans and/or Swingline Loans.
---- -----
"LOC Commitment" means the commitment of the Issuing Lender to issue,
--------------
and to honor payment obligations under, Letters of Credit hereunder and
with respect to each Lender, the commitment of each Lender to purchase
participation interests in the Letters of Credit up to such Lender's LOC
Committed Amount as specified in Schedule 2.1(a), as such amount may be
---------------
reduced from time to time in accordance with the provisions hereof.
"LOC Committed Amount" means, collectively, the aggregate amount of
--------------------
all of the LOC Commitments of the Lenders to issue and participate in
Letters of Credit as referenced in Section 2.2(a) and, individually, the
amount of each Lender's LOC Commitment as specified in Schedule 2.1(a).
---------------
"LOC Documents" means, with respect to any Letter of Credit, such
-------------
Letter of Credit, any amendments thereto, any documents delivered in
connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in application
or applicable only to such Letter of Credit) governing or providing for (i)
the rights and obligations of the parties concerned or at risk or (ii) any
collateral security for such obligations.
"LOC Obligations" means, at any time, the sum of (i) the maximum
---------------
amount which is, or at any time thereafter may become, available to be
drawn under Letters of Credit then outstanding, assuming compliance with
all requirements for drawings referred to in such Letters of Credit plus
----
(ii) the aggregate amount of all drawings under Letters of Credit honored
by the Issuing Lender but not theretofore reimbursed.
14
"Material Adverse Effect" means a material adverse effect on (i) the
-----------------------
condition (financial or otherwise), operations, business, assets,
liabilities or prospects of the Consolidated Group taken as a whole, (ii)
the ability of the Credit Parties taken as a whole to perform any material
obligation under the Credit Documents to which it is a party or (iii) the
rights and remedies of the Lenders under the Credit Documents.
"Materials of Environmental Concern" means any gasoline or petroleum
----------------------------------
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as
such in or under any Environmental Laws, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor or
-------
assignee of the business of such company in the business of rating
securities.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
------------------
defined in Sections 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which the Borrower, any
----------------------
Subsidiary of the Borrower or any ERISA Affiliate and at least one employer
other than the Borrower, any Subsidiary of the Borrower or any ERISA
Affiliate are contributing sponsors.
"NationsBank" means NationsBank, N.A. and its successors.
-----------
"Net Proceeds" means gross cash proceeds (including any cash received
------------
by way of deferred payment pursuant to a promissory note, receivable or
otherwise, but only as and when received) received in connection with an
Asset Disposition or Equity Transaction, net of (i) reasonable transaction
costs, including in the case of an Equity Transaction, underwriting
discounts and commissions and in the case of an Asset Disposition occurring
in connection with a claim under an insurance policy, costs incurred in
connection with adjustment and settlement of the claim, (ii) estimated
taxes payable in connection therewith, and (iii) in the case of an Asset
Disposition, any amounts payable in respect of Funded Debt, including
without limitation principal, interest, premiums and penalties, which is
secured by, or otherwise related to, any property or asset which is the
subject thereof to the extent that such Funded Debt and any payments in
respect thereof are paid with a portion of the proceeds therefrom.
"Non-Excluded Taxes" means such term as is defined in Section 3.10(a).
------------------
"Non-Guarantor Subsidiaries" shall have the meaning given such term in
--------------------------
Section 7.11(a).
"Note" or "Notes" means the promissory notes of the Borrower in favor
---- -----
of each of the Lenders evidencing the Revolving Loans and Swingline Loans
in substantially the
15
form attached as Schedule 2.1(e), individually or collectively, as
---------------
appropriate, as such promissory notes may be amended, modified,
supplemented, extended, renewed or replaced from time to time.
"Notice of Borrowing" means a written notice of borrowing in
-------------------
substantially the form of Schedule 2.1(b)(i), as required by Section
------------------
2.1(b)(i).
"Notice of Extension/Conversion" means the written notice of extension
------------------------------
or conversion in substantially the form of Schedule 3.2, as required by
------------
Section 3.2.
"Obligations" means, collectively, the Revolving Loans, Swingline
-----------
Loans and the LOC Obligations.
"Operating Lease" means, as applied to any Person, any lease
---------------
(including, without limitation, leases which may be terminated by the
lessee at any time) of any Property (whether real, personal or mixed) which
is not a Capital Lease other than any such lease in which that Person is
the lessor.
"Participation Interest" means the purchase by a Lender of a
----------------------
participation in Swingline Loans as provided in Section 2.2(b)(iii) and in
Loans as provided in Section 3.13.
"PBGC" means the Pension Benefit Guaranty Corporation established
----
pursuant to Subtitle A of Title IV of ERISA and any successor thereof.
"Permitted Investments" means Investments which are either (i) cash
---------------------
and Cash Equivalents; (ii) accounts receivable created, acquired or made in
the ordinary course of business and payable or dischargeable in accordance
with customary trade terms; (iii) Investments consisting of stock,
obligations, securities or other property received in settlement of
accounts receivable (created in the ordinary course of business) from
bankrupt obligors; (iv) Investments existing as of the Closing Date and set
forth in Schedule 8.5, (v) Support Obligations permitted by Section 8.1(h);
------------
(vi) acquisitions permitted by Section 8.4(c); (vii) transactions permitted
by Section 8.6, (viii) advances or loans to employees, directors, officers
or agents not to exceed $200,000 in the aggregate at any time outstanding;
(ix) advances or loans to customers or suppliers that do not exceed
$750,000 in the aggregate at any one time outstanding, (x) Investments by a
member of the Consolidated Group or an Affiliate of a member of the
Consolidated Group in connection with a Permitted Securitization
Transaction, (xi) Investments by members of the Consolidated Group in their
Subsidiaries and Affiliates existing on the Closing Date, (xii) Investments
by members of the Consolidated Group in and to a Credit Party and (xiii)
other loans, advances and investments of a nature not contemplated in the
foregoing subsections in an amount not to exceed $1,000,000 in the
aggregate at any time outstanding.
"Permitted Liens" means:
---------------
(i) Liens in favor of the Administrative Agent on behalf of the
Lenders;
16
(ii) Liens in favor of a Lender or an Affiliate of a Lender
pursuant to a Hedging Agreement permitted hereunder, but only (A) to
the extent such Liens secure obligations under such agreements or
indebtedness permitted under Section 8.1, (B) to the extent such Liens
are on the same collateral as to which the Lenders also have a Lien
and (C) if such provider and the Lender shall share pari passu in the
---- -----
collateral subject to such Liens;
(iii) Liens (other than Liens created or imposed under ERISA)
for taxes, assessments or governmental charges or levies not yet due
or Liens for taxes being contested in good faith by appropriate
proceedings for which adequate reserves determined in accordance with
GAAP have been established (and as to which the Property subject to
any such Lien is not yet subject to foreclosure, sale or loss on
account thereof);
(iv) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and suppliers and other Liens
imposed by law or pursuant to customary reservations or retentions of
title arising in the ordinary course of business, provided that such
--------
Liens secure only amounts not yet due and payable or, if due and
payable, are unfiled and no other action has been taken to enforce the
same or are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP have
been established (and as to which the Property subject to any such
Lien is not yet subject to foreclosure, sale or loss on account
thereof);
(v) Liens (other than Liens created or imposed under ERISA)
incurred or deposits made by the Borrower and its Subsidiaries in the
ordinary course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or to
secure the performance of tenders, statutory obligations, bids,
leases, government contracts, performance and return-of-money bonds
and other similar obligations (exclusive of obligations for the
payment of borrowed money);
(vi) Liens in connection with attachments or judgments
(including judgment or appeal bonds) provided that the judgments
--------
secured shall, within 30 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall have
been discharged within 30 days after the expiration of any such stay;
(vii) easements, rights-of-way, restrictions (including zoning
restrictions), minor defects or irregularities in title and other
similar charges or encumbrances not, in any material respect,
impairing the use of the encumbered Property for its intended
purposes;
17
(viii) Liens securing purchase money and sale/leaseback
Indebtedness (including Capital Leases) to the extent permitted under
Section 8.1(c), provided that any such Lien attaches only to the
--------
Property financed or leased and such Lien attaches thereto
concurrently with or within 90 days after the acquisition thereof in
connection with the purchase money transactions and within 30 days
after the closing of any sale/leaseback transaction;
(ix) leases or subleases granted to others not interfering in
any material respect with the business of any member of the
Consolidated Group;
(x) any interest of title of a lessor under, and Liens arising
from UCC financing statements (or equivalent filings, registrations or
agreements in foreign jurisdictions) relating to, leases permitted by
this Credit Agreement;
(xi) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection
with the importation of goods;
(xii) Liens created or deemed to exist in connection with a
Permitted Securitization Transaction (including any related filings of
any financing statements), but only to the extent that any such Lien
relates to the applicable receivables and related property actually
sold, contributed or otherwise conveyed pursuant to such transaction;
(xiii) Liens deemed to exist in connection with Investments in
repurchase agreements permitted under Section 8.5;
(xiv) normal and customary rights of setoff upon deposits of
cash in favor of banks or other depository institutions;
(xv) Liens granted to holders of Seller Subordinated Debt so
long as (a) such Liens relate solely to the assets purchased from such
holder(s), (b) such Liens are subordinate to the Liens granted to the
Lenders, and (c) the holders of such Seller Subordinated Debt agree to
stand still provisions and provisions not to contest the validity of
the Lenders' Liens satisfactory to the Required Lenders; and
(xvi) Liens existing as of the Closing Date and set forth on
Schedule 6.8; provided that (a) no such Lien shall at any time be
------------ --------
extended to or cover any Property other than the Property subject
thereto on the Closing Date and (b) the principal amount of the
Indebtedness secured by such Liens shall not be extended, renewed,
refunded or refinanced.
"Permitted Securitization Transaction" means any Securitization
------------------------------------
Transaction; provided that (i) the Administrative Agent and the Required
--------
Lenders shall be reasonably satisfied with the structure and documentation
for any such transaction and that the terms
18
of such transaction entered into after the Closing Date, including the
discount applicable to the receivables which are subject of such financing
and any termination events, shall be (in the good faith understanding of
the Administrative Agent and the Required Lenders) consistent with those
prevailing in the market at the time of commitment thereto for similar
transactions involving a receivables originator/servicer of similar credit
quality and a receivables pool or other similar characteristics and (ii)
the documentation for such transaction shall not be amended or modified in
a way which is materially detrimental to the Lenders without the prior
written approval of the Administrative Agent and the Required Lenders.
"Person" means any individual, partnership, joint venture, firm,
------
corporation, limited liability company, association, trust or other
enterprise (whether or not incorporated) or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3) of
----
ERISA) which is covered by ERISA and with respect to which the Borrower,
any Subsidiary of the Borrower or any ERISA Affiliate is (or, if such plan
were terminated at such time, would under Section 4069 of ERISA be deemed
to be) an "employer" within the meaning of Section 3(5) of ERISA.
"Pledge Agreement" means the Pledge Agreement dated as of the Closing
----------------
Date given by the Borrower and the other pledgors identified therein to
NationsBank, N.A., as Administrative Agent, to secure the obligations
hereunder, as amended and modified.
"Prime Rate" means the rate of interest per annum publicly announced
----------
from time to time by NationsBank as its prime rate in effect at its
principal office in Charlotte, North Carolina, with each change in the
Prime Rate being effective on the date such change is publicly announced as
effective (it being understood and agreed that the Prime Rate is a
reference rate used by NationsBank in determining interest rates on certain
loans and is not intended to be the lowest rate of interest charged on any
extension of credit by NationsBank to any debtor).
"Pro Forma Basis" means, with respect to any Transaction, that such
---------------
Transaction shall be deemed to have occurred as of the first day of the
four fiscal-quarter period ending as of the most recent fiscal quarter end
preceding the date of such Transaction with respect to which the
Administrative Agent and the Lenders have received the officer's
certificate in accordance with the provisions of Section 7.2(b). As used
herein, "Transaction" means (i), any corporate merger or consolidation as
referred to in Section 8.4(a), (ii) any sale or other disposition of assets
as referred to in Section 8.4(b), (iii) any acquisition of capital stock or
securities or any purchase, lease or other acquisition of property as
referred to in Section 8.4(c) or (iv) the making of any Restricted Payment
as referred to in Section 8.10.
"Pro Rata Share" shall have the meaning given such term in Section
--------------
4.6.
19
"Property" means any interest in any kind of property or asset,
--------
whether real, personal or mixed, or tangible or intangible.
"Rate Determination Date" shall have the meaning given such term in
-----------------------
the definition of "Applicable Percentage".
"Register" shall have the meaning given such term in Section 11.3(c).
--------
"Regulation T, U or X" means Regulation T, U or X, respectively, of
--------------------
the Board of Governors of the Federal Reserve System as from time to time
in effect and any successor to all or a portion thereof.
"Release" means any spilling, leaking, pumping, pouring, emitting,
-------
emptying, discharging, injecting, escaping, leaching, dumping or disposing
into the environment (including the abandonment or discarding of barrels,
containers and other closed receptacles containing any Materials of
Environmental Concern).
"Reportable Event" means any of the events set forth in Section
----------------
4043(c) of ERISA, other than those events as to which the notice
requirement has been waived by regulation.
"Required Lenders" means, at any time, Lenders having more than fifty
----------------
percent (50%) of the Commitments, or if the Commitments have been
terminated, Lenders having more than fifty percent (50%) of the aggregate
principal amount of the Obligations outstanding (taking into account in
each case Participation Interests or obligation to participate therein);
provided that the Commitments of, and outstanding principal amount of
--------
Obligations (taking into account Participation Interests therein) owing to,
a Defaulting Lender shall be excluded for purposes hereof in making a
determination of Required Lenders.
"Requirement of Law" means, as to any Person, the certificate of
------------------
incorporation and by-laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its material property
is subject.
"Responsible Officer" means the Chief Executive Officer, the Chief
-------------------
Financial Officer, the Controller, any Vice President and the General
Counsel.
"Restricted Payment" means (i) any dividend or other distribution,
------------------
direct or indirect, on account of any shares of any class of stock now or
hereafter outstanding, except (A) a dividend payable solely in shares of
that class to the holders of that class and (B) dividends and other
distributions payable to a Credit Party, (ii) any redemption, retirement,
sinking fund or similar payment, purchase or other acquisition for value,
direct or indirect, of any shares of any class of stock now or hereafter
outstanding, and (iii) any payment made to
20
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of stock now or hereafter
outstanding.
"Revolving Commitment" means, with respect to each Lender, the
--------------------
commitment of such Lender to make Revolving Loans in an aggregate principal
amount at any time outstanding of up to such Lender's Commitment Percentage
of the Aggregate Revolving Committed Amount as specified in Schedule
--------
2.1(a), as such amount may be reduced from time to time in accordance with
the provisions hereof.
"Revolving Commitment Percentage" means, for each Lender, a fraction
-------------------------------
(expressed as a decimal) the numerator of which is the Revolving Commitment
of such Lender at such time and the denominator of which is the Aggregate
Revolving Committed Amount at such time. The initial Revolving Commitment
Percentages are set out on Schedule 2.1(a).
---------------
"Revolving Committed Amount" means, collectively, the aggregate amount
--------------------------
of all of the Revolving Commitments and, individually, the amount of each
Lender's Revolving Commitment as specified in Schedule 2.1(a).
---------------
"Revolving Loans" shall have the meaning assigned to such term in
---------------
Section 2.1(a).
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
---
Hill, Inc., or any successor or assignee of the business of such division
in the business of rating securities.
"Securitization Transaction" means any financing transaction or series
--------------------------
of financing transactions that have been or may be entered into by a member
of the Consolidated Group pursuant to which such member of the Consolidated
Group may sell, convey or otherwise transfer to (i) a Subsidiary or
affiliate (a "Securitization Subsidiary"), or (ii) any other Person, or may
-------------------------
grant a security interest in, any receivables or interests therein secured
by merchandise or services financed thereby (whether such receivables are
then existing or arising in the future) of such member of the Consolidated
Group, and any assets related thereto, including without limitation, all
security interests in merchandise or services financed thereby, the
proceeds of such receivables, and other assets which are customarily sold
or in respect of which security interests are customarily granted in
connection with securitization transactions involving such assets.
"Security Agreement" means the Security Agreement dated as of the
------------------
Closing Date given by the Borrower and the other grantors identified
therein to NationsBank, N.A., as Administrative Agent, to secure the
obligations hereunder, as amended and modified.
"Seller Subordinated Debt" means Subordinated Debt issued to a seller
------------------------
in connection with an acquisition permitted under Section 8.4 of the Credit
Agreement.
21
"Single Employer Plan" means any Plan which is covered by Title IV of
--------------------
ERISA, but which is not a Multiemployer Plan or a Multiple Employer Plan.
"Spin-Off Transaction" shall mean the spin-off of the Borrower from
--------------------
U.S. Office Products, Inc.
"Subordinated Debt" means any Indebtedness of a member of the
-----------------
Consolidated Group which by its terms is expressly subordinated in right of
payment to the prior payment of the obligations under the Credit Agreement
and the other Credit Documents on terms and conditions satisfactory to the
Required Lenders.
"Subsidiary" means, as to any Person, (a) any corporation more than
----------
50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time, any class or
classes of such corporation shall have or might have voting power by reason
of the happening of any contingency) is at the time owned by such Person
directly or indirectly through Subsidiaries, and (b) any partnership,
association, joint venture or other entity in which such Person directly or
indirectly through Subsidiaries has more than 50% of the voting interests
at any time. Unless otherwise identified, "Subsidiary" or "Subsidiaries"
shall mean Subsidiaries of the Borrower.
"Support Obligations" means, with respect to any Person, without
-------------------
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or
collection) guaranteeing or intended to guarantee any Indebtedness of any
other Person in any manner, whether direct or indirect, and including
without limitation any obligation, whether or not contingent, (i) to
purchase any such Indebtedness or any Property constituting security
therefor, (ii) to advance or provide funds or other support for the payment
or purchase of any such Indebtedness or to maintain working capital,
solvency or other balance sheet condition of such other Person (including
without limitation keep well agreements, maintenance agreements, comfort
letters or similar agreements or arrangements) for the benefit of any
holder of Indebtedness of such other Person, (iii) to lease or purchase
Property, securities or services primarily for the purpose of assuring the
holder of such Indebtedness, or (iv) to otherwise assure or hold harmless
the holder of such Indebtedness against loss in respect thereof. The
amount of any Support Obligation hereunder shall (subject to any
limitations set forth therein) be deemed to be an amount equal to the
outstanding principal amount (or maximum principal amount, if larger) of
the Indebtedness in respect of which such Support Obligation is made.
"Swingline Commitment" means the commitment of the Swingline Lender to
--------------------
make Swingline Loans in an aggregate principal amount at any time
outstanding up to the Swingline Committed Amount and the commitment of the
Lenders to purchase participation interests in the Swingline Loans up to
their respective Revolving Commitment Percentage as provided in Section
2.3(b)(iii), as such amounts may be reduced from time to time in accordance
with the provisions hereof.
22
"Swingline Committed Amount" means the amount of the Swingline
--------------------------
Lender's Commitment as specified in Section 2.3(a).
"Swingline Lender" means NationsBank or its successor.
----------------
"Swingline Loan" means a swingline revolving loan made by the
--------------
Swingline Lender pursuant to the provisions of Section 2.3.
"Termination Date" means June 9, 2003 (five years from the Closing
----------------
Date), or if extended with the written consent of each of the Lenders, such
later date as to which the Termination Date may be extended.
"Threshold Requirement" shall have the meaning given such term in
---------------------
Section 7.11(a).
"Transaction" shall have the meaning given such term in the definition
-----------
of "Pro Forma Basis".
"Voting Stock" means, with respect to any Person, capital stock issued
------------
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to
vote has been suspended by the happening of such a contingency.
"Wholly Owned Subsidiary" of any Person means any Subsidiary 100% of
-----------------------
whose Voting Stock or other equity interests is at the time owned by such
Person directly or indirectly through other Wholly Owned Subsidiaries.
1.2 Computation of Time Periods.
---------------------------
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
1.3 Accounting Terms.
----------------
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP. All calculations made for
the purposes of determining compliance with this Credit Agreement shall (except
as otherwise expressly provided herein) be made by application of GAAP applied
on a basis consistent with the most recent annual or quarterly financial
statements delivered pursuant to Section 7.1 hereof (or, prior to the delivery
of the first financial statements pursuant to Section 7.1 hereof, consistent
with the annual audited financial statements referenced in Section 6.1(i)
hereof); provided, however, if (a) the Borrower shall object to determining such
-------- -------
compliance on such basis at the time of delivery of such financial statements
due to any change in GAAP or the rules promulgated with respect thereto or (b)
the Administrative Agent or the Required Lenders shall so
23
object in writing within 30 days after delivery of such financial statements,
then such calculations shall be made on a basis consistent with the most recent
financial statements delivered by the Borrower to the Lenders as to which no
such objection shall have been made.
It is further acknowledged and agreed that, except as expressly provided
otherwise, for purposes of determining the Applicable Percentage and compliance
with the financial covenants in Section 7.9 (and compliance therewith on a Pro
Forma Basis), in the case of acquisitions and dispositions which have occurred
during the applicable period to the extent permitted hereunder, adjustments
shall be made to take into account historical performance (reflecting
adjustments in income for elimination of salaries, owners' perks and other items
reasonably eliminated pursuant to contractual provisions) relating thereto
during such applicable period prior to the date of such acquisition or
disposition, and the effect of any Indebtedness paid with proceeds from a
disposition, provided that coverage items (relating to interest and rental
--------
expense and other such items, under Consolidated EBITDA, Consolidated Fixed
Charges or the like) shall be determined by annualization from the date of
acquisition of disposition rather than by reference to historical performance
relating prior the date of acquisition or disposition.
SECTION 2
CREDIT FACILITIES
-----------------
2.1 Revolving Loans.
---------------
(a) Revolving Commitment. During the Commitment Period, subject to the
--------------------
terms and conditions hereof, each Lender severally agrees to make revolving
credit loans (the "Revolving Loans") to the Borrower from time to time in the
---------------
amount of such Lender's Revolving Commitment Percentage of such Revolving Loans
for the purposes hereinafter set forth; provided that (i) with regard to the
--------
Lenders collectively, the aggregate principal amount of Obligations outstanding
at any time shall not exceed the Aggregate Revolving Committed Amount, and (ii)
with regard to each Lender individually, such Lender's Revolving Commitment
Percentage of Obligations outstanding at any time shall not exceed such Lender's
Revolving Committed Amount. Revolving Loans may consist of Base Rate Loans or
Eurodollar Loans, or a combination thereof, as the Borrower may request, and may
be repaid and reborrowed in accordance with the provisions hereof.
(b) Revolving Loan Borrowings.
-------------------------
(i) Notice of Borrowing. The Borrower shall request a Revolving Loan
-------------------
borrowing by written notice (or telephone notice promptly confirmed in
writing) to the Administrative Agent not later than 11:00 A.M. (Charlotte,
North Carolina time) on the Business Day prior to the date of the requested
borrowing in the case of Base Rate Loans, and on the third Business Day
prior to the date of the requested borrowing in the case of Eurodollar
Loans. Each such request for borrowing shall be irrevocable and shall
specify (A) that a Revolving Loan is requested, (B) the date of the
requested borrowing (which shall be a Business Day), (C) the aggregate
principal amount to be borrowed, and (D)
24
whether the borrowing shall be comprised of Base Rate Loans, Eurodollar
Loans or a combination thereof, and if Eurodollar Loans are requested, the
Interest Period(s) therefor. If the Borrower shall fail to specify in any
such Notice of Borrowing (I) an applicable Interest Period in the case of a
Eurodollar Loan, then such notice shall be deemed to be a request for an
Interest Period of one month, or (II) the type of Revolving Loan requested,
then such notice shall be deemed to be a request for a Base Rate Loan
hereunder. The Administrative Agent shall give notice to each Lender
promptly upon receipt of each Notice of Borrowing pursuant to this Section
2.1(b)(i), the contents thereof and each such Lender's share of any
borrowing to be made pursuant thereto.
(ii) Minimum Amounts. Each Revolving Loan shall be in a minimum
---------------
aggregate principal amount of $5,000,000 and integral multiples of
$1,000,000 in excess thereof in the case of Eurodollar Loans, or $1,000,000
(or the remaining Revolving Committed Amount, if less) and integral
multiples of $500,000 in excess thereof in the case of Base Rate Loans.
(iii) Advances. Each Lender will make its Revolving Commitment
--------
Percentage of each Revolving Loan borrowing available to the Administrative
Agent for the account of the Borrower, or in such other manner as the
Administrative Agent may specify in writing, by 1:00 P.M. (Charlotte, North
Carolina time) on the date specified in the applicable Notice of Borrowing
in Dollars and in funds immediately available to the Administrative Agent.
Such borrowing will then be made available to the Borrower by the
Administrative Agent by crediting the account of the Borrower 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.
(c) Repayment. The principal amount of all Revolving Loans shall be due
---------
and payable in full on the Termination Date.
(d) Interest. Subject to the provisions of Section 3.1,
--------
(i) Base Rate Loans. During such periods as Revolving Loans shall be
---------------
comprised in whole or in part of Base Rate Loans, such Base Rate Loans
shall bear interest at a per annum rate equal to the Base Rate plus the
----
Applicable Percentage;
(ii) Eurodollar Loans. During such periods as Revolving Loans shall
----------------
be comprised in whole or in part of Eurodollar Loans, such Eurodollar Loans
shall bear interest at a per annum rate equal to the Eurodollar Rate plus
----
the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each applicable
Interest Payment Date (or at such other times as may be specified herein).
(e) Revolving Notes. The Revolving Loans shall be evidenced by a duly
---------------
executed Note in favor of each Lender.
25
(f) Maximum Number of Eurodollar Loans. The Borrower will be limited to a
----------------------------------
maximum number of five (5) Eurodollar Loans outstanding at any time. For
purposes hereof, Eurodollar Loans with separate or different Interest Periods
will be considered as separate Eurodollar Loans even if their Interest Periods
expire on the same date.
(g) Increase in Aggregate Revolving Committed Amount. Subject to the terms
------------------------------------------------
and conditions set forth herein, the Borrower shall have the right to request,
at any time from the Closing Date, an increase in the aggregate Revolving
Commitments by as much as FIFTEEN MILLION DOLLARS ($15,000,000) up to SEVENTY-
FIVE MILLION DOLLARS ($75,000,000) in total aggregate Revolving Commitments;
provided that (i) the Administrative Agent and its affiliates (including
--------
NationsBanc Xxxxxxxxxx Securities LLC) will use its best efforts, with the
assistance of the Borrower, to obtain additional commitments from new or
existing Lenders (which if new to the facility are reasonably acceptable to the
Administrative Agent), (ii) any such increase shall be in a minimum aggregate
principal amount of $5,000,000 and in integral multiples of $1,000,000 in excess
thereof, (iii) Schedule 2.1(a) shall be amended to reflect the revised
---------------
commitments and commitment percentages of the Lenders, (iv) if any Revolving
Loans are outstanding at the time of any such increase, the Borrower shall make
such payments and adjustments on the Revolving Loans (including any break-
funding amounts owing under Section 3.11) as necessary to give effect to the
revised commitment percentages and outstandings, and (v) the conditions to the
extensions of credit in Section 5.2 shall be satisfied on the date of any such
increase.
2.2 Letter of Credit Subfacility.
----------------------------
(a) Issuance. During the Commitment Period, subject to the terms and
--------
conditions hereof and of the LOC Documents, if any, and such other terms and
conditions which the Issuing Lender may reasonably require, the Issuing Lender
shall issue, and the Lenders shall participate in, such Letters of Credit as the
Borrower may request for its own account or for the account of any Subsidiary as
provided herein, in a form acceptable to the Issuing Lender, for the purposes
hereinafter set forth; provided that (i) the aggregate amount of LOC Obligations
--------
shall not exceed TWO MILLION DOLLARS ($2,000,000) at any time (the "LOC
---
Committed Amount"), (ii) with regard to the Lenders collectively, the aggregate
----------------
principal amount of Obligations outstanding at any time shall not exceed the
Aggregate Revolving Committed Amount and (iii) with regard to each Lender
individually, such Lender's Revolving Commitment Percentage of Obligations
outstanding at any time shall not exceed such Lender's Revolving Committed
Amount. Letters of Credit issued hereunder shall not have an original expiry
date more than one year from the date of issuance or extension, nor an expiry
date, whether as originally issued or by extension, extending beyond the
Termination Date. Each Letter of Credit shall comply with the related LOC
Documents. The issuance date of each Letter of Credit shall be a Business Day.
(b) Notice and Reports. Except for those Letters of Credit described on
------------------
Schedule 2.2(b)-1 which shall be issued on the Closing Date, the request for the
-----------------
issuance of a Letter of Credit shall be submitted by the Borrower to the Issuing
Lender at least three (3) Business Days prior to the requested date of issuance
(or such shorter period as may be agreed by the Issuing Lender). A form of
Notice of Request for Letter of Credit is attached as Schedule 2.2(b)-2. The
-----------------
Issuing
26
Lender will provide to the Administrative Agent at least monthly, and more
frequently upon request, a detailed summary report on its Letters of Credit and
the activity thereon, in form and substance acceptable to the Administrative
Agent. In addition, the Issuing Lender will provide to the Administrative Agent
for dissemination to the Lenders at least quarterly, and more frequently upon
request, a detailed summary report on its Letters of Credit and the activity
thereon, including, among other things, the Credit Party for whose account the
Letter of Credit is issued, the beneficiary, the face amount, and the expiry
date. The Issuing Lender will provide copies of the Letters of Credit to the
Administrative Agent and the Lenders promptly upon request.
(c) Participation. Each Lender, with respect to the Existing Letters of
-------------
Credit, hereby purchases a participation interest in such Existing Letters of
Credit, and with respect to Letters of Credit issued after the Closing Date,
upon issuance of a Letter of Credit, shall be deemed to have purchased without
recourse a risk participation from the applicable Issuing Lender in such Letter
of Credit and the obligations arising thereunder, in each case in an amount
equal to its pro rata share of the obligations under such Letter of Credit
(based on the respective Revolving Commitment Percentages of the Lenders) and
shall absolutely, unconditionally and irrevocably assume, as primary obligor and
not as surety, and be obligated to pay to the Issuing Lender therefor and
discharge when due, its pro rata share of the obligations arising under such
Letter of Credit. Without limiting the scope and nature of each Lender's
participation in any Letter of Credit, to the extent that the Issuing Lender has
not been reimbursed as required hereunder or under any such Letter of Credit,
each such Lender shall pay to the Issuing Lender its pro rata share of such
unreimbursed drawing in same day funds on the day of notification by the Issuing
Lender of an unreimbursed drawing pursuant to the provisions of subsection (d)
hereof. The obligation of each Lender to so reimburse the Issuing Lender shall
be absolute and unconditional and shall not be affected by the occurrence of a
Default, an Event of Default or any other occurrence or event. Any such
reimbursement shall not relieve or otherwise impair the obligation of the
Borrower to reimburse the Issuing Lender under any Letter of Credit, together
with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any Letter of Credit,
-------------
the Issuing Lender will promptly notify the Borrower. Unless the Borrower shall
immediately notify the Issuing Lender that the Borrower intends to otherwise
reimburse the Issuing Lender for such drawing, the Borrower shall be deemed to
have requested that the Lenders make a Revolving Loan in the amount of the
drawing as provided in subsection (e) hereof on the related Letter of Credit,
the proceeds of which will be used to satisfy the related reimbursement
obligations. The Borrower promises to reimburse the Issuing Lender on the day
of drawing under any Letter of Credit (either with the proceeds of a Revolving
Loan obtained hereunder or otherwise) in same day funds. If the Borrower shall
fail to reimburse the Issuing Lender as provided hereinabove, the unreimbursed
amount of such drawing shall bear interest at a per annum rate equal to the Base
Rate plus the sum of (i) the Applicable Percentage and (ii) two percent (2%).
The Borrower's reimbursement obligations hereunder shall be absolute and
unconditional under all circumstances irrespective of any rights of setoff,
counterclaim or defense to payment the Borrower may claim or have against the
Issuing Lender, the Administrative Agent, the Lenders, the beneficiary of the
Letter of Credit drawn upon or any other Person, including without limitation
any defense based on any failure of the Borrower or any other Credit Party to
receive consideration or the legality, validity, regularity
27
or unenforceability of the Letter of Credit. The Issuing Lender will promptly
notify the other Lenders of the amount of any unreimbursed drawing and each
Lender shall promptly pay to the Administrative Agent for the account of the
Issuing Lender in Dollars and in immediately available funds, the amount of such
Lender's pro rata share of such unreimbursed drawing. Such payment shall be made
on the day such notice is received by such Lender from the Issuing Lender if
such notice is received at or before 2:00 P.M. (Charlotte, North Carolina time)
otherwise such payment shall be made at or before 12:00 Noon (Charlotte, North
Carolina time) on the Business Day next succeeding the day such notice is
received. If such Lender does not pay such amount to the Issuing Lender in full
upon such request, such Lender shall, on demand, pay to the Administrative Agent
for the account of the Issuing Lender interest on the unpaid amount during the
period from the date of such drawing until such Lender pays such amount to the
Issuing Lender in full at a rate per annum equal to, if paid within two (2)
Business Days of the date that such Lender is required to make payments of such
amount pursuant to the preceding sentence, the Federal Funds Rate and thereafter
at a rate equal to the Base Rate. Each Lender's obligation to make such payment
to the Issuing Lender, and the right of the Issuing Lender to receive the same,
shall be absolute and unconditional, shall not be affected by any circumstance
whatsoever and without regard to the termination of this Credit Agreement or the
Commitments hereunder, the existence of a Default or Event of Default or the
acceleration of the obligations of the Borrower hereunder and shall be made
without any offset, abatement, withholding or reduction whatsoever.
Simultaneously with the making of each such payment by a Lender to the Issuing
Lender, such Lender shall, automatically and without any further action on the
part of the Issuing Lender or such Lender, acquire a participation in an amount
equal to such payment (excluding the portion of such payment constituting
interest owing to the Issuing Lender) in the related unreimbursed drawing
portion of the LOC Obligation and in the interest thereon and in the related LOC
Documents, and shall have a claim against the Borrower with respect thereto.
(e) Repayment with Revolving Loans. On any day on which the Borrower shall
------------------------------
have requested, or been deemed to have requested, a Revolving Loan advance to
reimburse a drawing under a Letter of Credit, the Administrative Agent shall
give notice to the Lenders that a Revolving Loan has been requested or deemed
requested by the Borrower to be made in connection with a drawing under a Letter
of Credit, in which case a Revolving Loan advance comprised of Base Rate Loans
(or Eurodollar Loans to the extent the Borrower has complied with the procedures
of Section 2.1(b)(i) with respect thereto) shall be immediately made to the
Borrower by all Lenders (notwithstanding any termination of the Commitments
pursuant to Section 9.2) pro rata based on the respective Revolving Commitment
--- ----
Percentages of the Lenders (determined before giving effect to any termination
of the Commitments pursuant to Section 9.2) and the proceeds thereof shall be
paid directly to the Issuing Lender for application to the respective LOC
Obligations. Each such Lender hereby irrevocably agrees to make its pro rata
share of each such Revolving Loan immediately upon any such request or deemed
request in the amount, in the manner and on the date specified in the preceding
sentence notwithstanding (i) the amount of such borrowing may not comply with
---------------
the minimum amount for advances of Revolving Loans otherwise required hereunder,
(ii) whether any conditions specified in Section 5.2 are then satisfied, (iii)
whether a Default or an Event of Default then exists, (iv) failure for any such
request or deemed request for Revolving Loan to be made by the time otherwise
required hereunder, (v) whether the date of such borrowing is a date on which
Revolving Loans are otherwise permitted to be made hereunder or (vi) any
28
termination of the Commitments relating thereto immediately prior to or
contemporaneously with such borrowing. In the event that any Revolving Loan
cannot for any reason be made on the date otherwise required above (including,
without limitation, as a result of the commencement of a proceeding under the
Bankruptcy Code with respect to the Borrower or any Credit Party), then each
such Lender hereby agrees that it shall forthwith purchase (as of the date such
borrowing would otherwise have occurred, but adjusted for any payments received
from the Borrower on or after such date and prior to such purchase) from the
Issuing Lender such participation in the outstanding LOC Obligations as shall be
necessary to cause each such Lender to share in such LOC Obligations ratably
(based upon the respective Revolving Commitment Percentages of the Lenders
(determined before giving effect to any termination of the Commitments pursuant
to Section 9.2)), provided that in the event such payment is not made on the day
--------
of drawing, such Lender shall pay in addition to the Issuing Lender interest on
the amount of its unfunded Participation Interest at a rate equal to, if paid
within two (2) Business Days of the date of drawing, the Federal Funds Rate, and
thereafter at the Base Rate.
(f) Designation of Subsidiaries as Account Parties. Notwithstanding
----------------------------------------------
anything to the contrary set forth in this Credit Agreement, including without
limitation Section 2.2(a) hereof, a Letter of Credit issued hereunder may
contain a statement to the effect that such Letter of Credit is issued for the
account of a Subsidiary, provided that notwithstanding such statement, the
Borrower shall be the actual account party for all purposes of this Credit
Agreement for such Letter of Credit and such statement shall not affect the
Borrower's reimbursement obligations hereunder with respect to such Letter of
Credit.
(g) Renewal, Extension. The renewal or extension of any Letter of Credit
------------------
shall, for purposes hereof, be treated in all respects the same as the issuance
of a new Letter of Credit hereunder.
(h) Uniform Customs and Practices. The Letters of Credit shall be subject
-----------------------------
to The Uniform Customs and Practice for Documentary Credits, as published as of
the date of issue by the International Chamber of Commerce (the "UCP"), in which
---
case the UCP may be incorporated therein and deemed in all respects to be a part
thereof.
(i) Indemnification; Nature of Issuing Lender's Duties.
--------------------------------------------------
(i) In addition to its other obligations under this Section 2.2, the
Borrower hereby agrees to protect, indemnify, pay and save the Issuing
Lender harmless from and against any and all claims, demands, liabilities,
damages, losses, costs, charges and expenses (including reasonable
attorneys' fees) that the Issuing Lender may incur or be subject to as a
consequence, direct or indirect, of (A) the issuance of any Letter of
Credit or (B) the failure of the Issuing Lender to honor a drawing under a
Letter of Credit as a result of any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto government or
governmental authority (all such acts or omissions, herein called
"Government Acts"), except to the extent any such claims, demands,
----------------
liabilities, damages, costs, charges and expenses arise out of or relate to
disputes solely between or among the Administrative Agent and/or the
Lenders.
29
(ii) As between the Borrower and the Issuing Lender, the Borrower
shall assume all risks of the acts, omissions or misuse of any Letter of
Credit by the beneficiary thereof. The Issuing Lender shall not be
responsible: (A) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party (other
than the Issuing Lender) in connection with the application for and
issuance of any Letter of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or
forged; (B) for the validity or sufficiency of any instrument transferring
or assigning or purporting to transfer or assign any Letter of Credit or
the rights or benefits thereunder or proceeds thereof, in whole or in part,
that may prove to be invalid or ineffective for any reason; (C) for errors,
omissions, interruptions or delays (other than by the Issuing Lender) in
transmission or delivery of any messages, by mail, cable, telegraph, telex
or otherwise, whether or not they be in cipher; (D) for any loss or delay
(other than by the Issuing Lender) in the transmission or otherwise of any
document required in order to make a drawing under a Letter of Credit or of
the proceeds thereof; and (E) for any consequences arising from causes
beyond the control of the Issuing Lender, including, without limitation,
any Government Acts. None of the above shall affect, impair, or prevent
the vesting of the Issuing Lender's rights or powers hereunder.
(iii) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by
the Issuing Lender, under or in connection with any Letter of Credit or the
related certificates, if taken or omitted in good faith and not
constituting gross negligence, shall not put such Issuing Lender under any
resulting liability to the Borrower or any other Credit Party. It is the
intention of the parties that this Credit Agreement shall be construed and
applied to protect and indemnify the Issuing Lender against any and all
risks involved in the issuance of the Letters of Credit, all of which risks
(except as set forth herein) are hereby assumed by the Borrower (on behalf
of itself and each of the other Credit Parties), including, without
limitation, any and all Government Acts. The Issuing Lender shall not, in
any way, be liable for any failure by the Issuing Lender or anyone else to
pay any drawing under any Letter of Credit as a result of any Government
Acts or any other cause beyond the control of the Issuing Lender.
(iv) Nothing in this subsection (i) is intended to limit the
reimbursement obligations of the Borrower contained in subsection (d)
above. The obligations of the Borrower under this subsection (i) shall
survive the termination of this Credit Agreement. No act or omissions of
any current or prior beneficiary of a Letter of Credit shall in any way
affect or impair the rights of the Issuing Lender to enforce any right,
power or benefit under this Credit Agreement.
(v) Notwithstanding anything to the contrary contained in this
subsection (i), the Borrower shall have no obligation to indemnify the
Issuing Lender in respect of any liability incurred by the Issuing Lender
(A) arising out of the negligence or willful misconduct of the Issuing
Lender, as determined by a court of competent jurisdiction, or (B) caused
by the Issuing Lender's failure to pay under any Letter of Credit after
presentation to it of a request strictly complying with the terms and
conditions of such Letter of Credit, as
30
determined by a court of competent jurisdiction, unless such payment is
prohibited, as determined by a court of competent jurisdiction.
(j) Responsibility of Issuing Lender. It is expressly understood and agreed
--------------------------------
that the obligations of the Issuing Lender hereunder to the Lenders are only
those expressly set forth in this Credit Agreement and that the Issuing Lender
shall be entitled to assume that the conditions precedent set forth in Section
5.2 have been satisfied unless it shall have acquired actual knowledge that any
such condition precedent has not been satisfied; provided, however, that nothing
-------- -------
set forth in this Section 2.2 shall be deemed to prejudice the right of any
Lender to recover from the Issuing Lender any amounts made available by such
Lender to the Issuing Lender pursuant to this Section 2.2 in the event that it
is determined by a court of competent jurisdiction that the payment with respect
to a Letter of Credit constituted gross negligence or willful misconduct on the
part of the Issuing Lender.
(k) Conflict with LOC Documents. In the event of any conflict between this
---------------------------
Credit Agreement and any LOC Document (including any letter of credit
application), this Credit Agreement shall control.
2.3 Swingline Loan Subfacility.
--------------------------
(a) Swingline Commitment. Subject to the terms and conditions hereof and in
--------------------
reliance upon the representations and warranties set forth herein, the Swingline
Lender, in its individual capacity, agrees to make certain revolving credit
loans requested by the Borrower in Dollars to the Borrower (each a "Swingline
---------
Loan" and, collectively, the "Swingline Loans") from time to time from the
---- ---------------
Closing Date until the Termination Date for the purposes hereinafter set forth;
provided, however, (i) the aggregate principal amount of Swingline Loans
-------- -------
outstanding at any time shall not exceed FIVE MILLION DOLLARS ($5,000,000) (the
"Swingline Committed Amount"), and (ii) with regard to the Lenders collectively,
--------------------------
the aggregate principal amount of Obligations outstanding at any time shall not
exceed the Aggregate Revolving Committed. Swingline Loans hereunder shall be
made as Base Rate Loans, and may be repaid or reborrowed in accordance with the
provisions hereof.
(b) Swingline Loan Advances.
-----------------------
(i) Notices; Disbursement. Whenever the Borrower desires a Swingline
---------------------
Loan advance hereunder it shall give written notice (or telephonic notice
promptly confirmed in writing) to the Swingline Lender not later than 11:00
A.M. (Charlotte, North Carolina time) on the Business Day of the requested
Swingline Loan advance. Each such notice shall be irrevocable and shall
specify (A) that a Swingline Loan advance is requested, (B) the date of the
requested Swingline Loan advance (which shall be a Business Day) and (C)
the principal amount of and Interest Period for the Swingline Loan advance
requested. Each Swingline Loan shall have such maturity date as the
Swingline Lender and the Borrower shall agree upon receipt by the Swingline
Lender of any such notice from the Borrower. The Swingline Lender shall
initiate the transfer of funds representing the Swingline Loan
31
advance to the Borrower by 3:00 P.M. (Charlotte, North Carolina time) on the
Business Day of the requested borrowing.
(ii) Minimum Amounts. Each Swingline Loan advance shall be in a
---------------
minimum principal amount of $100,000 and in integral multiples of $100,000
in excess thereof (or the remaining amount of the Swingline Committed
Amount, if less).
(iii) Repayment of Swingline Loans. The principal amount of all
----------------------------
Swingline Loans shall be due and payable on the earlier of (A) the maturity
date agreed to by the Swingline Lender and the Borrower with respect to
such Loan (which maturity date shall not be a date more than thirty (30)
Business Days from the date of advance thereof) or (B) the Termination
Date. The Swingline Lender may, at any time, in its sole discretion, by
written notice to the Borrower and the Lenders, demand repayment of its
Swingline Loans by way of a Revolving Loan advance, in which case the
Borrower shall be deemed to have requested a Revolving Loan advance
comprised solely of Base Rate Loans in the amount of such Swingline Loans;
provided, however, that any such demand shall be deemed to have been given
-------- -------
one Business Day prior to the Termination Date and on the date of the
occurrence of any Event of Default described in Section 9.1 and upon
acceleration of the indebtedness hereunder and the exercise of remedies in
accordance with the provisions of Section 9.2. Each Lender hereby
irrevocably agrees to make its pro rata share of each such Revolving Loan
in the amount, in the manner and on the date specified in the preceding
sentence notwithstanding (I) the amount of such borrowing may not comply
---------------
with the minimum amount for advances of Revolving Loans otherwise required
hereunder, (II) whether any conditions specified in Section 5.2 are then
satisfied, (III) whether a Default or an Event of Default then exists, (IV)
failure of any such request or deemed request for Revolving Loan to be made
by the time otherwise required hereunder, (V) whether the date of such
borrowing is a date on which Revolving Loans are otherwise permitted to be
made hereunder or (VI) any termination of the Commitments relating thereto
immediately prior to or contemporaneously with such borrowing. In the
event that any Revolving Loan cannot for any reason be made on the date
otherwise required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with respect to the
Borrower or any other Credit Party), then each Lender hereby agrees that it
shall forthwith purchase (as of the date such borrowing would otherwise
have occurred, but adjusted for any payments received from the Borrower on
or after such date and prior to such purchase) from the Swingline Lender
such Participation Interests in the outstanding Swingline Loans as shall be
necessary to cause each such Lender to share in such Swingline Loans
ratably based upon its Commitment Percentage of the Revolving Committed
Amount (determined before giving effect to any termination of the
Commitments pursuant to Section 3.4), provided that (A) all interest
--------
payable on the Swingline Loans shall be for the account of the Swingline
Lender until the date as of which the respective Participation Interest is
purchased and (B) at the time any purchase of Participation Interests
pursuant to this sentence is actually made, the purchasing Lender shall be
required to pay to the Swingline Lender, to the extent not paid to the
Swingline Lender by the Borrower in accordance with the terms of subsection
(c)(ii) below, interest on the principal amount of Participation Interests
purchased for each day from and including the day upon which such
32
borrowing would otherwise have occurred to but excluding the date of
payment for such Participation Interests, at the rate equal to the Federal
Funds Rate.
(c) Interest on Swingline Loans.
---------------------------
Subject to the provisions of Section 3.1, each Swingline Loan shall bear
interest at a per annum rate (computed on the basis of the actual number of days
elapsed over a year of 365 days) equal to the Base Rate. Interest on Swingline
Loans shall be payable in arrears on each applicable Interest Payment Date (or
at such other times as may be specified herein), unless accelerated sooner
pursuant to Section 9.2.
(d) Swingline Note. The Swingline Loans shall be evidenced by the Note.
--------------
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
----------------------------------------------
3.1 Default Rate.
------------
Upon the occurrence, and during the continuance, of an Event of
Default, the principal of and, to the extent permitted by law, interest on the
Loans and any other amounts owing hereunder or under the other Credit Documents
shall bear interest, payable on demand, at a per annum rate 2% greater than the
rate which would otherwise be applicable (or if no rate is applicable, whether
in respect of interest, fees or other amounts, then 2% greater than the Base
Rate).
3.2 Extension and Conversion.
------------------------
Subject to the terms of Section 5.2, the Borrower shall have the
option, on any Business Day, to extend existing Loans into a subsequent
permissible Interest Period or to convert Loans into Loans of another interest
rate type; provided, however, that (i) except as provided in Section 3.8,
-------- -------
Eurodollar Loans may be converted into Base Rate Loans only on the last day of
the Interest Period applicable thereto, (ii) Eurodollar Loans may be extended,
and Base Rate Loans may be converted into Eurodollar Loans, only if no Default
or Event of Default is in existence on the date of extension or conversion,
(iii) Loans extended as, or converted into, Eurodollar Loans shall be subject to
the terms of the definition of "Interest Period" set forth in Section 1.1 and
---------------
shall be in such minimum amounts as provided in Section 2.1(b)(ii) , and (iv)
any request for extension or conversion of a Eurodollar Loan which shall fail to
specify an Interest Period shall be deemed to be a request for an Interest
Period of one month. Each such extension or conversion shall be effected by the
Borrower by giving a Notice of Extension/Conversion (or telephone notice
promptly confirmed in writing) to the Administrative Agent prior to 11:00 A.M.
(Charlotte, North Carolina time) on the Business Day of, in the case of the
conversion of a Eurodollar Loan into a Base Rate Loan, and on the third Business
Day prior to, in the case of the extension of a Eurodollar Loan as, or
conversion of a Base Rate Loan into, a Eurodollar Loan, the date of the proposed
extension or conversion, specifying the date of the proposed extension or
conversion, the Loans to
33
be so extended or converted, the types of Loans into which such Loans are to be
converted and, if appropriate, the applicable Interest Periods with respect
thereto. Each request for extension or conversion shall be irrevocable and shall
constitute a representation and warranty by the Borrower of the matters
specified in subsections (a) through (e) of Section 5.2. In the event the
Borrower fails to request extension or conversion of any Eurodollar Loan in
accordance with this Section, or any such conversion or extension is not
permitted or required by this Section, then such Eurodollar Loan shall be
automatically converted into a Base Rate Loan at the end of the Interest Period
applicable thereto. The Administrative Agent shall give each Lender notice as
promptly as practicable of any such proposed extension or conversion affecting
any Loan.
3.3 Prepayments.
-----------
(a) Voluntary Prepayments. Revolving Loans may be repaid in whole or
---------------------
in part without premium or penalty; provided that (i) Eurodollar Loans may be
--------
prepaid only upon three (3) Business Days' prior written notice to the
Administrative Agent and must be accompanied by payment of any amounts owing
under Section 3.11, and (ii) partial prepayments shall be minimum principal
amounts of $5,000,000, in the case of Eurodollar Loans, and $1,000,000, in the
case of Base Rate Loans, and in integral multiples of $1,000,000 in excess
thereof.
(b) Mandatory Prepayments. If at any time, (A) the aggregate
---------------------
principal amount of Obligations shall exceed the Aggregate Revolving Committed
Amount, (B) the aggregate amount of LOC Obligations shall exceed the LOC
Committed Amount, or (C) the aggregate amount of Swingline Loans shall exceed
the Swingline Committed Amount, the Borrower shall immediately make payment on
the Revolving Loans and/or Swingline Loans and/or to a cash collateral account
in respect of the LOC Obligations, in an amount sufficient to eliminate the
deficiency.
(c) Application. Unless otherwise specified by the Borrower,
-----------
prepayments made hereunder shall be applied first to Swingline Loans, then to
Revolving Loans which are Base Rate Loans, then to Revolving Loans which are
Eurodollar Loans in direct order of Interest Period maturities. Amounts prepaid
hereunder may be reborrowed in accordance with the provisions hereof.
3.4 Termination and Reduction of Commitments
----------------------------------------
(a) Voluntary Reductions. The Revolving Commitments may be terminated
--------------------
or permanently reduced in whole or in part upon three (3) Business Days' prior
written notice to the Administrative Agent, provided that (i) after giving
--------
effect to any voluntary reduction the aggregate amount of Obligations shall not
exceed the Aggregate Revolving Committed Amount, as reduced, and (ii) partial
reductions shall be minimum principal amount of $5,000,000, and in integral
multiples of $1,000,000 in excess thereof.
(b) Mandatory Reduction. The Revolving Commitments shall be
-------------------
permanently reduced in an amount equal to one hundred percent (100%) of the Net
Proceeds received from
34
Asset Dispositions in any fiscal year; but only to the extent that (i) such Net
Proceeds are not reinvested in other property or assets within six (6) months of
the date of sale, lease, disposition, casualty, theft or loss giving rise
thereto, and (ii) the aggregate amount of such Net Proceeds not reinvested in
accordance with the foregoing subsection (i) in any fiscal year shall exceed
$1,000,000.
(c) Termination. The Commitments hereunder shall terminate on the
-----------
Termination Date.
3.5 Fees.
----
(a) Commitment Fee. In consideration of the Revolving Commitments
--------------
hereunder, the Borrower agrees to pay to the Administrative Agent for the
ratable benefit of the Lenders a commitment fee (the "Commitment Fee") equal to
--------------
the Applicable Percentage per annum on the average daily unused amount of the
Revolving Committed Amount for the applicable period. The Commitment Fee shall
be payable quarterly in arrears on the 15th day following the last day of each
calendar quarter for the immediately preceding quarter (or portion thereof)
beginning with the first such date to occur after the Closing Date. For
purposes of computation of the Commitment Fee, Swingline Loans shall not be
counted toward or considered usage under the Revolving Loan facility.
(b) Letter of Credit Fees.
---------------------
(i) Letter of Credit Fee. In consideration of the LOC
--------------------
Commitment hereunder, the Borrower agrees to pay to the Administrative
Agent for the ratable benefit of the Lenders a fee (the "Letter of Credit
----------------
Fee") equal to the Applicable Percentage per annum on the average daily
---
maximum amount available to be drawn under Letters of Credit from the date
of issuance to the date of expiration. The Letter of Credit Fee shall be
payable quarterly in arrears on the 15th day following the last day of each
calendar quarter for the immediately preceding quarter (or portion thereof)
beginning with the first such date to occur after the Closing Date.
(ii) Issuing Lender Fee. In addition to the Letter of Credit
------------------
Fee, the Borrower agrees to pay to the Issuing Lender for its own account
without sharing by the other Lenders (A) a fronting and negotiation fee of
.125% per annum on the average daily maximum amount available to be drawn
under Letters of Credit issued by it from the date of issuance to the date
of expiration, and (B) customary charges of the Issuing Lender with respect
to the issuance, amendment, transfer, administration, cancellation and
conversion of, and drawings under, such Letters of Credit (collectively,
the "Issuing Lender Fees").
-------------------
(c) Administrative Agent's Fees. The Borrower agrees to pay to the
---------------------------
Administrative Agent, for its own account, an annual administrative fee and such
other fees, if any, referred to in the Administrative Agent's Fee Letter
(collectively, the "Administrative Agent's Fees").
---------------------------
35
3.6 Capital Adequacy.
----------------
If any Lender has determined, after the date hereof, that the adoption
or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or administration
of, any applicable law, rule or regulation regarding capital adequacy, or
compliance by such Lender with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on such Lender's capital or assets as a consequence of its commitments or
obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, effectiveness, change or compliance (taking into
consideration such Lender's policies with respect to capital adequacy), then,
upon notice from such Lender to the Borrower, the Borrower shall be obligated to
pay to such Lender such additional amount or amounts as will compensate such
Lender for such reduction. Each determination by any such Lender of amounts
owing under this Section shall, absent manifest error, be conclusive and binding
on the parties hereto.
3.7 Inability To Determine Interest Rate.
------------------------------------
If prior to the first day of any Interest Period, 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, 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 (a) any Eurodollar Loans requested to be
made on the first day of such Interest Period shall be made as Base Rate Loans
and (b) any Loans that were to have been converted on the first day of such
Interest Period to or continued as Eurodollar Loans shall be converted to or
continued as Base Rate 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 Base Rate Loans to
Eurodollar Loans.
3.8 Illegality.
----------
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurodollar Loans as contemplated by this Credit Agreement, (a) such
Lender shall promptly give written notice of such circumstances to the Borrower
and the Administrative Agent (which notice shall be withdrawn whenever such
circumstances no longer exist), (b) the commitment of such Lender hereunder to
make Eurodollar Loans, continue Eurodollar Loans as such and convert a Base Rate
Loan to Eurodollar Loans shall forthwith be canceled and, until such time as it
shall no longer be unlawful for such Lender to make or maintain Eurodollar
Loans, such Lender shall then have a commitment only to make a Base Rate Loan
when a Eurodollar Loan is requested and (c) such Lender's Loans then outstanding
as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans
on the respective last
36
days of the then current Interest Periods with respect to such Loans or within
such earlier period as required by law. If any such conversion of a Eurodollar
Loan occurs on a day which is not the last day of the then current Interest
Period with respect thereto, the Borrower shall pay to such Lender such amounts,
if any, as may be required pursuant to Section 3.11.
3.9 Requirements of Law.
-------------------
If, after the date hereof, the adoption of or any change in any Requirement
of Law or in the interpretation or application thereof applicable to any Lender,
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, in each
case made subsequent to the Closing Date (or, if later, the date on which such
Lender becomes a Lender):
(a) shall subject such Lender to any tax of any kind whatsoever
with respect to any Letter of Credit, any Eurodollar Loans made by it or
its obligation to make Eurodollar Loans, or change the basis of taxation of
payments to such Lender in respect thereof (except for (i) Non-Excluded
Taxes covered by Section 3.10 (including Non-Excluded Taxes imposed solely
by reason of any failure of such Lender to comply with its obligations
under Section 3.10(b)) and (ii) changes in taxes measured by or imposed
upon the overall net income, or franchise tax (imposed in lieu of such net
income tax), of such Lender or its applicable lending office, branch, or
any affiliate thereof));
(b) 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 hereunder; or
(c) shall impose on such Lender any other condition (excluding
any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by a material amount, of making, converting into, continuing or maintaining
Eurodollar Loans or issuing or participating in Letters of Credit or to reduce
any amount receivable hereunder in respect thereof, then, in any such case, upon
notice to the Borrower from such Lender, through the Administrative Agent, in
accordance herewith, the Borrower shall be obligated to promptly pay such
Lender, upon its demand, any additional amounts necessary to compensate such
Lender for such increased cost or reduced amount receivable, provided that, in
--------
any such case, the Borrower may elect to convert the Eurodollar Loans made by
such Lender hereunder to Base Rate Loans by giving the Administrative Agent at
least one Business Day's notice of such election, in which case the Borrower
shall promptly pay to such Lender, upon demand, without duplication, such
amounts, if any, as may be required pursuant to Section 3.11. If any Lender
becomes entitled to claim any additional amounts pursuant to this subsection, it
shall provide prompt notice thereof to the Borrower, through the Administrative
Agent, certifying (x) that one of the events described in this paragraph (a) has
occurred and describing in reasonable detail the nature of such event, (y) as to
the increased cost or
37
reduced amount resulting from such event and (z) as to the additional amount
demanded by such Lender and a reasonably detailed explanation of the calculation
thereof. Such a certificate as to any additional amounts payable pursuant to
this subsection submitted by such Lender, through the Administrative Agent, to
the Borrower shall be conclusive and binding on the parties hereto in the
absence of manifest error. This covenant shall survive the termination of this
Credit Agreement and the payment of the Loans and all other amounts payable
hereunder.
3.10 Taxes.
-----
(a) Except as provided below in this subsection, all payments made by the
Borrower under this Credit 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 income, stamp or other taxes, levies, imposts, duties, charges, fees,
deductions or withholdings, now or hereafter imposed, levied, collected,
withheld or assessed by any court, or governmental body, agency or other
official, excluding taxes measured by or imposed upon the overall net income of
any Lender or its applicable lending office, or any branch or affiliate thereof,
and all franchise taxes, branch taxes, taxes on doing business or taxes on the
overall capital or net worth of any Lender or its applicable lending office, or
any branch or affiliate thereof, in each case imposed in lieu of net income
taxes, imposed: (i) by the jurisdiction under the laws of which such Lender,
applicable lending office, branch or affiliate is organized or is located, or in
which its principal executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii) by reason
of any connection between the jurisdiction imposing such tax and such Lender,
applicable lending office, branch or affiliate other than a connection arising
solely from such Lender having executed, delivered or performed its obligations,
or received payment under or enforced, this Credit Agreement or any Notes. If
any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings ("Non-Excluded Taxes") are required to be withheld from any
------------------
amounts payable to the Administrative Agent or any Lender hereunder or under any
Notes, (A) the amounts so payable to the Administrative Agent or such Lender
shall be increased to the extent 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
Credit Agreement and any Notes, provided, however, that the Borrower shall be
-------- -------
entitled to deduct and withhold any Non-Excluded Taxes and shall not be required
to increase any such amounts payable to any Lender that is not organized under
the laws of the United States of America or a state thereof if such Lender fails
to comply with the requirements of paragraph (b) of this subsection whenever any
Non-Excluded Taxes are payable by the Borrower, and (B) 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 official receipt received by the Borrower showing payment
thereof. If the Borrower fails to pay any 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. The agreements in this subsection shall
survive the termination of this Credit Agreement and the payment of the Loans
and all other amounts payable hereunder.
38
(b) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:
(X)(i) on or before the date of any payment by the Borrower under this
Credit Agreement or Notes to such Lender, deliver to the Borrower and the
Administrative Agent (A) two (2) duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor applicable form,
as the case may be, certifying that it is entitled to receive payments
under this Credit Agreement and any Notes without deduction or withholding
of any United States federal income taxes and (B) an Internal Revenue
Service Form W-8 or W-9, or successor applicable form, as the case may be,
certifying that it is entitled to an exemption from United States backup
withholding tax;
(ii) deliver to the Borrower and the Administrative Agent two (2)
further copies of any such form or certification on or before the date that
any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by the Borrower or
the Administrative Agent; or
(Y) in the case of any such Lender that is not a "bank" within the
meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (i) represent
to the Borrower (for the benefit of the Borrower and the Administrative
Agent) that it is not a bank within the meaning of Section 881(c)(3)(A) of
the Internal Revenue Code, (ii) agree to furnish to the Borrower on or
before the date of any payment by the Borrower, with a copy to the
Administrative Agent two (2) accurate and complete original signed copies
of Internal Revenue Service Form W-8, or successor applicable form
certifying to such Lender's legal entitlement at the date of such
certificate to an exemption from U.S. withholding tax under the provisions
of Section 881(c) of the Internal Revenue Code with respect to payments to
be made under this Credit Agreement and any Notes (and to deliver to the
Borrower and the Administrative Agent two (2) further copies of such form
on or before the date it expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recently provided
form and, if necessary, obtain any extensions of time reasonably requested
by the Borrower or the Administrative Agent for filing and completing such
forms), and (iii) agree, to the extent legally entitled to do so, upon
reasonable request by the Borrower, to provide to the Borrower (for the
benefit of the Borrower and the Administrative Agent) such other forms as
may be reasonably required in order to establish the legal entitlement of
such Lender to an exemption from withholding with respect to payments under
this Credit Agreement and any Notes;
unless in any such case any change in treaty, law or regulation has occurred
after the date such Person becomes a Lender hereunder which renders all such
forms inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender so advises the
Borrower and the Administrative Agent. Each Person that shall become a
39
Lender or a participant of a Lender pursuant to subsection 11.3 shall, upon the
effectiveness of the related transfer, be required to provide all of the forms,
certifications and statements required pursuant to this subsection, provided
--------
that in the case of a participant of a Lender the obligations of such
participant of a Lender pursuant to this subsection (b) shall be determined as
if the participant of a Lender were a Lender except that such participant of a
Lender shall furnish all such required forms, certifications and statements to
the Lender from which the related participation shall have been purchased.
3.11 Indemnity.
---------
The Borrower promises to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur (other
than through such Lender's gross negligence or willful misconduct) as a
consequence of (a) default by the Borrower in making 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 Credit Agreement,
(b) default by the Borrower in making any prepayment of a Eurodollar Loan after
the Borrower has given a notice thereof in accordance with the provisions of
this Credit 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. With
respect to Eurodollar Loans, 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 the last day of the applicable 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
Percentage 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. The covenants of the Borrower
set forth in this Section 3.11 shall survive the termination of this Credit
Agreement and the payment of the Loans and all other amounts payable hereunder.
3.12 Pro Rata Treatment.
------------------
Except to the extent otherwise provided herein:
(a) Loans. Each Loan, each payment or prepayment of principal of any Loan
-----
(other than Swingline Loans), each payment of interest on the Loans, each
payment of Commitment Fees, each reduction of the Revolving Committed Amount and
each conversion or extension of any Loan (other than Swingline Loans), shall be
allocated pro rata among the Lenders in accordance with the respective principal
amounts of their outstanding Loans and Participation Interests.
(b) Advances. No Lender shall be responsible for the failure or delay by
--------
any other Lender in its obligation to make its ratable share of a borrowing
hereunder; provided, however, that the failure of any Lender to fulfill its
-------- -------
obligations hereunder shall not relieve any other Lender of its obligations
hereunder. Unless the Administrative Agent shall have been notified in writing
by any
40
Lender prior to a borrowing that such Lender will not make the amount that would
constitute its ratable 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 such
Lender within the time period specified therefor hereunder, such Lender shall
pay to the Administrative Agent, on demand, such amount with interest thereon at
a rate equal to the Federal Funds Rate for a period of two (2) Business Days,
and thereafter at the Base Rate, for the period until such Lender makes such
amount immediately available to the Administrative Agent. If such Lender does
not pay such amounts to the Administrative Agent forthwith upon demand, the
Administrative Agent may notify the Borrower and request the Borrower to
immediately pay such amount to the Administrative Agent with interest at the
Base Rate. A certificate of the Administrative Agent submitted to any Lender
with respect to any amounts owing under this subsection shall be conclusive in
the absence of manifest error.
3.13 Sharing of Payments.
-------------------
The Lenders agree among themselves that, in the event that any Lender shall
obtain payment in respect of any Loan, LOC Obligation or any other obligation
owing to such Lender under this Credit Agreement through the exercise of a right
of setoff, banker's lien or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Code or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable bankruptcy, insolvency or other similar law or otherwise, or by
any other means, in excess of its pro rata share of such payment as provided for
in this Credit Agreement, such Lender shall promptly purchase from the other
Lenders a participation in such Loans, LOC Obligations and other obligations in
such amounts, and make such other adjustments from time to time, as shall be
equitable to the end that all Lenders share such payment in accordance with
their respective ratable shares as provided for in this Credit Agreement. The
Lenders further agree among themselves that if payment to a Lender obtained by
such Lender through the exercise of a right of setoff, banker's lien,
counterclaim or other event as aforesaid shall be rescinded or must otherwise be
restored, each Lender which shall have shared the benefit of such payment shall,
by repurchase of a participation theretofore sold, return its share of that
benefit (together with its share of any accrued interest payable with respect
thereto) to each Lender whose payment shall have been rescinded or otherwise
restored. The Borrower agrees that any Lender so purchasing such a
participation may, to the fullest extent permitted by law, exercise all rights
of payment, including setoff, banker's lien or counterclaim, with respect to
such participation as fully as if such Lender were a holder of such Loan, LOC
Obligation or other obligation in the amount of such participation. Except as
otherwise expressly provided in this Credit Agreement, if any Lender or the
Administrative Agent shall fail to remit to the Administrative Agent or any
other Lender an amount payable by such Lender or the Administrative Agent to the
Administrative Agent or such other Lender pursuant to this Credit Agreement on
the date when such amount is due, such payments shall be made together with
interest thereon for each date from the date such amount is due until the date
such amount is paid to the Administrative Agent or such other Lender at a rate
per annum equal to the Federal Funds Rate. If under any applicable bankruptcy,
insolvency or other similar law, any Lender receives a secured claim in lieu of
a setoff to which this Section 3.13 applies, such Lender shall, to the extent
41
practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders under this Section 3.13 to share in
the benefits of any recovery on such secured claim.
3.14 Payments, Computations, Etc.
----------------------------
(a) Except as otherwise specifically provided herein, all payments
hereunder shall be made to the Administrative Agent in dollars in immediately
available funds, without setoff, deduction, counterclaim or withholding of any
kind, at the Administrative Agent's office specified in Section 11.1 not later
than 2:00 P.M. (Charlotte, North Carolina time) on the date when due. Payments
received after such time shall be deemed to have been received on the next
succeeding Business Day. The Administrative Agent may (but shall not be
obligated to) debit the amount of any such payment which is not made by such
time to any ordinary deposit account of the Borrower maintained with the
Administrative Agent (with notice to the Borrower). The Borrower shall, at the
time it makes any payment under this Credit Agreement, specify to the
Administrative Agent the Loans, LOC Obligations, Fees, interest or other amounts
payable by the Borrower hereunder to which such payment is to be applied (and in
the event that it fails so to specify, or if such application would be
inconsistent with the terms hereof, the Administrative Agent shall distribute
such payment to the Lenders in such manner as the Administrative Agent may
determine to be appropriate in respect of obligations owing by the Borrower
hereunder, subject to the terms of Section 3.12(a)). The Administrative Agent
will distribute such payments to such Lenders, if any such payment is received
prior to 12:00 Noon (Charlotte, North Carolina time) on a Business Day in like
funds as received prior to the end of such Business Day and otherwise the
Administrative Agent will distribute such payment to such Lenders on the next
succeeding Business Day. Whenever any payment hereunder shall be stated to be
due on a day which is not a Business Day, the due date thereof shall be extended
to the next succeeding Business Day (subject to accrual of interest and Fees for
the period of such extension), except that in the case of Eurodollar Loans, if
the extension would cause the payment to be made in the next following calendar
month, then such payment shall instead be made on the next preceding Business
Day. Except as expressly provided otherwise herein, all computations of
interest and fees shall be made on the basis of actual number of days elapsed
over a year of 360 days, except with respect to computation of interest on Base
Rate Loans which (unless the Base Rate is determined by reference to the Federal
Funds Rate) shall be calculated based on a year of 365 or 366 days, as
appropriate. Interest shall accrue from and include the date of borrowing, but
exclude the date of payment.
(b) Allocation of Payments After Event of Default. Notwithstanding any
---------------------------------------------
other provisions of this Credit Agreement to the contrary, after the occurrence
and during the continuance of an Event of Default, all amounts collected or
received by the Administrative Agent or any Lender on account of the Guaranteed
Obligations or any other amounts outstanding under any of the Credit Documents
shall be paid over or delivered as follows:
FIRST, to the payment of all reasonable and documented out-of-pocket
costs and expenses (including without limitation reasonable attorneys'
fees) of the Administrative Agent in connection with enforcing the rights
of the Lenders under the Credit Documents,
42
except to the extent any such costs arise out of or relate to disputes
solely between or among the Administrative Lender and/or the Lenders;
SECOND, to payment of any fees owed to the Administrative Agent;
THIRD, to the payment of all reasonable and documented out-of-pocket
costs and expenses (including without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its rights under
the Credit Documents or otherwise with respect to the Obligations owing to
such Lender, except to the extent any such costs arise out of or relate to
disputes solely between or among the Administrative Lender and/or the
Lenders;
FOURTH, to the payment of all accrued interest and fees on or in
respect of the Obligations;
FIFTH, to the payment of the outstanding principal amount of the
Guaranteed Obligations (including the payment or cash collateralization of
outstanding LOC Obligations);
SIXTH, to all other Obligations and other obligations which shall have
become due and payable under the Credit Documents or otherwise and not
repaid pursuant to clauses "FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may be
lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; and (ii) each of the Lenders shall receive an amount equal
to its pro rata share (based on the proportion that the then outstanding
Obligations held by such Lender bears to the aggregate then outstanding
Obligations) of amounts available to be applied pursuant to clauses "THIRD",
"FOURTH", "FIFTH" and "SIXTH" above; and (iii) to the extent that any amounts
available for distribution pursuant to clause "FIFTH" above are attributable to
the issued but undrawn amount of outstanding letters of credit, such amounts
shall be held by the Administrative Agent in a cash collateral account and
applied (A) first, to reimburse the issuing lender for any drawings under such
letters of credit and (B) then, following the expiration of all letters of
credit, to all other obligations of the types described in clauses "FIFTH" and
"SIXTH" above in the manner provided in this Section 3.14(b).
3.15 Evidence of Debt.
----------------
(a) Each Lender shall maintain an account or accounts evidencing each Loan
made by such Lender to the Borrower from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time under
this Credit Agreement. Each Lender will make reasonable efforts to maintain the
accuracy of its account or accounts and to promptly update its account or
accounts from time to time, as necessary.
43
(b) The Administrative Agent shall maintain the Register pursuant to
Section 11.3(c) hereof, and a subaccount for each Lender, in which Register and
subaccounts (taken together) shall be recorded (i) the amount, type and Interest
Period of each such Loan hereunder, (ii) the amount of any principal or interest
due and payable or to become due and payable to each Lender hereunder and (iii)
the amount of any sum received by the Administrative Agent hereunder from or for
the account of the Borrower and each Lender's share thereof. The Administrative
Agent will make reasonable efforts to maintain the accuracy of the subaccounts
referred to in the preceding sentence and to promptly update such subaccounts
from time to time, as necessary.
(c) The entries made in the accounts, Register and subaccounts maintained
pursuant to subsection (b) of this Section 3.15 (and, if consistent with the
entries of the Administrative Agent, subsection (a)) shall be prima facie
evidence of the existence and amounts of the obligations of the Borrower therein
recorded; provided, however, that the failure of any Lender or the
-------- -------
Administrative Agent to maintain any such account, such Register or such
subaccount, as applicable, or any error therein, shall not in any manner affect
the obligation of the Borrower to repay the Loans made by such Lender in
accordance with the terms hereof.
SECTION 4
GUARANTY
--------
4.1 The Guarantee.
-------------
Each of the Guarantors hereby jointly and severally guarantees to each
Lender, to each Affiliate of a Lender that enters into a Hedging Agreement and
to the Administrative Agent as hereinafter provided the prompt payment of the
Guaranteed Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, a mandatory cash collateralization or
otherwise) strictly in accordance with the terms thereof. The Guarantors hereby
further agree that if any of the Guaranteed Obligations are not paid in full
when due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as mandatory cash collateralization or otherwise), the Guarantors
will, jointly and severally, promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of payment or renewal
of any of the Guaranteed Obligations, the same will be promptly paid in full
when due (whether at extended maturity, as a mandatory prepayment, by
acceleration or otherwise) in accordance with the terms of such extension or
renewal.
Notwithstanding any provision to the contrary contained herein or in any
other of the Credit Documents or Hedging Agreements, to the extent the
obligations of a Guarantor shall be adjudicated to be invalid or unenforceable
for any reason (including, without limitation, because of any applicable state
or federal law relating to fraudulent conveyances or transfers) then the
obligations of each Guarantor hereunder shall be limited to the maximum amount
that is permissible under applicable law (whether federal or state and
including, without limitation, the Bankruptcy Code).
44
4.2 Obligations Unconditional.
-------------------------
The obligations of the Guarantors under Section 4.1 hereof are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents or Hedging
Agreements, or any other agreement or instrument referred to therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever which might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Section 4.2 that the obligations of the
Guarantors hereunder shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that such Guarantor shall have no right of
subrogation, indemnity, reimbursement or contribution against the Borrower or
any other Guarantor of the Guaranteed Obligations for amounts paid under this
Guaranty until such time as the Lenders (and any Affiliates of Lenders entering
into Hedging Agreements) have been paid in full, all Commitments under the
Credit Agreement have been terminated and no Person or Governmental Authority
shall have any right to request any return or reimbursement of funds from the
Lenders in connection with monies received under the Credit Documents or Hedging
Agreements. Without limiting the generality of the foregoing, it is agreed
that, to the fullest extent permitted by law, the occurrence of any one or more
of the following shall not alter or impair the liability of any Guarantor
hereunder which shall remain absolute and unconditional as described above:
(i) at any time or from time to time, without notice to any
Guarantor, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or compliance
shall be waived;
(ii) any of the acts mentioned in any of the provisions of any of
the Credit Documents, any Hedging Agreement or any other agreement or
instrument referred to in the Credit Documents or Hedging Agreements shall
be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under any of the
Credit Documents, any Hedging Agreement or any other agreement or
instrument referred to in the Credit Documents or Hedging Agreements shall
be waived or any other guarantee of any of the Guaranteed Obligations or
any security therefor shall be released or exchanged in whole or in part or
otherwise dealt with;
(iv) any Lien granted to, or in favor of, the Administrative Agent
or any Lender or Lenders as security for any of the Guaranteed Obligations
shall fail to attach or be perfected; or
(v) any of the Guaranteed Obligations shall be determined to be
void or voidable (including, without limitation, for the benefit of any
creditor of any Guarantor) or shall be subordinated to the claims of any
Person (including, without limitation, any creditor of any Guarantor).
45
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Administrative Agent or any Lender
exhaust any right, power or remedy or proceed against any Person under any of
the Credit Documents, any Hedging Agreement or any other agreement or instrument
referred to in the Credit Documents or Hedging Agreements, or against any other
Person under any other guarantee of, or security for, any of the Guaranteed
Obligations.
4.3 Reinstatement.
-------------
The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Guaranteed Obligations is rescinded
or must be otherwise restored by any holder of any of the Guaranteed
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including, without limitation, fees and expenses of counsel) incurred
by the Administrative Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.
4.4 Certain Additional Waivers.
--------------------------
Without limiting the generality of the provisions of this Section 4, each
Guarantor hereby specifically waives the benefits of N.C. Gen. Stat. (S)(S) 26-7
through 26-9, inclusive. Each Guarantor further agrees that such Guarantor
shall have no right of recourse to security for the Guaranteed Obligations,
except through the exercise of the rights of subrogation pursuant to Section
4.2.
4.5 Remedies.
--------
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Guaranteed Obligations may be declared to be
forthwith due and payable as provided in Section 9.2 hereof (and shall be deemed
to have become automatically due and payable in the circumstances provided in
said Section 9.2) for purposes of Section 4.1 hereof notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing the
Guaranteed Obligations from becoming automatically due and payable) as against
any other Person and that, in the event of such declaration (or the Guaranteed
Obligations being deemed to have become automatically due and payable), the
Guaranteed Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors for purposes of said
Section 4.1.
4.6 Rights of Contribution.
----------------------
The Guarantors hereby agree, as among themselves, that if any Guarantor
shall become an Excess Funding Guarantor (as defined below), each other
Guarantor shall, on demand of such Excess Funding Guarantor (but subject to the
succeeding provisions of this Section 4.6), pay to
46
such Excess Funding Guarantor an amount equal to such Guarantor's Pro Rata Share
(as defined below and determined, for this purpose, without reference to the
properties, assets, liabilities and debts of such Excess Funding Guarantor) of
such Excess Payment (as defined below). The payment obligation of any Guarantor
to any Excess Funding Guarantor under this Section 4.6 shall be subordinate and
subject in right of payment to the prior payment in full of the obligations of
such Guarantor under the other provisions of this Section 4, and such Excess
Funding Guarantor shall not exercise any right or remedy with respect to such
excess until payment and satisfaction in full of all of such obligations. For
purposes hereof, (i) "Excess Funding Guarantor" shall mean, in respect of any
------------------------
obligations arising under the other provisions of this Section 4 (hereafter, the
"Guarantied Obligations"), a Guarantor that has paid an amount in excess of its
----------------------
Share of the Guarantied Obligations; (ii) "Excess Payment" shall mean, in
--------------
respect of any Guarantied Obligations, the amount paid by an Excess Funding
Guarantor in excess of its Pro Rata Share of such Guarantied Obligations; and
(iii) "Pro Rata Share", for the purposes of this Section 4.6, shall mean, for
--------------
any Guarantor, the ratio (expressed as a percentage) of (a) the amount by which
the aggregate present fair saleable value of all of its assets and properties
exceeds the amount of all debts and liabilities of such Guarantor (including
contingent, subordinated, unmatured, and unliquidated liabilities, but excluding
the obligations of such Guarantor hereunder) to (b) the amount by which the
aggregate present fair saleable value of all assets and other properties of the
Borrower and all of the Guarantors exceeds the amount of all of the debts and
liabilities (including contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the obligations of the Borrower and the Guarantors
hereunder) of the Borrower and all of the Guarantors, all as of the Closing Date
(if any Guarantor becomes a party hereto subsequent to the Closing Date, then
for the purposes of this Section 4.6 such subsequent Guarantor shall be deemed
to have been a Guarantor as of the Closing Date and the information pertaining
to, and only pertaining to, such Guarantor as of the date such Guarantor became
a Guarantor shall be deemed true as of the Closing Date).
4.7 Continuing Guarantee.
--------------------
The guarantee in this Section 4 is a continuing guarantee, and shall apply
to all Guaranteed Obligations whenever arising.
SECTION 5
CONDITIONS
----------
5.1 Conditions to Closing.
---------------------
This Credit Agreement shall become effective, and the initial Extensions of
Credit may be made, upon the satisfaction (or waiver) of the following
conditions precedent:
(a) Execution of Credit Agreement and Credit Documents. Receipt of
--------------------------------------------------
(i) multiple counterparts of this Credit Agreement, (ii) a Note for each Lender,
(iii) multiple counterparts of the Pledge Agreement, the Security Agreement and
the UCC financing statements relating thereto, if any, in each case executed by
a duly authorized officer of each party thereto and in each case conforming to
the requirements of this Credit Agreement.
47
(b) Consummation of Spin-off. Evidence of consummation of the Spin-
------------------------
Off Transaction, and receipt of all shareholder, governmental and other
necessary consents, approvals and authorizations (including the passage of all
waiting periods).
(c) Pro Forma Balance Sheet. Receipt of a pro forma balance sheet for
-----------------------
the Borrower and its Subsidiaries upon consummation of the Spin-Off Transaction
after giving effect to the initial Extensions of Credit hereunder.
(d) Legal Opinions. Receipt of multiple counterparts of opinions of
--------------
counsel for the Credit Parties relating to the Credit Documents and the
transactions contemplated herein, in form and substance satisfactory to the
Administrative Agent and the Required Lenders.
(e) Stock Certificates. Receipt of original stock certificates
------------------
evidencing the ownership interests of the Credit Parties pledged pursuant to the
Pledge Agreement, together in each case with original undated stock powers
executed in blank.
(f) Financial Information. Receipt of financial information regarding
---------------------
the Borrower and its subsidiaries, as may be requested by, and in each case in
form and substance satisfactory to the Administrative Agent and the Lenders.
(g) Evidence of Insurance. Receipt of insurance certificates or
---------------------
policies evidencing flood hazard insurance (for improvements located in areas
having "special flood hazards"), casualty insurance (including builders' risk
and all-risk permanent policies) and liability insurance conforming to the
requirements of this Credit Agreement and the other Credit Documents, showing
the Administrative Agent as loss payee with respect to the flood hazard and
casualty insurance, together with evidence of payment of premiums thereon.
(h) Absence of Legal Proceedings. The absence of any action , suit,
----------------------------
investigation or proceeding pending in any court or before any arbitrator or
governmental instrumentality which could reasonably be expected to have a
Material Adverse Effect.
(i) Corporate Documents. Receipt of the following (or their
-------------------
equivalent) for each of the Credit Parties:
(i) Articles of Incorporation. Copies of the articles of
-------------------------
incorporation or charter documents certified to be true and complete as of
a recent date by the appropriate governmental authority of the state of its
incorporation.
(ii) Resolutions. Copies of resolutions of the Board of
-----------
Directors approving and adopting the respective Credit Documents, the
transactions contemplated therein and authorizing execution and delivery
thereof, certified by a secretary or assistant secretary as of the Closing
Date to be true and correct and in force and effect as of such date.
48
(iii) Bylaws. Copies of the bylaws certified by a secretary or
------
assistant secretary as of the Closing Date to be true and correct and in
force and effect as of such date.
(iv) Good Standing. Copies, where applicable, of (A)
-------------
certificates of good standing, existence or its equivalent certified as of
a recent date by the appropriate governmental authorities of the state of
incorporation and each other state in which the failure to so qualify and
be in good standing would in the aggregate have a Material Adverse Effect
and (B) a certificate indicating payment of all corporate franchise taxes
certified as of a recent date by the appropriate governmental taxing
authorities.
(v) Officer's Certificate. An officer's certificate for each
---------------------
of the Credit Parties dated as of the Closing Date substantially in the
form of Schedule 5.1(i)(v) with appropriate insertions and attachments.
------------------
(j) Fees. Receipt of all fees, if any, owing pursuant to the
----
Administrative Agent's Fee Letter, Section 3.5 or otherwise.
(k) Subsection 5.2 Conditions. The conditions specified in Section
-------------------------
5.2 shall be satisfied.
(l) Additional Matters. All other documents and legal matters in
------------------
connection with the transactions contemplated by this Credit Agreement shall be
reasonably satisfactory in form and substance to the Agents and the Required
Lenders.
5.2 Conditions to All Extensions of Credit.
--------------------------------------
The obligation of each Lender to make any Extension of Credit hereunder
(including the initial Extension of Credit to be made hereunder) is subject to
the satisfaction (or waiver) of the following conditions precedent on the date
of making such Extension of Credit:
(a) Representations and Warranties. The representations and
------------------------------
warranties made by the Credit Parties herein or in any other Credit Documents or
which are contained in any certificate furnished at any time under or in
connection herewith shall be true and correct in all material respects on and as
of the date of such Extension of Credit as if made on and as of such date
(except for those which expressly relate to an earlier date).
(b) No Default or Event of Default. No Default or Event of Default
------------------------------
shall have occurred and be continuing on such date or after giving effect to the
Extension of Credit to be made on such date unless such Default or Event of
Default shall have been waived in accordance with this Credit Agreement.
(c) No Bankruptcy Event. No Bankruptcy Event shall have occurred and
-------------------
be continuing with respect to any of the Credit Parties.
49
(d) No Material Adverse Effect. No circumstances, events or
--------------------------
conditions shall have occurred since the date of the audited financial
statements referenced in Section 6.1 which would have a Material Adverse Effect.
(e) Additional Conditions to Revolving Loans. If a Revolving Loan is
----------------------------------------
made pursuant to Section 2.1, all conditions set forth therein shall have been
satisfied.
(f) Additional Conditions to Swingline Loans. If a Swingline Loan is
----------------------------------------
made pursuant to Section 2.2, all conditions set forth therein shall have been
satisfied.
Each request for Extension of Credit (including extensions and conversions)
and each acceptance by the Borrower of an Extension of Credit (including
extensions and conversions) shall be deemed to constitute a representation and
warranty by the Borrower as of the date of such Extension of Credit that the
applicable conditions in paragraphs (a), (b), (c) and (d), and in (e) or (f) of
this subsection have been satisfied.
SECTION 6
REPRESENTATIONS AND WARRANTIES
------------------------------
To induce the Lenders to enter into this Credit Agreement and to make
Extensions of Credit herein provided for, each of the members of the
Consolidated Group parties hereto hereby represents and warrants to the
Administrative Agent and to each Lender that:
6.1 Financial Condition.
-------------------
Each of the financial statements described below (copies of which have
heretofore been provided to the Administrative Agent for distribution to the
Lenders), have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, are complete and correct in all material
respects and present fairly the financial condition and results from operations
of the entities and for the periods specified, subject in the case of interim
company-prepared statements to normal year-end adjustments and the absence of
footnotes:
(i) a consolidated balance sheet of the Borrower and its
consolidated subsidiaries dated as of April 26, 1997, together with related
statements income and cash flows certified by Price Waterhouse LLP,
certified public accountants; and
(ii) a consolidated balance sheet of the Borrower and its
consolidated subsidiaries dated as of January 24, 1998 certified by Price
Waterhouse LLP, certified public accountants.
6.2 No Changes or Restricted Payments.
---------------------------------
Since the date of the financial statements referenced in Section 6.1(i),
(a) there has been no circumstance, development or event relating to or
affecting the members of the Consolidated
50
Group which has had or would be reasonably expected to have a Material Adverse
Effect, and (b) except as permitted herein, no Restricted Payments have been
made or declared or are contemplated by any members of the Consolidated Group.
6.3 Organization; Existence; Compliance with Law.
--------------------------------------------
Each of the members of the Consolidated Group (a) is duly organized,
validly existing in good standing under the laws of the jurisdiction of its
incorporation or organization, (b) has the corporate or other necessary 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 as a foreign entity 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, other than in such jurisdictions where the failure to be so
qualified and in good standing would not, in the aggregate, 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 would not, in the aggregate, be
reasonably expected to have a Material Adverse Effect.
6.4 Power; Authorization; Enforceable Obligations.
---------------------------------------------
Each of the Credit Parties has the corporate or other necessary power and
authority, and the legal right, to make, deliver and perform the Credit
Documents to which it is a party and has taken all necessary corporate or other
action to authorize the execution, delivery and performance by it of the Credit
Documents to which it is a party. No consent or authorization of, filing with,
notice to or other act by or in respect of, any Governmental Authority or any
other Person is required in connection with acceptance of extensions of credit
or the making of the guaranties hereunder or with the execution, delivery or
performance of any Credit Documents by the Credit Parties (other than those
which have been obtained, such filings as are required by the Securities and
Exchange Commission and to fulfill other reporting requirements with
Governmental Authorities) or with the validity or enforceability of any Credit
Document against the Credit parties (except such filings as are necessary in
connection with the perfection of the Liens created by such Credit Documents).
Each Credit Document to which it is a party constitutes a legal, valid and
binding obligation of such Credit Party enforceable against such Credit Party in
accordance with their respective terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law.
6.5 No Legal Bar.
------------
The execution, delivery and performance of the Credit Documents, the
borrowings hereunder and the use of the Extensions of Credit will not violate
any Requirement of Law or any Contractual Obligation of any member of the
Consolidated Group (except those as to which waivers or consents have been
obtained), and will not result in, or require, the creation or imposition of any
Lien on any of their respective properties or revenues pursuant to any
Requirement of Law or Contractual Obligation other than the Liens arising under
or
51
contemplated in connection with the Credit Documents. No member of the
Consolidated Group is in default under or with respect to any of its Contractual
Obligations in any respect which would reasonably be expected to have a Material
Adverse Effect.
6.6 No Material Litigation.
----------------------
No claim, litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the best knowledge of the
Credit Parties, threatened by or against, any members of the Consolidated Group
or against any of their respective properties or revenues which (a) relate to
the Credit Documents or any of the transactions contemplated hereby or thereby,
(b) if adversely determined, would reasonably be expected to have a Material
Adverse Effect. Set forth on Schedule 6.6 is a summary of all material claims,
------------
litigation, investigations and proceedings pending or, to the best knowledge of
the Credit Parties, threatened by or against the members of the Consolidated
Group or against any of their respective properties or revenues, and none of
such actions, individually or in the aggregate, is reasonably expected to have a
Material Adverse Effect.
6.7 No Default.
----------
No Default or Event of Default has occurred and is continuing.
6.8 Ownership of Property; Liens.
----------------------------
Each of members of the Consolidated Group has good record and marketable
title in fee simple to, or a valid leasehold interest in, all its material real
property, and good title to, or a valid leasehold interest in, all its other
material property, and none of such property is subject to any Lien, except for
Permitted Liens.
6.9 Intellectual Property.
---------------------
Each of the members of the Consolidated Group owns, or has the legal right
to use, all United States trademarks, tradenames, copyrights, technology, know-
how and processes, if any, necessary for each of them to conduct its business as
currently conducted (the "Intellectual Property") except for those the failure
---------------------
to own or have such legal right to use would be subject to indemnification in
favor of a member of the Consolidated Group or would not be reasonably 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 any
Credit Party know of any such claim, and the use of such Intellectual Property
by the members of the Consolidated Group does not infringe on the rights of any
Person, except for such claims and infringements that in the aggregate, would
not be reasonably expected to have a Material Adverse Effect.
52
6.10 No Burdensome Restrictions.
--------------------------
No Requirement of Law or Contractual Obligation of the members of the
Consolidated Group would be reasonably expected to have a Material Adverse
Effect.
6.11 Taxes.
-----
Each of the members of the Consolidated Group has filed or caused to be
filed all United States federal income tax returns and all other material tax
returns which, to the best knowledge of the Credit Parties, are required to be
filed and has paid (a) all taxes shown to be due and payable on said returns or
(b) all taxes shown to be due and payable on any assessments of which it has
received notice made against it or any of its property and all other taxes, fees
or other charges imposed on it or any of its property by any Governmental
Authority (other than any (i) taxes, fees or other charges which would be
subject to indemnification in favor of a member of the Consolidated Group or
with respect to which the failure to pay, in the aggregate, would not have a
Material Adverse Effect or (ii) taxes, fees or other charges the amount or
validity of which are currently being contested and with respect to which
reserves in conformity with GAAP have been provided on the books of such
Person), and no tax Lien has been filed, and, to the best knowledge of the
Credit Parties, no claim is being asserted, with respect to any such tax, fee or
other charge.
6.12 ERISA
-----
Except as would be subject to indemnification in favor of a member of the
Consolidated Group or would not reasonably be expected to have a Material
Adverse Effect, to the knowledge of the Credit Parties:
(a) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no ERISA Event has occurred, and, to
the best knowledge of the Credit Parties, no event or condition has occurred or
exists as a result of which any ERISA Event could reasonably be expected to
occur, with respect to any Plan; (ii) no "accumulated funding deficiency," as
such term is defined in Section 302 of ERISA and Section 412 of the Code,
whether or not waived, has occurred with respect to any Plan; (iii) each Plan
has been maintained, operated, and funded in compliance with its own terms and
in material compliance with the provisions of ERISA, the Code, and any other
applicable federal or state laws; and (iv) no lien in favor of the PBGC or a
Plan has arisen or is reasonably likely to arise on account of any Plan.
(b) The actuarial present value of all "benefit liabilities" (as defined in
Section 4001(a)(16) of ERISA), whether or not vested, under each Single Employer
Plan, as of the last annual valuation date prior to the date on which this
representation is made or deemed made (determined, in each case, in accordance
with Financial Accounting Standards Board Statement 87, utilizing the actuarial
assumptions used in such Plan's most recent actuarial valuation report), did not
exceed as of such valuation date the fair market value of the assets of such
Plan.
(c) No member of the Consolidated Group nor any ERISA Affiliate has
incurred, or, to the best knowledge of the Credit Parties, could be reasonably
expected to incur, any withdrawal
53
liability under ERISA to any Multiemployer Plan or Multiple Employer Plan. No
member of the Consolidated Group nor any ERISA Affiliate would become subject to
any withdrawal liability under ERISA if any member of the Consolidated Group or
any ERISA Affiliate were to withdraw completely from all Multiemployer Plans and
Multiple Employer Plans as of the valuation date most closely preceding the date
on which this representation is made or deemed made. No member of the
Consolidated Group nor any ERISA Affiliate has received any notification that
any Multiemployer Plan is in reorganization (within the meaning of Section 4241
of ERISA), is insolvent (within the meaning of Section 4245 of ERISA), or has
been terminated (within the meaning of Title IV of ERISA), and no Multiemployer
Plan is, to the best knowledge of the Credit Parties, reasonably expected to be
in reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section 406 of ERISA
or Section 4975 of the Code) or breach of fiduciary responsibility has occurred
with respect to a Plan which has subjected or may subject any member of the
Consolidated Group or any ERISA Affiliate to any liability under Sections 406,
409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or under any
agreement or other instrument pursuant to which any member of the Consolidated
Group or any ERISA Affiliate has agreed or is required to indemnify any person
against any such liability.
(e) To the knowledge of the Borrower, no member of the Consolidated Group
nor any ERISA Affiliates has any material liability with respect to "expected
post-retirement benefit obligations" within the meaning of the Financial
Accounting Standards Board Statement 106. Each Plan which is a welfare plan (as
defined in Section 3(1) of ERISA) to which Sections 601-609 of ERISA and Section
4980B of the Code apply has been administered in compliance in all material
respects of such sections.
6.13 Governmental Regulations, Etc.
-----------------------------
(a) No part of the proceeds of the Extensions of Credit hereunder will be
used, directly or indirectly, for the purpose of purchasing or carrying any
"margin stock" within the meaning of Regulation U, or for the purpose of
purchasing or carrying or trading in any securities. 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 U-1 referred to in said Regulation U. No indebtedness
being reduced or retired out of the proceeds of the Extensions of Credit
hereunder was or will be incurred for the purpose of purchasing or carrying any
margin stock within the meaning of Regulation U or any "margin security" within
the meaning of Regulation T. "Margin stock" within the meanings of Regulation U
does not constitute more than 25% of the value of the consolidated assets of the
Borrower and its Subsidiaries. None of the transactions contemplated by this
Credit Agreement (including, without limitation, the direct or indirect use of
the proceeds of the Loans) will violate or result in a violation of the
Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as
amended, or regulations issued pursuant thereto, or Regulation T, U or X.
(b) None of the members of the Consolidated Group is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act or
the Investment Company Act of 1940, each as amended. In addition, none of the
members of the Consolidated Group is (i)
54
an "investment company" registered or required to be registered under the
Investment Company Act of 1940, as amended, and is not controlled by such a
company, or (ii) a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary" of a
"holding company", within the meaning of the Public Utility Holding Company Act
of 1935, as amended.
(c) No director, executive officer or principal shareholder of any member
of the Consolidated Group is a director, executive officer or principal
shareholder of any Lender. For the purposes hereof the terms "director",
"executive officer" and "principal shareholder" (when used with reference to any
Lender) have the respective meanings assigned thereto in Regulation O issued by
the Board of Governors of the Federal Reserve System.
6.14 Subsidiaries.
------------
Set forth on Schedule 6.14 are all the Subsidiaries of the Borrower at the
-------------
Closing Date, the jurisdiction of their incorporation and the direct or indirect
ownership interest of the Borrower therein.
6.15 Purpose of Extensions of Credit.
-------------------------------
Extensions of Credit hereunder may be used to refinance existing
indebtedness (including intercompany indebtedness owing to U.S. Office Products,
Inc.), to finance working capital, capital expenditures and other lawful
corporate purposes, including acquisitions permitted hereunder.
6.16 Environmental Matters.
---------------------
Except as would be subject to indemnification in favor of a member of the
Consolidated Group or would not reasonably be expected to have a Material
Adverse Effect, and to the knowledge of the Credit Parties:
(a) Each of the facilities and properties owned, leased or operated by the
members of the Consolidated Group (the "Properties") and all operations at the
----------
Properties are in compliance with all applicable Environmental Laws, and there
is no violation of any Environmental Law with respect to the Properties or the
businesses operated by the members of the Consolidated Group (the "Businesses"),
----------
and there are no conditions relating to the Businesses or Properties that could
give rise to liability under any applicable Environmental Laws.
(b) None of the Properties contains, or has previously contained, any
Materials of Environmental Concern at, on or under the Properties in amounts or
concentrations that constitute or constituted a violation of, or could give rise
to liability under, Environmental Laws.
(c) None of the members of the Consolidated Group has received any written
or verbal notice of, or inquiry from any Governmental Authority regarding, any
violation, alleged violation, non-compliance, liability or potential liability
regarding environmental matters or compliance with
55
Environmental Laws with regard to any of the Properties or the Businesses, nor
does any member of the Consolidated Group have knowledge or reason to believe
that any such notice will be received or is being threatened.
(d) Materials of Environmental Concern have not been transported or
disposed of from the Properties, or generated, treated, stored or disposed of
at, on or under any of the Properties or any other location, in each case by or
on behalf any members of the Consolidated Group in violation of, or in a manner
that would be reasonably likely to give rise to liability under, any applicable
Environmental Law.
(e) No judicial proceeding or governmental or administrative action is
pending or, to the best knowledge of any Credit Party, threatened, under any
Environmental Law to which any member of the Consolidated Group is or will be
named as a party, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with respect to
any member of the Consolidated Group, the Properties or the Businesses.
(f) There has been no release or, threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations (including, without limitation, disposal) of any member of the
Consolidated Group in connection with the Properties or otherwise in connection
with the Businesses, in violation of or in amounts or in a manner that could
give rise to liability under Environmental Laws.
SECTION 7
AFFIRMATIVE COVENANTS
---------------------
Each of the Credit Parties covenants and agrees that on the Closing Date,
and so long as this Credit Agreement is in effect and until the Commitments have
been terminated, no Obligations remain outstanding and all amounts owing
hereunder or in connection herewith have been paid in full, each of the members
of the Consolidated Group party hereto shall:
7.1 Financial Statements.
--------------------
Furnish, or cause to be furnished, to the Administrative Agent and the
Lenders:
(a) Audited Financial Statements. As soon as available, but in any
----------------------------
event within 90 days after the end of each fiscal year, an audited
consolidated balance sheet of the Borrower and its subsidiaries as of the
end of the fiscal year and the related consolidated statements of income,
retained earnings, shareholders' equity and cash flows for the year,
audited by Price Waterhouse LLP, or other firm of independent certified
public accountants of nationally recognized standing reasonably acceptable
to the Required Lenders, setting forth in each case in comparative form the
figures for the previous year, reported without a "going concern" or like
qualification or exception, or qualification indicating that the scope of
the audit was inadequate to permit such
56
independent certified public accountants to certify such financial
statements without such qualification.
(b) Company-Prepared Financial Statements. As soon as available, but
-------------------------------------
in any event
(i) within 45 days after the end of each of the first three
fiscal quarters, a company-prepared consolidated balance sheet of the
Borrower and its subsidiaries as of the end of the quarter and related
company-prepared consolidated statements of income, retained earnings,
shareholders' equity and cash flows for such quarterly period and for
the fiscal year to date;
(ii) within 60 days after the end of the fourth fiscal quarter,
a company-prepared consolidated balance sheet of the Borrower and its
subsidiaries as of the end of the quarter and related company-prepared
consolidated statements of income, retained earnings, shareholders'
equity and cash flows for such quarterly period and for the fiscal
year to date;
(iii) prior to the end of each fiscal year, an annual business
plan and budget for the members of the Consolidated Group, containing,
among other things, pro forma financial statements for the next fiscal
year,
in each case setting forth in comparative form the consolidated figures for
the corresponding period or periods of the preceding fiscal year or the
portion of the fiscal year ending with such period, as applicable, in each
case subject to normal recurring year-end audit adjustments.
All such financial statements shall be complete and correct in all material
respects (subject, in the case of interim statements, to normal recurring year-
end audit adjustments) and shall be prepared in reasonable detail and, in the
case of the annual and quarterly financial statements provided in accordance
with subsections (a) and (b) above, in accordance with GAAP applied consistently
throughout the periods reflected therein and further accompanied by a
description of, and an estimation of the effect on the financial statements on
account of, a change in the application of accounting principles as provided in
Section 1.3.
7.2 Certificates; Other Information.
-------------------------------
Furnish, or cause to be furnished, to the Administrative Agent for
distribution to the Lenders:
(a) Accountant's Certificate and Reports. Concurrently with the
------------------------------------
delivery of the financial statements referred to in subsection 7.1(a)
above, a certificate of the independent certified public accountants
reporting on such financial statements stating that in making the
examination necessary therefor no knowledge was obtained of any Default or
Event of Default, except as specified in such certificate.
57
(b) Officer's Compliance Certificate. Concurrently with the delivery
--------------------------------
of the financial statements referred to in Sections 7.1(a) and 7.1(b)
above, a certificate of a Responsible Officer stating that, to the best of
such Responsible Officer's knowledge and belief, (i) the financial
statements fairly present in all material respects the financial condition
of the parties covered by such financial statements, (ii) during such
period the members of the Consolidated Group have observed or performed in
all material respects the covenants and other agreements hereunder and
under the other Credit Documents relating to them, and satisfied in all
material respects the conditions, contained in this Credit Agreement to be
observed, performed or satisfied by them, and (iii) such Responsible
Officer has obtained no knowledge of any Default or Event of Default except
as specified in such certificate. Such certificate shall include the
calculations required to indicate compliance with Section 7.9. A form of
Officer's Certificate is attached as Schedule 7.2(b).
---------------
(c) Accountants' Reports. Promptly upon receipt, a copy of any final
--------------------
(as distinguished from a preliminary or discussion draft) "management
letter" or other similar report submitted by independent accountants or
financial consultants to the members of the Consolidated Group in
connection with any annual, interim or special audit.
(d) Public Information. Within thirty days after the same are sent,
------------------
copies of all reports (other than those otherwise provided pursuant to
subsection 7.1) and other financial information which any member of the
Consolidated Group sends to its public stockholders, and within thirty days
after the same are filed, copies of all financial statements and non-
confidential reports which any member of the Consolidated Group may make
to, or file with, the Securities and Exchange Commission or any successor
or analogous Governmental Authority.
(e) Other Information. Promptly, such additional financial and other
-----------------
information as the Administrative Agent, at the request of any Lender, may
from time to time reasonably request.
7.3 Notices.
-------
Give notice to the Administrative Agent (which shall promptly transmit such
notice to each Lender) of:
(a) Defaults. Immediately (and in any event within two (2) Business
--------
Days) after a responsible officer of a Credit Party has knowledge of the
occurrence of an Event of Default.
(b) Contractual Obligations. Promptly, the occurrence of any default
-----------------------
or event of default under any Contractual Obligation of any member of the
Consolidated Group which would reasonably be expected to have a Material
Adverse Effect.
58
(c) Legal Proceedings. Promptly, any litigation, or any investigation
-----------------
or proceeding (including without limitation, any environmental proceeding)
known to any member of the Consolidated Group, or any material development
in respect thereof, affecting any member of the Consolidated Group which,
if adversely determined, would reasonably be expected to have a Material
Adverse Effect.
(d) ERISA. Promptly, after any Responsible Officer of the Borrower
-----
knows or has reason to know of (i) any event or condition, including, but
not limited to, any Reportable Event, that constitutes, or might reasonably
lead to, an ERISA Event; (ii) with respect to any Multiemployer Plan, the
receipt of notice as prescribed in ERISA or otherwise of any withdrawal
liability assessed against any of their ERISA Affiliates, or of a
determination that any Multiemployer Plan is in reorganization or insolvent
(both within the meaning of Title IV of ERISA); (iii) the failure to make
full payment on or before the due date (including extensions) thereof of
all amounts which the members of the Consolidated Group or any ERISA
Affiliate are required to contribute to each Plan pursuant to its terms and
as required to meet the minimum funding standard set forth in ERISA and the
Code with respect; or (iv) any change in the funding status of any Plan
that reasonably could be expected to have a Material Adverse Effect;
together with a description of any such event or condition or a copy of any
such notice and a statement by the chief financial officer of the Borrower
briefly setting forth the details regarding such event, condition, or
notice, and the action, if any, which has been or is being taken or is
proposed to be taken by the Credit Parties with respect thereto. Promptly
upon request, the members of the Consolidated Group shall furnish the
Administrative Agent and the Lenders with such additional information
concerning any Plan as may be reasonably requested, including, but not
limited to, copies of each annual report/return (Form 5500 series), as well
as all schedules and attachments thereto required to be filed with the
Department of Labor and/or the Internal Revenue Service pursuant to ERISA
and the Code, respectively, for each "plan year" (within the meaning of
Section 3(39) of ERISA).
(e) Other. Promptly, any other development or event which a
-----
Responsible Officer of the Borrower determines could reasonably be expected
to have a Material Adverse Effect.
Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the relevant Credit Parties propose
to take with respect thereto.
7.4 Payment of Obligations.
----------------------
Pay, discharge or otherwise satisfy at or before maturity or before they
become delinquent, as the case may be, in accordance with prudent business
practice (subject, where applicable, to specified grace periods) all material
obligations of each member of the Consolidated Group of whatever nature and any
additional costs that are imposed as a result of
59
any failure to so pay, discharge or otherwise satisfy such obligations, except
when the amount or validity of such obligations and costs is currently being
contested in good faith by appropriate proceedings and reserves, if applicable,
in conformity with GAAP with respect thereto have been provided on the books of
the Consolidated Group, as the case may be.
7.5 Conduct of Business and Maintenance of Existence.
------------------------------------------------
Continue to engage in business of the same general type as now conducted by
it on the date hereof and similar or related businesses with, and preserve,
renew and keep in full force and effect its corporate existence and take all
reasonable action to maintain all rights, privileges, licenses and franchises
necessary or desirable in the normal conduct of its business; comply with all
Contractual Obligations and Requirements of Law applicable to it except to the
extent that failure to comply therewith would not, in the aggregate, have a
Material Adverse Effect.
7.6 Maintenance of Property; Insurance.
----------------------------------
Keep all material property useful and necessary in its business in
reasonably good working order and condition (ordinary wear and tear excepted);
maintain with financially sound and reputable insurance companies casualty,
liability and such other insurance (which may include plans of self-insurance)
with such coverage and deductibles, and in such amounts as may be consistent
with prudent business practice and in any event consistent with normal industry
practice (except to any greater extent as may be required by the terms of any of
the other Credit Documents); and furnish to the Administrative Agent, upon
written request, full information as to the insurance carried.
7.7 Inspection of Property; Books and Records; Discussions.
------------------------------------------------------
Keep proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its businesses and activities; and
permit, during regular business hours and upon reasonable notice by the
Administrative Agent, the Administrative Agent to visit and inspect any of its
properties and examine and make abstracts (including photocopies) from any of
its books and records (other than materials protected by the attorney-client
privilege and materials which the Credit Parties may not disclose without
violation of a confidentiality obligation binding upon them) at any reasonable
time, and to discuss the business, operations, properties and financial and
other condition of the members of the Consolidated Group with officers and
employees of the members of the Consolidated Group and with their independent
certified public accountants. The cost of the inspection referred to in the
preceding sentence shall be for the account of the Lenders unless an Event of
Default has occurred and is continuing, in which case the cost of such
inspection shall be for the account of the Credit Parties.
7.8 Environmental Laws.
------------------
(a) Comply in all material respects with, and take reasonable actions to
ensure compliance in all material respects by all tenants and subtenants, if
any, with, all applicable
60
Environmental Laws and obtain and comply in all material respects with and
maintain, and take reasonable actions to ensure that all tenants and subtenants
obtain and comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws except to the extent that failure to do so would
not reasonably be expected to have a Material Adverse Effect;
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions actually and lawfully
required under Environmental Laws and promptly comply in all material respects
with all lawful 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 and the failure to do or the pendency of
such proceedings would not reasonably be expected to have a Material Adverse
Effect; and
(c) Defend, indemnify and hold harmless the Administrative Agent and the
Lenders, and their respective employees, agents, officers and directors, from
and against any and all claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature known or
unknown, contingent or otherwise, arising out of, or in any way relating to the
violation of, noncompliance with or liability under, any Environmental Law
applicable to the operations of the members of the Consolidated Group or the
Properties, or any orders, requirements or demands of Governmental Authorities
related thereto, including, without limitation, reasonable attorney's and
consultant's fees, investigation and laboratory fees, response costs, court
costs and litigation expenses, except to the extent that any of the foregoing
arise out of the gross negligence or willful misconduct of the party seeking
indemnification therefor. The agreements in this paragraph shall survive
repayment of the Loans and all other amounts payable hereunder, and termination
of the Commitments.
7.9 Financial Covenants.
-------------------
(a) Consolidated Leverage Ratio. As of the end of each fiscal quarter,
---------------------------
the Consolidated Leverage Ratio shall be not greater than 3.0:1.0.
(b) Consolidated Fixed Charge Coverage Ratio. As of the end of each
----------------------------------------
fiscal quarter, the Consolidated Fixed Charge Coverage Ratio shall be not less
than 3.0:1.0.
(c) Consolidated Net Worth. As of the end of each fiscal quarter,
----------------------
Consolidated Net Worth shall be not less than the sum of 85% of Consolidated Net
Worth as of the Closing Date plus the net cash proceeds from the IPO plus on the
---- ----
last day of each fiscal quarter to occur after the Closing Date, 75% of
Consolidated Net Income for the fiscal quarter then ended, such increases to be
cumulative, plus 100% of the net proceeds from Equity Transactions occurring
----
after the Closing Date.
(d) Capital Expenditures. Members of the Consolidated Group will not make
--------------------
Capital Expenditures in any fiscal year which in the aggregate shall exceed:
61
(i) for the period from the Closing Date through April 30, 1999, $5
million; and
(ii) for each fiscal year ending after April 30, 1999, an amount
equal to five percent (5%) of Consolidated Net Worth as of the last day of
the immediately preceding fiscal year.
7.10 Administrative Fees.
-------------------
Pay to the Administrative Agent the annual agency fee and comply with the
other agreements provided for in the Administrative Agent's Fee Letter.
7.11 Additional Guaranties and Stock Pledges.
---------------------------------------
(a) Domestic Subsidiaries. Where Domestic Subsidiaries of the Borrower
---------------------
which are not Credit Parties hereunder (the "Non-Guarantor Subsidiaries") shall
--------------------------
at any time constitute more than (the "Threshold Requirement"):
---------------------
(i) in any instance for any such Non-Guarantor Subsidiary, five
percent (5%) of consolidated assets for the Consolidated Group or five
percent (5%) of consolidated revenues for the Consolidated Group, or
(ii) in the aggregate for all such Non-Guarantor Subsidiaries, ten
percent (10%) of consolidated assets for the Consolidated Group or ten
percent (10%) of consolidated revenues for the Consolidated Group,
then the Borrower shall (i) promptly notify the Administrative Agent thereof,
and promptly cause such Domestic Subsidiary or Subsidiaries to become a
Guarantor by execution of a Joinder Agreement, such that immediately after
joinder as a Guarantor, the remaining Non-Guarantor Subsidiaries shall not in
any instance, or collectively, exceed the Threshold Requirement, (ii) deliver
with the Joinder Agreement, supporting resolutions, incumbency certificates,
corporate formation and organizational documentation and opinions of counsel as
the Administrative Agent may reasonably request, and (iii) deliver stock
certificates and related pledge agreements or pledge joinder agreements
evidencing the pledge of 100% of the Voting Stock of all such Domestic
Subsidiaries (whether or not they are Guarantors) and 65% of the Voting Stock of
all Foreign Subsidiaries, together with undated stock transfer powers executed
in blank.
(b) Foreign Subsidiaries. At any time any Person becomes a Foreign
--------------------
Subsidiary, the Borrower will promptly notify the Administrative Agent thereof
and cause (i) delivery of supporting resolutions, incumbency certificates,
corporation formation and organizational documentation and opinions of counsel
as the Administrative Agent may reasonably request, and (ii) delivery of stock
certificates (where required for perfection under local law) and a related
pledge agreement or pledge joinder agreement evidencing the pledge of 65% of the
Voting Stock of such Foreign Subsidiary and of 65% of the Voting Stock of each
of its Domestic Subsidiaries
62
and 65% of the Voting Stock of each of its Foreign Subsidiaries, together in
each case with undated stock transfer powers executed in blank.
7.12 Ownership of Subsidiaries.
-------------------------
Except to the extent otherwise permitted in Section 8.4(b) and Section 8.7
and to the extent as would not cause a Change of Control and except as set forth
on Schedule 6.14, the Borrower shall, directly or indirectly, own at all times
-------------
100% of the Voting Stock of each of its Subsidiaries.
7.13 Use of Proceeds.
---------------
Extensions of Credit will be used solely for the purposes provided in
Section 6.15.
7.14 Year 2000 Compatibility.
-----------------------
Take all action reasonably necessary to assure that its computer based
systems are able to operate and effectively process data including dates on and
after January 1, 2000, and, at the reasonable request of the Administrative
Agent or the Required Lenders, provide evidence to the Lenders of such year 2000
compatibility.
SECTION 8
NEGATIVE COVENANTS
Each of the Credit Parties covenants and agrees that on the Closing Date,
and so long as this Credit Agreement is in effect and until the Commitments have
been terminated, no Obligations remain outstanding and all amounts owing
hereunder or in connection herewith, have been paid in full, no member of the
Consolidated Group shall:
8.1 Indebtedness.
------------
Contract, create, incur, assume or permit to exist any Indebtedness,
except:
(a) Indebtedness arising or existing under this Credit Agreement and
the other Credit Documents;
(b) Indebtedness set forth in Schedule 8.1, and renewals, refinancings
------------
and extensions thereof on terms and conditions not less favorable in any
material respect than for such existing Indebtedness;
(c) Capital Lease Obligations and Indebtedness incurred, in each case,
to provide all or a portion of the purchase price or costs of construction
of an asset or, in the case of a sale/leaseback transaction as described in
Section 8.11, to finance the value of such asset owned by a member of the
Consolidated Group, provided that (i) such
--------
63
Indebtedness when incurred shall not exceed the purchase price or cost of
construction of such asset or, in the case of a sale/leaseback transaction,
the fair market value of such asset, (ii) no such Indebtedness shall be
refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing, and (iii) the total
amount of all such Indebtedness shall not exceed $10,000,000 at any time
outstanding;
(d) Indebtedness and obligations owing under interest rate protection
agreements relating to the Obligations hereunder and under interest rate,
commodities and foreign currency exchange protection agreements entered
into in the ordinary course of business to manage existing or anticipated
risks and not for speculative purposes;
(e) unsecured intercompany Indebtedness owing by a member of the
Consolidated Group to another member of the Consolidated Group (subject,
however, to the limitations of Section 8.5 in the case of the member of the
Consolidated Group extending the intercompany loan, advance or credit);
(f) Subordinated Debt of the Borrower;
(g) other unsecured Indebtedness of the Borrower of up to $5,000,000
in the aggregate at any time outstanding; and
(h) Support Obligations of Indebtedness permitted under this Section
8.1.
8.2 Liens.
-----
Contract, create, incur, assume or permit to exist any Lien with respect to
any of their respective property or assets of any kind (whether real or
personal, tangible or intangible), whether now owned or hereafter acquired,
except for Permitted Liens.
8.3 Nature of Business.
------------------
Alter the character of their business in any material respect from that
conducted as of the Closing Date and similar or related businesses.
8.4 Consolidation, Merger, Sale or Purchase of Assets, Capital
----------------------------------------------------------
Expenditures, etc.
-----------------
(a) Enter into a transaction of merger or consolidation, except
------
(i) a member of the Consolidated Group may be a party to a
transaction of merger or consolidation with another member of the
Consolidated Group, provided that (A) if the Borrower is a party thereto,
--------
it shall be the surviving corporation, and (B) if a Guarantor is a party
thereto and the Borrower is not a party thereto, a Guarantor shall be the
surviving corporation or the surviving corporation shall be a Domestic
Subsidiary and shall become a Guarantor hereunder as an Additional Credit
Party pursuant to Section 7.11 concurrently therewith, and (C) no Default
or Event of
64
Default shall exist either immediately prior to or immediately after giving
effect thereto; and
(ii) a member of the Consolidated Group (other than the
Borrower) may be a party to a transaction of merger or consolidation with
any other Person, provided that (A) the provisions of Section 7.11
--------
regarding joinder of certain Subsidiaries as Additional Credit Parties
hereunder shall be complied with, (B) no Default or Event of Default shall
exist either immediately prior to or immediately after giving effect
thereto, and (C) the provisions of subsection (c) of this Section shall be
complied with.
(b) Sell, lease, transfer or otherwise dispose of assets, property
and/or operations (including any sale-leaseback transaction, but excluding and
not subject to clauses (i) and (ii) below, the sale of inventory in the ordinary
course of business, the sale or disposition of plant, property and equipment
which is no longer useful in the business or as to which the proceeds therefrom
are reinvested in plant, property and equipment within six months thereof and
the Excluded Asset Dispositions), other than to another Credit Party, which
(i) in the aggregate in any fiscal year shall constitute more
than ten percent (10%) of total assets for the Consolidated Group at the
end of the immediately preceding fiscal year or ten percent (10%)
Consolidated Net Income for the immediately preceding fiscal year, and
(ii) no Default of Event of Default would exist after giving
effect thereto on a Pro Forma Basis,
without the prior written consent of the Required Lenders (which consent shall
not be unreasonably withheld or delayed).
(c) Acquire, including in connection with an Equity Transaction, all
or any portion of the capital stock or other ownership interest in any Person
which is not a Subsidiary or all or any substantial portion of the assets,
property and/or operations of a Person which is not a Subsidiary, without the
prior written consent of the Required Lenders (which consent shall not be
unreasonably withheld or delayed), unless
------
(i) in the case of an acquisition of capital stock or other
ownership interest after giving effect thereto, such Person will not be a
Subsidiary, then such acquisition will not cause a violation of Section
8.5;
(ii) in the case of an acquisition of capital stock or other
ownership interest after giving effect thereto, such Person will be a
Subsidiary, or in the case of an acquisition of assets, property and/or
operations then
(A) the cost of any such acquisition (or series of related
transactions) shall not exceed $25 million in any instance;
65
(B) the acquisition is in the same or a similar or related
line of business as that of the Credit Parties;
(C) the Board of Directors of the Person which is the
subject of the acquisition shall have approved the acquisition; and
(D) no Default or Event of Default would exist after giving
effect thereto on a Pro Forma Basis.
(d) In the case of the Borrower, liquidate, wind-up or dissolve,
whether voluntarily or involuntarily (or suffer to permit any such liquidation
or dissolution).
8.5 Advances, Investments and Loans.
-------------------------------
Lend money or extend credit or make advances to any Person, or purchase or
acquire any stock, obligations or securities of, or any other interest in, or
make any capital contribution to, or otherwise make an Investment in, any Person
except as permitted by Section 8.4 or as may be Permitted Investments.
8.6 Transactions with Affiliates.
----------------------------
Enter into or permit to exist any transaction or series of transactions,
whether or not in the ordinary course of business, with any officer, director,
shareholder or Affiliate other than (i) transactions permitted by Section 8.1,
Section 8.4(b), Section 8.5 or Section 8.10, (ii) customary fees and expenses
paid to directors and (iii) where such transactions are on terms and conditions
substantially as favorable as would be obtainable in a comparable arm's-length
transaction with a Person other than an officer, director, shareholder or
Affiliate.
8.7 Ownership of Equity Interests.
-----------------------------
Issue, sell, transfer, pledge or otherwise dispose of any partnership
interests, shares of capital stock or other equity or ownership interests
("Equity Interests") in any member of the Consolidated Group, except (i)
-----------------
issuance, sale or transfer of Equity Interests to a Credit Party by a Subsidiary
of such Credit Party, (ii) in connection with a transaction permitted by Section
8.4, and (iii) as needed to qualify directors under applicable law.
8.8 Fiscal Year.
-----------
Change its fiscal year from an April 30 fiscal year end to any year-end
other than December 31 (and only then upon prior notice to the Administrative
Agent and adjustment of the financial covenants to reflect any partial year
periods).
66
8.9 Prepayments of Indebtedness, etc.
---------------------------------
(a) After the issuance thereof, amend or modify (or permit the amendment
or modification of), the terms of any other Indebtedness in a manner adverse to
the interests of the Lenders (including specifically shortening any maturity or
average life to maturity or requiring any payment sooner than previously
scheduled or increasing the interest rate or fees applicable thereto);
(b) Make any prepayment, redemption, defeasance or acquisition for value
of (including without limitation, by way of depositing money or securities with
the trustee with respect thereto before due for the purpose of paying when due),
or refund, refinance or exchange of any Funded Debt (other than intercompany
Indebtedness permitted hereunder) other than regularly scheduled payments of
principal and interest on such Funded Debt.
8.10 Restricted Payments.
-------------------
Make or permit any Restricted Payments, unless and to the extent that no
Default or Event of Default shall exist immediately prior or after giving effect
thereto on a Pro Forma Basis.
8.11 Sale Leasebacks.
---------------
Except as permitted pursuant to Section 8.1(c) hereof, directly or
indirectly, become or remain liable as lessee or as guarantor or other surety
with respect to any lease, whether an Operating Lease or a Capital Lease, of any
Property (whether real or personal or mixed), whether now owned or hereafter
acquired, (i) which such Person has sold or transferred or is to sell or
transfer to any other Person other than a Credit Party or (ii) which such Person
intends to use for substantially the same purpose as any other Property which
has been sold or is to be sold or transferred by such Person to any other Person
in connection with such lease.
8.12 No Further Negative Pledges.
---------------------------
Except with respect to prohibitions against other encumbrances on specific
Property encumbered to secure payment of particular Indebtedness (which
Indebtedness relates solely to such specific Property, and improvements and
accretions thereto, and is otherwise permitted hereby), no member of the
Consolidated Group will enter into, assume or become subject to any agreement
prohibiting or otherwise restricting the creation or assumption of any Lien upon
its properties or assets, whether now owned or hereafter acquired, or requiring
the grant of any security for such obligation if security is given for some
other obligation.
67
SECTION 9
EVENTS OF DEFAULT
-----------------
9.1 Events of Default.
-----------------
An Event of Default shall exist upon the occurrence of any of the following
specified events (each an "Event of Default"):
----------------
(a) Payment. Any Credit Party shall
-------
(i) default in the payment when due of any principal of any of
the Loans, or
(ii) default, and such defaults shall continue for three (3) or more
Business Days, in the payment when due of any interest on the Loans or of
any Fees or other amounts owing hereunder, under any of the other Credit
Documents or in connection herewith or therewith; or
(b) Representations. Any representation, warranty or statement made or
---------------
deemed to be made herein, in any of the other Credit Documents, or in any
statement or certificate delivered or required to be delivered pursuant hereto
or thereto shall prove untrue in any material respect on the date as of which it
was deemed to have been made; or
(c) Covenants.
---------
(i) Default in the due performance or observance of any term,
covenant or agreement contained in Section 7.3(a), 7.9, 7.13 or 8.1 through
8.12 (except in the case of the negative covenants contained in Sections
8.1 through 8.12, those Defaults which may occur or arise other than on
account of or by affirmative or intentional act of a Credit Party or event
or condition which a Credit Party shall with knowledge permit to exist, all
of which shall be subject to the provisions of clause (ii) hereof),
inclusive, or
(ii) Default in the due performance or observance by it of any term,
covenant or agreement (other than those referred to in subsections (a), (b)
or (c)(i) of this Section 9.1) contained in this Credit Agreement and such
default shall continue unremedied for a period of at least 30 days after
the earlier of a responsible officer of a Credit Party becoming aware of
such default or notice thereof by the Administrative Agent; or
(d) Other Credit Documents. (i) Any Credit Party shall default in the due
----------------------
performance or observance of any material term, covenant or agreement in any of
the other Credit Documents (subject to applicable grace or cure periods, if
any), or (ii) except as to the Credit Party which is dissolved, released or
merged or consolidated out of existence as the result of or in connection with a
dissolution, merger or disposition permitted by Section 8.4(a), Section 8.4(b)
or Section 8.4(c), any Credit Document shall fail to be in full force and effect
or to give the Administrative
68
Agent and/or the Lenders any material part of the Liens, rights, powers and
privileges purported to be created thereby; or
(e) Guaranties. Except as to the Credit Party which is dissolved, released
----------
or merged or consolidated out of existence as the result of or in connection
with a dissolution, merger or disposition permitted by Section 8.4(a), Section
8.4(b) or Section 8.4(c), the guaranty given by any Guarantor hereunder or any
material provision thereof shall cease to be in full force and effect, or any
Guarantor hereunder or any Person acting by or on behalf of such Guarantor shall
deny or disaffirm such Guarantor's obligations under such guaranty, or any
Guarantor shall default in the due performance or observance of any term,
covenant or agreement on its part to be performed or observed pursuant to any
guaranty; or
(f) Bankruptcy, etc. Any Bankruptcy Event shall occur with respect to any
---------------
Credit Party; or
(g) Defaults under Other Agreements. With respect to any Indebtedness
-------------------------------
(other than Indebtedness outstanding under this Credit Agreement) in excess of
$5,000,000 in the aggregate for the Consolidated Group taken as a whole, (A) (1)
any member of the Consolidated Group shall default in any payment (beyond the
applicable grace period with respect thereto, if any) with respect to any such
Indebtedness, or (2) the occurrence and continuance of a default in the
observance or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event or condition shall occur or condition exist, the effect of which default
or other event or condition is to cause, or permit, the holder or holders of
such Indebtedness (or trustee or agent on behalf of such holders) to cause
(determined without regard to whether any notice or lapse of time is required),
any such Indebtedness to become due prior to its stated maturity; or (B) any
such Indebtedness shall be declared due and payable, or required to be prepaid
other than by a regularly scheduled required prepayment, prior to the stated
maturity thereof; or
(h) Judgments. Any member of the Consolidated Group shall fail within 30
---------
days of the date due and payable to pay, bond or otherwise discharge any
judgment, settlement or order for the payment of money which judgment,
settlement or order, when aggregated with all other such judgments, settlements
or orders due and unpaid at such time, exceeds $5,000,000, and which is not
stayed on appeal (or for which no motion for stay is pending) or is not
otherwise being executed; or
(i) ERISA. Any of the following events or conditions, if such event or
-----
condition could reasonably be expected to have a Material Adverse Effect and is
not subject to indemnification in favor of the Consolidated Group: (1) any
"accumulated funding deficiency," as such term is defined in Section 302 of
ERISA and Section 412 of the Code, whether or not waived, shall exist with
respect to any Plan, or any lien shall arise on the assets of a member of the
Consolidated Group or any ERISA Affiliate in favor of the PBGC or a Plan; (2) an
ERISA Event shall occur with respect to a Single Employer Plan, which is, in the
reasonable opinion of the Administrative Agent, likely to result in the
termination of such Plan for purposes of Title IV of ERISA; (3) an ERISA Event
shall occur with respect to a Multiemployer Plan or Multiple
69
Employer Plan, which is, in the reasonable opinion of the Administrative Agent,
likely to result in (i) the termination of such Plan for purposes of Title IV of
ERISA, or (ii) a member of the Consolidated Group or any ERISA Affiliate
incurring any liability in connection with a withdrawal from, reorganization of
(within the meaning of Section 4241 of ERISA), or insolvency of (within the
meaning of Section 4245 of ERISA) such Plan; or (4) any prohibited transaction
(within the meaning of Section 406 of ERISA or Section 4975 of the Code) or
breach of fiduciary responsibility shall occur which may subject a member of the
Consolidated Group or any ERISA Affiliate to any liability under Sections 406,
409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or under any
agreement or other instrument pursuant to which a member of the Consolidated
Group or any ERISA Affiliate has agreed or is required to indemnify any person
against any such liability; or
(j) Ownership. There shall occur a Change of Control.
---------
9.2 Acceleration; Remedies.
----------------------
Upon the occurrence of an Event of Default, and at any time thereafter, the
Administrative Agent shall, upon the request and direction of the Required
Lenders, by written notice to the Credit Parties take any of the following
actions:
(i) Termination of Commitments. Declare the Commitments terminated
--------------------------
whereupon the Commitments shall be immediately terminated.
(ii) Acceleration. Declare the unpaid principal of and any accrued
------------
interest in respect of all Loans and any and all other indebtedness or
obligations of any and every kind owing by the Credit Parties to the
Administrative Agent and/or any of the Lenders hereunder to be due
whereupon the same shall be immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each of the Credit Parties.
(iii) Enforcement of Rights. Enforce any and all rights and
---------------------
interests created and existing under the Credit Documents and all rights of
set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all accrued interest in respect thereof, all accrued and unpaid Fees and
other indebtedness or obligations owing to the Administrative Agent and/or any
of the Lenders hereunder automatically shall immediately become due and payable
without presentment, demand, protest or the giving of any notice or other action
by the Administrative Agent or the Lenders, all of which are hereby waived by
the Credit Parties.
70
SECTION 10
AGENCY PROVISIONS
-----------------
10.1 Appointment.
-----------
Each Lender hereby designates and appoints NationsBank, N.A. as
administrative agent (in such capacity, the "Administrative Agent") of such
--------------------
Lender to act as specified herein and the other Credit Documents, and each such
Lender hereby authorizes the Administrative Agent as the Administrative Agent
for such Lender, to take such action on its behalf under the provisions of this
Credit Agreement and the other Credit Documents and to exercise such powers and
perform such duties as are expressly delegated by the terms hereof and of the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. Each Lenders further directs and authorizes the
Administrative Agent to execute releases (or similar agreements) to give effect
to the provisions of this Credit Agreement and the other Credit Documents,
including specifically without limitation the provisions of Section 8.4 hereof.
Notwithstanding any provision to the contrary elsewhere herein and in the other
Credit Documents, the Administrative Agent shall not have any duties or
responsibilities to any Lender, except those expressly set forth herein and
therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities to
any Lender shall be read into this Credit Agreement or any of the other Credit
Documents, or shall otherwise exist against the Administrative Agent. The
provisions of this Section are solely for the benefit of the Administrative
Agent and the Lenders and none of the Credit Parties shall (i) have any rights
as a third party beneficiary of the provisions hereof or (ii) have any other
rights otherwise and elsewhere given them limited by the provisions hereof. In
performing its functions and duties under this Credit Agreement and the other
Credit Documents, the Administrative Agent shall act solely as Administrative
Agent of the Lenders and does not assume and shall not be deemed to have assumed
any obligation or relationship of agency or trust with or for any Credit Party
or any of their respective Affiliates.
10.2 Delegation of Duties.
--------------------
The Administrative Agent may execute any of its duties hereunder or under the
other Credit 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.
10.3 Exculpatory Provisions.
----------------------
The Administrative Agent and its officers, directors, employees, agents,
attorneys-in-fact or affiliates shall not be (i) liable for any action lawfully
taken or omitted to be taken by it or such Person under or in connection
herewith or in connection with any of the other Credit Documents (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 any of the Credit Parties contained herein
or in any of the other Credit Documents or in any
71
certificate, report, document, financial statement or other written or oral
statement referred to or provided for in, or received by the Administrative
Agent under or in connection herewith or in connection with the other Credit
Documents, or enforceability or sufficiency therefor of any of the other Credit
Documents, or for any failure of any Credit Party to perform its obligations
hereunder or thereunder. The Administrative Agent shall not be responsible to
any Lender for the effectiveness, genuineness, validity, enforceability,
collectability or sufficiency of this Credit Agreement, or any of the other
Credit Documents or for any representations, warranties, recitals or statements
made herein or therein or made by the Borrower or any Credit Party in any
written or oral statement or in any financial or other statements, instruments,
reports, certificates or any other documents in connection herewith or therewith
furnished or made by the Administrative Agent to the Lenders or by or on behalf
of the Credit Parties to the Administrative Agent or any Lender or be required
to ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or of the existence or possible
existence of any Default or Event of Default or to inspect the properties, books
or records of the Credit Parties or any of their respective Affiliates.
10.4 Reliance on Communications.
--------------------------
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, cablegram, telegram, 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 any of the Credit Parties, independent accountants and
other experts selected by the Administrative Agent with reasonable care). The
Administrative Agent may deem and treat the Lenders as the owners of their
respective interests hereunder for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent in accordance with Section 11.3(b) hereof. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Credit Agreement or under any of the other Credit Documents
unless it shall first receive such advice or concurrence of the Required 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, hereunder or under any of the other Credit Documents in
accordance with a request of the Required Lenders (or to the extent specifically
provided in Section 11.6, all the Lenders) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders
(including their successors and assigns).
10.5 Notice of Default.
-----------------
The Administrative Agent shall not be deemed to have knowledge or notice of
the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or a Credit Party
referring to the Credit Document, describing such Default or Event of 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
prompt notice
72
thereof to the Lenders. The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders.
10.6 Non-Reliance on Administrative Agent and Other Lenders.
------------------------------------------------------
Each Lender expressly acknowledges that each of the Administrative Agent and
its officers, directors, employees, Administrative Agents, attorneys-in-fact or
affiliates has not made any representations or warranties to it and that no act
by the Administrative Agent or any affiliate thereof hereinafter taken,
including any review of the affairs of any Credit Party or any of their
respective Affiliates, 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, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrower, the other
Credit Parties or their respective Affiliates and made its own decision to make
its Loans hereunder and enter into this Credit 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 Credit Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrower, the other
Credit Parties and their respective Affiliates. 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, assets, property, financial or other
conditions, prospects or creditworthiness of the Borrower, the other Credit
Parties or any of their respective Affiliates which may come into the possession
of the Administrative Agent or any of its officers, directors, employees,
Administrative 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
Commitments (or if the Commitments have expired or been terminated, in
accordance with the respective principal amounts of outstanding Loans and
Participation Interests of the Lenders), 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 final payment of all of
the obligations of the Borrower hereunder and under the other Credit Documents)
be imposed on, incurred by or asserted against the Administrative Agent in its
capacity as such in any way relating to or arising out of this Credit Agreement
or the other Credit Documents or any documents contemplated by or referred to
herein or therein or the 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 of
--------
any portion of such
73
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the gross negligence or willful
misconduct of the Administrative Agent. If any indemnity furnished to the
Administrative Agent for any purpose shall, in the opinion of the Administrative
Agent, be insufficient or become impaired, the Administrative Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished. The agreements in this
Section shall survive the repayment of the Loans and other obligations under the
Credit Documents and the termination of the Commitments 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,
its Subsidiaries or their respective Affiliates as though the Administrative
Agent were not the Administrative Agent hereunder. With respect to the Loans
made by and all obligations of the Borrower hereunder and under the other Credit
Documents, the Administrative Agent shall have the same rights and powers under
this Credit Agreement as any Lender and may exercise the same as though it were
not the Administrative Agent, and the terms "Lender" and "Lenders" shall include
the Administrative Agent in its individual capacity.
10.9 Successor Administrative Agent.
------------------------------
The Administrative Agent may, at any time, resign upon 20 days' written
notice to the Lenders, and may be removed, upon show of cause, by the Required
Lenders upon 30 days' written notice to the Administrative Agent. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Administrative Agent. If no successor Administrative Agent shall have
been so appointed by the Required Lenders, and shall have accepted such
appointment, within 30 days after the notice of resignation or notice of
removal, as appropriate, then the retiring Administrative Agent shall select a
successor Administrative Agent provided such successor is a Lender hereunder or
a commercial bank organized under the laws of the United States of America or of
any State thereof and has a combined capital and surplus of at least
$500,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations as Administrative Agent, as
appropriate, under this Credit Agreement and the other Credit Documents and the
provisions of this Section 10.9 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Credit Agreement.
74
SECTION 11
MISCELLANEOUS
-------------
11.1 Notices.
-------
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (i) when
delivered, (ii) when transmitted via telecopy (or other facsimile device) to the
number set out below, (iii) the day following the day on which the same has been
delivered prepaid to a reputable national overnight air courier service, or (iv)
the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address, in the case of the Borrower, Guarantors and the Administrative
Agent, set forth below, and, in the case of the Lenders, set forth on Schedule
--------
11.1, or at such other address as such party may specify by written notice to
----
the other parties hereto:
if to the Borrower or the Guarantors:
Navigant International, Inc.
00 Xxxxxxxxx Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attn: General Counsel
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
if to the Administrative Agent:
NationsBank, N.A.
000 X. Xxxxx Xxxxxx
Xxxxxxxxxxxx Center, 00xx Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Agency Services
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
75
with a copy to:
NationsBank, N.A.
Corporate Finance Group
0000 Xxxxxxxxx Xxxxx, 0xx Xxxxx
MD2-600-06-13
Xxxxxxxx, Xxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
11.2 Right of Set-Off.
----------------
In addition to any rights now or hereafter granted under applicable
law or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default, each Lender is authorized at any time and
from time to time, without presentment, demand, protest or other notice of any
kind (all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Lender (including, without
limitation branches, agencies or Affiliates of such Lender wherever located) to
or for the credit or the account of any Credit Party against obligations and
liabilities of such Person to such Lender hereunder, under the Notes, the other
Credit Documents or otherwise, irrespective of whether such Lender shall have
made any demand hereunder and although such obligations, liabilities or claims,
or any of them, may be contingent or unmatured, and any such set-off shall be
deemed to have been made immediately upon the occurrence of an Event of Default
even though such charge is made or entered on the books of such Lender
subsequent thereto. Any Person purchasing a participation in the Loans and
Commitments hereunder pursuant to Section 3.13 or Section 11.3(d) may exercise
all rights of set-off with respect to its participation interest as fully as if
such Person were a Lender hereunder.
11.3 Benefit of Agreement.
--------------------
(a) Generally. This Credit Agreement shall be binding upon and inure
---------
to the benefit of and be enforceable by the respective successors and assigns of
the parties hereto; provided that none of the Credit Parties may assign or
--------
transfer any of its interests without prior written consent of the Lenders;
provided further that the rights of each Lender to transfer, assign or grant
-------- -------
participations in its rights and/or obligations hereunder shall be limited as
set forth in this Section 11.3, provided however that nothing herein shall
--------
prevent or prohibit any Lender from (i) pledging its Loans hereunder to a
Federal Reserve Bank in support of borrowings made by such Lender from such
Federal Reserve Bank, or (ii) granting assignments or selling participations in
such Lender's Loans and/or Commitments hereunder to its parent company and/or to
any Affiliate or Subsidiary of such Lender.
(b) Assignments. Each Lender may assign all or a portion of its
-----------
rights and obligations hereunder (including, without limitation, all or a
portion of its Commitments or its Loans), pursuant to an assignment agreement
substantially in the form of Schedule 11.3(b), to (i) a Lender, (ii) an
----------------
76
affiliate of a Lender or (iii) any other Person (other than the Borrower or an
Affiliate of the Borrower) reasonably acceptable to the Administrative Agent
and, so long as no Default or Event of Default has occurred and is continuing,
the Borrower (the consent of the Borrower shall not be unreasonably withheld or
delayed and such consent shall be deemed given if the Borrower does not notify
the assigning Lender and the Administrative Agent of any objection within two
Business Days after the Borrower has been provided notice of the proposed
assignment by the assigning Lender or the Administrative Agent); provided that
--------
(i) any such assignment (other than any assignment to an existing Lender) shall
be in a minimum aggregate amount of $5,000,000 (or, if less, the remaining
amount of the Commitment being assigned by such Lender) of the Commitments and
in integral multiples of $1,000,000 above such amount and (ii) each such
assignment shall be of a constant, not varying, percentage of all such Lender's
rights and obligations under this Credit Agreement. Any assignment hereunder
shall be effective upon delivery to the Administrative Agent of written notice
of the assignment together with a transfer fee of $3,500 payable to the
Administrative Agent for its own account from and after the later of (i) the
effective date specified in the applicable assignment agreement and (ii) the
date of recording of such assignment in the Register pursuant to the terms of
subsection (c) below. The assigning Lender will give prompt notice to the
Administrative Agent and the Borrower of any such assignment. Upon the
effectiveness of any such assignment (and after notice to, and (to the extent
required pursuant to the terms hereof), with the consent of, the Borrower as
provided herein), the assignee shall become a "Lender" for all purposes of this
Credit Agreement and the other Credit Documents and, to the extent of such
assignment, the assigning Lender shall be relieved of its obligations hereunder
to the extent of the Loans and Commitment components being assigned. Along such
lines the Borrower agrees that upon notice of any such assignment and surrender
of the appropriate Note or Notes, it will promptly provide to the assigning
Lender and to the assignee separate promissory notes in the amount of their
respective interests substantially in the form of the original Note (but with
notation thereon that it is given in substitution for and replacement of the
original Note or any replacement notes thereof). By executing and delivering an
assignment agreement in accordance with this Section 11.3(b), the assigning
Lender thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows: (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim; (ii) except
as set forth in clause (i) above, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Credit
Agreement, any of the other Credit Documents or any other instrument or document
furnished pursuant hereto or thereto, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Credit Agreement, any
of the other Credit Documents or any other instrument or document furnished
pursuant hereto or thereto or the financial condition of any Credit Party or any
of their respective Affiliates or the performance or observance by any Credit
Party of any of its obligations under this Credit Agreement, any of the other
Credit Documents or any other instrument or document furnished pursuant hereto
or thereto; (iii) such assignee represents and warrants that it is legally
authorized to enter into such assignment agreement; (iv) such assignee confirms
that it has received a copy of this Credit Agreement, the other Credit Documents
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into such assignment agreement;
(v) such assignee will independently and without reliance upon the
Administrative Agent, such assigning
77
Lender 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 decisions in
taking or not taking action under this Credit Agreement and the other Credit
Documents; (vi) such assignee appoints and authorizes the Administrative Agent
to take such action on its behalf and to exercise such powers under this Credit
Agreement or any other Credit Document as are delegated to the Administrative
Agent by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto; and (vii) such assignee agrees that it will
perform in accordance with their terms all the obligations which by the terms of
this Credit Agreement and the other Credit Documents are required to be
performed by it as a Lender.
(c) Maintenance of Register. The Administrative Agent shall maintain
-----------------------
at one of its offices in Charlotte, North Carolina a copy of each Lender
assignment agreement delivered to it in accordance with the terms of subsection
(b) above and a register for the recordation of the identity of the principal
amount, type and Interest Period of each Loan outstanding hereunder, the names,
addresses and the Commitments of the Lenders pursuant to the terms hereof from
time to time (the "Register"). The Administrative Agent will make reasonable
--------
efforts to maintain the accuracy of the Register and to promptly update the
Register from time to time, as necessary. The entries in the Register shall be
conclusive in the absence of manifest error and the Borrower, the Administrative
Agent and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Credit Agreement. The Register shall be available for inspection by the
Borrower and each Lender, at any reasonable time and from time to time upon
reasonable prior notice.
(d) Participations. Each Lender may sell, transfer, grant or assign
--------------
participations in all or a portion of such Lender's rights, obligations or
rights and obligations hereunder (including all or a portion of its Commitments
or its Loans); provided that (i) such selling Lender shall remain a "Lender" for
--------
all purposes under this Credit Agreement (such selling Lender's obligations
under the Credit Documents remaining unchanged) and the participant shall not
constitute a Lender hereunder, (ii) no such participant shall have, or be
granted, rights to approve any amendment or waiver relating to this Credit
Agreement or the other Credit Documents except to the extent any such amendment
or waiver would (A) reduce the principal of or rate of interest on or Fees in
respect of any Loans in which the participant is participating, (B) postpone the
date fixed for any payment of principal (including extension of the Termination
Date or the date of any mandatory prepayment), interest or Fees in which the
participant is participating, (C) except as expressly provided in the Credit
Documents, release any Guarantor from its guaranty obligations hereunder, or (D)
except as the result of or in connection with a disposition permitted under
Section 8.4(b), release all or substantially all of the collateral, and (iii)
sub-participations by the participant (except to an affiliate, parent company or
affiliate of a parent company of the participant) shall be prohibited. In the
case of any such participation, the participant shall not have any rights under
this Credit Agreement or the other Credit Documents (the participant's rights
against the selling Lender in respect of such participation to be those set
forth in the participation agreement with such Lender creating such
participation) and all amounts payable by the Borrower hereunder shall be
determined as if such Lender had not sold such participation, provided, however,
--------
that such participant shall be entitled to receive additional amounts under
Sections 3.6, 3.9, 3.10, 3.11 and 11.2 on the same basis as if it were a Lender.
78
11.4 No Waiver; Remedies Cumulative.
------------------------------
No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Administrative Agent or any
Lender and any of the Credit Parties shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, power or privilege hereunder
or under any other Credit Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder or
thereunder. The rights and remedies provided herein are cumulative and not
exclusive of any rights or remedies which the Administrative Agent or any Lender
would otherwise have. No notice to or demand on any Credit Party in any case
shall entitle the Borrower or any other Credit Party to any other or further
notice or demand in similar or other circumstances or constitute a waiver of the
rights of the Administrative Agent or the Lenders to any other or further action
in any circumstances without notice or demand.
11.5 Payment of Expenses, etc.
------------------------
The Borrower agrees to: (i) pay all reasonable out-of-pocket costs
and expenses (A) of the Administrative Agent in connection with the negotiation,
preparation, execution and delivery and administration of this Credit Agreement
and the other Credit Documents and the documents and instruments referred to
therein (including, without limitation, the reasonable and documented fees and
expenses of Xxxxx & Xxx Xxxxx, PLLC, special counsel to the Administrative
Agent) and any amendment, waiver or consent relating hereto and thereto
including, but not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or restructure relating
to the performance by the Credit Parties under this Credit Agreement and (B) of
the Administrative Agent and the Lenders in connection with enforcement of the
Credit Documents and the documents and instruments referred to therein
(including, without limitation, in connection with any such enforcement, the
reasonable and documented fees and disbursements of counsel for the
Administrative Agent and each of the Lenders and documented); (ii) pay and hold
each of the Lenders harmless from and against any and all present and future
stamp and other similar taxes with respect to the foregoing matters and save
each of the Lenders harmless from and against any and all liabilities with
respect to or resulting from any delay or omission (other than to the extent
attributable to such Lender) to pay such taxes; and (iii) indemnify each Lender,
its officers, directors, employees, representatives and Administrative Agents
from and hold each of them harmless against any and all losses, liabilities,
claims, damages or expenses incurred by any of them as a result of, or arising
out of, or in any way related to, or by reason of (A) any investigation,
litigation or other proceeding (whether or not any Lender is a party thereto)
related to the entering into and/or performance of any Credit Document or the
use of proceeds of any Loans (including other extensions of credit) hereunder or
the consummation of any other transactions contemplated in any Credit Document,
including, without limitation, the reasonable and documented fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding, except to the extent any such costs arise out of
or relate to disputes solely between or among the Administrative Agent and/or
the Lenders or (B) the presence or Release of any Materials of Environmental
Concern at, under or from any Property owned, operated or leased by the Borrower
or any of its Subsidiaries, or the failure by the Borrower or any of its
Subsidiaries to
79
comply with any Environmental Law (but excluding, in the case of either of
clause (A) or (B) above, any such losses, liabilities, claims, damages or
expenses to the extent incurred by reason of gross negligence or willful
misconduct on the part of the Person to be indemnified).
11.6 Amendments, Waivers and Consents.
--------------------------------
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing entered into by, or approved in writing by, the Required Lenders and the
Borrower, provided, however, that:
-------- -------
(a) without the consent of each Lender affected thereby, neither this
Credit Agreement nor any of the other Credit Documents may be amended to
(i) extend the final maturity of any Loan or extend or waive
any principal amortization payment of any Loan, or any portion
thereof,
(ii) reduce the rate or extend the time of payment of interest
(other than as a result of waiving the applicability of any increase
in interest rates after the occurrence of an Event of Default or on
account of a failure to deliver financial statements on a timely
basis) thereon or Fees hereunder,
(iii) reduce or waive the principal amount of any Loan,
(iv) increase the Commitment of a Lender over the amount
thereof in effect (it being understood and agreed that a waiver of any
Default or Event of Default or mandatory reduction in the Commitments
shall not constitute a change in the terms of any Commitment of any
Lender),
(v) except as the result of or in connection with a
dissolution, merger or disposition of a Subsidiary permitted under
Section 8.4, release the Borrower or substantially all of the other
Credit Parties from its or their obligations under the Credit
Documents,
(vi) except as the result of or in connection with a
disposition permitted under Section 8.4(b), release all or
substantially all of the collateral,
(vii) except as a result of or in connection with a dissolution,
merger or disposition of a Subsidiary permitted under Section 8.4,
release the Borrower or all or substantially all of the Guarantors
from their obligations under the Credit Agreement,
(viii) amend, modify or waive any provision of this Section 11.6
or Section 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 9.1(a),
11.2, 11.3, 11.5 or 11.9,
80
(ix) reduce any percentage specified in, or otherwise modify, the
definition of Required Lenders, or
(x) consent to the assignment or transfer by the Borrower (or
another Credit Party) of any of its rights and obligations under (or
in respect of) the Credit Documents except as permitted thereby;
(b) without the consent of the Agent, no provision of Section 10 may
be amended.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code supersedes the unanimous consent provisions set forth herein
and (y) the Required Lenders may consent to allow a Credit Party to use cash
collateral in the context of a bankruptcy or insolvency proceeding.
11.7 Counterparts.
------------
This Credit Agreement may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Credit Agreement to produce or account for more than one
such counterpart.
11.8 Headings.
--------
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 Survival.
--------
All indemnities set forth herein, including, without limitation, in Section
2.2(i), 3.9, 3.11, 10.7 or 11.5 shall survive the execution and delivery of this
Credit Agreement, the making of the Loans, the repayment of the Loans and other
obligations under the Credit Documents and the termination of the Commitments
hereunder, and all representations and warranties made by the Credit Parties
herein shall survive delivery of the Notes and the making of the Loans
hereunder.
11.10 Governing Law; Submission to Jurisdiction; Venue.
------------------------------------------------
(a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH
CAROLINA. Any legal action or proceeding with respect to this Credit Agreement
or any other Credit Document may be brought in the courts
81
of the State of North Carolina in Mecklenburg County, or of the United States
for the Western District of North Carolina, and, by execution and delivery of
this Credit Agreement, each of the Credit Parties hereby irrevocably accepts for
itself and in respect of its property, generally and unconditionally, the
nonexclusive jurisdiction of such courts. Each of the Credit Parties further
irrevocably consents to the service of process out of any of the aforementioned
courts in any such action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to it at the address set out for
notices pursuant to Section 11.1, such service to become effective three (3)
days after such mailing. Nothing herein shall affect the right of the
Administrative Agent to serve process in any other manner permitted by law or to
commence legal proceedings or to otherwise proceed against any Credit Party in
any other jurisdiction.
(b) Each of the Credit Parties hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Credit Agreement or any other Credit Document brought in the courts referred to
in subsection (a) hereof and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or proceeding brought in
any such court has been brought in an inconvenient forum.
(c) TO THE EXTENT PERMITTED BY LAW, EACH OF THE ADMINISTRATIVE AGENT, THE
LENDERS, THE BORROWER AND THE CREDIT PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
11.11 Severability.
------------
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
11.12 Entirety.
--------
This Credit Agreement together with the other Credit Documents represent
the entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Credit Documents or the transactions
contemplated herein and therein.
11.13 Binding Effect; Termination.
---------------------------
(a) This Credit Agreement shall become effective at such time on or
after the Closing Date when it shall have been executed by the Borrower, the
Guarantors and the Administrative Agent, and the Administrative Agent shall have
received copies hereof (telefaxed or otherwise) which, when taken together, bear
the signatures of each Lender, and thereafter this Credit
82
Agreement shall be binding upon and inure to the benefit of the Borrower, the
Guarantors, the Administrative Agent and each Lender and their respective
successors and assigns.
(b) The term of this Credit Agreement shall be until no Loans or any
other amounts payable hereunder or under any of the other Credit Documents shall
remain outstanding and until all of the Commitments hereunder shall have expired
or been terminated.
11.14 Confidentiality.
---------------
The Administrative Agent and the Lenders agree to keep confidential (and to
cause their respective affiliates, officers, directors, employees, agents and
representatives to keep confidential) all information, materials and documents
furnished to the Administrative Agent or any such Lender by or on behalf of any
Credit Party (whether before or after the Closing Date) which relates to the
Borrower or any of its Subsidiaries (the "Information"). Notwithstanding the
-----------
foregoing, the Administrative Agent and each Lender shall be permitted to
disclose Information (i) to its affiliates, officers, directors, employees,
Administrative Agents and representatives in connection with its participation
in any of the transactions evidenced by this Credit Agreement or any other
Credit Documents or the administration of this Credit Agreement or any other
Credit Documents; (ii) to the extent required by applicable laws and regulations
or by any subpoena or similar legal process, or requested by any Governmental
Authority; (iii) to the extent such Information (A) becomes publicly available
other than as a result of a breach of this Credit Agreement or any agreement
entered into pursuant to clause (iv) below, (B) becomes available to the
Administrative Agent or such Lender on a non-confidential basis from a source
other than a Credit Party or (C) was available to the Administrative Agent or
such Lender on a non-confidential basis prior to its disclosure to the
Administrative Agent or such Lender by a Credit Party; (iv) to any assignee or
participant (or prospective assignee or participant) so long as such assignee or
participant (or prospective assignee or participant) first specifically agrees
in a writing furnished to and for the benefit of the Credit Parties to be bound
by the terms of this Section 11.14; or (v) to the extent that the Borrower shall
have consented in writing to such disclosure. Nothing set forth in this Section
11.14 shall obligate the Administrative Agent or any Lender to return any
materials furnished by the Credit Parties.
11.15 Source of Funds.
---------------
Each of the Lenders hereby represents and warrants to the Borrower that at
least one of the following statements is an accurate representation as to the
source of funds to be used by such Lender in connection with the financing
hereunder:
(a) no part of such funds constitutes assets allocated to any
separate account maintained by such Lender in which any employee benefit
plan (or its related trust) has any interest;
(b) to the extent that any part of such funds constitutes assets
allocated to any separate account maintained by such Lender, such Lender
has disclosed to the Borrower the name of each employee benefit plan whose
assets in such account exceed 10% of the total
83
assets of such account as of the date of such purchase (and, for purposes
of this subsection (b), all employee benefit plans maintained by the same
employer or employee organization are deemed to be a single plan);
(c) to the extent that any part of such funds constitutes assets of
an insurance company's general account, such insurance company has complied
with all of the requirements of the regulations issued under Section
401(c)(1)(A) of ERISA; or
(d) such funds constitute assets of one or more specific benefit
plans which such Lender has identified in writing to the Borrower.
As used in this Section 11.15, the terms "employee benefit plan" and "separate
account" shall have the respective meanings assigned to such terms in Section 3
of ERISA.
11.16 Conflict.
--------
To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Credit Agreement shall control.
[Signature Page to Follow]
84
IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Credit Agreement to be duly executed and delivered as of the
date first above written.
BORROWER: NAVIGANT INTERNATIONAL, INC.
--------
a Delaware corporation
By:_________________________
Name:
Title:
GUARANTORS: PROFESSIONAL TRAVEL CORPORATION,
----------
a Colorado corporation
By: _________________________
Name:
Title:
ASSOCIATED TRAVEL SERVICES, LLC,
a Delaware limited liability company
By: _________________________
Name:
Title:
XXXXXXXX TRAVEL MANAGEMENT, INC.,
a Connecticut corporation
By: _________________________
Name:
Title:
MTA, INC.,
a Washington corporation
By: _________________________
Name:
Title:
LENDERS: NATIONSBANK, N.A.,
-------
individually in its capacity as a
Lender and in its capacity as Administrative
Agent
By:__________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION
By:__________________________
Name:
Title:
Schedule 2.1(a)
---------------
Schedule of Lenders and Commitments
Lender Revolving Revolving LOC
------
Committed Amount Commitment Percentage Committed Amount
---------------- --------------------- ----------------
NationsBank, N.A. $35,000,000 58.33% $1,166,666.67
US Bank National Association $25,000,000 41.67% $ 833,333.33
Schedule 2.1(b)(i)
------------------
FORM OF NOTICE OF BORROWING
NationsBank, N.A. NationsBank, N.A.,
as Administrative Agent for the Lenders as Swingline Lender
000 X. Xxxxx Xxxxxx 000 X. Xxxxx Xxxxxx
Independence Center, 15th Floor Independence Center, 15th Floor
NC1-001-15-04 NC1-001-15-04
Charlotte, North Carolina 28255 Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services Attention: Agency Services
RE: Credit Agreement dated as of June 9, 1998 (as amended and
modified, the "Credit Agreement") among NAVIGANT
----------------
INTERNATIONAL, INC., the Guarantors and Lenders identified
therein and NationsBank, N.A., as Administrative Agent. Terms
used but not otherwise defined herein shall have the meanings
provided in the Credit Agreement.
Ladies and Gentlemen:
The undersigned hereby gives notice of a request for Revolving Loan pursuant to
Section 2.1(b) of the Credit Agreement or of a request for Swingline Loan
pursuant to Section 2.2(b) of the Credit Agreement as follows:
________________ Revolving Loan
________________ Swingline Loan
(A) Date of Borrowing __________________________________
(which is a Business Day)
(B) Principal Amount of
Borrowing __________________________________
(C) Interest rate basis __________________________________
(D) Interest Period and the
last day thereof __________________________________
In accordance with the requirements of Section 5.2 of the Credit Agreement, the
undersigned Borrower hereby certifies that:
(a) The representations and warranties contained in the Credit
Agreement and the other Credit Documents are true and correct in all material
respects as of the date of this request, and will be true and correct after
giving effect to the requested Extension of Credit (except for those which
expressly related to an earlier date).
(b) No Default or Event of Default exists, or will exist after giving
effect to the requested Extension of Credit.
(c) As to any Credit Party, no involuntary action has been commenced
under applicable bankruptcy, insolvency or other similar law in effect, or any
case, proceeding or other action for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) as to any
Credit Party or as to any substantial party of the property of any Credit Party
or for the winding up or liquidation of its affairs, and remains undismissed,
undischarged or unbonded.
(d) No circumstances, events or conditions have occurred since the date
of the audited financial statements referenced in Section 6.1 of the Credit
Agreement which would have a Material Adverse Effect.
(e) All conditions set forth in Section 2.1 as to the making of
Revolving Loans or in Section 2.2 as to the making of Swingline Loans, as
appropriate, have been satisfied.
Very truly yours,
NAVIGANT INTERNATIONAL, INC.
By:_______________________________
Name:
Title:
3
Schedule 2.1(E)
---------------
FORM OF NOTE
June 9, 1998
FOR VALUE RECEIVED, the undersigned Borrower, hereby promises to pay to
the order of ______________________, and its successors and assigns, on or
before the Termination Date to the office of the Administrative Agent in
immediately available funds as provided in the Credit Agreement,
(i) in the case of Loans, such Lender's Revolving Committed
Amount or, if less, the aggregate unpaid principal amount of all
Revolving Loans owing to such Lender;
(ii) in the case of Swingline Loans, if such lender is the
Swingline Lender, the aggregate Swingline Committed Amount or, if less,
the aggregate unpaid principal amount of all Swingline Loans owing to
such Swingline Lender; and
together with interest thereon at the rates and as provided in the Credit
Agreement.
This Note is one of the Notes referred to in the Credit Agreement dated
as of June 9, 1998 (as amended and modified, the "Credit Agreement") among
----------------
NAVIGANT INTERNATIONAL, INC., a Delaware corporation, the Guarantors and Lenders
identified therein and NationsBank, N.A., as Administrative Agent. Terms used
but not otherwise defined herein shall have the meanings provided in the Credit
Agreement.
The holder may endorse and attach a schedule to reflect borrowings
evidenced by this Note and all payments and prepayments thereon; provided that
--------
any failure to endorse such information shall not affect the obligation of the
undersigned Borrower to pay amounts evidenced hereby.
Upon the occurrence of an Event of Default, all amounts evidenced by
this Note may, or shall, become immediately due and payable as provided in the
Credit Agreement without presentment, demand, protest or notice of any kind, all
of which are waived by the undersigned Borrower. In the event payment of amounts
evidenced by this Note is not made at any stated or accelerated maturity, the
undersigned Borrower agrees to pay, in addition to principal and interest, all
costs of collection, including reasonable attorneys' fees.
This Note and the Loans and amounts evidenced hereby may be transferred
only as provided in the Credit Agreement.
This Note shall be governed by, and construed and interpreted in
accordance with, the law of the State of North Carolina.
4
In WITNESS WHEREOF, the undersigned Borrower has caused this Note to be
duly executed as of the date first above written.
NAVIGANT INTERNATIONAL, INC.,
a Delaware corporation
By:______________________________
Name:
Title:
5
Schedule 2.2(B)-1
-----------------
Existing Letters of Credit
6
SCHEDULE 2.2(B)-2
-----------------
Form of Notice of Request for Letter of Credit
[Date]
NationsBank, N.A. NationsBank, N.A.
as Issuing Lender under the as Administrative Agent under the
Credit Agreement referred to below Credit Agreement referred to below
000 X. Xxxxx Xxxxxx 000 X. Xxxxx Xxxxxx
Independence Center, 15th Floor Independence Center, 15th Floor
NC1-001-15-04 NC1-001-15-04
Charlotte, North Carolina 28255 Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Re: Credit Agreement dated as of June 9, 1998 (as amended and
modified, the "CREDIT AGREEMENT") among Navigant
International, Inc., the Guarantors and Lenders identified
therein and NationsBank, N.A., as Administrative Agent. Terms
used but not otherwise defined herein shall have the meanings
provided in the Credit Agreement.
Ladies and Gentlemen:
The undersigned, pursuant to Section 2.2(b) of the Credit Agreement,
hereby requests that the following Letters of Credit be made on [date] as
follows:
(1) Account Party:
(2) For use by:
(3) Beneficiary:
(4) Face Amount of Letter of Credit:
(5) Date of Issuance:
Delivery of Letter of Credit should be made as follows:
In accordance with the requirements of Section 5.2 of the Credit
Agreement, the undersigned Borrower hereby certifies that:
(a) The representations and warranties contained in the Credit
Agreement and the other Credit Documents are true and correct in all material
respects as of the date of this request, and will be true and correct after
giving effect to the requested Extension of Credit (except for those which
expressly relate to an earlier date).
(b) No Default or Event of Default exists, or will exist after giving
effect to the requested Extension of Credit.
7
(c) As to any Credit Party, no involuntary action has been commenced
under applicable bankruptcy, insolvency or other similar law in effect, or any
case, proceeding or other action for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) as to any
Credit Party or as to any substantial part of the property of any Credit Party
or for the winding up or liquidation of its affairs, and remains undismissed,
undischarged or unbonded.
(d) No circumstances, events or conditions have occurred since the date
of the audited financial statements referenced in Section 7.1 of the Credit
Agreement which could reasonably be expected to have a Material Adverse Effect.
(e) All conditions set forth in Section 2.2 as to the issuance of a
Letter of Credit have been satisfied.
Very truly yours,
NAVIGANT INTERNATIONAL, INC.
By:_________________________________
Name:
Title:
8
SCHEDULE 3.2
Form of Notice of Extension/Conversion
NationsBank, N.A.,
as Administrative Agent for the Lenders
000 X. Xxxxx Xxxxxx
Independence Center, 15th Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Re: Credit Agreement dated as of June 9, 1998 (as amended and
modified, the "CREDIT AGREEMENT") among NAVIGANT
INTERNATIONAL, INC., the Guarantors and Lenders identified
therein and NationsBank, N.A., as Administrative Agent. Terms
used but not otherwise defined herein shall have the meanings
provided in the Credit Agreement.
Ladies and Gentlemen:
The undersigned hereby gives notice pursuant to Section 3.2 of the
Credit Agreement that it requests an extension or conversion of a Revolving Loan
outstanding under the Credit Agreement, and in connection therewith sets forth
below the terms on which such extension or conversion is requested to be made:
(A) Date of Extension or Conversion
(which is the last day of the
applicable Interest Period) ___________________________
(B) Principal Amount of
Extension or Conversion ___________________________
(C) Interest rate basis ___________________________
(D) Interest Period and the
last day thereof ___________________________
In accordance with the requirements of Section 5.2 of the Credit
Agreement, the undersigned Borrower hereby certifies that:
(a) The representations and warranties contained in the Credit
Agreement and the other Credit Documents are true and correct in all
material respects as of the date of this request, and will be true and
correct after giving effect to the requested Extension of Credit
(except for those which expressly relate to an earlier date).
(b) No Default or Event of Default exists, or will exist after
giving effect to the requested Extension of Credit.
9
(c) As to any Credit Party, no involuntary action has been
commenced under applicable bankruptcy, insolvency or other similar law
in effect, or any case, proceeding or other action for the appointment
of a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) as to any Credit Party or as to any substantial
part of the property of any Credit Party or for the winding up or
liquidation of its affairs, and remains undismissed, undischarged or
unbonded.
(d) No circumstances, events or conditions have occurred since
the date of the audited financial statements referenced in Section 6.1
of the Credit Agreement which would have a Material Adverse Effect.
Very truly yours,
NAVIGANT INTERNATIONAL, INC.
By:__________________________________
Name:
Title:
10
SCHEDULE 5.1(I)(V)
------------------
Assistant Secretary's Certificate
Pursuant to Section 5.1(i)(v) of the Credit Agreement (the "CREDIT
AGREEMENT"), dated as of June 9, 1998, among NAVIGANT INTERNATIONAL, INC., a
Delaware corporation, the Guarantors and Lenders identified therein and
NationsBank, N.A., as Administrative Agent, the undersigned
___________________________, Assistant Secretary of ____________________ (the
"CORPORATION") hereby certifies as follows:
1. Attached hereto as Annex I is a true and complete copy of
resolutions duly adopted by the Board of Directors of the Corporation on
_______________________, 199_. The attached resolutions have not been rescinded
or modified and remain in full force and effect. The attached resolutions are
the only corporate proceedings of the Corporation now in force relating to or
affecting the matters referenced to therein.
2. Attached hereto as Annex II is a true and complete copy of the By-
laws of the Corporation as in effect on the date hereof.
3. Attached hereto as Annex III is a true and complete copy of the
Certificate of Incorporation of the Corporation and all amendments thereto as in
effect on the date hereof.
4. The following persons are now duly elected and qualified officers of
the Corporation, holding the offices indicated, and the signature appearing
opposite his name below is his true and genuine signature, and such officer is
duly authorized to execute and deliver on behalf of the Corporation, the Credit
Agreement, the Notes to be issued pursuant thereto and the other Credit
Documents and to act as a Responsible Officer on behalf of the Corporation under
the Credit Agreement.
NAME OFFICE SIGNATURE
________________________
________________________
IN WITNESS WHEREOF, the undersigned has hereunto set his/her name and
affixed the corporate seal of the Corporation.
_____________________________
Assistant Secretary
Date: _______________________, 1998
I, _____________________, ___________________ of ____________________,
hereby certify that _____________________, whose genuine signature appears
above, is, and has been at all times since ______________________, a duly
elected, qualified and acting ____________________ of _________________________.
11
_______________________________ of
____________________________________
______________________________, 1998
12
SCHEDULE 6.6
------------
Description of Legal Proceedings
13
SCHEDULE 6.8
------------
Existing Liens
14
SCHEDULE 6.14
-------------
Subsidiaries
15
SCHEDULE 7.2(B)
---------------
Form of Officer's Compliance Certificate
This Certificate is delivered in accordance with the provisions of
Section 7.2(b) of that Credit Agreement dated as of June 9, 1998 (as amended,
modified and supplemented, the "CREDIT AGREEMENT") among NAVIGANT INTERNATIONAL,
INC., a Delaware corporation, the Guarantors and Lenders identified therein, and
NationsBank, N.A., as Administrative Agent. Terms used but not otherwise defined
herein shall have the same meanings provided in the Credit Agreement.
The undersigned, being a Responsible Officer of NAVIGANT INTERNATIONAL,
INC., a Delaware corporation, hereby certifies, in my official capacity and not
in my individual capacity, that to the best of my knowledge and belief:
(a) the financial statements accompanying this Certificate fairly
present the financial condition of the parties covered by such financial
statements in all material respects;
(b) during the period the Credit Parties have observed or performed all
of their covenants and other agreements in all material respects, and satisfied
in all material respects every material condition, contained in this Credit
Agreement to be observed, performed or satisfied by them;
(c) the undersigned has no actual knowledge of any Default or Event of
Default; and
(d) detailed calculations demonstrating compliance with the financial
covenants set out in Section 7.9 of the Credit Agreement accompanying this
Certificate.
This the _______________ day of ________________________, 199_.
NAVIGANT INTERNATIONAL, INC.
By:___________________________________
Name:
Title:
16
ATTACHMENT TO OFFICER'S CERTIFICATE
-----------------------------------
Computation of Financial Covenants
17
Schedule 7.11-1
---------------
Form of Joinder Agreement
THIS JOINDER AGREEMENT (the "Agreement"), dated as of
---------
___________________, 199_, is by and between _______________________, a
__________________ (the "Applicant Guarantor"), and NATIONSBANK, N.A., in its
-------------------
capacity as Administrative Agent under that certain Credit Agreement dated as of
June 9, 1998 (as amended and modified, the "Credit Agreement") by and among
----------------
NAVIGANT INTERNATIONAL, INC., a Delaware corporation, the Guarantors and Lenders
identified therein and NationsBank, N.A., as Administrative Agent. All of the
defined terms in the Credit Agreement are incorporated herein by reference.
The Applicant Guarantor has indicated its desire to become a Guarantor
or is required by the terms of Section 7.11 of the Credit Agreement to become a
Guarantor under the Credit Agreement.
Accordingly, the Applicant Guarantor hereby agrees as follows with the
Administrative Agent for the benefit of the Lenders:
1. The Applicant Guarantor hereby acknowledges, agrees and confirms
that, by its execution of this Agreement, the Applicant Guarantor will be deemed
to be a party to the Credit Agreement and a "Guarantor" for all purposes of the
Credit Agreement and the other Credit Documents, and shall have all of the
obligations of a Guarantor thereunder as if it had executed the Credit Agreement
and the other Credit Documents. The Applicant Guarantor agrees to be bound by
all of the terms, provisions and conditions contained in the Credit Documents,
including without limitation (i) all of the affirmative and negative covenants
set forth in Sections 7 and 8 of the Credit Agreement and (ii) all of the
undertakings and waivers set forth in Section 4 of the Credit Agreement. Without
limiting the generality of the foregoing terms of this paragraph 1, the
Applicant Guarantor hereby (A) jointly and severally together with the other
Guarantors, guarantees to each Lender and the Administrative Agent as provided
in Section 4 of the Credit Agreement, the prompt payment and performance of the
Guaranteed Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, as a mandatory cash collateralization or
otherwise) strictly in accordance with the terms thereof, (B) agrees that if any
of the Guaranteed Obligations are not paid or performed in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise), the Applicant Guarantor will,
jointly and severally together with the other Guarantors, promptly pay and
perform the same, without any demand or notice whatsoever, and that in the case
of any extension of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, as a mandatory prepayment, by acceleration, as a mandatory
cash collateralization or otherwise) in accordance with the terms of such
extension or renewal, (C) grants to the Administrative Agent a security interest
in its Collateral as referred in, and pursuant to the terms of, the Security
Agreement, and (D) pledges and grants a security interest to the Administrative
Agent in the Pledged Stock identified in Schedule A attached and the other
----------
Collateral as referred in, and pursuant to the terms of, the Pledge Agreement.
2. The Applicant Guarantor acknowledges and confirms that it has
received a copy of the Credit Agreement and the Schedules and Exhibits thereto.
The information on the Schedules to the Credit Agreement, the Security Agreement
and the Pledge Agreement are amended to provide the information shown on the
attached Schedule A.
----------
18
3. The Applicant Guarantor hereby waives acceptance by the
Administrative Agent and the Lenders of the guaranty by the Applicant Guarantor
under Section 4 of the Credit Agreement upon the execution of this Joinder
Agreement by the Applicant Guarantor.
4. This Agreement may be executed in two or more counterparts, each of
which shall constitute an original but all of which when taken together shall
constitute one contract.
5. This Agreement shall be governed by and construed and interpreted in
accordance with the laws of the State of North Carolina.
IN WITNESS WHEREOF, the Applicant Guarantor has caused this Joinder
Agreement to be duly executed by its authorized officers, and the Administrative
Agent, for the benefit of the Lenders, has caused the same to be accepted by its
authorized officer, as of the day and year first above written.
APPLICANT GUARANTOR
By: ______________________________
Name:
Title:
Address for Notices:
Attn:
Telephone:
Telecopy:
Acknowledged and accepted:
NATIONSBANK, N.A., as Administrative Agent
By: ______________________________
Name:
Title:
19
Schedule A
----------
to
Joinder Agreement
Schedule 1 to Security Agreement
--------------------------------
Address for Chief Executive Locations of Record
Applicant Guarantor Notices Office Collateral Owner
------------------- ------- ------ ---------- -----
Schedule 1 Po Aledge agreement
------------------------------
Pledgor/Applicant Guarantor Issuer Class Cert. No. No. Shares Percent
--------------------------- ------ ----- --------- ---------- -------
Schedule 8.1
------------
Indebtedness
------------
Schedule 8.5
------------
Existing Investments
--------------------
Schedule 11.1
-------------
Lenders and Addresses
Notice Address
--------------
NationsBank, N.A. NationsBank, N.A.
000 X. Xxxxx Xxxxxx
Independence Center, 15th Floor
Agency Services
Xxxxxxxxx, XX 00000
ATTN: Xxx Xxxxxx
with a copy to:
NationsBank, N.A.
Corporate Finance Group
0000 Xxxxxxxxx Xxxxx
XX0-000-00-00
Xxxxxxxx, XX 00000-0000
ATTN: Xxxxxxx X. Xxxxxxx
U.S. Bank National Association U.S. Bank National Association
0000 X. Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
ATTN: Xxxxxx X. Xxxxx
Schedule 11.3(b)
----------------
Form of Assignment and Acceptance
THIS ASSIGNMENT AND ACCEPTANCE dated as of , 199_ is entered into
between THE LENDER IDENTIFIED ON THE SIGNATURE PAGES AS THE "ASSIGNOR" (the
"Assignor") and THE PARTIES IDENTIFIED ON THE SIGNATURE PAGES AS "ASSIGNEES"
--------
("Assignee").
--------
Reference is made to that Credit Agreement dated as of June 9, 1998 (as
amended and modified, the "Credit Agreement") among NAVIGANT INTERNATIONAL,
----------------
INC., a Delaware corporation (the "Borrower"), the Guarantors and Lenders
--------
identified therein and NationsBank, N.A., as Administrative Agent. Terms defined
in the Credit Agreement are used herein with the same meanings.
1. The Assignor hereby sells and assigns, without recourse, to the
Assignees, and the Assignees hereby purchase and assume, without recourse, from
the Assignor, effective as of the Effective Date shown below, those rights and
interests of the Assignor under the Credit Agreement identified below (the
"Assigned Interests"), including the Obligations and Commitments relating
------------------
thereto, together with unpaid interest and fees relating thereto accruing from
the Effective Date. The Assignor represents and warrants that it owns interests
assigned hereby free and clear of liens, encumbrances or other claims. Each of
the Assignees represents that it is an Eligible Assignee within the meaning of
the term in the Credit Agreement. The Assignor and each of the Assignees hereby
makes and agrees to be bound by all the representations, warranties and
agreements set forth in Section 11.3 of the Credit Agreement, a copy of which
has been received by each such party. From and after the Effective Date (i) each
Assignee, if it is not already a Lender under the Credit Agreement, shall be a
party to and be bound by the provisions of the Credit Agreement and, to the
extent of the interests assigned by this Assignment and Acceptance, have the
rights and obligations of a Lender thereunder and (ii) each Assignor shall, to
the extent of the interests assigned by this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement (other than the rights of indemnification referenced in Section 11.9
of the Credit Agreement). Schedule 2.1(A) is deemed modified and amended to the
---------------
extent necessary to give effect to this Assignment.
2. This Assignment and Acceptance shall be governed by and construed
in accordance with the laws of the State of North Carolina.
3. Terms of Assignment
(a) Date of Assignment: _______________, 199__
(b) Legal Name of Assignor: SEE SIGNATURE PAGE
(c) Legal Name of Assignee: SEE SIGNATURE PAGE
(d) Effective Date of Assignment: ______________, 199__
See Schedule I attached for a description of the Loans and Obligations and
----------
Commitments (and the percentage interests therein and relating thereto) which
are the subject of this Assignment and Acceptance.
4. The fee payable to the Paying Agent in connection with this
Assignment is enclosed.
IN WITNESS WHEREOF, the parties hereto have caused the execution of
this instrument by their duly authorized officers as of the date first above
written.
ASSIGNOR: ASSIGNEE:
-------- --------
By:________________________ By:______________________
Name: Name:
Title: Title:
Address for Notices:
-------------------
ACKNOWLEDGMENT AND CONSENT
--------------------------
NATIONSBANK, N.A. NAVIGANT INTERNATIONAL, INC.
as Administrative Agent
By:________________________ By:______________________
Name: Name:
Title: Title:
SCHEDULE I
----------
TO ASSIGNMENT AND ACCEPTANCE
NAVIGANT INTERNATIONAL, INC.
REVOLVING LOANS PRIOR TO ASSIGNMENT
Revolving Revolving Revolving
Committed Commitment Loans
Amount Percentage Outstanding
------ ---------- -----------
ASSIGNOR
--------
ASSIGNEES
---------
-------------------- -------------------- --------------------
$ $
REVOLVING LOANS SUBJECT TO THIS ASSIGNMENT
Revolving Revolving Revolving
Committed Commitment Loans
Amount Percentage Outstanding
------ ---------- -----------
ASSIGNOR
--------
ASSIGNEES
---------
-------------------- -------------------- --------------------
$ $
SCHEDULE I
----------
TO ASSIGNMENT AND ACCEPTANCE
NAVIGANT INTERNATIONAL, INC.
REVOLVING LOANS AFTER ASSIGNMENT
Revolving Revolving Revolving
Committed Commitment Loans
Amount Percentage Outstanding
------ ---------- -----------
ASSIGNOR
--------
ASSIGNEES
---------
-------------------- -------------------- --------------------
--- --- ---
$ $
