SENIOR SUBORDINATED CREDIT AGREEMENT
dated as of
September 30, 1996
among
XXXXXXXX PUBLISHING COMPANY, L.L.C.,
as Borrower,
THE GUARANTORS named herein,
THE LENDERS named herein
and
FIRST UNION CORPORATION, as Agent
TABLE OF CONTENTS
Section Heading Page
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RECITALS.................................................................................. 1
SECTION 1 DEFINITIONS.................................................................... 1
1.1 Certain Defined Terms........................................................... 1
1.2 Accounting Terms................................................................ 31
1.3 Other Definitional Provisions; Construction..................................... 31
SECTION 2 AMOUNT AND TERMS OF LOAN COMMITMENT AND LOANS; NOTE............................. 31
2.1 Bridge Loan and Bridge Note..................................................... 31
A. Bridge Loan Commitment...................................................... 31
B. Notice of Borrowing......................................................... 31
C. Disbursement of Funds....................................................... 32
D. Bridge Notes................................................................ 32
E. Scheduled Payment of Bridge Loan............................................ 32
F. Termination of Bridge Loan Commitment....................................... 32
G. Pro Rata Borrowings......................................................... 32
2.2 Term Loan and Term Note......................................................... 33
A. Term Loan Commitment........................................................ 33
B. Notice of Conversion/Borrowing.............................................. 33
C. Making of Term Loan......................................................... 33
D. Maturity of Term Loan....................................................... 33
E. Term Notes.................................................................. 33
2.3 Interest on the Loans........................................................... 34
A. Rate of Interest............................................................ 34
B. Interest Payments........................................................... 35
C. PostMaturity Interest....................................................... 35
D. Computation of Interest..................................................... 35
2.4 Fees............................................................................ 36
2.5 Prepayments and Payments........................................................ 36
A. Prepayments................................................................. 36
B. Manner and Time of Payment.................................................. 38
C. Payments on NonBusiness Days................................................ 38
D. Notation of Payment......................................................... 38
2.6 Use of Proceeds................................................................. 38
A. Bridge Loan................................................................. 38
B. Term Loan................................................................... 39
C. Margin Regulations.......................................................... 39
SECTION 3 CONDITIONS..................................................................... 39
3.1 Conditions to Bridge Loan....................................................... 39
3.2 Conditions to Term Loan......................................................... 00
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Xxxxxxx Xxxxxxx Page
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SECTION 4 REPRESENTATIONS AND WARRANTIES................................................. 48
4.1 Corporate Organization and Power................................................ 48
4.2 Authorization; Enforceability................................................... 48
4.3 No Violation.................................................................... 49
4.4 Governmental Authorization; Permits............................................. 49
4.5 Litigation...................................................................... 50
4.6 Taxes........................................................................... 50
4.7 Subsidiaries.................................................................... 51
4.8 Full Disclosure................................................................. 51
4.9 Margin Regulations.............................................................. 51
4.10 Financial Matters.............................................................. 51
4.11 Ownership of Properties........................................................ 54
4.12 ERISA.......................................................................... 55
4.13 Environmental Matters.......................................................... 55
4.14 Compliance With Governing Documents, Decrees and Laws.......................... 57
4.15 Labor Relations................................................................ 57
4.16 Regulated Industries........................................................... 58
4.17 Insurance...................................................................... 58
4.18 Certain Contracts.............................................................. 58
4.19 Capitalization................................................................. 59
4.20 Transaction Documents.......................................................... 59
4.21 Broker's or Finder's Fees...................................................... 59
4.22 Guarantees..................................................................... 60
4.23 Senior Subordinated Indenture; Etc............................................. 60
SECTION 5 AFFIRMATIVE COVENANTS.......................................................... 61
5.1 Financial Statements............................................................ 61
5.2 Other Business and Financial Information........................................ 64
5.3 Existence; Franchise; Maintenance of Properties................................. 67
5.4 Compliance with Laws............................................................ 68
5.5 Payment of Obligations.......................................................... 68
5.6 Insurance....................................................................... 68
5.7 Maintenance of Books and Records; Inspection.................................... 68
5.8 Fiscal Year..................................................................... 69
5.9 Exchange of Term Notes.......................................................... 69
5.10 Payments in U.S. Dollars....................................................... 70
5.11 Register....................................................................... 70
5.12 Lenders Meeting................................................................ 71
5.13 Additional Guarantors.......................................................... 71
5.14 Permitted Acquisitions......................................................... 71
5.15 Creation or Acquisition of Subsidiaries......................................... 74
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Section Heading Page
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SECTION 6 NEGATIVE COVENANTS.............................................................. 75
6.1 Indebtedness.................................................................... 75
6.2 Liens........................................................................... 76
6.3 Restricted Payments............................................................. 79
6.4 Investments..................................................................... 80
6.5 Senior Subordinated Indebtedness................................................ 82
6.6 Merger; Consolidation........................................................... 82
6.7 Limitation on Certain Restrictions.............................................. 83
6.8 Transactions with Affiliates.................................................... 84
6.9 Permitted Lines of Business..................................................... 84
6.10 Amendments or Waivers of Certain Documents..................................... 85
6.11 Refinancing of the Loans in Part............................................... 85
6.12 Asset Dispositions............................................................. 85
SECTION 7 EVENTS OF DEFAULT.............................................................. 85
7.1 Failure To Make Payments When Due............................................... 85
7.2 Default in Other Agreements..................................................... 86
7.3 Breach of Certain Covenants..................................................... 86
7.4 Breach of Warranty.............................................................. 86
7.5 Other Defaults Under Agreement or Loan Documents................................ 86
7.6 Voluntary Bankruptcy; Appointment of Custodian, Etc............................. 86
7.7 Involuntary Bankruptcy; Appointment of Custodian................................ 87
7.8 Judgments and Attachments....................................................... 87
7.9 Dissolution..................................................................... 87
7.10 Guarantee...................................................................... 87
7.11 Foreclosure.................................................................... 88
SECTION 8 SUBORDINATION.................................................................. 89
8.1 Obligations Subordinated to Senior Indebtedness of the Borrower................. 89
8.2 Priority and Payment Over of Proceed in Certain Events.......................... 89
8.3 Payments May Be Paid Prior to Dissolution....................................... 92
8.4 Rights of Holders of Senior Indebtedness of the Borrower Not To Be Impaired..... 92
8.5 Subrogation..................................................................... 93
8.6 Obligations of the Borrower Unconditional....................................... 93
8.7 Lenders Authorize Agent To Effectuate Subordination............................. 94
SECTION 9 THE AGENT...................................................................... 95
9.1 Appointment..................................................................... 95
9.2 Delegation of Duties............................................................ 95
9.3 Exculpatory Provisions.......................................................... 95
9.4 Reliance by Agent............................................................... 96
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Section Heading Page
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9.5 Notice of Default.............................................................. 97
9.6 Non-Reliance on Agent and Other Lenders........................................ 97
9.7 Indemnification................................................................ 98
9.8 Agent in Its Individual Capacity............................................... 98
9.9 Resignation of the Agent; Successor Agent...................................... 98
SECTION 10 GUARANTEE.................................................................... 99
10.1 Unconditional Guarantee....................................................... 99
10.2 Subordination of Guarantee.................................................... 100
10.3 Severability.................................................................. 100
10.4 Release of a Guarantor........................................................ 100
10.5 Limitation of Guarantor's Liability........................................... 101
10.6 Guarantors May Consolidate, etc., on Certain
Term.......................................................................... 101
10.7 Contribution.................................................................. 102
10.8 Waiver of Subrogation......................................................... 102
10.9 Evidence of Guarantee......................................................... 103
10.10 Waiver of Stay, Extension or Usury Laws...................................... 103
10.11 Guarantor Covenant........................................................... 103
SECTION 11 SUBORDINATION OF GUARANTEE OBLIGATIONS....................................... 104
11.1 Guarantee Obligations Subordinated to Senior
Indebtedness.................................................................. 104
11.2 Priority and Payment Over of Proceeds in Certain
Events........................................................................ 104
11.3 Payments May Be Paid Prior to Dissolution..................................... 107
11.4 Rights of Holders of Guarantor Senior Indebtedness
Not To Be Impaired............................................................. 107
11.5 Subrogation................................................................... 108
11.6 Obligations of the Guarantors Unconditional................................... 108
11.7 Lenders Authorize Agent to Effectuate
Subordination................................................................. 109
SECTION 12 MISCELLANEOUS................................................................ 110
12.1 Representation of the Lenders................................................. 110
12.2 Participations in and Assignments of Loans and
Notes......................................................................... 110
12.3 Fees and Expenses............................................................. 112
12.4 Indemnity..................................................................... 113
12.5 Setoff........................................................................ 113
12.6 Amendments and Waivers........................................................ 114
12.7 Independence of Covenants..................................................... 115
12.8 Entirety...................................................................... 115
12.9 Notices....................................................................... 115
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Section Heading Page
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12.10 Survival of Warranties and Certain Agreements................................ 116
12.11 Failure or Indulgence Not Waiver; Remedies Cumulative........................ 116
12.12 Severability................................................................. 116
12.13 Headings..................................................................... 116
12.14 Applicable Law............................................................... 117
12.15 Successors and Assigns; Subsequent Holders of Notes.......................... 117
12.16 Counterparts; Effectiveness.................................................. 117
12.17 Consent to Jurisdiction; Venue; Waiver of Jury Trial......................... 117
12.18 Payments Pro Rata............................................................ 118
12.19 Taxes........................................................................ 119
12.20 Replacement of Lenders....................................................... 121
12.21 Waiver of Stay, Extension or Usury Laws...................................... 122
12.22 Requirements of Law.......................................................... 122
12.23 Confidentiality.............................................................. 123
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SCHEDULES
A EXISTING LIENS
B CONSOLIDATED OPERATING CASH FLOW
C CONSENTS AND APPROVALS
D TAXES
E LEASES
F INSURANCE
G CERTAIN CONTRACTS
H CAPITAL STOCK
I INVESTMENTS
J TRANSACTIONS WITH AFFILIATES
EXHIBITS
I FORM OF BRIDGE NOTE
II FORM OF TERM NOTE
III FORM OF COMPLIANCE CERTIFICATE
IV-A FORM OF NOTICE OF BORROWING
IV-B FORM OF NOTICE OF CONVERSION
V TERM SHEET FOR REGISTRATION RIGHTS AGREEMENT AND SENIOR SUBORDINATED
INDENTURE
VII FORM OF OPINION OF XXXXXXXX & XXXXX - COUNSEL FOR THE
BORROWER AND THE GUARANTORS
VIII FORM OF OPINION OF XXXXXX XXXXXX & XXXXXXX - COUNSEL
FOR THE LENDERS
IX FORM OF NOTATION OF GUARANTEE
X FORM OF FINANCIAL CONDITION CERTIFICATE
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This Senior Subordinated Credit Agreement is dated as of September 30,
1996, and entered into by and among Xxxxxxxx Publishing Company, L.L.C., a
Delaware limited liability corporation with its principal offices in Los
Angeles, California (the "Borrower"), the Guarantors named on the signature
pages hereto, the Lenders named on the signature pages hereto (the "Lenders")
and First Union Corporation ("First Union"), as agent for the Lenders (in such
capacity, the "Agent").
RECITALS
WHEREAS, the Borrower is owned by Xxxxxxxx Holdings, L.L.C., a
Delaware limited liability company ("Holdings"), which holds a 99.9% managing
membership interest in the Borrower), and by BrightView Communications Group,
Inc., a Delaware corporation ("BrightView"), which holds a 0.1% passive
membership interest in the Borrower.
WHEREAS, the Borrower proposes to acquire from Xxxxxxxx Publishing
Company, a California corporation ("Xxxxxxxx"), the assets and certain
liabilities relating to Xxxxxxxx'x publishing and media businesses (the
"Xxxxxxxx Acquisition"), pursuant to an Asset Purchase Agreement, dated as of
August 15, 1996, by and between BrightView and Xxxxxxxx (as amended, modified or
supplemented from time to time in accordance with the terms of this Agreement,
the "Asset Purchase Agreement").
WHEREAS, the Borrower desires that the Lenders extend a senior
subordinated credit facility to the Borrower in connection with the Xxxxxxxx
Acquisition (as defined herein);
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereby agree as follows:
SECTION 1 DEFINITIONS
1.1 Certain Defined Terms. The following terms used in this
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Agreement shall have the following meanings:
"Acquisition" shall mean any transaction or series of related
transactions, consummated on or after the date hereof, by
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which the Borrower directly, or indirectly through one or more Subsidiaries, (i)
acquires any ongoing business, any publication or brand name and the related
rights and assets, or all or substantially all of the assets, of any Person,
whether through purchase of assets, merger or otherwise, or (ii) acquires
securities or other ownership interests of any Person having at least a majority
of combined voting power of the then outstanding securities or other ownership
interests of such Person.
"Acquisition Amount" shall mean, with respect to any Acquisition, the
sum (without duplication) of (i) the amount of cash paid by the Borrower and its
Subsidiaries in connection with such Acquisition, (ii) the Fair Market Value of
all Capital Stock of the Borrower issued or given in connection with such
Acquisition, (iii) the amount (determined by using the face amount or the amount
payable at maturity, whichever is greater) of all Indebtedness incurred, assumed
or acquired by the Borrower and its Subsidiaries in connection with such
Acquisition, (iv) all additional purchase price amounts in connection with such
Acquisition in the form of earnouts and other contingent obligations that should
be recorded as a liability on the balance sheet of the Borrower and its
Subsidiaries or expensed, in either event in accordance with GAAP, Regulation S-
X under the Securities Act of 1933, as amended, or any other rule or regulation
of the Securities and Exchange Commission, (v) all amounts paid in respect of
covenants not to compete, consulting agreements and other affiliated contracts
in connection with such Acquisition, (vi) the amount of all transaction fees and
expenses (including, without limitation, legal, accounting and finders' fees and
expenses) incurred by the Borrower and its Subsidiaries in connection with such
Acquisition and (vii) the aggregate fair market value of all other consideration
given by the Borrower and its Subsidiaries in connection with such Acquisition.
"Adjusted Net Assets" shall have the meaning provided in SECTION 10.7.
"Affiliate" shall mean, as to any Person, each other Person that
directly, or indirectly through one or more
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intermediaries, owns or controls, is controlled by or under common control with,
such Person or is a director or officer of such Person. For purposes of this
definition, with respect to any Person "control" shall mean (i) the possession,
direct or indirect, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities, by contract or otherwise, or (ii) the beneficial ownership of
securities or other ownership interests of such Person having 10% or more of the
combined voting power of the then outstanding securities or other ownership
interests of such Person ordinarily (and apart from rights accruing under
special circumstances) having the right to vote in the election of directors or
other governing body of such Person; provided that none of First Union, CIBC or
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any of their respective Affiliates shall be treated as an Affiliate of the
Borrower or of any Subsidiary of the Borrower.
"Agent" has the meaning ascribed to such term in the introduction to
this Agreement.
"Agreement" means this Senior Subordinated Credit Agreement dated as
of September 30, 1996, as it may be amended, supplemented or otherwise modified
from time to time in accordance with the terms hereof.
"Applicable Interest Rate" means (i) for each Quarterly Period prior
to the Conversion Date, the Applicable Prime Rate then in effect and (ii) for
each Quarterly Period on and after the Conversion Date, the greatest of, as of
the Interest Rate Determination Date, (a) the Applicable Prime Rate then in
effect, (b) the Applicable LIBOR Rate then in effect and (c) the Application
Treasury Rate then in effect in each case as determined on the applicable
Interest Rate Determination Date; provided, however, that in no event shall the
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Applicable Interest Rate exceed 18% per annum.
"Applicable LIBOR Rate" means (i) an interest rate per annum equal to
the rate of interest appearing on Telerate Page 3750 (or any successor page) or
if no such rate is available, or at the
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option of the Agent in any event, the rate of interest determined by the Agent
to be the rate or the arithmetic mean of rates (rounded upward, if necessary, to
the nearest 1/16 of one percentage point) at which Dollar deposits in
immediately available funds are offered by First Union to first-tier banks in
the London interbank Eurodollar market, at approximately 11:00 a.m., London
time, on the Interest Rate Determination Date for a 3-month period at the amount
of the Loans outstanding plus (ii) the Applicable LIBOR Rate Spread.
"Applicable LIBOR Rate Spread" means 8.50% per annum for the period
from and including the Conversion Date to but excluding the 90th day following
the Conversion Date and for each subsequent 90-day period the Applicable LIBOR
Rate Spread in effect for the immediately preceding 90-day period plus .50% per
annum.
"Applicable Prime Rate" means (i) the rate which First Union
Corporation announces from time to time as its prime lending rate, the
Applicable Prime Rate to change when and as such prime lending rate changes,
plus (ii) the Applicable Prime Rate Spread. The Applicable Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. First Union Corporation or its affiliates may
make commercial loans or other loans at rates of interest at, above or below the
Applicable Prime Rate.
"Applicable Prime Rate Spread" means 4.25% per annum for the period
from and including the Closing Date to but excluding the 90th day following the
Closing Date and for each subsequent 90-day period the Applicable Prime Rate
Spread in effect for the immediately preceding 90-day period plus .50% per
annum.
"Applicable Treasury Rate" means (i) the rate equal to the yield
(expressed as a rate per annum) in the secondary market on United States
Treasury securities of substantially the same principal amount as the Loans and
having a term to maturity of (a) one year, (b) three years, (c) five years and
(d) ten years, whichever of (a), (b), (c) and (d) has the greatest yield as of
the Interest Rate Determination Date (the determination of yield to be
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based upon quotes obtained by the Agent from at least two established dealers in
such market), plus (ii) the Applicable Treasury Rate Spread.
"Applicable Treasury Rate Spread" means 8.50% per annum for the period
from and including the Conversion Date to but excluding the 90th day following
the Conversion Date and for each subsequent 90-day period the Applicable
Treasury Rate Spread for the immediately preceding 90-day period plus .50% per
annum.
"Asset Disposition" shall mean any sale, assignment, lease,
conveyance, transfer or other disposition (whether in one or a series of
transactions) of all or any portion of its assets, business or properties
(including, without limitation, any Capital Stock of any Subsidiary), or enter
into any arrangement with any Person providing for the lease by the Borrower or
any of its Subsidiaries as lessee of any asset that has been sold or transferred
by the Borrower or such Subsidiary to such Person, or agree to do any of the
foregoing, except for:
(i) sales of inventory and other assets and licenses or leases
of intellectual property, in each case in the ordinary course of
business;
(ii) the sale or exchange of used or obsolete equipment to the
extent (y) the proceeds of such sale are applied towards, or such
equipment is exchanged for, replacement equipment or (z) such
equipment is no longer necessary for the operations of the Borrower or
its applicable Subsidiary in the ordinary course of business;
(iii) the sale or other disposition of any or all right, title and
interest of the Borrower and its Subsidiaries in and to the assets and
properties (other than cash) directly associated with the publications
listed in SCHEDULE 8.4 to the Senior Credit Facility (such assets and
properties, collectively, the "Scheduled Titles"), and the sale or
other disposition of any Investments made by the contribution of any
of the
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Scheduled Titles to a joint venture, partnership or other
Person (which may be a Subsidiary) as permitted by clause (xi) of
SECTION 6.4, in each case provided that, in the good faith judgment of
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the Borrower, fair value is received in exchange for such sale or
other disposition; and
(iv) the sale, lease or other disposition of assets by a
Subsidiary of the Borrower to the Borrower or to another Wholly Owned
Subsidiary if, immediately after giving effect thereto, no Potential
Event Default or Event of Default would exist.
"Asset Purchase Agreement" shall have the meaning given such term in
the recitals hereof.
"Bankruptcy Code" shall mean 11 U.S.C. (S)(S) 101 et seq., as amended
-- ----
from time to time, and any successor statute.
"Board of Directors" means, with respect to any Person, the Board of
Directors of such Person or any duly authorized committee of that Board.
"Borrower" has the meaning ascribed to such term in the introduction
to this Agreement.
"Bridge Loan" means, collectively, the loans made by the Lenders
pursuant to SECTION 2.1A.
"Bridge Loan Commitment" means the commitment of the Lenders to make
the Bridge Loan as set forth in Section 2.1A.
"Bridge Notes" has the meaning ascribed to such term in SECTION 2.1D.
"Business Day" shall mean (i) any day other than a Saturday or Sunday,
a legal holiday or a day on which commercial banks in New York, New York or Los
Angeles are required by law to be closed and (ii) in respect of any
determination relevant to a
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LIBOR Loan, any such day that is also a day on which trading in U.S. Dollars is
conducted in the London interbank Eurodollar market.
"Capital Lease," as applied to any Person, means any lease of any
property (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is required to be accounted for as a capital lease on the
balance sheet of that Person.
"Capital Stock" shall mean (i) with respect to any Person that is a
corporation, any and all shares, interests or equivalents in corporate stock
(whether voting or nonvoting, and whether common or preferred) of such
corporation, and (ii) with respect to any Person that is not a corporation, any
and all partnership, membership, limited liability company or other equity
interests of such Person; and in each case, any and all warrants or options to
purchase any of the foregoing.
"Capitalized Lease Obligation" means obligations under a Capital
Lease, and the amount of Indebtedness represented by such obligations shall be
the capitalized amount of such obligations determined in accordance with GAAP.
"Cash Equivalents" shall mean (i) securities issued or unconditionally
guaranteed by the United States of America or any agency or instrumentality
thereof, backed by the full faith and credit of the United States of America and
maturing within one year from the date of acquisition, (ii) commercial paper
issued by any Person organized under the laws of the United States of America,
maturing within 270 days from the date of acquisition and, at the time of
acquisition, having a rating of at least A-1 or the equivalent thereof by
Standard & Poor's Ratings Services or at least P-1 or the equivalent thereof by
Xxxxx'x Investors Service, Inc., (iii) time deposits and certificates of deposit
maturing within one year from the date of issuance and issued by a bank or trust
company organized under the laws of the United States of America or any state
thereof that has combined capital and surplus of at least $500,000,000 and that
has (or is a subsidiary of a bank
-8-
holding company that has) a long-term unsecured debt rating of at least A or the
equivalent thereof by Standard & Poor's Rating Services or at least A2 or the
equivalent thereof by Xxxxx'x Investors Service, Inc., (iv) repurchase
obligations with a term not exceeding seven (7) days with respect to underlying
securities of the types described in clause (i) above entered into with any bank
or trust company meeting the qualifications specified in clause (iii) above, and
(v) money market funds at least 95% of the assets of which are continuously
invested in securities of the type described in clause (i) above.
"Cash Proceeds" means, with respect to any Asset Disposition, cash
payments (including any cash received by way of deferred payment pursuant to, or
monetization of, a note receivable or otherwise but only as and when so
received) received from such Asset Disposition.
"Change of Control" means the occurrence of one or more of the
following events: (i) Holdings and BrightView collectively shall cease to own
all of the outstanding Capital Stock of the Borrower; (ii) prior to a Qualified
IPO, (x) Holdings shall cease to be the managing member of the Borrower or shall
otherwise cease to have the sole right and authority to exercise control over
the management of Borrower; (y) BrightView shall cease to be the managing member
of Holdings or shall otherwise cease to have the sole right and authority to
exercise control over the management of Holdings; (z) Xxxxxx Xxxxx shall cease
to have the power (regardless of whether such power is exercised) to elect a
majority of the Board of Directors of BrightView; (iii) in connection with or
subsequent to a Qualified IPO, any Person or group of Persons acting in concert
as a partnership or other group (other than the Permitted Holders) shall, as a
result of a tender or exchange offer, open market purchases, privately
negotiated purchases or otherwise, have become, after the date hereof, the
"beneficial owner" (within the meaning of such term under Rule 13d-3 under the
Exchange Act) of securities of Holdings or BrightView or such successor entity
representing 20% or more of the combined voting power of the then outstanding
securities of Holdings or BrightView or such successor entity, as the case may
be, ordinarily (and apart
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from rights accruing under special circumstances) having the right to vote in
the election of directors, managers or other members of its governing body.
"CIBC" shall mean Canadian Imperial Bank of Commerce.
"Closing Date" means the date on or before October 18, 1996 on which
the Original Bridge Loan is made.
"Commission" means the Securities and Exchange Commission or any
successor thereto.
"Commitment Letter" means the letter agreement dated August 8, 1996,
between Xxxxxx Xxxxx & Partners, L.P. and First Union pursuant to which First
Union and CIBC committed to provide the Bridge Loan to the Borrower, subject to
the terms and conditions thereof, and the Borrower committed to pay First Union
certain fees and to satisfy certain other obligations to First Union in respect
of such commitments.
"Commodity Hedge Agreement" shall mean any option, hedge or other
similar agreement or arrangement designed to protect against fluctuations in
commodity or materials prices.
"Common Stock" of any Person means any and all shares, interests or
other participations in, and other equivalents (however designated and whether
voting or non-voting) of, such Person's common stock including common membership
interests in a limited liability company, whether outstanding on the Closing
Date or issued after the Closing Date, and includes, without limitation, all
series and classes of such common stock.
"Compliance Certificate" means a certificate substantially in the form
of EXHIBIT III delivered to the Agent by the Borrower pursuant to SECTION
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5.2(A).
"Contested Claim" means any Tax, Indebtedness or other claim or
liability (i) the validity or amount of which is being diligently contested in
good faith, (ii) for which adequate
-10-
reserve, or other appropriate provision, if any, as required in conformity with
GAAP shall have been made, and (iii) with respect to which any right to execute
upon or sell any assets of the Borrower or of any of its Subsidiaries has not
matured or has been and continues to be effectively enjoined, superseded or
stayed.
"Contingent Obligation" shall mean, with respect to any Person, any
direct or indirect liability of such Person with respect to any Indebtedness,
liability or other obligation (the "primary obligation") of another Person (the
"primary obligor"), whether or not contingent, (a) to purchase, repurchase or
otherwise acquire such primary obligation or any property constituting direct or
indirect security therefor, (b) to advance or provide funds (i) for the payment
or discharge of any such primary obligation or (ii) to maintain working capital
or equity capital of the primary obligor or otherwise to maintain the net worth
or solvency or any balance sheet item, level of income or financial condition of
the primary obligor, (c) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor in respect thereof to make payment of such
primary obligation or (d) otherwise to assure or hold harmless the owner of any
such primary obligation against loss or failure or inability to perform in the
respect thereof; provided, however, that, with respect to the Borrower and its
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Subsidiaries, the term Contingent Obligation shall not include endorsements for
collection or deposit in the ordinary course of business.
"Contractual Obligation", as applied to any Person, means any
provision of any Security issued by that Person or of any indenture, mortgage,
deed of trust, contract, undertaking, agreement or other instrument to which
that Person is a party or by which it or any of its properties is bound or to
which it or any of its properties is subject.
"Controlled Group" means (i) a controlled group of corporations as
defined in Section 1563(a) of the Internal Revenue Code or (ii) a group of
trades or businesses under common control, as defined in Section 414(c) of the
Internal Revenue Code, of which
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the Borrower or any of its Subsidiaries is a part or becomes a part.
"Conversion Date" means the one year anniversary of the Closing Date
or such later date to which the Conversion Date may be deferred pursuant to
SECTION 3.2D.
"Covered Taxes" has the meaning ascribed to it in SECTION 12.19.
"Credit Party" shall mean any of the Borrower, any of its
Subsidiaries, Holdings and BrightView.
"Currency Agreement" means any foreign exchange contract, currency
swap agreement, futures contract, option contract, synthetic cap or other
similar agreement or arrangement designed to protect Borrower or any of its
Subsidiaries against fluctuations in currency values.
"Custodian" means any receiver, interim receiver, receiver and
manager, trustee, assignee, liquidator, sequestrator or similar official charged
with maintaining possession or control over property for one or more creditors,
whether under any Bankruptcy Law or otherwise.
"Designated Non-Guarantor Subsidiary" shall mean (i) any Foreign
Subsidiary, (ii) a Subsidiary formed by the Borrower solely to become a co-
issuer of the Take-Out Securities and that has no assets (other than nominal
capitalization) and conducts no business other than the performance of its
obligation with regard to such Take-Out Securities or (iii) any other Subsidiary
of the Borrower that is not a Wholly Owned Subsidiary and that has elected, by
written notice to the Agent given not less than ten (10) Business Days after the
creation or acquisition thereof by the Borrower or any other Subsidiary, not to
become a guarantor under a Guarantee.
"Disqualified Capital Stock" means, with respect to any Person, any
Capital Stock of such Person that, by its terms (or by the terms of any security
into which it is convertible or for which
-12-
it is exchangeable), or upon the happening of any event or otherwise, (i)
matures or is mandatorily redeemable or subject to any mandatory repurchase
requirement, pursuant to a sinking fund obligation or otherwise, (ii) is
redeemable or subject to any mandatory repurchase requirement at the sole option
of the holder thereof, or (iii) is convertible into or exchangeable for (whether
at the option of the issuer or the holder thereof) (a) debt securities or (b)
any Capital Stock referred to in (i) or (ii) above, in each case under (i), (ii)
or (iii) above at any time on or prior to the Maturity Date; provided, however,
-------- -------
that only the portion of Capital Stock that so matures or is mandatorily
redeemable, is so redeemable at the option of the holder thereof, or is so
convertible or exchangeable on or prior to such date shall be deemed to be
Disqualified Capital Stock.
"Dollars" or the sign "$" means the dollars of the United States of
America.
"Eligible Assignee" means (A) (i) a commercial bank organized under
the laws of the United States of America or any state thereof; (ii) a savings
and loan association or savings bank organized under the laws of the United
States or any state thereof; (iii) a commercial bank organized under the laws of
any other country or a political subdivision thereof; provided that (x) such
--------
bank is acting through a branch or agency located in the United States or (y)
such bank is organized under the laws of a country that is a member of the
Organization for Economic Cooperation and Development or a political subdivision
of such country; and (iv) any other entity which is an "accredited investor" (as
defined in Regulation D under the Securities Act of 1933) which extends credit
or buys loans as one of its businesses including, but not limited to, insurance
companies, mutual funds and lease financing companies, in each case (under
clauses (i) through (iv) above) that is reasonably acceptable to the Agent; and
(B) any Lender and any Affiliate of any Lender.
"Employee Benefit Plan" means any "employee benefit plan" as defined
in Section 3(3) of ERISA (i) which is, or, at any time within the five calendar
years immediately preceding the date
-13-
hereof, was at any time, maintained or contributed to by the Borrower or its
Subsidiaries or any of their respective ERISA Affiliates or (ii) with respect to
which the Borrower or its Subsidiaries retains any liability, including any
potential joint and several liability as a result of an affiliation with an
ERISA Affiliate or a party that would be an ERISA Affiliate except for the fact
the affiliation ceased more than five calendar years prior to the date hereof.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
accusations, allegations, notices of noncompliance or violation, investigations
(other than internal reports prepared by any Person in the ordinary course of
its business and not in response to any third party action or request of any
kind) or proceedings relating in any way to any actual or alleged violation of a
liability under any Environmental Law or relating to any permit issued, or any
approval given, under any such Environmental Law (collectively, "Claims"),
including, without limitation, (i) any and all Claims by Governmental
Authorities for enforcement, cleanup, removal, response, remedial or other
actions or damages pursuant to any applicable Environmental Law and (ii) any and
all Claims by any third party seeking damages, contribution, indemnification,
cost recovery, compensation or injunctive relief resulting from Hazardous
Substances or arising from alleged injury or threat of injury to human health or
the environment.
"Environmental Laws" shall mean any and all federal, state and local
laws, statutes, ordinances, rules, regulations, permits, licenses, approvals,
rules of common law and orders of courts or Governmental Authorities, relating
to the protection of human health or occupational safety or the environment, now
or hereafter in effect and in each case as amended from time to time, including,
without limitation, requirements pertaining to the manufacture, processing,
distribution, use, treatment, storage, disposal, transportation, handling,
reporting, licensing, permitting, investigation or remediation of Hazardous
Substances.
-14-
"Environmental Lien" means a Lien in favor of a Tribunal or other
Person (i) for any liability under an Environmental Law or (ii) for damages
arising from or costs incurred by such Tribunal or other Person in response to a
release or threatened release of hazardous or toxic waste, substance or
constituent into the environment.
"Equity Financing" shall mean the contribution to the capital of
BrightView and Holdings effected pursuant to the sale of BrightView's and
Holdings' Capital Stock pursuant to the Securities Purchase Agreement, as
defined in the Senior Credit Facility.
"Equity Financing Documents" shall mean each of the documents related
to the consummation of the Equity Financing.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute and all rules and
regulations from time to time promulgated thereunder.
"ERISA Affiliate" shall mean any Person (including any trade or
business, whether or not incorporated) that would be deemed to be under "common
control" with, or a member of the same "controlled group" as, the Borrower or
any of its Subsidiaries, within the meaning of Section 414(b), (c), (m) or (o)
of the Internal Revenue Code or Section 4001 of ERISA.
"ERISA Event" shall mean any of the following with respect to a Plan
or Multiemployer Plan, as applicable: (i) a Reportable Event with respect to a
Plan or a Multiemployer Plan, (ii) a complete or partial withdrawal by the
Borrower or any ERISA Affiliate from a Multiemployer Plan that results in
liability under Section 4201 or 4204 of ERISA, or the receipt by the Borrower or
any ERISA Affiliate of notice from a Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA or that
it intends to terminate or has terminated under Section 4041A of ERISA, (iii)
the distribution by the Borrower or any ERISA Affiliate under Section 4041 or
4041A of ERISA of a notice of intent to terminate any Plan or the taking of any
action
-15-
to terminate any Plan, (iv) the commencement of proceedings by the PBGC under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by the Borrower or any ERISA Affiliate of a
notice from any Multiemployer Plan that such action has been taken by the PBGC
with respect to such Multiemployer Plan, (v) the institution of a proceeding by
any fiduciary of any Multiemployer Plan against the Borrower or any ERISA
Affiliate to enforce Section 515 of ERISA, which is not dismissed within thirty
(30) days, (vi) the imposition upon the Borrower or any ERISA Affiliate of any
liability under Title IV of ERISA, other than for PBGC premiums due but not
delinquent under Section 4007 of ERISA, or the imposition or threatened
imposition of any Lien upon any asset of the Borrower or any ERISA Affiliate as
a result of any alleged failure to comply with the Internal Revenue Code or
ERISA in respect of any Plan, (vii) the engaging in or otherwise becoming liable
for a nonexempt Prohibited Transaction by the Borrower or any ERISA Affiliate,
(viii) a violation of the applicable requirements of Section 404 or 405 of ERISA
or the exclusive benefit rule under Section 401(a) of the Internal Revenue Code
by any fiduciary of any Plan for which the Borrower or any of its ERISA
Affiliates may be directly or indirectly liable or (ix) the adoption of an
amendment to any Plan that, pursuant to Section 401(a)(29) of the Internal
Revenue Code or Section 307 of ERISA, would result in the loss of tax-exempt
status of the trust of which such Plan is a part if the Borrower or an ERISA
Affiliate fails to timely provide security to such Plan in accordance with the
provisions of such sections.
"Event of Default" means each of the events set forth in SECTION 7.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and any successor statute and all rules and regulations from
time to time promulgated thereunder.
"Exchange Notes" has the meaning ascribed to it in SECTION 5.9(II).
-16-
"Exchange Request" has the meaning ascribed to it in SECTION 5.9.
"Facilities" means any and all real property (including, without
limitation, all buildings, fixtures or other improvements located thereon) now,
hereafter or heretofore owned, leased, operated or used by the Borrower, its
Subsidiaries or any of their respective predecessors in interest.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate equal for each day during such period to the weighted average of the rates
on overnight Federal Funds transactions with members of the Federal Reserve
System arranged by Federal Funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal Funds brokers of
recognized standing selected by the Agent.
"Financial Condition Certificate" shall mean a financial condition
certificate, substantially in the form of EXHIBIT X, duly executed by a
Financial Officer of the Borrower.
"Financial Officer" shall mean, with respect to the Borrower, the
chief financial officer, vice president - finance, principal accounting officer
or treasurer of the Borrower.
"Fixed Rate" has the meaning ascribed to it in SECTION 2.3(A)(II).
"Fixed Rate Loan Redemption Price" shall mean the redemption price
(expressed as a percentage of principal amount) equal to 100% of the aggregate
principal amount of the Fixed Rate Loans plus (i) for any redemptions on or
after September 30, 2002 and prior to October 1, 2003, 50% of the interest rate
borne by the Fixed Rate Loans, (ii) for any redemptions on or after September
30, 2003 and prior to October 1, 2004, 33.3% of the interest rate borne by the
Fixed Rate Loans and (iii) for any redemptions on or
-17-
after September 30, 2004 and prior to October 1, 2005, 16.7% of the interest
rate borne by the Fixed Rate Loans. For any redemptions on or after September
30, 2005, the Fixed Rate Loan Redemption Price shall mean 100% of the aggregate
principal amount thereof.
"Fixed Rate Loans" means Loans described in SECTION 2.3A(II).
"Floating Rate Loans" means Loans described in SECTION 2.3A(I).
"Foreign Subsidiary" shall mean any Subsidiary of the Borrower that is
organized under the laws of any nation, state or jurisdiction other than the
United States of America or any state thereof.
"Funded Debt" shall mean any Indebtedness other than (i) Indebtedness
arising under Interest Rate Protection Agreements or Commodity Hedge Agreements
and (ii) accrued expenses, current trade or other accounts payable (it being
understood that such expenses and accounts payable that are 90 days or more past
due (except to the extent such items are being disputed by the obligor on
reasonable grounds and in good faith) shall be considered to be "Funded Debt")
and other current liabilities arising in the ordinary course of business and not
incurred through the borrowing of money.
"Funding Guarantor" has the meaning ascribed to it in SECTION 10.7.
"GAAP" shall mean generally accepted accounting principles, as set
forth in the statements, opinions and pronouncements of the Accounting
Principles Board, the American Institute of Certified Public Accountants and the
Financial Accounting Standards Board (or, to the extent not so set forth in such
statements, opinions and pronouncements, as generally followed by entities
similar in size to the Borrower and engaged in generally similar lines of
business), consistently applied and maintained and in conformity with those used
in the preparation of
-18-
the most recent financial statements of Xxxxxxxx referred to in SECTION 4.10(A).
"Guarantee Obligations" has the meaning ascribed to it in SECTION
11.1.
"Guarantees" means, collectively, the guarantees delivered to the
Lenders by the Guarantors pursuant to SECTION 10 which are evidenced by
notations of guarantee substantially in the form of EXHIBIT IX.
----------
"Guarantor Payment Blockage Period" has the meaning ascribed to it in
SECTION 11.2(B).
"Guarantor Senior Indebtedness" means, with respect to any Guarantor,
the principal of, premium, if any, and interest on, and all amounts payable in
respect of, all obligations of every nature of such Guarantor from time to time
owed to the lenders under the Senior Credit Facility, including, without
limitation, all obligations with respect to letters of credit and principal of
and interest on, and all fees, indemnities and expenses payable under, the
Senior Credit Facility and all obligations under Interest Rate Protection
Agreements entered into with lenders under the Senior Credit Facility and their
respective Affiliates and any guarantees thereof. Without limiting the
generality of the foregoing, "Guarantor Senior Indebtedness" shall include
interest accruing thereon subsequent to the occurrence of any Event of Default
specified in SECTIONS 7.6 and 7.7 relating to the Guarantors, whether or not the
claim for such interest is allowed under any applicable Bankruptcy Law.
Notwithstanding the foregoing, "Guarantor Senior Indebtedness" shall not include
that portion of any Indebtedness which is incurred by such Guarantor in
violation of this Agreement.
"Guarantors" has the meaning ascribed to such term in the introduction
to this Agreement.
"Governmental Authority" shall mean any nation or government, any
state or other political subdivision thereof and
-19-
any central bank thereof, any municipal, local, city or county government, and
any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any corporation or
other entity owned or controlled, through stock or capital ownership or
otherwise, by any of the foregoing.
"Hazardous Substances" shall mean any substances or materials (i) that
are or become defined as hazardous wastes, hazardous substances, pollutants,
contaminants or toxic substances under any Environmental Law, (ii) that are
defined by any Environmental Law as toxic, explosive, corrosive, ignitable,
infectious, radioactive, mutagenic or otherwise hazardous, (iii) that constitute
a nuisance, trespass or health or safety hazard to Persons or neighboring
properties, or (iv) that contain, without limitation, asbestos, polychlorinated
biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum
derived substances or wastes, crude oil, nuclear fuel, natural gas or synthetic
gas.
"High Yield Notes" shall mean the securities to be issued in the
contemplated offering for the purpose of redeeming the Bridge Notes or the Term
Notes, as the case may be.
"Holdings" shall have the meaning given to such term in the recitals
hereof.
"Indebtedness" shall mean, with respect to any Person (without
duplication), (i) all indebtedness, obligations and liabilities of such Person
for borrowed money or in respect of loans or advances (including, in the case of
the Borrower, pay-in-kind interest, if any, on Indebtedness permitted under
clause (iii) of SECTION 6.1), (ii) all obligations of such Person evidenced by
notes, bonds, debentures or similar instruments, (iii) all reimbursement
obligations of such Person with respect to surety bonds, letters of credit and
bankers' acceptances (in each case, whether or not drawn or matured and in the
stated amount thereof), (iv) all obligations of such Person to pay the deferred
purchase price of property or services, (v) all indebtedness
-20-
created or arising under any conditional sale or other title retention agreement
with respect to property acquired by such Person, (vi) all obligations of such
Person as lessee under leases that are or are required to be, in accordance with
GAAP, recorded as capital leases, to the extent such obligations are required to
be so recorded, (vii) all Disqualified Capital Stock issued by such Person with
the amount of Indebtedness represented by such Disqualified Capital Stock being
equal to the greater of its voluntary or involuntary liquidation preference and
its maximum fixed repurchase price, but excluding accrued dividends, if any (for
purposes hereof, the "maximum fixed repurchase price" of any Disqualified
Capital Stock which does not have a fixed repurchase price shall be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Agreement, and if such price
is based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value to be determined reasonably and in good
faith by the board of directors or other governing body of the issuer of such
Disqualified Capital Stock), (viii) the net termination obligations of such
Person under any Interest Rate Protection Agreements or Commodity Hedge
Agreements, calculated as of any date as if such agreement or arrangement were
terminated as of such date, (ix) all Contingent Obligations of such Person and
(x) all indebtedness referred to in clauses (i) through (ix) above secured by
any Lien on any property or asset owned or held by such Person regardless of
whether the indebtedness secured thereby shall have been assumed by such Person
or is nonrecourse to the credit of such Person.
"Indemnified Liabilities" has the meaning ascribed to such term in
SECTION 12.4.
"Indemnitees" has the meaning ascribed to such term in SECTION 12.4.
"Independent Financial Advisor" means a firm (i) which does not, and
whose directors, officers and employees or Affiliates do not, have a direct or
indirect financial interest in the
-21-
Borrower and (ii) which, in the judgment of the Board of Directors of the
Borrower, is otherwise independent and qualified to perform the task for which
it is to be engaged.
"Intellectual Property" means all patents, trademarks, tradenames,
copyrights, technology, know-how and processes used in or necessary for the
conduct of the business of the Borrower as currently conducted that are material
to the condition (financial or otherwise), business, operations or prospects of
the Borrower and its Subsidiaries, taken as a whole.
"Intercompany Indebtedness" means any Indebtedness of the Borrower or
any Subsidiary of the Borrower which, in the case of the Borrower, is owing to
any Subsidiary of the Borrower and which, in the case of any such Subsidiary, is
owing to the Borrower or any Subsidiary of the Borrower; provided that if as of
--------
any date any Person other than the Borrower or a Subsidiary of the Borrower or
any lender under the Senior Credit Facility owns or holds such Indebtedness, or
holds any Lien in respect thereof, such Indebtedness shall no longer be
Intercompany Indebtedness permitted to be incurred pursuant to SECTION 6.1(VI).
"Interest Rate Determination Date" means, with respect to any
Quarterly Period, the second Business Day on which banks in New York and London
are open prior to the first Business Day of such Quarterly Period.
"Interest Rate Protection Agreement" shall mean any interest or
foreign currency rate swap, cap, collar, option, hedge, forward rate or other
similar agreement or arrangement designed to protect against fluctuations in
interest rates or currency exchange rates.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and any successor code or statute and all rules and
regulations promulgated from time to time thereunder.
-22-
"Investments" shall have the meaning set forth in SECTION 6.4.
"Joint Venture" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; provided
--------
that, as to any such arrangement in corporate form, such corporation shall not,
as to any Person of which such corporation is a Subsidiary, be considered to be
a Joint Venture to which such Person is a party.
"Laws" means all applicable statutes, laws, ordinances, regulations,
rules, orders, judgments, writs, injunctions or decrees of any state,
commonwealth, nation, territory, possession, province, county, parish, town,
township, village, municipality or Tribunal, and "Law" means each of the
foregoing.
"Lenders" has the meaning ascribed to that term in the introduction to
this Agreement and shall include any assignee of any Loan, Note or Loan
Commitment to the extent of such assignment.
"Lien" means any lien, mortgage, pledge, assignment, security
interest, charge or other encumbrance of any kind (including any conditional
sale or other title retention agreement, any lease in the nature thereof, and
any agreement to give any security interest) and any option, trust or other
preferential arrangement having the practical effect of any of the foregoing.
"Litigation" means any action, suit, proceeding, claim or lawsuit by
or before any Tribunal.
"Loan Commitment" means the Bridge Loan Commitment and the Term Loan
Commitment.
"Loan Documents" means this Agreement, the Bridge Notes, the Term
Notes, the Guarantees, the Senior Subordinated Indenture, the Exchange Notes and
the Registration Rights Agreement.
"Loans" means the Bridge Loan and the Term Loan as each may be
outstanding.
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"Maturity Date" has the meaning set forth in SECTION 2.2D.
"Margin Stock" has the meaning assigned to that term in Regulation U.
"Material Adverse Change" shall mean (i) with reference to any time or
period prior to the Closing Date, a material adverse change in the condition
(financial or otherwise), operations, business, properties or assets of
Xxxxxxxx, and (ii) with reference to any time or period from and after the
Closing Date, a material adverse change in the condition (financial or
otherwise), operations, business, properties or assets of the Borrower and its
Subsidiaries taken as a whole. For purposes of this definition, determination
of whether a change is a "Material Adverse Change" shall be made by the Required
Lenders.
"Material Adverse Effect" shall mean (i) with reference to any time
period prior to the Closing Date, a material adverse effect upon the condition
(financial or otherwise), operations, business, properties or assets of
Xxxxxxxx, and (ii) with reference to any time or period from and after the
Closing Date, a material adverse effect upon (A) the condition (financial or
otherwise), operations, business, properties or assets of the Borrower and its
Subsidiaries taken as a whole, (B) to the extent not covered under clause (A)
above, the ability of any Credit Party to consummate the Transactions or perform
its obligations under this Agreement or any of the other Loan Documents to which
it is a party or (C) the legality, validity or enforceability of (y) this
Agreement or any of the other Loan Documents or the rights and remedies of the
Agent and the Lenders hereunder and thereunder, or (z) any other document or
instrument to be delivered in connection with the Transactions that is executed
or to be executed by any Credit Party. For purposes of this definition,
determinations of whether an effect is a "Material Adverse Effect" shall be made
by the Required Lenders.
"Material Subsidiary" means, with respect to any accounting period,
any Subsidiary of the Borrower (i) whose revenues constitute greater than 10% of
the aggregate dollar value
-24-
of the revenues of Borrower and its Subsidiaries, taken as a whole, for such
accounting period or (ii) the fair market value of whose assets at any time
during such accounting period is greater than 10% of the fair market value of
all of the assets of Borrower and its Subsidiaries at such time.
"Maximum Cash Interest Rate" means an interest rate of 12.50% per
---
annum; provided that in computing such interest rate, fees paid to the Lenders
----- --------
(whether in cash or otherwise) shall not be deemed an interest payment; and
provided, further, that at any time prior to the Conversion Date the Maximum
-------- -------
Cash Interest Rate shall be reduced to such an interest rate below 12.50% per
annum as is required for the Borrower's Interest Coverage Ratio (as defined in
the Senior Credit Facility) not to be less than, on a pro forma basis as if such
reduced interest rate was in effect for the period of calculation of such
Interest Coverage Ratio for any Quarterly Interest Period, 1.55 to 1.00 but in
no event shall the Maximum Cash Interest Rate be less than 7% per annum.
--- -----
"Multiemployer Plan" shall mean any "multiemployer plan" within the
meaning of Section 4001(a)(3) of ERISA to which the Borrower or any ERISA
Affiliate makes, is making or is obligated to make contributions or has made or
been obligated to make contributions.
"Net Cash Proceeds" means, with respect to any Asset Disposition, Cash
Proceeds of such Asset Disposition net of bona fide direct costs of sale
including, but not limited to, the aggregate amount of all cash payments
received by the Borrower and its Subsidiaries in connection with such Asset
Disposition less (x) reasonable fees and expenses incurred by the Borrower and
its Subsidiaries in connection therewith, (y) Indebtedness to the extent the
amount thereof is secured by a Lien on the property that is the subject of such
Asset Disposition and the transferee of (or holder of the Lien on) such Property
requires that such Indebtedness be repaid as a condition to such Asset
Disposition, and (z) any income or transfer taxes paid or reasonably estimated
by the Borrower to be payable by the Borrower and its Subsidiaries as a result
of such Asset Disposition.
-25-
"Non-payment Default" means any event (other than a Payment Default)
the occurrence of which entitles one or more Persons to act to accelerate the
maturity of any Senior Indebtedness.
"Notes" means, collectively, the Bridge Notes and the Term Notes,
whichever is then outstanding.
"Notice of Borrowing" means a notice substantially in the form of
EXHIBIT IV-A with respect to a proposed borrowing.
------------
"Notice of Conversion" means a notice substantially in the form of
EXHIBIT IV-B with respect to a proposed conversion.
------------
"Obligations" means all obligations of every nature of the Borrower
from time to time owed to the Lenders and the Agent under the Loan Documents,
whether for principal, reimbursements, interest, fees, expenses, indemnities or
otherwise, and whether primary, secondary, direct, indirect, contingent, fixed
or otherwise (including obligations of performance).
"Officer" means the Chairman of the Board, the President, any Vice
President, the Chief Financial Officer, the Controller, the Treasurer, the
Secretary or Assistant Secretary of each of the Borrower and the Guarantors.
"Officers' Certificate" means, as applied to any corporation, a
certificate executed on behalf of such corporation by two Officers; provided
--------
that every Officers' Certificate with respect to the compliance with a condition
precedent to the making of the Loans hereunder shall include (i) a statement
that the officer or officers making or giving such Officers' Certificate have
read such condition and any definitions or other provisions contained in this
Agreement relating thereto, (ii) a statement that, in the opinion of the
signers, they have made or have caused to be made such examination or
investigation as is necessary to enable them to express an informed opinion as
to whether or not such condition has been complied with, and (iii) a statement
as to
-26-
whether, in the opinion of the signers, such condition has been complied with.
"Original Bridge Notes" has the meaning ascribed to such term in
SECTION 2.1D.
"Original Term Notes" has the meaning ascribed to such term in SECTION
2.2E.
"Other Taxes" has the meaning ascribed to such term in SECTION
12.19(B).
"Payment Blockage Period" has the meaning ascribed to such term in
SECTION 8.2(B).
"Payment Default" means any default in the payment of principal,
premium, if any, or interest on any Senior Indebtedness beyond any applicable
grace period with respect thereto.
"Payment Office" shall mean the office of the Agent located at Xxx
Xxxxx Xxxxx Xxxxxx, XX-00, Xxxxxxxxx, XX 00000-0000 or such other office as the
Agent may designate to the Borrower and the Lenders from time to time.
"PBGC" means the Pension Benefit Guaranty Corporation and any
successor thereto.
"Pension Plan" means an employee pension benefit plan as defined in
Section 3(2) of ERISA which is subject to the provisions of Title IV of ERISA
and which is maintained for employees of the Borrower, any Subsidiary of the
Borrower or any member of the Controlled Group.
"Permitted Acquisition" shall mean (a) any Acquisition with respect to
which all of the following conditions are satisfied: (i) each business acquired
shall be within the Permitted Lines of Business, (ii) any Capital Stock given as
consideration in connection therewith shall be Capital Stock of Holdings or
BrightView, (iii) in the case of an Acquisition involving the
-27-
acquisition of control of Capital Stock of any Person, immediately after giving
effect to such Acquisition such Person (or the surviving Person, if the
Acquisition is effected through a merger or consolidation) shall be the Borrower
or a Guarantor (provided that such Person (or the surviving Person) may be a
--------
Designated Non-Guarantor Subsidiary, but only so long as after giving effect to
such Acquisition the Borrower is in compliance with the applicable provisions of
SECTION 6.4), and (iv) all of the conditions and requirements of SECTIONS 5.14
and 5.15 applicable to such Acquisition are satisfied; or (b) any other
Acquisition to which the Required Lenders (or the Agent on their behalf) have
given their prior written consent (which consent may be in their sole discretion
and may be given subject to such additional terms and conditions as the Required
Lenders shall establish) and with respect to which all of the conditions and
requirements set forth in this definition and in SECTION 5.14, and in or
pursuant to any such consent, have been satisfied or waived in writing by the
Required Lenders (or the Agent on their behalf).
"Permitted Holders" shall mean, collectively, Xxxx Xxxxxx and each
Person purchasing Capital Stock of Holdings, Brightview or Xxxxxxxx Investment
Corp. pursuant to the Securities Purchase Agreement as of the Closing Date.
"Permitted Investments" means (a) Cash Equivalents; (b) Investments
consisting of (i) purchases and acquisitions of inventory, supplies, materials
and equipment, or (ii) licenses or leases of intellectual property and other
assets, in each case in the ordinary course of business; (c) Investments
consisting of loans and advances to employees for reasonable travel, relocation
and business expenses in the ordinary course of business, extensions of trade
credit in the ordinary course of business, and prepaid expenses incurred in the
ordinary course of business; (d) without duplication, Investments consisting of
Indebtedness permitted under clause (v) of SECTION 6.1; (e) Investments existing
on the Closing Date and described in SCHEDULE I; (f) Investments of
the Borrower under Interest Rate Protection Agreements required pursuant to
SECTION 6.8 of the Senior Credit Facility; (g) Investments under Commodity Hedge
Agreements entered into in
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the ordinary course of business consistent with reasonable business requirements
and not for speculation; (h) Investments consisting of endorsements for
collection or deposit in the ordinary course of business; (i) Investments
consisting of the making of capital contributions or the purchase of Capital
Stock (i) by the Borrower or any Subsidiary in any other Subsidiary that is (or
after giving effect to such Investment will be) a Guarantor (including all such
Investments constituting Permitted Acquisitions, but subject to compliance with
the provisions of SECTION 5.14, and (ii) by any Subsidiary in the Borrower; (j)
Investments consisting of the contribution by the Borrower to partnerships,
joint ventures or other Persons (including Subsidiaries) of the Scheduled
Titles, as defined in the Senior Credit Facility, in exchange for equity
interests in such Persons, provided that all such Investments are made within
365 days after the Closing Date; (k) Investments consisting of the licensing of
publication titles and other assets pursuant to joint marketing arrangements
with other Persons; and (l) Investments (other than Investments specified in
clauses (a) through (k) above) in an aggregate amount, as valued at the time
each such Investment is made, not exceeding $5,000,000 for all such Investments
from and after the Closing Date (which Investments shall include, without
limitation, (i) Investments in Designated Non-Guarantor Subsidiaries, as defined
in the Senior Credit Facility, (ii) Investments in Persons holding Scheduled
Titles, as defined in the Senior Credit Facility, to the extent such Investments
are made with cash or other property not consisting of such Scheduled Titles,
and (iii) consideration received by any Person other than the Borrower or a
Wholly Owned Subsidiary in a transaction permitted by SECTION 6.8.
"Permitted Liens" shall have the meaning given to such term in SECTION
6.2.
"Permitted Lines of Business" shall have the meaning given to such
term in SECTION 6.9.
"Permitted Tax Distributions" means, subject to the limitations set
forth in SECTION 6.3(C), distributions by the Borrower to Holdings and
BrightView from time to time in an amount
-29-
approximately equal to the income tax liability of such member (but in the case
of Holdings and for so long as Holdings is treated as a pass-through entity for
taxation purposes, to the income tax liability that Holdings would have if it
were required to pay income taxes) resulting from the taxable income of the
Borrower (after taking into account all of the Borrower's prior tax losses,
to the extent such losses have not previously been deemed to reduce the taxable
income of the Borrower and thereby reduce distributions for taxes pursuant to
this clause (iii)); such distribution for taxes shall be based on the
approximate highest combined tax rate that applies to any one of the members of
the Borrower.
"Person" means and includes natural persons, corporations, limited
liability companies, limited partnerships, general partnerships, joint stock
companies, joint ventures, associations, companies, trusts, banks, trust
companies, land trusts, business trusts or other organizations, whether or not
legal entities, and governments and agencies and political subdivisions thereof.
"Xxxxxxxx" shall have the meaning given to such term in the recitals
hereof.
"Xxxxxxxx Acquisition" shall have the meaning given to such term in
the recitals hereof.
"Xxxxxxxx Assets" means the assets of Xxxxxxxx to be acquired by the
Borrower in the Xxxxxxxx Acquisition pursuant to the Asset Purchase Agreement.
"Xxxxxxxx License Agreement" shall mean the License Agreement, dated
as of August 15, 1996, between Xxxxxx X. Xxxxxxxx and Xxxxxxxx, as licensor, and
BrightView, as licensee, as amended, modified or supplemented from time to time
in accordance with the terms of this Agreement.
"Xxxxxxxx Purchase Price Adjustment" shall mean the post-closing
adjustment to the cash portion of the purchase price for the Purchased Assets
(as defined in the Asset Purchase
-30-
Agreement), as contemplated by Section 1.5 of the Asset Purchase Agreement.
"PIK Interest Amount" has the meaning ascribed to such term in SECTION
2.3B.
"Plan" shall mean any "employee pension benefit plan" within the
meaning of Section 3(2) of ERISA that is subject to the provisions of Title IV
of ERISA (other than a Multiemployer Plan) and to which the Borrower or any
ERISA Affiliate may have any liability.
"Potential Event of Default" means a condition or event which, after
notice or lapse of time or both, would constitute an Event of Default if that
condition or event were not cured or removed within any applicable grace or cure
period.
"Preferred Stock" of any Person means any Capital Stock of such Person
that has preferential rights (as compared to any other Capital Stock of such
Person) with respect to dividends or redemptions or upon liquidation.
"pro forma" means, with respect to any calculation made or required to
be made pursuant to the terms of this Agreement, a calculation in accordance
with Article 11 of Regulation S-X under the Securities Act as interpreted by the
Borrower's chief financial officer or Board of Directors in consultation with
its independent certified public accountants.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Capital Stock.
"Qualified IPO" shall have the meaning given to such term in the
Securityholders Agreement.
"Quarterly Period" shall mean the period commencing on the first
calendar day of each three-month period, if such day is a Business Day, or the
first Business Day succeeding the first
-31-
calendar day of each three-month period and ending on the day next preceding the
first Business Day of the following Quarterly Period.
"Real Property Assets" means interests in land, buildings,
improvements, and fixtures attached thereto or used in the operation thereof, in
each case owned or leased (as lessee) by the Borrower or its Subsidiaries.
"Refinance" means, in respect of any security or Indebtedness, to
refinance, extend, renew, refund or defease, or to issue a security or
Indebtedness in exchange or replacement for, such security or Indebtedness in
whole or in part. "Refinanced" and "Refinancing" shall have correlative
meanings.
"Register" has the meaning ascribed to such term in SECTION 5.11.
"Registration Rights Agreement" means a registration rights agreement
substantially in the form contemplated by EXHIBIT V (with such changes therein
---------
as the Agent and the Borrower shall approve).
"Reportable Event" shall mean (i) any "reportable event" within the
meaning of Section 4043(c) of ERISA for which the 30-day notice under Section
4043(a) of ERISA has not been waived by the PBGC (including any failure to meet
the minimum funding standard of, or timely make any required installment under,
Section 412 of the Internal Revenue Code or Section 302 of ERISA, regardless of
the issuance of any waivers in accordance with Section 412(d) of the Internal
Revenue Code), (ii) any such "reportable event" subject to advance notice to the
PBGC under Section 4043(b)(3) of ERISA, (iii) any application for a funding
waiver or an extension of any amortization period pursuant to Section 412 of the
Internal Revenue Code, and (iv) a cessation of operations described in Section
4062(e) of ERISA.
"Required Lenders" means Lenders holding in the aggregate more than
66-2/3% of the outstanding principal amount of Notes.
-32-
"Requirement of Law" shall mean, with respect to any Person, the
charter, articles or certificate of organization or incorporation and bylaws or
other organizational or governing documents of such Person, and any statute,
law, treaty, rule, regulation, order, decree, writ, injunction or determination
of any arbitrator or court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject or otherwise pertaining to any or
all of the transactions contemplated by this Agreement and the other Loan
Documents.
"Responsible Officer" shall mean, with respect to the Borrower, the
president, the chief executive officer, the chief financial officer, any
executive officer, or any other Financial Officer of the Borrower, and any other
officer or similar official thereof responsible for the administration of the
obligations of the Borrower in respect of this Agreement.
"Restricted Payment" has the meaning ascribed to such term in SECTION
6.3.
"Securities" means any stock, shares, partnership interests, voting
trust certificates, certificates of interest or participation in any profit
sharing agreement or arrangement, bonds, debentures, options, warrants, notes,
or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"Securities Purchase Agreement" shall mean the Securities Purchase
Agreement, dated as of September 30, 1996, among Holdings, Xxxxxxxx Investment
Corp., BrightView and the Persons listed on SCHEDULE A to the Senior Credit
Facility, providing for the purchase and sale of Capital Stock of Holdings,
BrightView and Xxxxxxxx Investment Corp., as amended, modified or supplemented
from time to time.
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"Securityholders Agreement" shall mean the Securityholders Agreement,
dated as of September 30, 1996, among Xxxxxxxx Investment Corp., Holdings,
BrightView and the securityholders named therein, as amended, modified or
supplemented from time to time.
"Senior Credit Facility" means the Amended and Restated Credit
Agreement dated as of September 30, 1996 among the Borrower, the lenders listed
therein and First Union, as administrative agent, and CIBC as documentation
agent, together with the documents related thereto (including, without
limitation, any guarantee agreements and security documents), in each case as
such agreements may be amended (including any amendment and restatement
thereof), supplemented or otherwise modified from time to time, including any
agreement extending the maturity of, refinancing, replacing or otherwise
restructuring (including adding Subsidiaries of the Borrower as additional
borrowers or guarantors thereunder) all or any portion of the Indebtedness under
such agreement or any successor or replacement agreement and whether by the same
or any other agent, lender or group of lenders.
"Senior Indebtedness" means for any Person the principal of, premium,
if any, and interest on, and all amounts payable in respect of, all obligations
of every nature of such Person from time to time owed to the lenders under the
Senior Credit Facility, including, without limitation, any Refinancings, all
obligations in respect of letters of credit and principal of and interest on and
all fees, indemnities, and expenses payable under the Senior Credit Facility and
all obligations under Interest Rate Protection Agreements entered into with
lenders under the Senior Credit Facility and their respective Affiliates and any
guarantees thereof. Without limiting the generality of the foregoing, "Senior
Indebtedness" shall include interest accruing thereon subsequent to the
occurrence of any Event of Default specified in SECTIONS 7.6 and 7.7 relating to
the Borrower, whether or not the claim for such interest is allowed under any
applicable Bankruptcy Law. Notwithstanding the foregoing, "Senior Indebtedness"
of any Person shall not include that portion of any Indebtedness which is
incurred by such Person in violation of this Agreement.
-34-
"Senior Subordinated Indenture" means an indenture among the Borrower,
the guarantors named therein and a trustee substantially in the form
contemplated by EXHIBIT V (with such changes therein as the Agent and the
---------
Borrower shall approve, and, at such time as notes issued thereunder are sold in
a public offering, with other appropriate changes to reflect such public
offering), as the same may at any time be amended, modified and supplemented and
in effect.
"Subordinated Indebtedness" means Indebtedness of the Borrower or any
Guarantor which is expressly subordinated in right of payment to the Notes or
the Guarantee of such Guarantor, as the case may be.
"Subsequent Bridge Notes" has the meaning ascribed to such term in
SECTION 2.1D.
"Subsequent Term Notes" has the meaning ascribed to such term in
SECTION 2.2E.
"Subsidiary" shall mean, with respect to any Person, any corporation
or other Person of which more than fifty percent (50%) of the outstanding
Capital Stock having ordinary voting power to elect a majority of the board of
directors, board of managers or other governing body of such Person, is at the
time, directly or indirectly, owned or controlled by such Person and one or more
of its other Subsidiaries or a combination thereof (irrespective of whether, at
the time, securities of any other class or classes of any such corporation or
other Person shall or might have voting power by reason of the happening of any
contingency). When used without reference to a parent entity, the term
"Subsidiary" shall be deemed to refer to a Subsidiary of the Borrower.
"Take-Out Banks" has the meaning ascribed to such term in SECTION
3.1R.
"Take-Out Securities" means (i) any High-Yield Notes of the Borrower
and/or the Guarantors the proceeds of which are used to repay the Notes in full
and (ii) any High-Yield Notes of the
-35-
Borrower issued in accordance with SECTION 2.5A(II)(B) the proceeds of which are
used to Refinance the Notes in part.
"Taxes" means all taxes, assessments, fees, levies, imposts, duties,
penalties, deductions, liabilities, withholdings or other charges of any nature
whatsoever, including interest penalties, from time to time or at any time
imposed by any Law or any Tribunal.
"Term Loan Commitment" has the meaning ascribed to such term in
SECTION 2.2A.
"Term Notes" has the meaning ascribed to such term in SECTION 2.2E.
"Transaction Costs" means the fees, costs and expenses payable by the
Borrower pursuant hereto and other fees, costs and expenses payable by the
Borrower or a Subsidiary of the Borrower in connection with the Transactions.
"Transaction Documents" means all documents in connection with the
consummation of the Transactions.
"Transactions" shall mean, collectively, (i) the Equity Financing,
(ii) the incurrence of the loans drawn down on the Closing Date under the Senior
Credit Facility, (iii) the incurrence of the Bridge Loans hereunder on the
Closing Date, (iv) the Xxxxxxxx Acquisition, (v) any other transaction on the
Closing Date contemplated in relation to the foregoing and (vi) the payment of
fees and expenses in connection with the foregoing.
"Transferee" has the meaning ascribed to such term in SECTION
12.19(A).
"Tribunal" means any government, any arbitration panel, any court or
any governmental department, commission, board, bureau, agency, authority or
instrumentality of the United States or any state, province, commonwealth,
nation, territory,
-00-
xxxxxxxxxx, xxxxxx, xxxxxx, xxxx, xxxxxxxx, village or municipality, whether now
or hereafter constituted and/or existing.
"U.S. Legal Tender" means such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Unfunded Pension Liability" shall mean, with respect to any Plan of
Multiemployer Plan, the excess of its benefit liabilities under Section
4001(a)(16) of ERISA over the current value of its assets, determined in
accordance with the applicable assumptions used for funding under Section 412 of
the Code for the applicable plan year.
"Voting Stock" means, with respect to any Person, securities of any
class or classes of Capital Stock in such Person entitling the holders thereof
(whether at all times or only so long as no senior class of stock has voting
power by reason of any contingency) to vote in the election of members of the
board of directors or other governing body of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the then
outstanding aggregate principal amount of such Indebtedness into (b) the total
of the products obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment.
"Wholly Owned" shall mean, with respect to any Subsidiary of any
Person, that 100% of the outstanding Capital Stock of such Subsidiary (excluding
directors' qualifying shares and shares required to be held by foreign
nationals, in the case of a Foreign Subsidiary) is owned, directly or
indirectly, by such Person.
"Xxxxxx Xxxxx" shall mean Xxxxxx Xxxxx & Partners, L.P., a Delaware
limited partnership.
-37-
1.2 Accounting Terms. Except as specifically provided otherwise in
----------------
this Agreement, all accounting terms used herein that are not specifically
defined shall have the meanings customarily given them, and all financial
computations hereunder shall be made, in accordance with GAAP. Notwithstanding
the foregoing, in the event that any changes in GAAP after the date hereof are
required to be applied to the Borrower and would affect the computation of the
financial covenants contained in SECTIONS 7.1 through 7.4 of the Senior Credit
Facility, as applicable, such changes shall be followed only from and after the
date this Agreement shall have been amended to take into account any such
changes.
1.3 Other Definitional Provisions; Construction. Any of the terms
-------------------------------------------
defined in SECTION 1.1 may, unless the context otherwise requires, be used in
the singular or the plural depending on the reference.
SECTION 2 AMOUNT AND TERMS OF LOAN COMMITMENT AND LOANS; NOTES
2.1 Bridge Loan and Bridge Note
---------------------------
A. Bridge Loan Commitment. Subject to the terms and conditions of
----------------------
this Agreement, the Lenders hereby agree to lend to the Borrower on the Closing
Date $100,000,000 in the aggregate (the "Bridge Loan"), each such Lender
committing to lend the amount set forth next to such Lender's name on the
signature pages hereto. The Lenders' commitments to make the Bridge Loan to the
Borrower pursuant to this SECTION 2.1A are herein called individually, the
"Bridge Loan Commitment" and collectively, the "Bridge Loan Commitments."
B. Notice of Borrowing. When the Borrower desires to borrow under
-------------------
this SECTION 2.1, it shall deliver to the Agent a Notice of Borrowing no later
than 1:00 P.M. (New York time), at least two Business Days in advance of the
Closing Date or such later date as shall be agreed to by the Agent. The Notice
of Borrowing shall specify the applicable date of borrowing (which shall be a
Business Day). Upon receipt of such Notice of
-38-
Borrowing, the Agent shall promptly notify each Lender of its share of the
Bridge Loan and the other matters covered by the Notice of Borrowing.
C. Disbursement of Funds. (a) No later than 1:00 P.M. (New York
---------------------
time) on the Closing Date, each Lender will make available its pro rata share of
the Bridge Loan requested to be made on such date in the manner provided below.
All amounts shall be made available to the Agent in U.S. Legal Tender and
immediately available funds at the Payment Office and the Agent promptly will
make available to the Borrower by depositing to its account at the Payment
Office the aggregate of the amounts so made available in the type of funds
received.
(b) Nothing herein shall be deemed to relieve any Lender from its
obligation to fulfill its Bridge Loan Commitment hereunder or to prejudice any
rights which the Borrower may have against any Lender as a result of any default
by such Lender hereunder.
D. Bridge Notes. The Borrower shall execute and deliver to each
------------
Lender on the Closing Date a Bridge Note dated the Closing Date substantially in
the form of EXHIBIT I to evidence such Lender's portion of the Bridge Loan
---------
Commitment and with appropriate insertions (the "Original Bridge Notes"). On
each interest payment date prior to the Conversion Date on which the Borrower
elects to pay a PIK Interest Amount pursuant to SECTION 2.3B, the Borrower shall
execute and deliver to each Lender on such interest payment date a Bridge Note
dated such interest payment date substantially in the form of Exhibit I annexed
hereto in a principal amount equal to such Lender's pro rata portion of such PIK
Interest Amount and with other appropriate insertions (each a "Subsequent Bridge
Note" and, together with the Original Bridge Notes, the "Bridge Notes"). A
Subsequent Bridge Note shall bear interest from the date of its issuance at the
same rate borne by all Bridge Notes.
E. Scheduled Payment of Bridge Loan. Subject to Section 2.2, the
--------------------------------
Borrower shall pay in full the outstanding amount
-39-
of the Bridge Loan and all other Obligations owing hereunder no later than the
Conversion Date.
F. Termination of Bridge Loan Commitment. The Bridge Loan
-------------------------------------
Commitment hereunder shall terminate on the earlier of (i) the date on which the
Asset Purchase Agreement is terminated in accordance with its terms or (ii)
October 18, 1996 if the Bridge Loan is not made on or before such date.
G. Pro Rata Borrowings. The Bridge Loan made under this Agreement
-------------------
shall be made by the Lenders pro rata on the basis of their respective Bridge
--- ----
Loan Commitments. It is understood that no Lender shall be responsible for any
default by any other Lender of its obligation to make its portion of the Bridge
Loan hereunder and that each Lender shall be obligated to make its portion of
the Bridge Loan hereunder, regardless of the failure of any other Lender to
fulfill its commitments hereunder.
2.2 Term Loan and Term Note.
-----------------------
A. Term Loan Commitment. Subject to the terms and conditions of
--------------------
this Agreement and in reliance upon the representations and warranties of the
Borrower herein set forth, the Lenders hereby agree, on the Conversion Date,
upon the request of the Borrower, to convert the then outstanding principal
amount of the Bridge Notes into a term loan (the "Term Loan"), such Term Loan to
be in the aggregate principal amount of the then outstanding principal amount of
the Bridge Notes. The Lenders' commitments under this SECTION 2.2A are herein
called collectively the "Term Loan Commitment."
B. Notice of Conversion/Borrowing. If the Borrower has not repaid
------------------------------
the Bridge Loan in full on or prior to the Conversion Date, then the Borrower
shall convert the then outstanding principal amount of the Bridge Notes into a
Term Loan under this SECTION 2.2. The Borrower shall deliver to the Lenders a
Notice of Conversion no later than 1:00 P.M. (New York time), at least two
Business Days in advance of the Conversion Date. The Notice of Conversion shall
specify the principal amount of the Bridge Notes
-40-
outstanding on the Conversion Date to be converted into a Term Loan.
C. Making of Term Loan. Upon satisfaction or waiver of the
-------------------
conditions precedent specified in SECTION 3.2, each Lender shall extend to the
Borrower the Term Loan to be issued on the Conversion Date by such Lender by
cancelling on its records a corresponding principal amount of the Bridge Notes
held by such Lender.
D. Maturity of Term Loan. The Term Loan shall mature and the
---------------------
Borrower shall pay in full the outstanding principal amount thereof and accrued
interest thereon on the tenth anniversary of the Conversion Date (the "Maturity
Date").
E. Term Notes. The Borrower, as borrower, shall execute and deliver
----------
to each Lender on the Conversion Date a Term Note dated the Conversion Date
substantially in the form of EXHIBIT II to evidence the Term Loan made on such
----------
date, in the principal amount of the Bridge Notes held by such Lender on such
date and with other appropriate insertions (collectively the "Original Term
Notes") and each Lender shall return the Bridge Notes then held by such Lender.
On or after the Conversion Date, on each interest payment date on which the
Borrower elects to pay a PIK Interest Amount pursuant to SECTION 2.3B, the
Borrower shall execute and deliver to each Lender on such interest payment date
a Term Note dated such interest payment date substantially in the form of
EXHIBIT II annexed hereto in a principal amount equal to such Lender's pro rata
----------
portion of such PIK Interest Amount and with other appropriate insertions (each
a "Subsequent Term Note" and, together with the Original Term Notes, the "Term
Notes"). A Subsequent Term Note shall bear interest from the date of its
issuance at the same rate borne by all Term Notes.
2.3 Interest on the Loans.
---------------------
A. Rate of Interest. The Loans shall bear interest on the unpaid
----------------
principal amount thereof from the date made through
-41-
maturity (whether by prepayment, acceleration or otherwise) at a rate determined
as set forth below.
(i) Floating Rate Loans. Subject to SECTION 2.3A(II), the Loans
-------------------
shall bear interest for each Quarterly Period at a rate per annum equal to the
Applicable Interest Rate for such period.
(ii) Fixed Rate Loans. At any time on or after the Conversion Date,
----------------
at the request of any Lender in connection with the sale of all or any portion
of the Term Loan owing to such Lender to a Person who is not an Affiliate of
such Lender or any other Lender, all or a portion of the Term Loan to be so sold
shall bear interest at a fixed rate per annum equal to the rate of interest
borne by the Term Loans at the time of such request (the "Fixed Rate"),
effective as of the first interest payment date with respect to such Term Loan
after such notice so long as the 10 Business Days' notice set forth below is
given; provided that no such conversion shall be permitted in respect of amounts
--------
to be voluntarily prepaid following receipt of a notice of prepayment pursuant
to SECTION 2.5A. In order to request the conversion of a Floating Rate Loan to a
Fixed Rate Loan, the Lender shall notify the Agent and the Borrower in writing
of its intention to do so at least 10 Business Days prior to an interest payment
date indicating the amount of the Term Loan for which it is requesting
conversion to a Fixed Rate Loan. Upon the conversion of a portion of a Floating
Rate Loan to a Fixed Rate Loan an appropriate notation will be made on the Term
Note and, on and after the first interest payment date following the receipt by
the Borrower of a notice hereunder, such portion of the Term Loan which is
converted to a Fixed Rate Loan shall bear interest at the Fixed Rate until
repaid.
(iii) Notwithstanding clause (i) or (ii) of this SECTION 2.3A or any
other provision herein, in no event will the combined sum of interest on the
Loans exceed 18.00% per annum.
--- -----
B. Interest Payments. (i) Interest shall be payable (x) with
-----------------
respect to the Bridge Loan, in arrears on December 31, 1996, March 31, 1997,
June 30, 1997, September 30, 1997, and upon any prepayment of the Bridge Loan
(to the extent accrued on the
-42-
amount being prepaid) and at maturity of the Bridge Loan in respect of any
amounts paid on such date and not converted to Term Loans and (y) with respect
to the Term Loan, in arrears on each December 31, March 31, June 30 and
September 30 of each year, commencing on the first of such dates to follow the
Conversion Date, upon any prepayment of the Term Loan (to the extent accrued on
the amount being prepaid) and at maturity of the Term Loan; provided, however,
-------- -------
that if for any Quarterly Period the interest rate borne by the Bridge Loan or
the Term Loan, as the case may be, exceeds the Maximum Cash Interest Rate, the
Borrower shall pay all or a portion of the interest payable in excess of the
Maximum Cash Interest Rate by the issuance of Subsequent Bridge Notes, or
Subsequent Term Notes, as the case may be, in an aggregate principal amount
equal to the amount of such interest being so paid (the "PIK Interest Amount").
(ii) Payment of Interest Based on Maximum Cash Interest Rate. For
-------------------------------------------------------
each Quarterly Interest Period prior to the Conversion Date, interest shall be
paid by the Credit Parties in cash at 7.00% per annum; provided, however that
within 45 days following the end of such Quarterly Interest Period, the Credit
Parties shall remit to the Lenders additional cash interest to the maximum
extent that the Borrower could have paid such interest as of the end of the most
recent fiscal quarter without causing the Interest Coverage Ratio (as defined in
the Senior Credit Facility) to exceed 1.55 to 1.
C. Post-Maturity Interest. Any principal payments on the Loans not
----------------------
paid when due and, to the extent permitted by applicable law, any interest
payment on the Loans not paid when due, in each case whether at stated maturity,
by notice of prepayment, by acceleration or otherwise, shall thereafter bear
interest payable upon demand at a rate which is 2.00% per annum in excess of the
rate of interest otherwise payable under this Agreement for the Loans.
D. Computation of Interest. Interest on the Loans shall be computed
-----------------------
on the basis of a 360-day year and, with respect to any amount of the Loans
which are Floating Rate Loans, the
-43-
actual number of days elapsed in the period during which it accrues or, with
respect to any amount of the Loans which are Fixed Rate Loans, twelve 30-day
months. In computing interest on the Loans, the date of the making of the Loans
shall be included and the date of payment shall be excluded; provided that if a
--------
Loan is repaid on the same day on which it is made, one day's interest shall be
paid on that Loan.
2.4 Fees. The Borrower agrees to pay to [the Lenders] all fees and
----
other obligations in accordance with, and at the times specified by, the
Commitment Letter.
2.5 Prepayments and Payments.
------------------------
A. Prepayments
-----------
(i) Voluntary Prepayments. The Borrower may, upon not less than
---------------------
ten Business Days' prior written or telephonic notice confirmed in writing
to the Agent at any time and from time to time, prepay without premium or
penalty the Loans made to the Borrower in whole or in part in an aggregate
minimum amount of $500,000 and integral multiples of $100,000 in excess of
that amount; provided, that at such time as all or part of the Term Loan
--------
bears interest at the Fixed Rate, the Term Loan or such part that bears
interest at the Fixed Rate, as the case may be, will be redeemable at the
option of the Borrower at any time prior to October 1, 1998 at a redemption
price of 101% of principal amount plus accrued and unpaid interest to the
redemption date and will not be redeemable at the option of the Borrower at
any time commencing October 1, 1998 and prior to October 1, 2002, and
thereafter will be redeemable at the option of the Borrower, in whole or in
part, at any time at the Fixed Rate Loan Redemption Price plus accrued and
unpaid interest to the redemption date. Prepayments in this Section may be
designated, pro rata, to either Fixed Rate Loans or Floating Rate Loans.
Notice of prepayment having been given as aforesaid, the principal
amount of the Loans to be prepaid shall become due
-44-
and payable on the prepayment date. Amounts of the Loans so prepaid may not
be reborrowed.
(ii) Mandatory Prepayments
---------------------
(a) Prepayments from Asset Dispositions. Upon receipt by the
Borrower or any Subsidiary of the Borrower of Cash Proceeds of any Asset
Disposition occurring after the Closing Date, (i) the Borrower or any
Subsidiary of the Borrower may, or may cause its Subsidiaries to, apply the
Net Cash Proceeds of such Asset Disposition to acquire assets or properties
or other reinvestments in the businesses of the Borrower and (ii) the
Borrower or any Subsidiary of the Borrower shall apply any Net Cash
Proceeds remaining after application pursuant to clause (i) above to prepay
(x) the term loans outstanding under the Senior Credit Facility or (y)
revolving loans outstanding under the Senior Credit Facility; provided that
--------
the commitment thereunder is permanently reduced to the extent of the
prepayment. Concurrently with the consummation of an Asset Disposition, the
Borrower shall deliver to the Agent an Officer's Certificate demonstrating
the derivation of Net Cash Proceeds from the gross sales price of such
Asset Disposition.
To the extent not used as above, the Borrower shall, or shall cause
its Subsidiaries to, prepay the Floating Rate Loans with the Net Cash
Proceeds received from any Asset Disposition on a date not later than the
Business Day next succeeding (i) the third Business day after the receipt
thereof if such date of receipt is on or prior to the Conversion Date and
(ii) the 180th day after the consummation of such Asset Disposition if and
to the extent that such Net Cash Proceeds are not applied by the Borrower
or any Subsidiary of the Borrower within 180 days to acquire assets or
properties or other reinvestments in the businesses of the Borrower if such
date of receipt is after the Conversion Date; provided that at such time as
--------
the Term Loan bears interest at the Fixed Rate, any such Net Cash Proceeds
not so applied to prepay the Floating Rate Loans shall be used to make an
offer
-45-
to purchase the Fixed Rate Loans from each Lender on a pro rata basis
--- ----
at 100% of the principal amount thereof plus accrued and unpaid interest
thereon to the date of repurchase.
(b) Prepayments from Issuances of Take-Out Securities. Concurrently
-------------------------------------------------
with the receipt by the Borrower of proceeds from the issuance of Take-Out
Securities, the Borrower shall prepay the Loans (at a price per Note equal
to the principal amount of such Note plus accrued interest to the date of
payment) in a principal amount equal to the lesser of the proceeds thereof
(net of fees and expenses payable by the Borrower to any Person other than
an Affiliate of the Borrower in connection with the issuance thereof) or
the aggregate principal amount of the Notes then outstanding; provided,
however that the redemption price shall be 103.0% of principal amount plus
accrued interest if the Bridge Notes are redeemed with or in anticipation
of funds raised by any means other than a transaction in which the Agent
and CIBC have acted as exclusive agents or lead managers for the Company.
(c) Prepayments upon a Change of Control. Within 10 days following
------------------------------------
any Change of Control, the Borrower shall prepay the Loans in full at a
redemption price equal to 103% of the principal amount thereof plus accrued
and unpaid interest, if any, to the date of redemption.
(d) Notice. The Borrower shall notify the Agent of any prepayment to
------
be made pursuant to this Section 2.5A(ii) at least ten Business Days prior
to such prepayment date (unless shorter notice is satisfactory to the
Required Lenders).
(iii) Borrower's Mandatory Prepayment Obligation; Application of
------------------------------------------- --------------
Prepayments. All prepayments shall include payment of accrued interest on
-----------
the principal amount so prepaid and shall be applied to payment of interest
before application to principal.
B. Manner and Time of Payment. All payments of principal and
--------------------------
interest hereunder and under the Notes by the
-46-
Borrower shall be made without defense, set-off or counterclaim and in same-day
funds and delivered to the Agent, unless otherwise specified, not later than
12:00 Noon (New York time) on the date due at the Payment Office for the account
of the Lenders; funds received by the Agent after that time shall be deemed to
have been paid by the Borrower on the next succeeding Business Day. The Borrower
hereby authorizes the Agent to charge its account with the Agent in order to
cause timely payment to be made of all principal, interest and fees due
hereunder (subject to sufficient funds being available in its account for that
purpose).
C. Payments on Non-Business Days. Whenever any payment to be made
-----------------------------
hereunder or under the Notes shall be stated to be due on a day which is not a
Business Day, the payment shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the payment of
interest hereunder or under the Notes or of the commitment and other fees
hereunder, as the case may be.
D. Notation of Payment. Each Lender agrees that before disposing of
-------------------
any Note held by it, or any part thereof (other than by granting participations
therein), such Lender will make a notation thereon of all principal payments
previously made thereon and of the date to which interest thereon has been paid
and will notify the Borrower of the name and address of the transferee of that
Note; provided that the failure to make (or any error in the making of) such a
--------
notation or to notify the Borrower of the name and address of such transferee
shall not limit or otherwise affect the obligation of the Borrower hereunder or
under such Notes with respect to the Loans and payments of principal or interest
on any such Note.
2.6 Use of Proceeds.
---------------
A. Bridge Loan. The proceeds of the Bridge Loan shall be applied by
-----------
the Borrower, together with borrowings under the Senior Credit Facility and
funds raised in the Equity Financing, to the payment of the Transaction Costs
and to pay the consideration for the Xxxxxxxx Acquisition.
-47-
B. Term Loan. Upon the extension of a Term Loan by a Lender, the
---------
Borrower shall cancel a corresponding principal amount of Bridge Notes held by
such Lender.
C. Margin Regulations. No portion of the proceeds of any borrowing
------------------
under this Agreement shall be used by the Borrower in any manner which might
cause the borrowing or the application of such proceeds to violate the
applicable requirements of Regulation G, Regulation U, Regulation T or
Regulation X of the Board of Governors of the Federal Reserve System or any
other regulation of the Board of Governors or to violate the Exchange Act, in
each case as in effect on the date or dates of such borrowing and such use of
proceeds.
SECTION 3 CONDITIONS
3.1 Conditions to Bridge Loan. The obligation of the Lenders to make
-------------------------
the Bridge Loan is subject to prior or concurrent satisfaction of each of the
following conditions:
A. On or before the Closing Date, all corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by the Agent shall be reasonably satisfactory in form and substance
to the Agent, and the Agent shall have received on behalf of the Lenders the
following items, each of which shall be in form and substance satisfactory to
the Agent and, unless otherwise noted, dated the Closing Date:
1. the Agent shall have received a certificate, signed by the
president, the chief executive officer or the chief financial officer of
the Borrower, in form and substance satisfactory to the Agent, certifying
that (i) all representations and warranties of the Borrower contained in
this Agreement and the other Loan Documents are true and correct as of the
Closing Date, both immediately before and after giving effect to the
consummation of the Transactions, the Loans hereunder and the application
of the proceeds
-48-
thereof, (ii) no Potential Event of Default or Event of Default has
occurred and is continuing, both immediately before and after giving effect
to the consummation of the Transactions, the Loans and the Bridge Notes
hereunder and the application of the proceeds thereof, (iii) both
immediately before and after giving effect to the consummation of the
Transactions, the Loans and the Bridge Notes hereunder and the application
of the proceeds thereof, no Material Adverse Change has occurred since May
31, 1995, and there exists no event, condition or state of facts that could
reasonably be expected to result in a Material Adverse Change, and (iv) all
conditions to the consummation of the Xxxxxxxx Acquisition have been
satisfied in all material respects and have not been waived or amended
without the prior written consent of the Agent;
2. the Agent shall have received a certificate of the secretary or
an assistant secretary of the Borrower, in form and substance satisfactory
to the Agent, certifying (i) that attached thereto is a true and complete
copy of the articles of organization and all amendments thereto of the
Borrower, certified as of a recent date by the Secretary of State of the
State of Delaware, and that the same has not been amended since the date of
such certification and (ii) that attached thereto is a true and complete
copy of the limited liability company operating agreement of the Borrower
and all amendments thereto, as then in effect, and as to the incumbency and
genuineness of the signature of each officer of [the Borrower] executing
this Agreement or any of the other Loan Documents on behalf of the
Borrower, and attaching all such copies of the documents described above;
3. the Agent shall have received a certificate of the secretary or
an assistant secretary of Holdings, in form and substance satisfactory to
the Agent, certifying (i) that attached thereto is a true and complete copy
of the articles of organization and all amendments thereto of Holdings,
certified as of a recent date by the Secretary of State of the State of
Delaware, and that the same has not been amended
-49-
since the date of such certification, and (ii) that attached thereto is a
true and complete copy of the limited liability company operating agreement
of Holdings and all amendments thereto, as then in effect, and as to the
incumbency and genuineness of the signature of each officer of Holdings
executing any of such Loan Documents on behalf of Holdings, and attaching
all such copies of the documents described above;
4. the Agent shall have received a certificate of the secretary or
an assistant secretary of BrightView, in form and substance satisfactory to
the Agent, certifying (i) that attached thereto is a true and complete copy
of the certificate of incorporation and all amendments thereto of
BrightView, certified as of a recent date by the Secretary of State of the
State of Delaware, and that the same has not been amended since the date of
such certification, (ii) that attached thereto is a true and complete copy
of the bylaws of BrightView, as then in effect and as in effect at all
times from the date on which the resolutions referred to in clause (iii)
below were adopted to and including the date of such certificate and (iii)
that attached thereto is a true and complete copy of the resolutions
adopted by the board of directors of BrightView (x) authorizing the
execution, delivery and performance by BrightView of the Loan Documents to
which it is a party, (y) authorizing in its capacity as the managing member
of Holdings, the execution, delivery and performance by Holdings of the
Loan Documents to which Holdings is a party, and (z) authorizing, in its
capacity as the managing member of Holdings (in Holdings capacity as the
managing member of the Borrower), the execution, delivery and performance
by the Borrower of the Loan Documents to which the Borrower is a party, and
as to the incumbency and genuineness of the signature of each officer of
BrightView executing any of such documents, and attaching all such copies
of the documents described above;
5. the Agent shall have received (i) a certificate as of a recent
date of the good standing of each of the Borrower,
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Holdings and BrightView under the laws of the State of Delaware, from the
Secretary of State of Delaware, and (ii) certificates as of a recent date
of the qualification of the Borrower to conduct business as a foreign
corporation in the States of Illinois and California, from the Secretaries
of State of Illinois and California;
6. executed copies of this Agreement and the Bridge Notes
substantially in the form of EXHIBIT I executed in accordance with SECTION
---------
2.1D drawn to the order of the Lenders and with appropriate insertions;
7. an originally executed Notice of Borrowing substantially in the
form of EXHIBIT IV-A, signed by the President or a Vice President of the
------------
Borrower on behalf of the Borrower in writing delivered to the Agent;
8. the favorable opinions of (A) Xxxxxxxx & Xxxxx, special counsel
to the Credit Parties, in substantially the form of EXHIBIT VII-A, and (B)
Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Lenders, in substantially the form
of Exhibit VIII in each case addressed to the Agent and the Lenders and
addressing such matters as the Agent or any Lender may reasonably request;
9. a certificate, delivered by the Borrower and signed by the
President or a Vice President and the Chief Financial or Accounting Officer
of the Borrower and addressed to the Lenders in form and substance
reasonably satisfactory to the Agent, with appropriate attachments, stating
that, after giving effect to the consummation of the Transactions, the fair
saleable value of the assets of the Borrower and its Subsidiaries will not
be less than the probable liability on their debts, that each of the
Borrower and its Subsidiaries will be able to pay its debts as they mature
and that each will not have unreasonably small capital to conduct its
business, and the Agent shall have received such opinions of value, other
appropriate factual information and expert advice supporting the
conclusions reached in such letter as the Agent
-51-
may reasonably request, all in form and substance reasonably satisfactory
to the Agent;
10. (i) executed or conformed copies of the Senior Credit Facility
and any amendments thereto made on or prior to the Closing Date and a copy
of each legal opinion delivered in connection with the Senior Credit
Facility, and the terms and provisions of the Senior Credit Facility and
all documents and instruments relating thereto shall be reasonably
satisfactory to the Agent, (ii) an Officers' Certificate from the Borrower
certifying that the Senior Credit Facility is in full force and effect on
the Closing Date and no material term or condition thereof has been
amended, modified or waived from the form most recently provided to the
Agent a reasonable time prior to the Closing Date except with the prior
written consent of the Agent (which consent shall not be unreasonably
withheld or delayed) and (iii) an Officers' Certificate from the Borrower
to the effect that such party has performed or complied with all agreements
and conditions contained in the Senior Credit Facility and any agreements
or documents referred to therein, and the Borrower is not in default in the
performance or compliance with any of the terms or provisions thereof;
11. a notation of Guarantee, executed and delivered by each
Guarantor, dated the date of this Agreement, substantially in the form of
EXHIBIT IX, as applicable; and
----------
12. a copy of all closing documents relating to the Xxxxxxxx
Acquisition and all such counterpart originals or certified copies of such
documents, instruments, certificates and opinions as the Agent may
reasonably request.
13. the execution and delivery of the escrow letter dated September
30, 1996 from Holdings and BrightView to First Union and CIBC in connection
with the prospective issuance (upon the occurrence of certain events and
the passage of time) of warrants representing up to 10% of the common
equity
-52-
of Holdings and BrightView at the Closing Date upon the occurrence of
certain events.
B. Except as set forth on SCHEDULE C, all approvals, permits and
consents of any Governmental Authorities or other Persons required in connection
with the execution and delivery of this Agreement and the other Transaction
Documents and the consummation of the Transactions shall have been obtained
(without the imposition of conditions that are not reasonably acceptable to the
Agent), and all related filings, if any, shall have been made, and all such
approvals, permits, consents and filings shall be in full force and effect, and
the Agent shall have received such copies thereof as it shall have requested;
all applicable waiting periods shall have expired without any adverse action
being taken by any Governmental Authority having jurisdiction; and no action,
proceeding, investigation, regulation or legislation shall have been instituted,
threatened or proposed before, and no order, injunction or decree shall have
been entered by, any court or other Governmental Authority, in each case to
enjoin restrain or prohibit, to obtain substantial damages in respect of, or
that is otherwise related to or arises out of, this Agreement, any of the
other Transaction Documents or the consummation of the Transactions, or that, in
the opinion of the Agent, could reasonably be expected to have a Material
Adverse Effect.
C. No default or event of default shall have occurred under the
Senior Credit Facility, all conditions to borrowing thereunder shall have been
satisfied without waiver (except for any written waivers delivered in respect of
a condition that in the opinion of the Agent is immaterial) and, after giving
effect to borrowing thereunder to consummate the Xxxxxxxx Acquisition, the
Borrower shall have undrawn availability under the revolving credit portion of
the Senior Credit Facility of at least $15,000,000.
D. On or before the Closing Date, the Borrower shall have paid to
the Lenders the fees payable on the Closing Date pursuant to SECTION 2.4.
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E. The Agent shall have received evidence in form and substance
reasonably satisfactory to it that the Equity Financing shall have been made,
that Holdings and BrightView shall have contributed to the capital of the
Borrower gross proceeds of not less than $163,000,000 therefrom, (including cash
proceeds of not less than $138,000,000) and that Xxxxxx Xxxxx shall have
contributed not less than $50,000,000 of the Equity Financing, all on terms and
conditions reasonably satisfactory to the Agent.
F. Simultaneously with the making of the Bridge Loan by the Lenders,
the Borrower shall have delivered to the Agent an Officers' Certificate from the
Borrower in form and substance reasonably satisfactory to the Agent to the
effect that (i) the representations and warranties in SECTION 4 and the
representations and warranties of the Borrower in the Senior Credit Facility are
true, correct and complete in all material respects on and as of the Closing
Date to the same extent as though made on and as of that date, (ii) on or prior
to the Closing Date, the Borrower has performed and complied with in all
material respects all covenants and conditions to be performed and observed by
the Borrower on or prior to the Closing Date and (iii) all conditions to the
consummation of the Xxxxxxxx Acquisition in the Asset Purchase Agreement have
been satisfied substantially on the terms set forth therein and have not been
waived or amended without the Agent's prior written consent.
G. The Asset Purchase Agreement shall not have been amended,
modified or supplemented, nor any provision thereof waived, in any material
respect since the date thereof, except as shall have been approved in writing by
the Agent; BrightView shall have duly complied with and performed in all
material respects all of its agreements and conditions set forth in the Asset
Purchase Agreement required to be complied with or performed by it on or prior
to the closing date thereunder; the Asset Purchase Agreement and the Xxxxxxxx
License Agreement and the other documents and instruments executed and delivered
by Xxxxxxxx in connection with the Asset Purchase Agreement shall be in full
force and effect, and BrightView's rights and interest thereunder shall have
been assigned to the Borrower in compliance with the terms thereof and
-54-
pursuant to documentation acceptable to the Agent; the Agent shall have received
evidence satisfactory to it that, concurrently with the making of the Loans
hereunder, the Xxxxxxxx Acquisition shall be consummated in accordance with the
terms of the Asset Purchase Agreement in all material respects and in compliance
with all applicable Requirements of Law, including any necessary stockholder
approvals; the Agent shall have received a letter from O'Melveny & Xxxxx LLP,
counsel to Xxxxxxxx, addressed to the Agent and the Lenders and in sufficient
copies for each Lender, to the effect that the Agent and the Lenders are
entitled to rely on their opinion delivered to the Borrower in connection with
the Xxxxxxxx Acquisition as if such opinion were addressed to them and attaching
a copy thereof; and after giving effect to the Xxxxxxxx Acquisition, senior
management of the Borrower shall be reasonably acceptable to the Agent.
H. Immediately following the making of the Bridge Loan by the
Lenders, the Xxxxxxxx Acquisition shall be consummated without the waiver of any
material conditions precedent thereto.
I. Since November 30, 1995, the Xxxxxxxx Assets shall not have
sustained any loss or interference with respect to its businesses or properties
from fire, flood, hurricane, accident or other calamity, whether or not covered
by insurance, or from any labor dispute or any legal or governmental proceeding,
which loss or interference, in the sole judgment of the Agent, has had or could
reasonably be expected to have a Material Adverse Effect on the ability of the
Borrower to consummate the Transactions and to execute, deliver and perform its
obligations under the Loan Documents, the Senior Credit Facility and each other
document or instrument to be delivered in connection with the Transactions
executed or to be executed by it; there shall not have been any Material Adverse
Change.
J. No event shall have occurred and be continuing or would result
from the consummation of the borrowing contemplated by the Notice of Borrowing
which would constitute an Event of Default or Potential Event of Default.
-55-
K. No order, judgment or decree of any court, arbitrator or
governmental authority shall purport to enjoin or restrain the Lenders from
making the Bridge Loan.
L. There shall not be pending or, to the knowledge of the Borrower,
threatened any action, suit, proceeding, governmental investigation or
arbitration against the Borrower or, to its knowledge, Xxxxxxxx or any property
or asset of the Borrower or the Xxxxxxxx Assets which has not been disclosed by
the Borrower in writing to the Agent (and the Agent shall have received on the
Closing Date an Officer's Certificate dated the Closing Date attesting to the
same) and there shall have occurred no development not so disclosed in any such
action, suit, proceeding, governmental investigation or arbitration so
disclosed, which, in each case, singly or in the aggregate, could reasonably be
expected to have a Material Adverse Effect or a material adverse effect on the
Borrower, the Xxxxxxxx Assets, the Transactions or the making of the Bridge
Loans.
M. The making of the Bridge Loan in the manner contemplated in this
Agreement shall not violate the applicable provisions of Regulation G, T, U or X
of the Board of Governors of the Federal Reserve Board or any other regulation
of the Board.
N. The Agent shall have received a Financial Condition Certificate,
together with the Pro Forma Balance Sheet and the Projections as described in
SECTIONS 4.10(C) and 4.10(D) substantially in the form of EXHIBIT X, all of
which shall be in form and substance satisfactory to the Agent.
O. The pro forma consolidated capital structure of the Borrower and
its Subsidiaries, after giving effect to the Transactions, shall be consistent
with the capital structure contemplated in the Commitment Letter.
P. All transaction fees and expenses payable by or on behalf of the
Borrower in connection with the Transactions shall be in an aggregate amount
acceptable to the Agent, and the Agent shall have received such evidence thereof
in form and substance
-56-
satisfactory to it (including itemizations thereof) as it shall have reasonably
requested.
Q. The Agent shall be satisfied that audited, unaudited and pro
forma financial statements meeting the requirements of Regulation S-X under the
Securities Act of 1933, as amended, of the Borrower and each Guarantor will be
available.
R. The Agent and its counsel shall be reasonably satisfied that the
consummation of the Xxxxxxxx Acquisition and the related financing, including
the funding of the Bridge Loan, shall be in compliance in all material respects
with all applicable Laws. There shall not have been any statute, rule,
regulation, injunction or order applicable to the Xxxxxxxx Acquisition, or the
financing thereof, promulgated, enacted, entered or enforced by any state or
federal government or governmental or regulatory authority or agency or by any
federal or state court, or by any Tribunal, nor shall there be pending any
action or proceeding by or before any such authority, court or tribunal,
involving a substantial likelihood of an order, that would prohibit, restrict,
delay or otherwise materially affect the Xxxxxxxx Acquisition or the financing
thereof.
3.2 Conditions to Term Loan. The obligation of the Lenders to make
-----------------------
the Term Loan on the Conversion Date is subject to the prior or concurrent
satisfaction or waiver of the following conditions precedent:
A. The Agent shall have received in accordance with the provisions
of SECTION 2.2B an originally executed Notice of Conversion.
B. The Borrower or any of its Material Subsidiaries shall not be
subject to a Bankruptcy Order or a bankruptcy or other insolvency proceeding and
an Event of Default or Potential Event of Default shall not have occurred and be
continuing under SECTION 7.6, 7.7 or 7.9.
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C. No Event of Default or Potential Event of Default (whether
matured or not) shall have occurred and be continuing under SECTION 7.1.
D. No Event of Default or Potential Event of Default shall have
occurred and be continuing under SECTION 7.2; provided that if an event
--------
described in this SECTION 3.2D is continuing at the Conversion Date but 30 days
has not passed since the date of written notice of the commencement of such 30-
day period from the holder or holders of not less than 50% in aggregate
principal amount of the Loans then outstanding (the "Grace Period"), the
Conversion Date shall be deferred until the earlier to occur of (x) the cure of
such event or (y) the expiration of such Grace Period.
E. On the Conversion Date, the Agent shall have received an
Officers' Certificate from the Borrower, dated the Conversion Date and
reasonably satisfactory in form and substance to the Agent, to the effect that
the conditions in this SECTION 3.2 are satisfied on and as of the Conversion
Date.
F. The Borrower shall have executed and delivered to the Agent on
the Conversion Date for delivery to the Lenders Term Notes dated the Conversion
Date substantially in the form of EXHIBIT II to evidence the Term Loan, in the
----------
principal amount of (which principal amount shall be the aggregate principal
amount of the Bridge Loan outstanding immediately prior to issuance of the Term
Notes) the Term Loan less amounts paid and with other appropriate insertions.
G. The Borrower shall have paid any fees owing pursuant to Section
2.4 to the Lenders.
H. The making of the Term Loan shall not violate Regulation G, T, U
or X of the Board of Governors of the Federal Reserve Board or any other
regulation of the Board.
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SECTION 4 REPRESENTATIONS AND WARRANTIES
To induce the Agent and the Lenders to enter into this Agreement and
to induce the Lenders to extend the credit contemplated hereby, the Borrower
represents and warrants to the Agent and the Lenders, both before and after
giving effect to the Transactions, as follows:
4.1 Corporate Organization and Power. Each Credit Party (i) is a
--------------------------------
limited liability company, corporation, partnership or other business
organization duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, (ii) has the full limited
liability company, corporate, partnership or other applicable power and
authority to execute, deliver and perform the Transaction Documents to which it
is or will be a party, to own and hold its property and to engage in its
business as presently conducted, and (iii) is duly qualified to do business as a
foreign limited liability company, corporation, partnership or other business
organization and is in good standing in each jurisdiction where the nature of
its business or the ownership of its properties requires it to be so qualified,
except where the failure to be so qualified could not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect.
4.2 Authorization; Enforceability. Each Credit Party has taken, or
-----------------------------
on the Closing Date will have taken, all necessary limited liability company or
corporate action to execute, deliver and perform each of the Transaction
Documents to which it is or will be a party, and has, or on the Closing Date (or
any later date of execution and delivery) will have, validly executed and
delivered each of the Transaction Documents to which it is or will be a party.
This Agreement constitutes, and each of the other Transaction Documents upon
execution and delivery will constitute, the legal, valid and binding obligation
of each of the Credit Parties that is a party hereto or thereto, enforceable
against it in accordance with its terms, except as enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally or by
-59-
general equitable principles or principles of good faith and fair dealing.
4.3 No Violation. The execution, delivery and performance by each
------------
Credit Party of this Agreement and each of the other Transaction Documents to
which it is or will be a party, compliance by it with the terms hereof and
thereof, and the consummation of the Transactions, do not and will not (i)
violate any provision of its articles of organization, certificate of
incorporation, certificate of partnership, operating agreement, bylaws,
partnership agreement or other constituent documents, as applicable, or
contravene any other Requirement of Law applicable to it, (ii) conflict with,
result in a breach of or constitute (with notice, lapse of time or both) a
default under any indenture, agreement or other instrument to which it is a
party, by which it or any of its properties is bound or to which it is subject,
(iii) require any approval of stockholders, members or partners of any Credit
Party or any approval or consent of any Person under any agreement to which any
Credit Party is party, except for such approvals or consents which will be
obtained on or before the Closing Date and disclosed in writing to the Lenders
or such approvals or consents the failure of which to obtain could not
reasonably be expected, singly or in the aggregate, to have a Material Adverse
Effect, (iv) except for the Liens granted pursuant to the security documents in
connection with the Senior Credit Facility, result in or require the creation or
imposition of any Lien upon any of its properties or assets. No Subsidiary is
subject to any restriction or encumbrance on its ability to make dividend
payments or other distributions in respect of its Capital stock, to repay
Indebtedness owed to the Borrower or any other Subsidiary, or to transfer any of
its assets or properties to the Borrower or any other Subsidiary, in each case
other than such restrictions or encumbrances existing under or by reason of (i)
the Credit Documents, (ii) the Senior Credit Facility and any other agreement or
instrument evidencing or governing any Indebtedness permitted under clause (ii)
of SECTION 6.1, (iii) applicable Requirements of Law, (iv) customary non-
assignment provisions in any lease governing a leasehold interest, (v) the terms
of licenses of trademarks and copyrights entered into in the ordinary course of
-60-
business, (vi) the contracts set forth on SCHEDULE G and (vii) other contractual
restrictions in respect of assets not material to the business of Credit
Parties, taken as a whole.
4.4 Governmental Authorization; Permits. (a) No consent, approval,
-----------------------------------
authorization or other action by, notice to, or registration or filing with, any
Governmental Authority or other Person is or will be required as a condition to
or otherwise in connection with the due execution, delivery and performance by
any Credit Party of this Agreement or any of the other Transaction Documents to
which it is or will be a party or the legality, validity or enforceability
hereof or thereof, other than (i) consents, authorizations and filings in
connection with the Xxxxxxxx Acquisition that, except as indicated on Schedule
C, have been (or on or prior to the Closing Date will have been) made or
obtained and that are (or on the Closing Date will be) in full force and effect,
which consents, authorizations and filings are listed thereon, (ii) filings of
Uniform Commercial Code financing statements and other instruments necessary to
perfect the Liens created by the security documents in connection with the
Senior Credit Facility, (iii) consents that would be required in respect of the
leases referred to in clause (iv) of SECTION 4.3 and (iv) consents the failure
of which to obtain would not, individually or in the aggregate, have a Material
Adverse Effect.
(b) Each Credit Party has, and is in good standing with respect to,
all governmental approvals, licenses, permits and authorizations necessary to
conduct its business as presently conducted and to own or lease and operate its
properties, except for those the failure to obtain which could not be reasonably
expected, individually or in the aggregate, to have a Material Adverse Effect.
4.5 Litigation. There are no actions, investigations, suits or
----------
proceedings pending or, to the knowledge of the Borrower (after due
investigation) threatened, at law, in equity or in arbitration, before any
court, other Governmental Authority or other Person ("Litigation"), (i) against
or affecting any Credit Party or any of such Person's properties that could, if
adversely
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determined, be reasonably expected to have a Material Adverse Effect, or (ii)
with respect to this Agreement, any of the other Transaction Documents or any of
the Transactions. The Borrower has not been advised that there is a reasonable
likelihood of an adverse determination of any Litigation, which adverse
determination, should it occur, would have a Material Adverse Effect.
4.6 Taxes. Each Credit Party has timely filed all federal and all
-----
material state and local tax returns and reports required to be filed by it and
has paid all taxes, assessments, fees and other charges levied upon it or upon
its properties that are shown thereon as due and payable, other than those that
are being contested in good faith and by proper proceedings and for which
adequate reserves have been established in accordance with GAAP. Such returns
accurately reflect in all material respects all liability for taxes of the
Borrower and its Subsidiaries for the periods covered thereby. Except as
described in SCHEDULE D, there is no ongoing audit or examination or, to the
knowledge of the Borrower, other investigation by any Governmental Authority of
the tax liability of any Credit Party and there is no unresolved claim by any
Governmental Authority concerning the tax liability of any Credit Party for any
period for which tax returns have been or were required to have been filed,
other than claims for which adequate reserves have been established in
accordance with GAAP. No Credit Party has waived or extended or has been
requested to waive or extend the statute of limitations relating to the payment
of any taxes. As of the Closing Date, no federal income tax return or report
has been required to have been filed by any Credit Party.
4.7 Subsidiaries. As of the Closing Date and after giving effect to
------------
the Transactions, the Borrower has no Subsidiaries and does not otherwise have
any equity or other ownership interest in any corporation, partnership, joint
venture or other Person.
4.8 Full Disclosure. All factual information furnished to the Agent
---------------
or any Lender on or prior to the Closing Date in writing by or on behalf of any
Credit Party for purposes of or in connection with this Agreement, the
transactions contemplated
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hereby and the other Transactions is, and all other such factual information
hereafter furnished to the Agent or any Lender in writing by or on behalf of any
Credit Party will be, true and accurate in all material respects on the date as
of which such information is dated or certified (or, if such information has
been amended or supplemented, on the date as of which any such amendment or
supplement is dated or certified) and not made incomplete by omitting to state a
material fact necessary to make the statements contained therein, in light of
the circumstances under which such information was provided, not misleading. No
fact is known, no condition exists nor has any event occurred which has not been
disclosed herein or in any other document, certificate or statement furnished to
the Agent or the Lenders for use in the transactions contemplated hereby which,
singly or in the aggregate, could reasonably be expected to have a Material
Adverse Effect.
4.9 Margin Regulations. Neither the Borrower nor any of its
------------------
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying
Margin Stock. No proceeds of the Loans will be used, directly or indirectly, to
purchase or carry any Margin Stock, to extend credit for such purpose or for any
other purpose that would violate or be inconsistent with Regulations G, T, U or
X or any provision of the Exchange Act.
4.10 Financial Matters. (a) To the knowledge of the Borrower, the
-----------------
audited consolidated balance sheets of Xxxxxxxx at November 30, 1995, 1994 and
1993 and the related consolidated statements of income, stockholders equity and
cash flows of Xxxxxxxx for the three-year period ended November 30, 1995
certified by Ernst & Young, L.L.P., copies of which have been delivered to the
Agent, were prepared in accordance with GAAP, have been prepared from, and are
consistent with, the books and records of Xxxxxxxx and fairly present the
consolidated financial position of Xxxxxxxx as at the respective dates thereof
and the consolidated results of operations and cash flows of Xxxxxxxx for the
periods then ended. No events which have had or could reasonably be expected to
have a Material Adverse Effect have occurred since November 30, 1995 (it being
understood that, with regard solely to
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the period from November 30, 1995 to the Closing Date, such representation is
made as to the knowledge of the Borrower).
(b) To the knowledge of the Borrower, the unaudited consolidated
balance sheets of Xxxxxxxx at August 31, 1996 and the related consolidated
statements of income, stockholders equity and cash flows of Xxxxxxxx for the
nine-month period then ended, copies of which have been delivered to the Agent,
were prepared in accordance with GAAP consistently applied (except to the extent
noted therein), have been prepared from, and are consistent with, the books and
records of Xxxxxxxx and fairly present the consolidated financial position of
Xxxxxxxx as of such date and the consolidated results of operations and cash
flows of Xxxxxxxx for the period covered thereby, in each case subject to normal
year-end audit adjustments (including footnotes), consistent with past
practices.
(c) The unaudited pro forma sheet of the Borrower as of August 31,
1996, a copy of which has heretofore been delivered to the Agent (the "Pro Forma
Balance Sheet"), gives pro forma effect to the consummation of the Xxxxxxxx
Acquisition, the issuance of the Senior Indebtedness, the completion of the
Equity Financing, the extensions of credit made under this Agreement, the
payment of transaction fees and expenses incident to the foregoing, and the
consummation of all other Transactions, all as if such events had occurred on
such date. The Pro Forma Balance Sheet has been prepared in accordance with GAAP
(subject to the absence of footnotes required by GAAP and subject to normal
year-end adjustments) and, subject to stated assumptions made in good faith and
having a reasonable basis set forth therein, presents fairly in all material
respects the financial condition of the Borrower on an unaudited pro forma basis
as of the date set forth therein after giving effect to the consummation of the
Transactions as described above. Prior to the Closing Date, the Borrower has not
engaged in any business, owned any assets or incurred or assumed any liabilities
except in connection with the execution and performance of the Transaction
Documents.
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(d) The Borrower has prepared, and has heretofore furnished to the
Agent a copy of, annual projected balance sheets and statements of income and
cash flows of the Borrower for the six-year period beginning with the year ended
December 31, 1996, giving effect to the consummation of the Xxxxxxxx
Acquisition, the issuance of the Senior Indebtedness, the completion of the
Equity Financing, the extensions of credit made under this Agreement, the
payment of transaction fees and expenses related to the foregoing, and the
consummation of the other Transactions (the "Projections"). In the opinion of
management of the Borrower, the assumptions used in the preparation of the
Projections were fair, complete and reasonable when made and continue to be
fair, complete and reasonable as of the date hereof. The Projections have been
prepared in good faith by the executive and financial personnel of the Borrower,
are complete and represent a reasonable estimate of the future performance and
financial condition of the Borrower, subject to the uncertainties and
approximations inherent in any projections and without any representation or
warranty that the projected results will be achieved.
(e) Upon consummation of the Transactions and as of the Closing Date:
(i) The fair saleable value of the assets of the Borrower and each
of its Subsidiaries, on a stand-alone basis, exceeds the amount that will
reasonably be required to be paid on or in respect of the existing debts
and other liabilities (including Contingent Obligations) of such Person as
they mature.
(ii) The assets of each of the Borrower and each of its
Subsidiaries, on a stand-alone basis, do not constitute unreasonably small
capital for any such Person to carry out its business as conducted as of
the Closing Date and as proposed to be conducted, including the capital
needs of any such Person, taking into account the particular capital
requirements of the business conducted and to be conducted by such Person,
and the availability of capital in respect
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thereof (with reference, without limitation, to the Projections).
(iii) The Borrower does not intend to, and does not intend to permit
any of its Subsidiaries to, incur debts beyond its ability to pay such
debts as they mature (taking into account the timing and amounts of cash to
be payable on or in respect of debt of each of such Person). As of the
Closing Date, the anticipated cash flow of the Borrower and each of its
Subsidiaries, after taking into account all presently anticipated uses of
the cash of each such Person, will at all times be sufficient to pay all
amounts on or in respect of Indebtedness of each such Person when such
amounts are, as anticipated as of the Closing Date, required to be paid.
(iv) The Borrower does not intend, and does not believe, that final
judgments against any of the Borrower or its Subsidiaries in actions for
money damages will be rendered at a time when, or in an amount such that,
any such Person will be unable to satisfy any such judgments promptly in
accordance with their terms (taking into account the maximum reasonable
amount of such judgments in any such actions and the earliest reasonable
time at which such judgments might be rendered). The anticipated cash flow
of the Borrower and each of its Subsidiaries, on a stand-alone basis, after
taking into account all other anticipated uses of the cash of each such
Person (including the payments on or in respect of debt referred to in
clause (iii) of this SECTION 4.10(E)), will at all times be sufficient to
pay all such judgments promptly in accordance with their terms.
4.11 Ownership of Properties. Each Credit Party (i) has good and
-----------------------
marketable title to all real property owned by it, (ii) holds interests as
lessee under valid leases in full force and effect with respect to all material
leased real and personal property used in connection with its business, (iii)
possesses or has rights to use licenses, patents, copyrights, trademarks,
service marks, trade names and other assets sufficient to enable it to continue
to conduct its business substantially as heretofore
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conducted (including, to the knowledge of the Borrower, as conducted by Xxxxxxxx
prior to the Closing Date) and without any material conflict with the rights of
others, and (iv) after giving effect to the Xxxxxxxx Acquisition, has good title
to all of its other properties and assets reflected in the most recent financial
statements referred to in SECTION 4.10(A) (except as sold or otherwise disposed
of since the date thereof in the ordinary course of business), in each case
under (i), (ii), (iii) and (iv) above free and clear of all Liens other than
Permitted Liens, and other than for encumbrances or restrictions that could not
reasonably be expected to have a Material Adverse Effect. SCHEDULE E lists, as
of the Closing Date and after giving effect to the Transactions, all real
property leasehold interests of each Credit Party, indicating in each case the
identity of the owner, the nature of the leased premises and the address of the
property. As of the Closing Date and after giving effect to the Transactions, no
Credit Party owns any fee interest in any real property.
4.12 ERISA. Each Plan is and has been administered in compliance in
-----
all material respects with all applicable Requirements of Law, including,
without limitation, the applicable provisions of ERISA and the Internal Revenue
Code. No ERISA Event has occurred and is continuing or, to the knowledge of the
Borrower, is reasonably expected to occur with respect to any Plan, in either
case that could be reasonably expected, individually or in the aggregate, to
have a Material Adverse Effect. No Plan has any Unfunded Pension Liability, and
neither the Borrower nor any ERISA Affiliate has engaged in a transaction that
could be subject to Section 4069 or 4212(c) of ERISA, in either instance where
the same could be reasonably expected, individually or in the aggregate, to have
a Material Adverse Effect. Neither the Borrower nor any ERISA Affiliate is
required to contribute to or has, or has at any time had, any liability to a
Multiemployer Plan.
4.13 Environmental Matters. (a) No Hazardous Substances are or have
---------------------
been generated, used, located, released, treated, disposed of or stored by any
Credit Party or, to the knowledge of the Borrower, by any other Person
(including any predecessor in interest) or otherwise in, on or under any portion
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of any real property, leased or owned, of any Credit Party, as could not
reasonably be expected to have a Material Adverse Effect, and no portion of any
such real property or, to the knowledge of the Borrower, any other real property
at any time leased, owned or operated by any Credit Party, has been contaminated
by any Hazardous Substance; and no portion of any real property, leased or
owned, of any Credit Party has been or is presently the subject of an
environmental audit, assessment or remedial action, except for any such
contamination, audit, assessment or remedial action that could not reasonably be
expected to have a Material Adverse Effect.
(b) No portion of any real property leased or owned by any Credit
Party, as of the Closing Date, has been used by a Credit Party or, to the
knowledge of the Borrower, any other Person, as or for a mine, a landfill, a
dump or other disposal facility, a gasoline service station, or (other than for
petroleum substances stored in the ordinary course of business) a petroleum
products storage facility; no portion of such real property or any other real
property at any time leased, owned or operated by any Credit Party has, pursuant
to any Environmental Law, been placed on the "National Priorities List" or
"CERCLIS List" (or any similar federal or state list) of sites subject to
possible environmental problems; and there are not and to Borrower's knowledge
have never been any underground or above-ground storage tanks situated on any
real property currently leased or owned by any Credit Party.
(c) Each Credit Party has obtained all licenses and permits under
Environmental Laws necessary to their respective operations, and all such
licenses and permits are being maintained in good standing, and each Credit
Party is in compliance with all material terms and conditions of such licenses
and permits, except for any such failure to obtain, maintain or comply which
could not reasonably be expected to have a Material Adverse Effect.
(d) No Credit Party has received (i) any notice or claim to the
effect that it is or may be liable to any Person under any Environmental Law,
including without limitation, any claim relating to any Hazardous Materials
except as could not reasonably be expected to have a Material Adverse Effect or
(ii) any letter or
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request for information under Section 104 of the Comprehensive Environmental
Response, Compensation, and Liability Act (42 U.S.C. (S) 9604) or comparable
foreign or state laws regarding any matter which could reasonably be expected to
result in a Material Adverse Effect, and, to the best of the Borrower's
knowledge, no Credit Party is involved in any investigation, response or
corrective action relating to or in connection with any Hazardous Materials at
any real property occupied by such Person or at any other location except for
such of the foregoing which could not reasonably be expected to have a Material
Adverse Effect.
(e) No Credit Party is subject to any judicial or administrative
proceeding alleging the violation of or liability under any Environmental Laws
which, if adversely determined, could reasonably be expected to have a Material
Adverse Effect.
(f) No Credit Party nor any of its respective properties or
operations is subject to any outstanding written order or agreement with any
governmental authority or private party relating to (a) any actual or potential
violation of or liability under any Environmental Laws or (b) any Environmental
Claims except for such of the foregoing which could not reasonably be expected
to have a Material Adverse Effect.
(g) No Credit Party or, to the best of the Borrower's knowledge any
predecessor of any Credit Party, has filed any notice under any Environmental
Law indicating past or present ownership or operation of a hazardous waste
treatment, storage or disposal facility, as defined under 40 C.F.R. Parts 260-
270 or any state equivalent.
(h) No Lien in favor of any Person relating to or in connection with
any Environmental Claim has attached to any property currently owned by any
Credit Party, except for any such Lien which could not reasonably be expected to
have a Material Adverse Effect.
(i) All activities and operations of each Credit Party are in
compliance with the requirements of all applicable
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Environmental Laws, except to the extent the failure so to comply, individually
or in the aggregate, could not be reasonably expected to have a Material Adverse
Effect. No Credit Party is involved in any suit, action or proceeding, or has
received any notice, complaint or other request for information from any
Governmental Authority or other Person, in either case with respect to any
actual, alleged or threatened Environmental Claims that, if adversely
determined, could be reasonably expected, individually or in the aggregate, to
have a Material Adverse Effect.
(j) To the Borrower's knowledge, no event or condition has occurred
which may interfere with present compliance by any Credit Party with any
Environmental Law, or which may give rise to any liability of any Credit Party
under any Environmental Law, which individually or in the aggregate, has had or
could reasonably be expected to have a Material Adverse Effect.
4.14 Compliance With Governing Documents, Decrees and Laws. (a) No
-----------------------------------------------------
Credit Party is in violation of (i) its articles of incorporation, articles of
organization, bylaws, operating agreement or any other organizational documents
or (ii) any order, decree or judgment of any Governmental Authority having
jurisdiction over any such Person.
(b) Each Credit Party has timely filed all material reports,
documents and other materials required to be filed by it under all applicable
Requirements of Law with any Governmental Authority, has retained all material
records and documents required to be retained by it under all applicable
Requirements of Law, and is otherwise in compliance with all applicable
Requirements of Law in respect of the conduct of its business and the ownership
and operation of its properties, except for such Requirements of Law the failure
to comply with which, individually or in the aggregate, could not be reasonably
expected to have a Material Adverse Effect.
4.15 Labor Relations. Except as could not reasonably be expected to
---------------
have a Material Adverse Effect: (a) no Credit Party is engaged in any unfair
labor practice within the meaning of the National Labor Relations Act of 1947,
as amended; (b) there is
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(i) no unfair labor practice complaint before the National Labor Relations
Board, or grievance or arbitration proceeding arising out of or under any
collective bargaining agreement, pending or, to the knowledge of the Borrower,
threatened against any Credit Party, (ii) no strike, lock-out, slowdown,
stoppage, walkout or other labor dispute pending or, to the knowledge of the
Borrower, threatened against any Credit Party and (iii) to the knowledge of the
Borrower, no petition for certification or union election or union organizing
activities with respect to any Credit Party and the Borrower is not aware of any
existing or imminent labor disturbance by the employees of any Credit Party's
principal suppliers, manufacturers or customers that could, singly or in the
aggregate, have a Material Adverse Effect.
4.16 Regulated Industries. No Credit Party is (i) an "investment
--------------------
company," a company "controlled" by an "investment company," or an "investment
advisor," within the meaning of the Investment Company Act of 1940, as amended,
or (ii) a "holding company," a "subsidiary company" of a "holding company," or
an "affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
as amended or (iii) subject to regulation under the Federal Power Act.
4.17 Insurance. SCHEDULE F sets forth a summary (that is true and
---------
correct in all material respects) of all insurance policies or arrangements
carried or maintained by any Credit Party as of the Closing Date and after
giving effect to the Transactions. The assets, properties and business of the
Credit Parties are insured against such hazards and liabilities, under such
coverages and in such amounts, as are customarily maintained by prudent
companies of established repute engaged in the same or similar businesses and
under policies issued by insurers of recognized responsibility.
4.18 Certain Contracts. SCHEDULE G lists, as of the Closing Date and
-----------------
after giving effect to the Transactions, each contract, agreement or commitment,
written or oral, to which any Credit Party is a party, by which any of them or
their respective
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properties is bound or to which any of them is subject and that (i) relates to
employment of senior executives of a Credit Party or labor matters, (ii)
evidences Funded Debt of a Credit Party or (iii) the termination or breach of
which by a Credit Party could reasonably be expected to have a Material Adverse
Effect, in each case other than purchase orders in the ordinary course of
business and the Transaction Documents, and also indicates the parties, subject
matter and term thereof. As of the Closing Date, each such contract is in full
force and effect, and no Credit Party or, to the knowledge of the Borrower, any
other party thereto, is in default under any such contract.
4.19 Capitalization. As of the Closing Date and after giving effect
--------------
to the Transactions, the capitalization of each Credit Party is set forth on
SCHEDULE H. All issued and outstanding Capital Stock of the Borrower and each
Subsidiary has been duly authorized and validly issued and, to the extent
applicable, is fully paid and nonassessable. As of the Closing Date and after
giving effect to the Transactions, there will be no outstanding securities
convertible into or exchangeable for Capital Stock of any Credit Party or
options, warrants or other rights to purchase or subscribe for Capital Stock of
any Credit Party or contracts, commitments, agreements, understandings or
arrangements of any kind to which any Credit Party is a party relating to the
issuance of any Capital Stock of such Credit Party, any such convertible or
exchangeable securities or any such options, warrants or rights other than
warrants which may be issued to the Lenders in certain events. As of the
Closing Date, no stockholder or member of the Borrower or any of its
Subsidiaries has or will have any preemptive rights to subscribe for any
additional equity securities of such Credit Party. Any issuance and sale of
Capital Stock of the Borrower and any Subsidiary, upon such issuance and sale,
will either (a) have been registered or qualified under applicable federal and
state securities laws or (b) be exempt therefrom.
4.20 Transaction Documents. The Borrower has heretofore furnished to
---------------------
each Lender a true and complete copy of each of the Securities Purchase
Agreement, the Securityholders Agreement as
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defined in the Senior Credit Facility, in each case together with all schedules
and exhibits referred to therein or delivered pursuant thereto and all
amendments, modifications and waivers relating thereto. As of the Closing Date,
none of such Transaction Documents has been amended, modified or supplemented,
nor have any of the provisions thereof been waived, in any material respect
other than as approved in writing by the Agent. All representations and
warranties of any Credit Party contained in any of such Transaction Documents
were true and correct in all material respects on and as of the date made and
will be true and correct in all material respects on and as of the Closing Date
with the same effect as though made on and as of the Closing Date, except as
contemplated by the terms of such Transaction Documents.
4.21 Broker's or Finder's Fees. No broker's or finder's fees or
-------------------------
commissions will be payable by any Credit Party with respect to any transaction
contemplated hereby or in connection with the Transactions and no similar fees
or commissions will be payable by any Credit Party for any other services
rendered to a Credit Party in connection with the transactions contemplated
hereby and thereby.
4.22 Guarantees. Each Guarantor shall, on the date it executes and
----------
delivers a Guarantee hereunder, have the full corporate power, authority and
capacity to execute and deliver such Guarantee and to perform all of its
obligations to be performed thereunder; all corporate and other acts, conditions
and things required to be done and performed or to have occurred prior to such
execution and delivery to constitute such Guarantee as a valid and legally
binding obligation of such Guarantor enforceable in accordance with its terms
shall have been done and performed and shall have occurred in due compliance
with all applicable Laws; on the date of such execution and delivery, the
execution, delivery and performance of such Guarantee by such Guarantor will not
(i) violate any provision of Law or any provision of the charter or bylaws of
such Guarantor, or (ii) result in a breach of, a default under (including,
without limitation, any event which with notice or lapse of time, or both, would
constitute a breach of or a default under), or the creation of any Lien on the
properties or
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assets of such Guarantor, the Borrower or any Subsidiary of the Borrower under
any Contract to which such Guarantor or the Borrower or the Borrower is a party
or by which the properties or assets of such Guarantor or the Borrower may be
bound or affected; on the date of such execution and delivery, each Guarantee
executed and delivered by a Guarantor shall constitute legal, valid, binding and
unconditional obligations of the Guarantor executing and delivering it to the
Lenders hereunder, enforceable in accordance with its terms, except to the
extent that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization or similar laws affecting the enforcement of
creditors' rights generally or by general principles of equity (regardless of
whether such enforcement is considered in a proceeding in equity or at law); and
the foregoing representations and warranties of the Borrower shall be deemed for
all purposes to have been made on each date when a Guarantee is delivered
hereunder with respect solely to that Guarantee and the Guarantor so issuing
such Guarantee.
4.23 Senior Subordinated Indenture; Etc. Each of the Borrower and
----------------------------------
the Guarantors shall (to the extent such documents are executed), on the date it
executes and delivers the Senior Subordinated Indenture and the Exchange Notes
and the Take-Out Securities and the indenture governing the Take-Out Securities
(or the guarantees related thereto, as the case may be), have the full corporate
power, authority and capacity to do so and to perform all of its obligations to
be performed thereunder; all corporate and other acts, conditions and things
required to be done and performed or to have occurred prior to such execution
and delivery to constitute them as valid and legally binding obligations of the
Borrower enforceable against the Borrower and the Guarantors in accordance with
their respective terms except to the extent that the enforceability thereof may
be limited by applicable bankruptcy, insolvency, reorganization or similar laws
affecting the enforcement of creditors' rights generally or by general
principles of equity (regardless of whether such enforcement is considered in a
proceeding in equity or at law), shall have been done and performed and shall
have occurred in due compliance with all applicable Laws; on the date, if any,
of such execution and delivery by the Borrower and the Guarantors, the Senior
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Subordinated Indenture and the Exchange Notes and the Take-Out Securities (and
the guarantees) and the indenture governing the Take-Out Securities shall
constitute legal, valid, binding and unconditional obligations of the Borrower
and the Guarantors, as the case may be, enforceable against the Borrower and the
Guarantors, as the case may be, in accordance with their respective terms,
except to the extent that the enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors' rights generally or by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law).
SECTION 5 AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that, until the Loans and the Notes
and all other amounts due under this Agreement have been paid in full it shall
perform all covenants in this Section 5 required to be performed by it:
5.1 Financial Statements. The Borrower will deliver to the Agent:
--------------------
(a) As soon as available and in any event within thirty (30) days
after the end of each month ending after the Closing Date, (i) unaudited
consolidated balance sheets of the Borrower and its Subsidiaries as of the end
of such month and unaudited consolidated statements of income and cash flows for
the Borrower and its Subsidiaries for the month then ended and for that portion
of the fiscal year then ended, in each case setting forth comparative
consolidated figures as of the end of and for the corresponding period in the
preceding fiscal year, all in reasonable detail and prepared in accordance with
GAAP (subject to the absence of notes required by GAAP and subject to normal
year-end adjustments) applied on a basis consistent with that of the preceding
month or containing disclosure of the effect on the financial condition or
results of operations of any change in the application of accounting principles
and practices during such
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month, and certified by a Financial Officer of the Borrower as fairly presenting
the financial condition and results of operations of the Borrower and its
Subsidiaries on a consolidated basis as of the dates and for the periods
indicated;
(b) As soon as available and in any event within forty-five (45) days
after the end of each of the first three fiscal quarters of each fiscal year,
beginning with the fiscal quarter ended September 30, 1996, (i) unaudited
consolidated balance sheets of the Borrower and its Subsidiaries as of the end
of such fiscal quarter and unaudited consolidated statements of income and cash
flows for the Borrower and its Subsidiaries for the fiscal quarter then ended
and for that portion of the fiscal year then ended, in each case setting forth
comparative consolidated figures as of the end of and for the corresponding
period in the preceding fiscal year, all in reasonable detail and prepared in
accordance with GAAP (subject to the absence of notes required by GAAP and
subject to normal year-end adjustments) applied on a basis consistent with that
of the preceding quarter or containing disclosure of the effect on the financial
condition or results of operations of any change in the application of
accounting principles and practices during such quarter (and, in the case of the
financial statements as of and for the period ended September 30, 1996, which
are not required by this Agreement to be delivered together with a Compliance
Certificate, such statements shall be certified by a Financial Officer of the
Borrower as fairly presenting the financial condition and results of operations
of the Borrower and its Subsidiaries on a consolidated basis as of the dates and
for the periods indicated) and (ii) if applicable, the Borrower's quarterly
report on Form 10-Q for such quarterly period; and
(c) As soon as available and in any event within 100 days after the
end of each fiscal year, beginning with the fiscal year ending December 31,
1996, (i) an audited consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such fiscal year and audited consolidated
statements of income and cash flows for the Borrower and its Subsidiaries for
the fiscal year then ended, in each case setting forth comparative figures as of
the end of and for the preceding fiscal year, all in reasonable
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detail, together with (y) a report thereon by Ernst & Young, L.L.P. or another
certified public accounting firm of recognized national standing reasonably
acceptable to the Required Lenders that is not qualified as to going concern or
scope of audit and to the effect that (A) such financial statements present
fairly the consolidated financial condition and results of operations of the
Borrower and its Subsidiaries as of the dates and for the periods indicated in
accordance with GAAP applied on a basis consistent with that of the preceding
year or containing disclosure of the effect on the financial position or results
of operations of any change in the application of accounting principles and
practices during such year and (B) the examination by such accountants in
connection with such financial statements has been made in accordance with
generally accepted auditing standards, and (z) a report by such accountants to
the effect that, based on and in connection with their examination of the
financial statements of the Borrower and its Subsidiaries, such accountants
obtained no knowledge of the occurrence or existence of any Potential Event of
Default or Event of Default relating to accounting or financial reporting
matters, or a statement specifying the nature and period of existence of any
such Potential Event of Default or Event of Default disclosed by their audit;
provided, however, that such accountants shall not be liable by reason of the
-------- -------
failure to obtain knowledge of any Potential Event of Default or Event of
Default that would not be disclosed or revealed in the course of their audit
examination, and (ii) if applicable, the Borrower's annual report on Form 10-K
for such year; and
(d) As soon as available and in any event within sixty (60) days
after the end of each fiscal quarter of each fiscal year, beginning with the
fiscal quarter ended September 30, 1996, unaudited statements of profit and loss
(listing revenues, contribution profit and circulation figures) for each of the
top twenty publications (ranked by revenues) of the Borrower and its
Subsidiaries (and to the extent not already included in such group, the
Scheduled Titles) for such fiscal quarter.
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At the Borrower's option the financial statements described in
subsections (a), (b) (c) and (d) above may be consolidated financial statements
of Holdings and its Subsidiaries, provided that not less than 99% of the assets,
liabilities, revenues, income and other financial items contained in the
financial statements of Holdings and its Subsidiaries shall be attributable to
the Borrower and its Subsidiaries.
5.2 Other Business and Financial Information. The Borrower will
----------------------------------------
deliver to the Agent:
(a) Concurrently with each delivery of the financial statements
described in SECTION 5.1(B) or SECTION 5.1(C), beginning with the delivery of
financial statements with respect to the fiscal quarter ending September 30,
1996, a Compliance Certificate in the form of Exhibit III with respect to the
period covered by the financial statements then being delivered, executed by a
Financial Officer of the Borrower.
(b) As soon as available and in any event within thirty (30) days
after the end of each fiscal year, beginning with the fiscal year ending
December 31, 1996, a consolidated operating budget for the Borrower and its
Subsidiaries for the succeeding fiscal year (prepared on a quarterly basis)
together with a certificate of a Financial Officer of the Borrower to the effect
that such budget has been prepared in good faith and is a reasonable estimate of
the financial position and results of operations of the Borrower and its
Subsidiaries for the period covered thereby and that such Financial Officer has
no reason to believe that such budget is misleading in any material respect in
light of the circumstances existing at the time of preparation or delivery
thereof (but without representation or warranty that the results reflected
therein will actually be achieved); and as soon as available from time to time
thereafter, any modifications or revisions to or restatements of such budget;
(c) Promptly upon receipt thereof, copies of all reports in final
form (other than reports of a routine or ministerial nature which are not
material) submitted to the Borrower by its
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independent certified public accountants in connection with each annual, interim
or special audit, including, without limitation, any comment letter submitted by
such accountants to management in connection with their annual audit, and
promptly upon completion thereof, any response reports from the Borrower in
respect thereof;
(d) Promptly upon the sending, filing or receipt thereof, copies of
(i) all financial statements, reports, notices and proxy statements that the
Borrower or any of its Subsidiaries shall send or make available generally to
the members of Holdings in their capacity as such or to the stockholders of
BrightView, (ii) all regular, periodic and special reports, registration
statements and prospectuses (other than on Form S-8) that the Borrower or any of
its Subsidiaries shall render to or file with the Securities and Exchange
Commission, the National Association of Securities Dealers, Inc. or any national
securities exchange and (iii) all press releases and other statements made
available generally by the Borrower or any of its Subsidiaries to the public
concerning material developments in the business of the Borrower or any of its
Subsidiaries.
(e) Promptly upon (and in any event within (5) Business Days after) a
Responsible Officer obtains knowledge thereof, written notice of any of the
following:
(i) the occurrence of any Potential Event of Default or Event of
Default or of any condition or event that would be required to be disclosed
in a current report filed with the Commission on Form 8-K (whether or not
the Borrower is required to file such reports under the Exchange Act),
together with a written statement of a Responsible Officer of the Borrower
specifying the nature and period of existence of such event or condition
and the action that the Borrower has taken, is taking and proposes to take
with respect thereto;
(ii) the institution or threatened institution of any action, suit,
investigation or proceeding against or affecting the Borrower or any of its
Subsidiaries, including any such investigation or proceeding by any
Governmental Authority
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(other than routine periodic inquiries, investigations or reviews), that
seeks to enjoin or otherwise prevent the consummation of, or to recover
damages or obtain relief as a result of, any of the Transactions, or that
could, if adversely determined, be reasonably expected, individually or in
the aggregate, to have a Material Adverse Effect, and any material
development in any litigation or other proceeding previously reported
pursuant to SECTION 4.5 or this SECTION 5.2(E)(II);
(iii) the receipt by the Borrower or any of its Subsidiaries from
any Governmental Authority of any notice asserting any failure by the
Borrower or any of its Subsidiaries to be in compliance with applicable
Requirements of Law or that threatens the taking of any action against the
Borrower or such Subsidiary or sets forth circumstances that, if taken or
adversely determined, could be reasonably expected to have a Material
Adverse Effect;
(iv) the occurrence of any ERISA Event that could be reasonably
expected to have a Material Adverse Effect, together with (i) a written
statement of a Responsible Officer of the Borrower specifying the details
of such ERISA Event and the action that the Borrower has taken, is taking
and proposes to take with respect thereto, (ii) a copy of any notice with
respect to such ERISA Event that may be required to be filed with the PBGC
and (iii) a copy of any notice delivered by the PBGC to the Borrower or
such ERISA Affiliate with respect to such ERISA Event;
(v) the termination, resignation or replacement of any of the
chairman, chief executive officer, president or chief operating officer of
the Borrower, and (together with copies thereof) the execution of any
modification of any existing employment agreement, or any new employment
agreement, with any such officer;
(vi) the occurrence of any material default under, or any proposed
or threatened termination or cancellation of, any
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material contract or agreement to which the Borrower or any of its
Subsidiaries is a party, the termination or cancellation of which could be
reasonably expected to have a Material Adverse Effect;
(vii) the occurrence of any of the following: (i) the assertion of
any Environmental Claim against or affecting the Borrower, any of its
Subsidiaries or any of their respective real property, leased or owned;
(ii) the receipt by the Borrower or any of its Subsidiaries of notice of
any alleged violation of or noncompliance with any Environmental Laws; or
(iii) the taking of any remedial action by the Borrower, any of its
Subsidiaries or any other Person in response to the actual or alleged
generation, storage, release, disposal or discharge of any Hazardous
Substance on, to, upon or from any real property leased or owned by the
Borrower or any of its Subsidiaries; but in each case under clauses (i),
(ii) and (iii) above, only to the extent the same could be reasonably
expected to have a Material Adverse Effect; and
(viii) any other matter or event that has, or could be reasonably
expected to have, a Material Adverse Effect, together with a written
statement of a Responsible Officer of the Borrower setting forth the nature
and period of existence thereof and the action that the Borrower has taken,
is taking and proposes to take with respect thereto;
(f) At the same time provided to the holders of the Bridge Notes or
the Term Notes, any information provided to such holders pursuant to SECTION 5.1
of this Agreement;
(g) Promptly upon (and in any event not later than two (2) Business
Days after) determination of the Xxxxxxxx Purchase Price Adjustment, a
certificate signed by a Financial Officer of the Borrower, in form and substance
satisfactory to the Agent, attaching or setting forth the calculation of the
Xxxxxxxx Purchase Price Adjustment;
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(h) Not later than the last day of each fiscal year of the Borrower,
a report in form and substance satisfactory to the Agent outlining all material
insurance coverage maintained as of the date of such report by the Borrower and
its Subsidiaries and all material insurance coverage planned to be maintained by
such Persons in the subsequent fiscal year;
(i) Promptly after the availability thereof, copies of all material
amendments to the articles of organization, operating agreement or other
organizational documents of the Borrower or any of its Subsidiaries; and
(j) As promptly as reasonably possible, such other information about
the business, condition (financial or otherwise), operations or properties of
the Borrower or any of its Subsidiaries (including any Plan and any information
required to be filed under ERISA, and including any statements, audits or other
reports submitted by or on behalf of the Borrower or any of its Subsidiaries to
any state Governmental Authority) as the Agent or any Lender may from time to
time reasonably request.
5.3 Existence; Franchise; Maintenance of Properties. The Borrower
-----------------------------------------------
will, and will cause each of its Subsidiaries to, (i) maintain and preserve in
full force and effect its limited liability company or corporate existence, as
applicable, except as expressly permitted otherwise by SECTION 6.6, (ii) obtain,
maintain and preserve in full force and effect all other rights, franchises,
licenses, permits, certifications, approvals and authorizations required by
Governmental Authorities and necessary to the ownership, occupation or use of
its properties or the conduct of its business, except to the extent the failure
to do so could not be reasonably expected to have a Material Adverse Effect, and
(iii) keep all material properties in good working order and condition (normal
wear and tear excepted) and from time to time make all necessary repairs to and
renewals and replacements of such properties, except to the extent that any of
such properties are obsolete or are being replaced.
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5.4 Compliance with Laws. The Borrower will, and will cause each of
--------------------
its Subsidiaries to, comply in all respects with all Requirements of Law
applicable in respect of the conduct of its business and the ownership and
operation of its properties, except to the extent the failure so to comply could
not be reasonably expected to have a Material Adverse Effect.
5.5 Payment of Obligations. The Borrower will, and will cause each
----------------------
of its Subsidiaries to, (i) pay all liabilities and obligations as and when due
(subject to any applicable subordination provisions), except to the extent
failure to do so could not be reasonably expected to have a Material Adverse
Effect, and (ii) pay and discharge all taxes, assessments and governmental
charges or levies imposed upon it, upon its income or profits or upon any of its
properties, prior to the date on which penalties would attach thereto, and all
lawful claims that, if unpaid, might become a Lien upon any of the properties of
the Borrower or any of its Subsidiaries; provided, however, that neither the
-------- -------
Borrower nor any of its Subsidiaries shall be required to pay any such tax,
assessment, charge, levy or claim that is being contested in good faith and by
proper proceedings and as to which the Borrower or such Subsidiary is
maintaining adequate reserves with respect thereto in accordance with GAAP,
unless and until any tax lien notice has become effective with respect thereto
or until any lien resulting therefrom attaches to its properties and becomes
enforceable against its other creditors.
5.6 Insurance. The Borrower will, and will cause each of its
---------
Subsidiaries to, maintain with financially sound and reputable insurance
companies insurance with respect to its assets, properties and business, against
such hazards and liabilities, of such types and in such amounts, as is
customarily maintained by companies of established reputation engaged in the
same or similar businesses similarly situated, and maintain such other or
additional insurance on such terms and subject to such conditions as may be
required under any security documents in connection with the Senior Credit
Facility.
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5.7 Maintenance of Books and Records; Inspection. The Borrower will,
--------------------------------------------
and will cause each of its Subsidiaries to, (i) maintain adequate books,
accounts and records, in which full, true and correct entries in all material
respects shall be made of all financial transactions in relation to its business
and properties, and prepare all financial statements required under this
Agreement, in each case in accordance with GAAP and in compliance with the
requirements of any Governmental Authority having jurisdiction over it, and (ii)
permit employees or agents of the Agent or any Lender to inspect its properties
and examine or audit its books, records, working papers and accounts and make
copies and memoranda of them, and to discuss its affairs, finances and accounts
with its officers and employees and, upon notice to the Borrower, the
independent public accountants of the Borrower and its Subsidiaries (and by this
provision the Borrower authorizes such accountants, in the presence of a
Responsible Officer, to discuss the finances and affairs of the Borrower and its
Subsidiaries), all at such times and from time to time, upon reasonable notice
and during business hours, as may be reasonably requested.
5.8 Fiscal Year. The Borrower will, within thirty (30) days after
-----------
the Closing Date, cause the ending date of its fiscal year to be December 31.
5.9 Exchange of Term Notes. (a) Borrower will, at any time during
----------------------
the period commencing 60 days prior to the Conversion Date and continuing for so
long as any Term Notes bearing interest at the Fixed Rate remain outstanding, if
so requested in writing by the Agent (the "Exchange Document Request"):
(i) Subject to SECTIONS 5.9(II) below, as promptly as practicable after
receipt of the Exchange Document Request, (a) execute and deliver,
cause each Guarantor to execute and deliver, and cause a bank or
trust company acting as trustee thereunder to execute and deliver,
the Senior Subordinated Indenture, and (b) execute and deliver, and
cause each Guarantor to execute and deliver for the benefit of any
holder of a note issued under the
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Senior Subordinated Indenture (the "Exchange Notes"), the
Registration Rights Agreement.
(ii) The Senior Subordinated Indenture and Registration Rights Agreement
shall have the terms as are generally set forth in the Term Sheet
attached hereto as EXHIBIT V. The Borrower and Agent shall cooperate
---------
and negotiate in good faith as to the precise terms of the Senior
Subordinated Indenture and the Registration Rights Agreement, both
of which shall be in form, scope and substance as is customary for
indentures and registration right agreements relating to high-yield
debt securities issued for cash in the then prevailing market. In
the event that the Borrower and Agent have not reached agreement as
to the precise terms of the Senior Subordinated Indenture or the
Registration Rights Agreement within 30 days after the receipt of
the Exchange Document Request as provided in paragraph (i) above,
then upon the written request of either the Borrower or the Lender,
such unresolved terms shall be determined by binding arbitration
conducted in accordance with the Rules of the Center for Public
Resources Institute for Dispute Resolution by a sole arbitrator. To
the extent not governed by such rules, such arbitrator shall be
directed by the Agent to set a schedule for determination of such
dispute that is reasonable under the circumstances. The arbitration
will be conducted in New York City. The arbitration will be governed
by the United States Arbitration Act, 9 U.S.C. (S)(S) 1-16. Judgment
upon the award rendered by the arbitrator may be entered by any
court having jurisdiction. The cost of such arbitration shall be
borne equally among the Borrower and Agent.
(b) The Borrower will, on the 5th Business Day following the written
request (the "Exchange Request") of the holder of any Term Note bearing interest
at the Fixed Rate (or beneficial owner of a portion thereof) execute and deliver
to such holder or beneficial owner in accordance with the Senior Subordinated
Indenture, if such Senior Subordinated Indenture has been executed and
delivered, an
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Exchange Note in the form attached to the Senior Subordinated Indenture bearing
interest at the Fixed Rate in exchange for such Term Note dated the date of the
issuance of such Exchange Note, payable to the order of such holder or owner, as
the case may be, in the same principal amount as such Term Note (or portion
thereof) being exchanged, and cause each Guarantor to endorse its guarantee
thereon.
5.10 Payments in U.S. Dollars. All payments of any Obligations to be
------------------------
made hereunder or under the Notes by the Borrower or any other obligor with
respect thereto shall be made solely in U.S. Dollars or such other currency as
is then legal tender for public and private debts in the United States of
America.
5.11 Register. The Borrower hereby designates the Agent to serve as
--------
the Borrower's agent, solely for purposes of this SECTION 5.11, to maintain a
register (the "Register") on which it will record the Loans made by each of the
Lenders and each repayment in respect of the principal amount of the Loans of
each Lender. Failure to make any such recordation, or any error in such
recordation shall not affect the Borrower's obligations in respect of such
Loans. With respect to any Lender, the transfer of the Loan Commitments of such
Lender and the rights to the principal of, and interest on, any Loan made
pursuant to such Loan Commitments shall not be effective until such transfer is
recorded on the Register maintained by the Agent with respect to ownership of
such Loan Commitments and Loans and prior to such recordation all amounts owing
to the transferor with respect to such Loan Commitments and Loans shall remain
owing to the transferor. The registration of assignment or transfer of all or
part of any Loan Commitments and Loans shall be recorded by the Agent on the
Register only upon the receipt by the Agent of a properly executed and delivered
assignment and assumption agreement pursuant to SECTION 12.2A. Coincident with
the delivery of such an assignment and assumption agreement to the Agent for
acceptance and registration of assignment or transfer of all or part of a Loan,
or as soon thereafter as practicable, the assigning or transferor Lender shall
surrender the Note evidencing such Loan, and thereupon one or more new Notes of
the same type and in the same aggregate
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principal amount shall be issued to the assigning or transferor Lender and/or
the new Lender.
5.12 Lenders Meeting. The Borrower will participate in a meeting
---------------
with the Lenders once during each fiscal year during which any Obligations are
outstanding hereunder to be held at a location and a time selected by the
Borrower and reasonably satisfactory to the Lenders.
5.13 Additional Guarantors. The Borrower will cause any Person which
---------------------
becomes a Subsidiary (other than Designated Non-Guarantor Subsidiaries) of the
Borrower (whether by creation, acquisition or otherwise) to execute and deliver
a guarantee, in form and substance satisfactory to the Agent (and with such
documentation relating thereto as the Agent shall reasonably require, including,
without limitation, a supplement or amendment to this Agreement and opinions of
counsel as to the enforceability of such guarantee) pursuant to which such
Subsidiary shall become a Guarantor under the Bridge Notes and this Agreement in
accordance with Section 10 with the same effect and to the same extent as if
such Person had been named herein as a Guarantor.
5.14 Permitted Acquisitions. (a) Subject to the provisions of
----------------------
subsection (b) below and the requirements contained in the definition of
Permitted Acquisition, and subject to the other terms and conditions of this
Agreement, the Borrower may from time to time on or after the Closing Date
effect Permitted Acquisitions, provided that, with respect to each Permitted
--------
Acquisition:
(i) no Potential Event of Default or Event of Default shall have
occurred and be continuing at the time of the consummation of such
Permitted Acquisition or would exist immediately after giving effect
thereto;
(ii) if, after giving pro forma effect to such Permitted Acquisition
and any incurrence of Indebtedness in connection therewith (determined as
if such Permitted Acquisition had been consummated and such Indebtedness
incurred as of the
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first day of the period of four consecutive fiscal quarters ending on the
last day of the Borrower's most recently ended fiscal quarter), the
Leverage Ratio, as defined in the Senior Credit Facility, as of the last
day of the Borrower's most recently ended fiscal quarter is equal to or
greater than 5.0 to 1.0, the Acquisition Amount with respect thereto (x) to
the extent paid or payable in cash (other than cash contributed by Holdings
or BrightView to the Borrower specifically for the purpose of paying all or
a portion of the Acquisition Amount and which is in fact used solely for
such purpose ("Designated Acquisition Funds")), shall not exceed
$10,000,000, (y) together with the aggregate of the Acquisition Amounts (to
the extent paid or payable in cash other than Designated Acquisition Funds)
for all other Permitted Acquisitions consummated during the same fiscal
quarter or the period of three consecutive fiscal quarters immediately
prior thereto, shall not exceed $20,000,000, and (z) together with the
aggregate of the Acquisition Amounts (regardless of the form of
consideration) for all other Permitted Acquisitions consummated during the
same fiscal quarter or the period of three consecutive fiscal quarters
immediately prior thereto, shall not exceed $80,000,000; and
(iii) if, after giving pro forma effect to such Permitted Acquisition
and any incurrence of Indebtedness in connection therewith (determined as
if such Permitted Acquisition had been consummated and such Indebtedness
incurred as of the first day of the period of four consecutive fiscal
quarters ending on the last day of the Borrower's most recently ended
fiscal quarter), the Leverage Ratio (as defined in the Senior Credit
Facility) as of the last day of the Borrower's most recently ended fiscal
quarter is less than 5.0 to 1.0, the Acquisition Amount with respect
thereto (to the extent paid or payable in cash other than Designated
Acquisition Funds), together with the aggregate of the Acquisition Amounts
(to the extent paid or payable in cash other than Designated Acquisition
Funds) for all other Permitted Acquisitions consummated during the same
fiscal quarter or the period of
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three consecutive fiscal quarters immediately prior thereto, shall not
exceed $20,000,000.
(b) The Borrower shall have delivered to the Agent and each Lender
the items listed in clauses (i) and (ii) below not less than ten (10) Business
Days prior to the consummation of any Permitted Acquisition with respect to
which the Acquisition Amount exceeds $10,000,000, and the items listed in
clauses (iii) and (iv) below not less than three (3) Business Days prior
thereto:
(i) a reasonably detailed description of the material terms of such
Permitted Acquisition (including, without limitation, the purchase price
and method and structure of payment) and of each Person or business that is
the subject of such Permitted Acquisition (each, a "Target");
(ii) historical financial statements of the Target (or, if there are
two or more Targets that are the subject of such Permitted Acquisition and
that are part of the same consolidated group, consolidated historical
financial statements for all such Targets) for the two (2) most recent
fiscal years available and, if available, for any interim periods since the
most recent fiscal year-end;
(iii) consolidated projected income statements of the Borrower and
its Subsidiaries (giving effect to such Permitted Acquisition and the
consolidation with the Borrower of each relevant Target) for the three-year
period following the consummation of such Permitted Acquisition, in
reasonable detail, together with any appropriate statement of assumptions
and pro forma adjustments; and
(iv) a certificate in form and substance reasonably satisfactory to
the Agent and to the extent it is still a Lender, CIBC, executed by a
Financial Officer of the Borrower setting forth the Acquisition Amount and
further to the effect that, to the best of such individual's knowledge, (x)
the consummation of such Permitted Acquisition will not result in a
violation of any provision of this SECTION 5.14, and after
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giving effect to such Permitted Acquisition and any Borrowings made in
connection therewith, the Borrower will be in compliance with the financial
covenants contained in SECTIONS 7.1 through 7.4 of the Senior Credit
Facility (and, additionally, in the case of a Permitted Acquisition subject
to clause (iii) of subsection (a) of SECTION 6.9 of the Senior Credit
Facility, that the Borrower will be in compliance with the requirements set
forth in such clause (iii) as to the Leverage Ratio as defined in the
Senior Credit Facility), such compliance determined with regard to
calculations made on a pro forma basis in accordance with GAAP as if each
--- -----
Target had been consolidated with the Borrower for those periods applicable
to such covenants (such calculations to be attached to the certificate),
(y) the Borrower believes in good faith that it will continue to comply
with such financial covenants for a period of one year following the date
of the consummation of such Permitted Acquisition, and (z) after giving
effect to such Permitted Acquisition and any Borrowings in connection
therewith, the Borrower believes in good faith that it will have sufficient
availability under the Revolving Credit Commitments as defined in the
Senior Credit Facility to meet its ongoing working capital requirements.
(c) As soon as reasonably practicable after the consummation of any
Permitted Acquisition, the Borrower will deliver to the Agent and each Lender a
copy of the fully executed acquisition agreement (including schedules and
exhibits thereto) and other material documents and closing papers delivered in
connection therewith.
The consummation of each Permitted Acquisition shall be deemed to be a
representation and warranty by the Borrower that (except as shall have been
approved by the Required Lenders) all conditions thereto set forth in this
SECTION 5.14 and in the description furnished under clause (i) of subsection (b)
above have been satisfied in all material respects, that the same is permitted
in accordance with the terms of this Agreement and that the matters certified to
by the Financial Officer of the Borrower in the certificate referred to in
clause (iv) of subsection (b) above are,
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to the best of such individual's knowledge, true and correct in all material
respects as of the date such certificate is given, which representation and
warranty shall be deemed to be a representation and warranty as of the date
thereof for all purposes hereunder, including, without limitation, for purposes
of Sections 4.2 and 9.1 of the Senior Credit Facility.
5.15 Creation or Acquisition of Subsidiaries. Subject to the
---------------------------------------
provisions of SECTION 6.4, the Borrower may from time to time create or acquire
new Subsidiaries in connection with Permitted Acquisitions or otherwise, and the
Subsidiaries of the Borrower may create or acquire new Subsidiaries, provided
--------
that:
Concurrently with (and in any event within ten (10) Business Days
thereafter) the creation or direct or indirect acquisition by the Borrower
thereof, each such new Subsidiary (unless such Subsidiary is a Designated Non-
Guarantor Subsidiary) will execute and deliver to the Agent a Guarantee (or an
appropriate joinder to an existing Guarantee), pursuant to which such new
Subsidiary shall guarantee the payment in full of the Obligations of the
Borrower under this Agreement and the other Loan Documents.
SECTION 6 NEGATIVE COVENANTS
Each of the Borrower and Holdings covenants and agrees that until the
satisfaction in full of the Loans and the Notes and all other monetary
Obligations then due under this Agreement it will fully and timely perform all
covenants in this SECTION 6.
6.1 Indebtedness. The Borrower shall not, and shall not cause or
------------
permit any of its Subsidiaries, create, incur, assume or suffer to exist any
Indebtedness, except for the following ("Permitted Indebtedness"):
(i) the Borrower and the Guarantors may incur and remain liable
with respect to the Obligations;
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(ii) the Borrower and the Guarantors may incur and remain liable
with respect to Indebtedness under the Senior Credit Facility and the
Guarantees thereunder; provided that the aggregate principal amount of
--------
Indebtedness outstanding under the Senior Credit Facility at any one time
shall not exceed the sum of (x) $260,000,000 less the sum of (a) the
aggregate amount of scheduled amortization payments of the principal amount
thereof actually made; provided that the commitments thereunder are
--------
permanently reduced, (b) the aggregate amount of mandatory prepayments of
the principal amount thereof actually made, (c) each permanent reduction of
commitments to extend credit thereunder not otherwise caused pursuant to
clause (a) or (b); plus any amount of Indebtedness permitted under clause
(vii) below which is incurred under the Senior Credit Facility;
(iii) the Borrower and the Guarantors may incur and remain liable
with respect to the Bridge Notes, Term Notes, Take-Out Securities and
Exchange Notes;
(iv) Indebtedness of the Borrower and its Subsidiaries incurred
solely to finance the payment of all or part of the purchase price of any
equipment, real property or other fixed assets acquired in the ordinary
course of business after the Closing Date, including Indebtedness in
respect of capital lease obligations ("Purchase Money Indebtedness") and
any refinancings, renewals or replacements of any such Purchase Money
Indebtedness (subject to the limitations on the principal amount thereof
set forth in this clause (iv)), and other Indebtedness that is unsecured
(other than Indebtedness specified in clauses (i) through (iii) above and
(v) through (x) below, which Purchase Money Indebtedness and other
unsecured Indebtedness shall not exceed $10,000,000 in the aggregate at any
time.
(v) the Borrower and its Subsidiaries may incur and remain liable
with respect to Intercompany Indebtedness;
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(vi) accrued expenses (including salaries accrued and other
compensation), current trade or other accounts payable and other current
liabilities arising in the ordinary course of business and not incurred
through the borrowing of money, provided that the same shall be paid within
90 days of when due except to the extent being contested in good faith and
by appropriate proceedings;
(vii) Indebtedness of the Borrower under Interest Rate Protection
Agreements required pursuant to Section 6.8 of the Senior Credit Facility
or entered into for the purpose of hedging interest rate rises and not for
speculation;
(viii) Indebtedness under Commodity Hedge Agreements entered into in
the ordinary course of business consistent with reasonable business
requirements and not for speculation;
(ix) Indebtedness of the type described in, and secured by Liens of
the type described in, clauses (iv) and (v) of the definition of Permitted
Liens;
(x) Indebtedness consisting of guarantees made in the ordinary
course of business by the Borrower or any of its Subsidiaries of
obligations of the Borrower or any of its Subsidiaries, which obligations
are otherwise permitted under this Agreement; and
(xi) the Borrower and its Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
connection with the Xxxxxxxx Acquisition, additional acquisitions of assets
or stock, Asset Dispositions or other sales of assets; provided that the
--------
maximum assumable liability in respect of all such obligations shall at no
time exceed the gross proceeds actually received by the Borrower and its
Subsidiaries in connection with such Asset Dispositions and other sales.
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6.2 Liens. The Borrower shall not, and shall not cause or permit any
-----
of its Subsidiaries to, directly or indirectly, create, incur, assume or suffer
to exist any Lien on or with respect to any of its property or assets, whether
now owned or hereafter acquired, or file or permit the filing of, or permit to
remain in effect, any financing statement or other similar notice of any Lien
with respect to any such property, asset, income or profits under the Uniform
Commercial Code of any State or under any similar recording or notice statute,
other than the following (collectively, the "Permitted Liens"):
(i) Liens granted to secure the Senior Credit Facility and to
secure obligations under any Interest Rate Protection Agreement entered
into with any lender under the Senior Credit Facility or their respective
Affiliates and any guarantees thereof;
(ii) Liens existing on the Closing Date and set forth on SCHEDULE
A;
(iii) Liens imposed by law, such as Liens of carriers, warehousemen,
mechanics, materialmen and landlords, and other similar Liens incurred in
the ordinary course of business for sums not constituting borrowed money
that are not overdue for a period of more than thirty (30) days or that are
being contested in good faith by appropriate proceedings and for which
adequate reserves have been established in accordance with GAAP (if so
required);
(iv) Liens (other than any Lien imposed by ERISA, the creation or
incurrence of which would result in an Event of Default under Section
9.1(j) of the Senior Credit Facility incurred in the ordinary course of
business in connection with worker's compensation, unemployment insurance
or other forms of government insurance or benefits, or to secure the
performance of letters of credit, bids, tenders, statutory obligations,
surety and appeal bonds, leases, government contracts and other similar
obligations (other than
-94-
obligations for borrowed money) entered into in the ordinary course of
business;
(v) Liens for taxes, assessments or other governmental charges or
statutory obligations that are not delinquent or remain payable without any
penalty or that are being contested in good faith by appropriate
proceedings and for which adequate reserves have been established in
accordance with GAAP (if so required);
(vi) Liens securing the Purchase Money Indebtedness permitted
under clause (iv) of SECTION 6.2; provided that the aggregate principal
--------
amount at any time outstanding of all Indebtedness secured by such Liens,
when combined with the aggregate amount of all other unsecured Indebtedness
outstanding at such time incurred pursuant to clause (iv) of SECTION 6.2,
does not exceed $10,000,000, and provided further that any such Lien (i)
-------- -------
shall attach to such property concurrently with or within twenty (20) days
after the acquisition thereof by the Borrower or such Subsidiary, (ii)
shall not exceed the lesser of (y) the fair market value of such property
or (z) the cost thereof to the Borrower or such Subsidiary and (iii) shall
not encumber any other property of the Borrower or any of its Subsidiaries;
and the replacement, extension or renewal of any such Lien, provided that
such replacement, extension or renewal Lien shall not extend to or cover
any property other than the property subject to such Lien immediately prior
to such replacement, extension or renewal, and provided further that the
Indebtedness secured by such replacement, extension or renewal Lien is
permitted under this Agreement;
(vii) any attachment or judgment Lien not constituting an Event of
Default under Section 9.1(i) of the Senior Credit Facility that is being
contested in good faith by appropriate proceedings and for which adequate
reserves have been established in accordance with GAAP (if so required);
-95-
(viii) Liens arising from the filing, for notice purposes only, of
financing statements in respect of operating leases;
(ix) Liens arising by operation of law in favor of depositary banks
and collecting banks, incurred in the ordinary course of business;
(x) Liens consisting of restrictions on the transfer of securities
pursuant to applicable federal and state securities laws;
(xi) interests of lessors and licensors under leases and licenses to
which the Borrower or any of its Subsidiaries is a party;
(xii) with respect to any real property occupied by the Borrower or any
of its Subsidiaries, all easements, rights of way, licenses and similar
encumbrances on title that do not materially impair the use of such
property for its intended purposes; and
(xiii) Liens in favor of the trustee or agent under any agreement or
indenture relating to Indebtedness of the Borrower issued in accordance
with clause (iii) of SECTION 6.1.
(xiv) Liens on (a) Real Property Assets or (b) equipment, fixtures
and other similar property of Borrower and any of its Subsidiaries, in each
case securing Indebtedness described in SECTION 6.1(IV); provided that such
--------
Liens shall extend only to the equipment, fixtures, and other similar
property so financed (and improvements or attachments thereto) and the
proceeds thereof;
(xv) the replacement, extension or renewal of any Lien permitted by
this SECTION 6.2 upon or in the same property or replacement property
subject to such Lien and as security for the same obligations or any
refinancings thereof to the extent such refinancings are permitted under
SECTION 6.1; provided
--------
-96-
that such Lien does not extend to or cover any property other than the
property covered by such Lien immediately prior to such replacement,
extension or renewal of such Lien (and improvements or attachments thereto)
and the principal of the obligations secured thereby is not increased; and
(xvi) additional Liens securing Indebtedness at any one time
outstanding not exceeding $5,000,000.
6.3 Restricted Payments.
-------------------
(a) Except as set forth in Section 8.6(a)(ii) of the Senior Credit
Facility, The Borrower shall not, and shall not cause or permit any of its
Subsidiaries to, directly or indirectly (i) declare or pay any dividend, or make
any distribution, on any Capital Stock of the Borrower (other than dividends or
distributions payable solely in Qualified Capital Stock of the Borrower), (ii)
purchase, redeem or otherwise acquire or retire for value any of the Borrower's
Capital Stock, or any warrants, rights or options to acquire shares of any class
of such Capital Stock or (iii) make any principal payment on, purchase, defease,
redeem, prepay, or otherwise acquire or retire for value, other than any
scheduled final maturity, scheduled repayment or scheduled sinking fund payment,
any Subordinated Indebtedness of the Borrower or of a Guarantor (any such
dividend, distribution, purchase, redemption, acquisition, retirement,
defeasance or prepayment set forth in clauses (i), (ii) and (iii) above a
"Restricted Payment").
(b) Notwithstanding the foregoing, if no Potential Event of Default
or Event of Default shall have occurred and be continuing or shall be caused as
a consequence thereof, the provisions set forth in the immediately preceding
paragraph will not prevent (1) the acquisition of any shares of Capital Stock of
the Borrower or the repurchase, redemption or other repayment of any
Subordinated Indebtedness of the Borrower or of a Guarantor in exchange for or
solely out of the proceeds of the substantially concurrent sale (other than to
the Borrower or a Subsidiary of the Borrower) of shares of Qualified Capital
Stock of the Borrower, (2) the repurchase, redemption or other repayment of any
-97-
Subordinated Indebtedness of the Borrower in exchange for or solely out of the
proceeds of the substantially concurrent sale (other than to the Borrower or a
Subsidiary of the Borrower) of Subordinated Indebtedness of the Borrower with a
Weighted Average Life to Maturity equal to or greater than the then remaining
Weighted Average Life to Maturity of the Subordinated Indebtedness repurchased,
redeemed or repaid, and (3) dividend payments or other distributions of cash by
the Borrower in an amount not in excess of (y) $1,000,000 per fiscal year solely
for the purpose of paying fees and expenses of the Credit Parties, including
directory fees, less (z) the amount of any management, advisory, consulting and
similar fees, paid by the Borrower to Xxxxxx Xxxxx and its Affiliates during
such fiscal year.
(c) Notwithstanding the foregoing, if no Event of Default pursuant to
Sections 7.1, 7.6 or 7.7 shall have occurred and be continuing, or would result
from any such distribution, the Borrower may make a Permitted Tax Distribution.
6.4 Investments. The Borrower will not, and will not permit or cause
-----------
any of its Subsidiaries to, directly or indirectly, purchase, own, invest in or
otherwise acquire any Capital Stock, evidence of indebtedness or other
obligation or security or any interest whatsoever in any other Person, or make
or permit to exist any loans, advances or extensions of credit to, or any
investment in cash or by delivery of property in, any other Person, or purchase
or otherwise acquire (whether in one or a series of related transactions) any
portion of the assets, business or properties of another Person (including
pursuant to an Acquisition), or create or acquire any Subsidiary, or become a
partner or joint venturer in any partnership or joint venture (collectively,
"Investments"), or make a commitment or otherwise agree to do any of the
foregoing, other than:
(i) Cash Equivalents;
(ii) Investments consisting of (a) purchases and acquisitions of
inventory, supplies, materials and equipment,
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or (b) licenses or leases of intellectual property and other assets, in
each case in the ordinary course of business,
(iii) Investments consisting of loans and advances to employees
for reasonable travel, relocation and business expenses in the ordinary
course of business, extensions of trade credit in the ordinary course of
business, and prepaid expenses incurred in the ordinary course of business;
(iv) without duplication, Investments consisting of Indebtedness
permitted under clause (v) of SECTION 8.2 of the Senior Credit Facility;
(v) Investments existing on the Closing Date and described in
SCHEDULE 8.5 of the Senior Credit Facility;
(vi) Investments of the Borrower under Interest Rate Protection
Agreements;
(vii) Investments under Commodity Hedge Agreements entered into in the
ordinary course of business consistent with reasonable business
requirements and not for speculation;
(viii) Investments consisting of endorsements for collection or deposit
in the ordinary course of business;
(ix) Investments consisting of the making of capital contributions
or the purchase of Capital Stock (a) by the Borrower or any Subsidiary in
any other Subsidiary that is (or after giving effect to such Investment
will be) a Guarantor (including all such Investments constituting Permitted
Acquisitions, but subject to compliance with the provisions of SECTION 6.9
of the Senior Credit Facility and SECTION 5.14 hereof), and (b) by any
Subsidiary in the Borrower;
(x) Permitted Acquisitions;
(xi) Investments consisting of the contribution by the Borrower to
partnerships, joint ventures or other Persons
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(including Subsidiaries) of the Scheduled Titles in exchange for equity
interests in such Persons, provided that all such Investments are made
--------
within 365 days after the Closing Date;
(xii) Investments consisting of the licensing of publication titles and
other assets pursuant to joint marketing arrangements with other Persons;
(xiii) Investments in the Borrower or any Subsidiary consisting of
Designated Acquisition Funds (as defined in the Senior Credit Facility);
and
(xiv) Investments (other than Investments specified in clauses (i)
through (xiii) above) in an aggregate amount, as valued at the time each
such Investment is made, not exceeding $5,000,000 for all such Investments
from and after the Closing Date (which Investments shall include, without
limitation, (a) Investments in Foreign Subsidiaries as defined in the
Senior Credit Facility and other Designated Non-Guarantor Subsidiaries, (b)
Investments in Persons holding Scheduled Titles, to the extent such
Investments are made with cash or other property not consisting of
Scheduled Titles, and (c) cash or other assets of the Borrower or any of
its Subsidiaries received as consideration by any Person other than the
Borrower or a Wholly Owned Subsidiary in a transaction permitted by SECTION
8.1 of the Senior Credit Facility); provided that the permitted aggregate
--------
amount of such Investments shall increase to (A) $10,000,000 upon delivery
pursuant to SECTION 6.2(A) of the Senior Credit Facility of a Compliance
Certificate indicating a Leverage Ratio as defined in the Senior Credit
Facility of less than 5.0 to 1.0, and (B) $15,000,000 upon delivery
pursuant to SECTION 6.2(A) of the Senior Credit Facility of a Compliance
Certificate evidencing a Leverage Ratio as defined in the Senior Credit
Facility of less than 4.0 to 1.0; and provided further that for purposes of
-------- -------
determining compliance with the limitations set forth in this clause (xiv),
the amount of any such Investment shall be reduced (but not below zero) by
the amount of any cash distributions or cash proceeds (in the case
-100-
of a sale or other disposition of such Investment) actually received from
time to time by the Borrower or any Subsidiary in respect thereof.
6.5 Senior Subordinated Indebtedness. Neither the Borrower nor any
--------------------------------
of the Guarantors shall, directly or indirectly, incur any Indebtedness (other
than the Notes, the Exchange Notes and the Take-Out Securities) that is by its
terms (or by the terms of any agreement governing such Indebtedness)
subordinated in right of payment to any other Indebtedness of the Borrower or of
such Guarantor unless such Indebtedness is also by its terms (or by the terms of
any agreement governing such Indebtedness) made expressly subordinate to the
Loans and the Notes and the Guarantees to substantially the same extent and in
substantially the same manner as such Loans and Notes and Guarantees are
subordinated to the Senior Credit Facility.
6.6 Merger; Consolidation. The Borrower will not, and will not
---------------------
permit or cause any of its Subsidiaries to, liquidate, wind up or dissolve, or
enter into any consolidation, merger or other combination, or agree to do any of
the foregoing; provided, however, that:
-------- -------
(i) the Borrower may merge or consolidate with another Person so
long as (w) the Borrower is the surviving entity, (x) if such other Person
is a Subsidiary immediately prior to giving effect thereto, the aggregate
of any cash or other assets of the Borrower or any of its Subsidiaries
received as consideration pursuant to such transaction by Persons other
than the Borrower or a Wholly Owned Subsidiary shall be deemed to
constitute an Investment made by the Borrower pursuant to clause (xiv) of
Section 8.5 of the Senior Credit Facility, (y) if such other Person is not
a Subsidiary immediately prior to giving effect thereto, such merger or
consolidation shall constitute a Permitted Acquisition and the applicable
conditions and requirements of Sections 6.9 and 6.10 of the Senior Credit
Facility shall be satisfied, and (z) immediately after giving effect
thereto, no Potential Event of Default or Event of Default would exist; and
-101-
(ii) any Subsidiary may merge or consolidate with another Person so
long as (w) the surviving entity is the Borrower or a Guarantor (which may
be the acquired entity), (x) if such other Person is a Subsidiary
immediately prior to giving effect thereto, the aggregate of any cash or
other assets of the Borrower or any of its Subsidiaries received as
consideration pursuant to such transaction by Persons other than the
Borrower or a Wholly Owned Subsidiary shall be deemed to constitute an
Investment made by the Borrower pursuant to clause (xiv) of SECTION 8.5 of
the Senior Credit Facility, (y) if such other Person is not a Subsidiary
immediately prior to giving effect thereto, such merger or consolidation
shall constitute a Permitted Acquisition and the applicable conditions and
requirements of SECTIONS 6.9 and 6.10 of the Senior Credit Facility shall
be satisfied, and (z) immediately after giving effect thereto, no Potential
Event of Default or Event of Default would exist.
6.7 Limitation on Certain Restrictions. The Borrower will not, and
----------------------------------
will not permit or cause any of its Subsidiaries to, directly or indirectly,
create or otherwise cause or suffer to exist or become effective any restriction
or encumbrance on (i) the right of the Borrower and its Subsidiaries to perform
and comply with their respective obligations under the Loan Documents or (ii)
the ability of any Subsidiary of the Borrower to make any dividend payments or
other distributions in respect of its Capital Stock, to repay Indebtedness owed
to the Borrower or any other Subsidiary, to make loans or advances to the
Borrower or any other Subsidiary, or to transfer any of its assets or properties
to the Borrower or any other Subsidiary, in each case other than such
restrictions or encumbrances existing under or by reason of (i) the Loan
Documents, (ii) the Senior Credit Facility and any other agreement or instrument
evidencing or governing any Indebtedness permitted under clause (ii) of SECTION
8.2 of the Senior Credit Facility, (iii) applicable Requirements of Law and,
(iv) customary non-assignment provisions in any lease governing a leasehold
interest, (v) the terms of licenses or trademarks and copyrights entered into in
the ordinary course of business and (vi) other
-102-
contractual restrictions in respect of assets not material to the business of
the Credit Parties, taken as a whole.
6.8 Transactions with Affiliates. The Borrower will not, and will
----------------------------
not permit or cause any of its Subsidiaries to, enter into any material
transaction (including, without limitation, any purchase, sale, lease or
exchange of property or the rendering of any service) with any officer,
director, stockholder or other Affiliate of the Borrower or any Subsidiary,
except in the ordinary course of its business and upon fair and reasonable terms
that are no less favorable to it than would obtain in a comparable arm's length
transaction with a Person other than an Affiliate of the Borrower or such
Subsidiary; provided, however, that nothing contained in this Section shall
-------- -------
prohibit:
(i) transactions described on SCHEDULE J or otherwise expressly
permitted under this Agreement;
(ii) the consummation on the Closing Date of the Transactions; and
(iii) transactions after the Closing Date that are expressly
contemplated by the Securities Purchase Agreement, the Securityholders
Agreement and the Securities Purchase Agreement (including any registration
rights described therein) and that are not prohibited by any other
provision of this Agreement or any other Credit Document, provided that the
--------
aggregate management, advisory, consulting and similar fees paid by the
Borrower to Xxxxxx Xxxxx and its Affiliates pursuant to the Securities
Purchase Agreement or otherwise shall not exceed (y) $1,000,000 during any
fiscal year less (z) the amount of any distributions made by the Borrower
during such fiscal year pursuant to Section 6.3(b)(3) and provided further
-------- -------
that any such fees may accrue but shall not be paid by the Borrower at any
time after the occurrence and during the continuance of a Potential Event
of Default or Event of Default.
-103-
6.9 Permitted Lines of Business. The Borrower will not, and will
---------------------------
not permit or cause any of its Subsidiaries to, engage in any businesses other
than the publication, sale, distribution and licensing of publications and brand
names, copyrights, patents, service marks and trademarks for the conduct of a
publishing, programming, events and media business (including, without
limitation, electronic media), and including new or additional publications,
media, programming or events and the business and activities ancillary thereto
(the "Permitted Lines of Business").
6.10 Amendments or Waivers of Certain Documents. The Borrower will
------------------------------------------
not, and will not permit or cause any of its Subsidiaries to, (i) amend, modify
or waive, or permit the amendment, modification or waiver of, any provision of
the Senior Credit Facility as in effect on the Closing Date, the effect of which
would be to increase the principal amount due thereunder, shorten the time of
payment of any amount due thereunder, increase the applicable interest rate or
amount of fees or costs due thereunder, or make any covenant thereunder more
restrictive as such covenant directly relates to the prompt and timely payment
of any of the Obligations under this Agreement.
6.11 Refinancing of the Loans in Part. Except as set forth in
--------------------------------
Section 12.20, the Borrower shall not, and shall not cause or permit any of its
Subsidiaries to, incur any Indebtedness to Refinance the Loans in part other
than the Exchange Notes, unless the terms, conditions, covenants, events of
default and other provisions in respect of the instruments evidencing the
Indebtedness incurred to Refinance the Loans in part shall have been approved in
writing by the Agent prior to the incurrence of any such Indebtedness.
6.12 Asset Dispositions. The Borrower will not, and will not permit
------------------
or cause any of its Subsidiaries to directly or indirectly consummate any Asset
Disposition except for the sale or disposition of assets outside the ordinary
course of business for cash, provided that (i) the Net Cash Proceeds from such
--------
sales or dispositions, when aggregated with the Net Cash Proceeds from all other
sales and dispositions not otherwise specifically excluded
-104-
under the definition of Asset Disposition that are consummated during the same
fiscal quarter or the period of three consecutive fiscal quarters immediately
prior thereto, do not exceed (A) $5,000,000 in the aggregate for the Borrower
and its Subsidiaries if at the time of such sale or disposition the Leverage
Ratio as defined in the Senior Credit Facility (determined with reference to the
Compliance Certificate then most recently delivered to the Lenders) is greater
than or equal to 5.0 to 1.0, and (B) $10,000,000 in the aggregate for the
Borrower and its Subsidiaries if at the time of such sale or disposition the
Leverage Ratio as defined in the Senior Credit Facility (determined with
reference to the Compliance Certificate then most recently delivered to the
Lenders) is less than 5.0 to 1.0, (ii) to the extent not theretofore expended or
committed to be expended within a reasonable period to acquire assets or
properties or otherwise reinvested in the businesses of the Borrower, such Net
Cash Proceeds are applied to the prepayment of the Loans as defined in the
Senior Credit Facility in accordance with the provisions of SECTION 2.6(H)
thereto, (iii) to the extent not expended or committed to be expended in (ii),
such Net Cash Proceeds are delivered to the Agent within 180 days after receipt
thereof for application in prepayment of the Loans hereunder in accordance with
Section 2.5A(ii), (iv) in no event shall the Borrower or any of its Subsidiaries
sell or otherwise dispose of any of the Capital Stock of any Subsidiary (other
than a Subsidiary to which the Borrower has contributed no assets or properties
other than assets consisting of Scheduled Titles as defined in the Senior Credit
Facility), and (v) immediately after giving effect thereto, no Potential Event
of Default or Event of Default would exist.
Nothing in this covenant shall be deemed to prevent the exercise of
remedies by secured creditors of the Borrower or any Subsidiary of the Borrower.
SECTION 7 EVENTS OF DEFAULT
If any of the following conditions or events ("Events of Default")
shall occur and be continuing:
-105-
7.1 Failure To Make Payments When Due. Failure to pay any
---------------------------------
installment of principal of the Loans when due, whether at stated maturity, by
acceleration, by notice of prepayment or otherwise (whether or not such payment
is prohibited by SECTION 8); or failure to pay any interest on the Loans or any
other amount due under this Agreement within five days or more after the date
due (whether or not such payment is prohibited by SECTION 8); or
7.2 Default in Other Agreements. The Borrower or any other Credit
---------------------------
Party shall (i) fail to pay when due (whether by scheduled maturity,
acceleration or otherwise and after giving effect to any applicable grace
period) any principal of or interest on any Indebtedness (other than the
Indebtedness incurred pursuant to this Agreement) having an aggregate principal
amount of at least $1,000,000; or (ii) fail to observe, perform or comply with
any condition, covenant or agreement contained in any agreement or instrument
evidencing or relating to any such Indebtedness, or any other event shall occur
or condition exist in respect thereof, and the effect of such failure, event or
condition is to cause such Indebtedness to become due, or to be prepaid,
redeemed, purchased or defeased, prior to its stated maturity; or
7.3 Breach of Certain Covenants. Failure of the Borrower or Holdings
---------------------------
to perform or comply with any covenant, term or condition contained in SECTION
5.2 or any agreements or obligations set forth in the Commitment Letter; or
7.4 Breach of Warranty. Any representation, warranty or
------------------
certification made by the Borrower or Holdings in any Loan Document or in any
statement or certificate at any time given by the Borrower in writing pursuant
hereto or thereto or in connection herewith or therewith shall be false or
incorrect in any material respect on the date as of which made or deemed made;
or
7.5 Other Defaults Under Agreement or Loan Documents. The Borrower
------------------------------------------------
or Holdings shall default in the performance of or compliance with any covenant,
term or condition contained in this Agreement or the other Loan Documents (other
than those covered by
-106-
SECTION 7.1, 7.3, 7.4, 7.10 or 7.11) and such default shall not have been
remedied or waived in accordance with this Agreement within 30 days after the
date of written notice from the holder or holders of not less than 25% in
aggregate principal amount of the Loans then outstanding of such default; or
7.6 Voluntary Bankruptcy; Appointment of Custodian, Etc. The
---------------------------------------------------
Borrower or any other Credit Party (other than a Designated Non-Guarantor
Subsidiary) shall (i) file a voluntary petition or commence a voluntary case
seeking liquidation, winding-up, reorganization, dissolution, arrangement,
readjustment of debts or any other relief under the Bankruptcy Code or under any
other applicable bankruptcy, insolvency or similar law now or hereafter in
effect, (ii) consent to the institution of, or fail to controvert in a timely
and appropriate manner, any petition or case of the type described in section
7.7, (iii) apply for or consent to the appointment of or taking possession by a
custodian, trustee, receiver or similar official for or of itself or all or a
substantial part of its properties or assets, (iv) fail generally, or admit in
writing its inability, to pay its debts generally as they become due, (v) make a
general assignment for the benefit of creditors or (vi) take any corporate
action to authorize or approve any of the foregoing; or
7.7 Involuntary Bankruptcy; Appointment of Custodian, Etc. Any
-----------------------------------------------------
involuntary petition or case shall be filed or commenced against the Borrower or
any other Credit Party (other than a Designated Non-Guarantor Subsidiary)
seeking liquidation, winding-up, reorganization, dissolution, arrangement,
readjustment of debts, the appointment of a custodian, trustee, receiver or
similar official for it or all or a substantial part of its properties or any
other relief under the Bankruptcy Code or under any other applicable bankruptcy,
insolvency or similar law now or hereafter in effect, and such petition or case
shall continue undismissed and unstayed for a period of sixty (60) days; or an
order, judgment or decree approving or ordering any of the foregoing shall be
entered in any such proceeding; or
-107-
7.8 Judgments and Attachments. Any one or more money judgments,
-------------------------
writs or warrants of attachment, executions or similar processes involving an
aggregate amount (exclusive of amounts fully bonded or covered by insurance as
to which the surety or insurer, as the case may be, has acknowledged its
liability in writing) in excess of $1,000,000 shall be entered or filed against
the Borrower or any other Credit Party or any of their respective properties and
the same shall not be dismissed, stayed or discharged for a period of thirty
(30) days or in any event later than five days prior to the date of any proposed
sale thereunder; or
7.9 Dissolution. Any order, judgment or decree shall be entered
-----------
against the Borrower, any Material Subsidiary or Holdings decreeing the
dissolution or split-up of the Borrower, that Material Subsidiary or Holdings
and such order shall remain undischarged or unstayed for a period in excess of
30 days; or
7.10 Guarantee. (i) Any Guarantee or any provision thereof shall
---------
cease to be in full force or effect (other than in accordance with its express
terms or in accordance with this Agreement), or (ii) any Guarantor or any Person
acting by or on behalf of such Guarantor shall deny or disaffirm such
Guarantor's obligations under its Guarantee, or (iii) any Guarantor shall
default in any material respect in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed, after
giving effect to any applicable grace periods, pursuant to its Guarantee; or
7.11 Foreclosure. The agent under the Senior Credit Facility or any
-----------
other party entitled to act thereunder commences judicial proceedings to
foreclose on the collateral securing the Senior Credit Facility or exercises any
right under applicable law or any instrument evidencing a security interest or
other encumbrance in respect of such collateral to take ownership or effect the
transfer of such collateral in lieu of foreclosure.
THEN (i) upon the occurrence of any Event of Default described in the
foregoing Sections 7.6 or 7.7, all of the unpaid principal amount of and accrued
interest on the Loans and all other
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outstanding Obligations shall automatically become immediately due and payable,
without presentment, demand, protest or other requirements of any kind, all of
which are hereby expressly waived by the Borrower, and the commitments of the
Lenders hereunder shall thereupon terminate, and (ii) upon the occurrence of any
other Event of Default, the Agent shall, upon written notice of the holder or
holders of a majority in aggregate principal amount of the Loans then
outstanding, by written notice to the Borrower, declare all of the unpaid
principal amount of and accrued interest on the Loans and all other outstanding
Obligations to be, and the same shall forthwith become, due and payable, and the
obligations of the Lenders hereunder shall thereupon terminate; provided that,
--------
for so long as the Senior Credit Facility is in effect, such declaration shall
not become effective until the earlier of (a) 5 days after receipt by the
Borrower and the agent under the Senior Credit Facility of notice of such
acceleration and (b) acceleration of such of the Indebtedness under the Senior
Credit Facility; and provided further that if any declaration of acceleration
----------------
under this Agreement occurs solely because an Event of Default set forth in
Section 7.2 has occurred and is continuing, such declaration of acceleration
shall be automatically annulled if the holders of the Indebtedness which is the
subject of such Event of Default have rescinded their declaration of
acceleration in respect of such Indebtedness within thirty days of such
acceleration of such Indebtedness and the Agent has received written notice
thereof within such time and if no other Event of Default has occurred during
such thirty-day period which has not been cured or waived in accordance with
this Agreement. Nevertheless, if at any time after acceleration of the maturity
of the Loans, the Borrower shall pay all arrears of interest and all payments on
account of the principal thereof which shall have become due otherwise than by
acceleration (with interest on principal and, to the extent permitted by law, on
overdue interest, at the rates specified in this Agreement or the Notes) and all
Events of Default and Potential Events of Default (other than non-payment of
principal of and accrued interest on the Loans and the Notes due and payable
solely by virtue of acceleration) shall be remedied or waived pursuant to
SECTION 12.6, then the Agent shall, upon written notice of the holders of a
majority in aggregate principal amount of the
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Loans then outstanding, by written notice to the Borrower rescind and annul the
acceleration and its consequences; but such action shall not affect any
subsequent Event of Default or Potential Event of Default or impair any right
consequent thereon.
SECTION 8 SUBORDINATION
8.1 Obligations Subordinated to Senior Indebtedness of the Borrower.
---------------------------------------------------------------
The Lenders covenant and agree that payments in respect of the Obligations by
the Borrower shall be subordinated in accordance with the provisions of this
SECTION 8 to the prior payment in full, in cash or Cash Equivalents, of all
amounts payable in respect of Senior Indebtedness of the Borrower, whether now
outstanding or hereafter created (including any interest accruing subsequent to
an event specified in SECTION 7.6 or 7.7 whether or not such interest is an
allowed claim against the Borrower), that the subordination is for the benefit
of the holders of Senior Indebtedness of the Borrower, and that each holder of
Senior Indebtedness of the Borrower whether now outstanding or hereafter
created, incurred, assumed or guaranteed shall be deemed to have acquired Senior
Indebtedness of the Borrower in reliance upon the covenants and provisions
contained in this Agreement.
8.2 Priority and Payment Over of Proceeds
-------------------------------------
in Certain Events.
-----------------
(a) Subordination on Dissolution, Liquidation or Reorganization of
--------------------------------------------------------------
the Borrower. Upon any payment or distribution of assets or securities of the
------------
Borrower of any kind or character, whether in cash, property or securities, upon
any dissolution or winding up or total or partial liquidation or reorganization
of the Borrower, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all Senior Indebtedness of the Borrower
(including any interest accruing subsequent to an event specified in SECTION 7.6
or 7.7 whether or not such interest is an allowed claim enforceable against the
Borrower) shall first be paid in full in cash or Cash Equivalents, before the
Lenders shall be entitled to receive any payment or
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distribution by the Borrower in respect of any Obligations and upon any such
dissolution or winding up or liquidation or reorganization, any payment or
distribution of assets or securities of the Borrower of any kind or character,
whether in cash, property or securities, to which the Lenders would be entitled
except for the provisions of this SECTION 8 shall be made by the Borrower or by
any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, directly to the holders of the Senior
Indebtedness of the Borrower or their representatives to the extent necessary to
pay all of the Senior Indebtedness of the Borrower in full and in Cash or Cash
Equivalents to the holders of such Senior Indebtedness of the Borrower.
(b) Subordination on Default on Senior Indebtedness. Upon the
-----------------------------------------------
maturity of any Senior Indebtedness of the Borrower by lapse of time,
acceleration or otherwise, all Senior Indebtedness of the Borrower then due and
payable shall first be paid in full in cash or Cash Equivalents, before any
payment or distribution is made by the Borrower or any Person acting on behalf
of the Borrower with respect to the Obligations. No direct or indirect payment
or distribution by the Borrower or any Person acting on behalf of the Borrower
of or in respect of any Obligations whether pursuant to the terms of the Loans
or upon acceleration or otherwise shall be made, if at the time of such payment,
there exists a default in the payment of all or any portion of any principal,
interest, fees, letter of credit reimbursement obligations or other amounts
payable in respect of any Senior Indebtedness of the Borrower and such default
shall not have been cured or waived or the benefits of this sentence waived by
or on behalf of the holders of such Senior Indebtedness. In addition, during the
continuation of any Non-Payment Default, upon the receipt by the Agent of
written notice from the agent or representative of the holders of such Senior
Indebtedness, no such payment may be made by the Borrower upon or in respect of
the Obligations, for a period ("Payment Blockage Period") commencing on the date
of receipt of such notice and ending 179 days after receipt of such notice
(unless such Payment Blockage Period shall be terminated by written notice to
the Agent from such agent or representative). Notwithstanding anything
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herein to the contrary, (x) in no event will a Payment Blockage Period or
successive Payment Blockage Periods with respect to the same payment on the
Obligations extend beyond 179 days from the date the payment on the Obligations
was due and (y) there must be 180 consecutive days in any 365-day period during
which no Payment Blockage Period is in effect. For all purposes of this SECTION
8.2(B), no Non-Payment Default which existed or was continuing on the date of
the commencement of any Payment Blockage Period with respect to the Senior
Indebtedness of the Borrower initiating such Payment Blockage Period shall be,
or be made, the basis for the commencement of a second Payment Blockage Period
by the holders or by the agent or other representative of such Senior
Indebtedness whether or not within a period of 365 consecutive days, unless such
Non-Payment Default shall have been cured or waived for a period of not less
than 90 consecutive days.
(c) Rights and Obligations of the Lenders. In the event that,
-------------------------------------
notwithstanding the foregoing provisions prohibiting such payment or
distribution, the Agent or any Lender shall have received any payment or
distribution in respect of any Obligation (other than as permitted by Sections
(a) and (b) of this SECTION 8.2) at a time when such payment is prohibited by
this SECTION 8.2, then and in such event such payment or distribution shall be
received and held in trust for the holders of the Senior Indebtedness of the
Borrower and shall be paid over or delivered to the holders of the Senior
Indebtedness of the Borrower remaining unpaid to the extent necessary to pay in
full in cash or Cash Equivalents all Senior Indebtedness of the Borrower in
accordance with its terms after giving effect to any concurrent payment or
distribution to the holders of such Senior Indebtedness of the Borrower.
If payment in respect of the Obligations is accelerated because of an
Event of Default, the Borrower shall promptly notify the agent or other
representatives for Senior Indebtedness of the Borrower of such acceleration.
Upon any payment or distribution of assets or securities referred to
in this SECTION 8, the Lenders (notwithstanding any
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other provision of this Agreement) shall be entitled to rely upon any order or
decree of a court of competent jurisdiction in which such dissolution, winding
up, liquidation or reorganization proceedings are pending, and upon a
certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making any such payment or distribution, delivered to the
Lenders for the purpose of ascertaining the Persons entitled to participate in
such distribution, the holders of Senior Indebtedness of the Borrower, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this SECTION 8.
The Borrower shall promptly give written notice to each of the Lenders
of any default or event of default under the Senior Credit Facility and, in the
event of any such event of default, shall provide to the Agent the name and
address of the agent under the Senior Credit Facility.
With respect to the holders and owners of Senior Indebtedness of the
Borrower, each Lender undertakes to perform only such obligations on the part
of such Lender as are specifically set forth in this SECTION 8, and no implied
covenants or obligations with respect to the holders or owners of Senior
Indebtedness of the Borrower shall be read into this Agreement against the
Lenders. The Lenders shall not be deemed to owe any fiduciary duty to the
holders or owners of Senior Indebtedness of the Borrower or to any agent under
the Senior Credit Facility.
8.3 Payments May Be Paid Prior to Dissolution. Nothing contained in
-----------------------------------------
this SECTION 8 or elsewhere in this Agreement shall prevent or delay (i) the
Borrower, except under the conditions described in SECTION 8.2, from making
payments at any time for the purpose of making payments in respect of its
Obligations, or from depositing with the Agent any moneys for such payments, or
(ii) subject to SECTION 8.2, the application by the Agent of any moneys
deposited with it for the purpose of making payments in respect of Obligations.
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8.4 Rights of Holders of Senior Indebtedness of the Borrower Not To
---------------------------------------------------------------
Be Impaired. No right of any present or future holder of any Senior
-----------
Indebtedness of the Borrower to enforce subordination as provided in this
SECTION 8 shall at any time in any way be prejudiced or impaired by any act or
failure to act by any such holder, or by any noncompliance by the Borrower with
the terms and provisions and covenants herein, regardless of any knowledge
thereof any such holder may have or otherwise be charged with. Without in any
way limiting the generality of the foregoing Section, such holders of Senior
Indebtedness of the Borrower may, at any time and from time to time without
impairing or releasing the subordination provided in this SECTION 8 or the
obligations of the Lenders hereunder to the holders of Senior Indebtedness of
the Borrower, do any one or more of the following: (i) change the manner, place,
terms or time of payment of, or renew or alter, Senior Indebtedness of the
Borrower or otherwise amend or supplement in any manner Senior Indebtedness of
the Borrower or any instrument evidencing the same or any agreement under which
any Senior Indebtedness of the Borrower is outstanding; (ii) sell, exchange,
release, or otherwise deal with any property pledged, mortgaged, or otherwise
securing Senior Indebtedness of the Borrower or fail to perfect or delay in the
perfection of the security interest in such property; (iii) release any Person
liable in any manner for the collection of Senior Indebtedness of the Borrower;
and (iv) exercise or refrain from exercising any rights against the Borrower and
any other Person. Each Lender by purchasing or accepting a Note waives any and
all notice of the creation, modification, renewal, extension or accrual of any
Senior Indebtedness of the Borrower and notice of or proof of reliance by any
holder or owner of Senior Indebtedness of the Borrower upon this SECTION 8 and
the Senior Indebtedness of the Borrower shall conclusively be deemed to have
been created, contracted or incurred in reliance upon this SECTION 8, and all
dealings between the Borrower and the holders and owners of the Senior
Indebtedness of the Borrower shall be deemed to have been consummated in
reliance upon this SECTION 8.
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The provisions of this SECTION 8 are intended to be for the benefit
of, and shall be enforceable directly by, the holders of the Senior Indebtedness
of the Borrower.
8.5 Subrogation. Upon the payment in full in accordance with the
-----------
terms of SECTION 8.2 of all amounts payable under or in respect of the Senior
Indebtedness of the Borrower, the Lenders shall be subrogated to the rights of
the holders of such Senior Indebtedness of the Borrower to receive payments or
distributions of assets of Borrower made on such Senior Indebtedness of the
Borrower until the Obligations shall be paid in full in cash or Cash
Equivalents; and for purposes of such subrogation no payments or distributions
to holders of such Senior Indebtedness of the Borrower of any cash, property or
securities to which the Lenders would be entitled except for the provisions of
this SECTION 8, and no payment over pursuant to the provisions of this SECTION 8
to holders of such Senior Indebtedness of the Borrower by the Lenders, shall, as
between the Borrower, its creditors other than holders of such Senior
Indebtedness of the Borrower and the Lenders, be deemed to be a payment by the
Borrower to or on account of such Senior Indebtedness of the Borrower, it being
understood that the provisions of this SECTION 8 are solely for the purpose of
defining the relative rights of the holders of such Senior Indebtedness of the
Borrower, on the one hand, and the Lenders, on the other hand. A release of any
claim by any holder of Senior Indebtedness of the Borrower shall not limit the
Lenders' rights of subrogation under this SECTION 8.5.
If any payment or distribution to which the Lenders would otherwise
have been entitled but for the provisions of this SECTION 8 shall have been
applied, pursuant to the provisions of this SECTION 8, to the payment of all
amounts payable under the Senior Indebtedness of the Borrower, then and in such
case, the Lenders shall be entitled to receive from the holders of such Senior
Indebtedness of the Borrower at the time outstanding the full amount of any such
payments or distributions received by such holders of Senior Indebtedness of the
Borrower in excess of the amount sufficient to pay all Senior Indebtedness of
the Borrower payable under or in respect of the Senior Indebtedness of the
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Borrower in full in cash or Cash Equivalents in accordance with the terms of
SECTION 8.2.
8.6 Obligations of the Borrower Unconditional. Nothing contained in
-----------------------------------------
this SECTION 8 or elsewhere in this Agreement is intended to or shall impair as
between the Borrower and the Lenders the obligations of the Borrower, which are
absolute and unconditional, to pay to the Lenders the Obligations as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Lenders and creditors of
the Borrower other than the holders of the Senior Indebtedness of the Borrower,
nor shall anything herein or therein prevent the Lenders from exercising all
remedies otherwise permitted by applicable law upon default under this
Agreement, subject to the rights, if any, under this SECTION 8 of the holders of
such Senior Indebtedness of the Borrower in respect of cash, property or
securities of the Borrower received upon the exercise of any such remedy.
The failure to make a payment in respect of Obligations by reason of
any provision of this SECTION 8 shall not prevent the occurrence of an Event of
Default under SECTION 7.
8.7 Lenders Authorize Agent To Effectuate Subordination. Each Lender
---------------------------------------------------
hereby authorizes and expressly directs the Agent on its behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provided in this SECTION 8 and appoints the Agent its attorney in fact for such
purpose, including, without limitation, in the event of any dissolution, winding
up, liquidation or reorganization of the Borrower (whether in bankruptcy,
insolvency, receivership, reorganization or similar proceedings or upon an
assignment for the benefit of creditors or any other similar remedy or
otherwise) tending towards liquidation of the business and assets of the
Borrower, the immediate filing of a claim for the unpaid balance of the
Obligations in the form required in said proceedings and causing said claim to
be approved. If the Agent does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the
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holders of the Senior Indebtedness of the Borrower are hereby authorized to have
the right to file and are hereby authorized to file, but shall have no
obligation to file, an appropriate claim for and on behalf of the Lenders. In
the event of any such proceeding, until the Senior Indebtedness of the Borrower
is paid in full in cash or Cash Equivalents, without the consent of the holders
of a majority in principal amount outstanding of Senior Indebtedness of the
Borrower, no Lender shall waive, settle or compromise any such claim or claims
relating to the Obligations that such Lender now or hereafter may have against
the Borrower.
SECTION 9 THE AGENT
9.1 Appointment. Each Lender hereby irrevocably designates and
-----------
appoints First Union as Agent of such Lender to act as specified herein and in
the other Loan Documents, and each Lender hereby irrevocably authorizes First
Union as the Agent to take such action on its behalf under the provisions of
this Agreement and the other Loan Documents and to exercise such powers and
perform such duties as are expressly delegated to the Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto. The Agent agrees to act as such upon the express
conditions contained in this SECTION 9. Notwithstanding any provision to the
contrary elsewhere in this Agreement or in any other Loan Document, the Agent
shall not have any duties or responsibilities, except those expressly set forth
herein or in the other Loan Documents, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise exist
against the Agent. The provisions of this SECTION 9 are solely for the benefit
of the Agent and the Lenders, and neither the Borrower nor any of its
Subsidiaries shall have any rights as a third party beneficiary of any of the
provisions hereof. In performing its functions and duties under this Agreement,
the Agent shall act solely as agent of the Lenders and the Agent does not assume
and shall not be deemed to have assumed any obligation or relationship of agent
or trust with or for the Borrower or any of its Subsidiaries.
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9.2 Delegation of Duties. The Agent may execute any of its duties
--------------------
under this Agreement or any other Loan Document by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care except to the extent otherwise required by SECTION 9.3.
9.3 Exculpatory Provisions. Neither the Agent nor any of its
----------------------
officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
(i) liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or the other Loan 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 the Borrower, any of its
Subsidiaries, Holdings or any of their respective officers contained in this
Agreement, any other Loan Documents, or in any certificate, report, statement or
other document referred to or provided for in, or received by the Agent under or
in connection with, this Agreement or any other Loan Document or for any failure
of the Borrower, any of its Subsidiaries, Holdings or any of their respective
officers to perform its obligations hereunder or thereunder. The Agent shall
not be under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or the other Loan Documents, or to inspect the properties,
books or records of the Borrower or any of its Subsidiaries. The Agent shall
not be responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectability or sufficiency of this Agreement or any other
Loan Document or for any representations, warranties, recitals or statements
made herein or therein or made 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 Agent to
the Lenders or by or on behalf of the Borrower, any of its Subsidiaries or
Holdings to the Agent or any Lender or be required to ascertain or inquire as to
the
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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 Potential Event of
Default or Event of Default.
9.4 Reliance by Agent. The 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, facsimile, telex
or teletype message, statement, order or other document or conversation believed
by it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons, and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower or any of its
Subsidiaries or Holdings), independent accountants and other experts selected by
the Agent. The Agent shall be fully justified in failing or refusing to take
any action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the 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. As between the Agent and the
Lenders, the Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Loan Documents in
accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders.
9.5 Notice of Default. The Agent shall not be deemed to have
-----------------
knowledge or notice of the occurrence of any Potential Event of Default or Event
of Default hereunder unless the Agent has actually received notice from a Lender
or the Borrower referring to this Agreement, describing such Potential Event of
Default or Event of Default and stating that such notice is a "notice of
default." In the event that the Agent receives such a notice, the Agent shall
give prompt notice thereof to the Lenders. The Agent shall take such action
with respect to such Potential Event of Default or Event of Default as shall be
reasonably directed by the Required
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Lenders; provided that, as between the Agent and the Lenders unless and until
--------
the Agent shall have received such directions, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Potential Event of Default or Event of Default as it shall deem
advisable in the best interests of the Lenders.
9.6 Non-Reliance on Agent and Other Lenders. Each Lender expressly
---------------------------------------
acknowledges that neither the Agent nor any of its respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by the Agent hereinafter
taken, including any review of the affairs of the Borrower or any of its
Subsidiaries, shall be deemed to constitute any representation or warranty by
the Agent to any Lender. Each Lender represents to the Agent that it has,
independently and without reliance upon the Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, assets, operations, property,
financial and other condition, prospects and creditworthiness of the Borrower
and its Subsidiaries and made its own decision to make its Loans hereunder and
enter into this Agreement. Each Lender also represents that it will,
independently and without reliance upon the Agent or any other Lender, and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement, and to make such investigation as it
deems necessary to inform itself as to the business, assets, operations,
property, financial and other condition, prospects and creditworthiness of the
Borrower and its Subsidiaries. The Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, assets, property, financial and other
condition, prospects or creditworthiness of the Borrower, any of its
Subsidiaries or Holdings which may come into the possession of the Agent or any
of its officers, directors, employees, agents, attorneys-in-fact or affiliates.
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9.7 Indemnification. The Lenders agree to indemnify the Agent in its
---------------
capacity as such ratably according to their respective "percentages" as used in
determining the Required Lenders at such time, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, reasonable expenses or disbursements of any kind whatsoever which may at
any time (including, without limitation, at any time following the payment in
full of the Obligations) be imposed on, incurred by or asserted against the
Agent in its capacity as such in any way relating to or arising out of this
Agreement or any other Loan Document, or any documents contemplated by or
referred to herein or the transactions contemplated hereby of any action taken
or omitted to be taken by the Agent under or in connection with any of the
foregoing, but only to the extent that any of the foregoing is not paid by the
Borrower, any of its Subsidiaries or Holdings; provided that no Lender shall be
--------
liable to the Agent for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting solely from the gross negligence or willful
misconduct of the Agent. If any indemnity furnished to the Agent for any
purpose shall, in the opinion of the Agent be insufficient or become impaired,
the 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 9.7 shall survive the payment in full of all
Obligations.
9.8 Agent in Its Individual Capacity. The Agent and its affiliates
--------------------------------
may make loans to, accept deposits from and generally engage in any kind of
business with the Borrower, its Subsidiaries and Holdings as though the Agent
were not the Agent hereunder. With respect to the Loans made by it and all
Obligations owing to it, the Agent shall have the same rights and powers under
this Agreement as any Lender and may exercise the same as though it were not the
Agent and the terms "Lender" and "Lenders" shall include the Agent in its
individual capacity.
9.9 Resignation of the Agent; Successor Agent. The Agent may resign
-----------------------------------------
as the Agent upon 20 days' notice to the Lenders
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and the Borrower. Upon the resignation of the Agent, the Required Lenders shall
appoint from among the Lenders a successor Agent which is a bank or a trust
company for the Lenders subject to prior approval by the Borrower (such approval
not to be unreasonably withheld or delayed), whereupon such successor agent
shall succeed to the rights, powers and duties of the Agent, and the term
"Agent" shall include such successor agent effective upon its appointment, and
the resigning Agent's rights, powers and duties as the Agent shall be
terminated, without any other or further act or deed on the part of such former
Agent or any of the parties to this Agreement. After the resignation of the
Agent hereunder, the provisions of this SECTION 9 shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was Agent under this
Agreement.
SECTION 10 GUARANTEE
10.1 Unconditional Guarantee. Each Guarantor hereby unconditionally,
-----------------------
jointly and severally, guarantees (such guarantee to be referred to herein as
the "Guarantee"), subject to SECTION 11, to each of the Lenders and to the Agent
and their respective successors and assigns that (i) the principal of and
interest on the Loans will be promptly paid in full when due, subject to any
applicable grace period, whether at maturity, by acceleration or otherwise and
interest on the overdue principal, if any, and interest on any interest, to the
extent lawful, of the Loans and all other obligations of the Borrower to the
Lenders or the Agent hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (ii) in case
of any extension of time of payment or renewal of any of the Loans or of any
such other obligations, the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, subject to
any applicable grace period, whether at stated maturity, by acceleration or
otherwise, subject, however, in the case of clauses (i) and (ii) above, to the
limitations set forth in SECTION 10.5. Each Guarantor hereby agrees that its
obligations hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of the
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Loans or this Agreement, the absence of any action to enforce the same, any
waiver or consent by any of the Lenders with respect to any provisions hereof or
thereof, the recovery of any judgment against the Borrower, any action to
enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a Guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Borrower, any right to require a
proceeding first against the Borrower, protest, notice and all demands
whatsoever and covenants that this Guarantee will not be discharged except by
complete performance of the obligations contained in the Loans, this Agreement
and in this Guarantee. If any Lender or the Agent is required by any court or
otherwise to return to the Borrower, any Guarantor, or any custodian, trustee,
liquidator or other similar official acting in relation to the Borrower or any
Guarantor, any amount paid by the Borrower or any Guarantor to the Agent or such
Lender, this Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Guarantor further agrees that, as
between each Guarantor, on the one hand, and the Lenders and the Agent, on the
other hand, (x) the maturity of the obligations guaranteed hereby may be
accelerated as provided in SECTION 7 for the purposes of this Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (y) in the
event of any acceleration of such obligations as provided in SECTION 7, such
obligations (whether or not due and payable) shall forthwith become due and
payable by each Guarantor for the purpose of this Guarantee.
10.2 Subordination of Guarantee. The obligations of each Guarantor
--------------------------
to the Lenders and to the Agent pursuant to the Guarantee of such Guarantor and
this Agreement are expressly subordinate and subject in right of payment to the
prior payment in full of all Guarantor Senior Indebtedness of such Guarantor, to
the extent and in the manner provided in SECTION 11.
10.3 Severability. In case any provision of this Guarantee shall be
------------
invalid, illegal or unenforceable, the validity,
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legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
10.4 Release of a Guarantor. Upon (i) the release by the lenders
----------------------
under the Senior Credit Facility, related documents and future refinancings
thereof of all guarantees of a Guarantor and all Liens on the property and
assets of such Guarantor relating to such Indebtedness, or (ii) the sale or
disposition (whether by merger, stock purchase, asset sale or otherwise) of a
Guarantor (or all or substantially all its assets) to an entity which is not a
Subsidiary of the Borrower and which sale or disposition is otherwise in
compliance with the terms of this Agreement, such Guarantor shall be deemed
released from all obligations under this SECTION 10 without any further action
required on the part of the Agent or any Lender; provided that any such
--------
termination shall occur only to the extent that all obligations of such
Guarantor under all of its guarantees of, and under all of its pledges of assets
or other security interests which secure, such Indebtedness of the Borrower
shall also terminate upon such release, sale or transfer.
The Agent shall deliver an appropriate instrument evidencing such
release upon receipt of a request by the Borrower accompanied by an Officers'
Certificate certifying as to the compliance with this SECTION 10.4. Any
Guarantor not so released remains liable for the full amount of principal of and
interest on the Loans as provided in this SECTION 10.
10.5 Limitation of Guarantor's Liability. Each Guarantor and by its
-----------------------------------
acceptance hereof each of the Lenders hereby confirms that it is the intention
of all such parties that the guarantee by such Guarantor pursuant to its
Guarantee not constitute a fraudulent transfer or conveyance for purposes of any
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar Federal or state law. To effectuate the foregoing
intention, the Lenders and such Guarantor hereby irrevocably agree that the
obligations of such Guarantor under the Guarantee shall be limited to the
maximum amount as will, after giving effect to all other contingent and fixed
liabilities of such Guarantor (including, but not limited to, the Guarantor
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Senior Indebtedness of such Guarantor) and after giving effect to any
collections from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under its Guarantee or
pursuant to SECTION 10.7, result in the obligations of such Guarantor under the
Guarantee not constituting such fraudulent transfer or conveyance.
10.6 Guarantors May Consolidate, etc., on Certain Terms.
--------------------------------------------------
(a) Nothing contained in this Agreement or in the Loans shall prevent
any consolidation or merger of a Guarantor with or into the Borrower or another
Guarantor or shall prevent any sale or conveyance of the property of a Guarantor
as an entirety or substantially as an entirety, to the Borrower or another
Guarantor. Upon any such consolidation, merger, sale or conveyance, the
Guarantee given by such Guarantor shall no longer have any force or effect.
(b) Except as set forth in SECTION 6.7, nothing contained in this
Agreement or in the Loans shall prevent any consolidation or merger of a
Guarantor with or into a corporation or corporations other than the Borrower or
another Guarantor (whether or not affiliated with the Guarantor); provided that,
--------
subject to SECTIONS 10.4 and 10.6(A), (i) immediately after such transaction,
and giving effect thereto, no Potential Event of Default or Event of Default
shall have occurred as a result of such transaction and be continuing, and (ii)
upon any such consolidation, merger, sale or conveyance, the Guarantee of such
Guarantor set forth in this SECTION 10, and the due and punctual performance and
observance of all of the covenants and conditions of this Agreement to be
performed by such Guarantor, shall be expressly assumed (in the event that the
Guarantor is not the surviving corporation in the merger), by supplemental
indenture satisfactory in form to the Agent, executed and delivered to the
Agent, by the corporation formed by such consolidation, or into which the
Guarantor shall have merged, or by the corporation that shall have acquired such
property. In the case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor corporation, by supplemental indenture
executed
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and delivered to the Agent and satisfactory in form and substance to the Agent
of the due and punctual performance of all of the covenants and conditions of
this Agreement to be performed by the Guarantor, such successor corporation
shall succeed to and be substituted for the Guarantor with the same effect as if
it had been named herein as a Guarantor.
10.7 Contribution. In order to provide for just and equitable
------------
contribution among the Guarantors, the Guarantors agree, inter se, that in the
----- --
event any payment or distribution is made by any Guarantor (a "Funding
Guarantor") under its Guarantee, such Funding Guarantor shall be entitled to a
contribution from all other Guarantors in a pro rata amount based on the
--- ----
Adjusted Net Assets of each Guarantor (including the Funding Guarantor) for all
payments, damages and expenses incurred by that Funding Guarantor in discharging
the Borrower's obligations with respect to the Obligations. "Adjusted Net
Assets" of such Guarantor at any date shall mean the lesser of (x) the amount by
which the fair value of the property of such Guarantor exceeds the total amount
of liabilities, including, without limitation, contingent liabilities (after
giving effect to all other fixed and contingent liabilities incurred or assumed
on such date (other than liabilities of such Guarantor under Subordinated
Indebtedness)), but excluding liabilities under the Guarantee, of such Guarantor
at such date and (y) the amount by which the present fair salable value of the
assets of such Guarantor at such date exceeds the amount that will be required
to pay the probable liabilities of such Guarantor on its debts including,
without limitation, Guarantor Senior Indebtedness (after giving effect to all
other fixed and contingent liabilities incurred or assumed on such date and
after giving effect to any collection from any Subsidiary of such Guarantor in
respect of the obligations of such Subsidiary under the Guarantee), excluding
debt in respect of the Guarantee of such Guarantor, as they become absolute and
matured.
10.8 Waiver of Subrogation. Each Guarantor hereby irrevocably waives
---------------------
any claim or other rights which it may now or hereafter acquire against the
Borrower that arise from the existence, payment, performance or enforcement of
such Guarantor's
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obligations under its Guarantee and this Agreement, including, without
limitation, any right of subrogation, reimbursement, exoneration,
indemnification, and any right to participate in any claim or remedy of any
Lender against the Borrower, whether or not such claim, remedy or right arises
in equity, or under contract, statute or common law, including, without
limitation, the right to take or receive from the Borrower, directly or
indirectly, in cash or other property or by set-off or in any other manner,
payment or security on account of such claim or other rights. If any amount
shall be paid to any Guarantor in violation of the preceding sentence and the
Loans shall not have been paid in full, such amount shall be deemed to have been
paid to such Guarantor for the benefit of, and held in trust for the benefit of,
the Lenders, and shall, subject to the provisions of SECTION 8, SECTION 10.2 and
SECTION 11, forthwith be paid to the Agent for the benefit of such Lenders to be
credited and applied upon the Loans, whether matured or unmatured, in accordance
with the terms of this Agreement. Each Guarantor acknowledges that it will
receive direct and indirect benefits from the financing arrangements
contemplated by this Agreement and that the waiver set forth in this SECTION
10.8 is knowingly made in contemplation of such benefits.
10.9 Evidence of Guarantee. To evidence their guarantees to the
---------------------
Lenders set forth in this SECTION 10, each Guarantor hereby agrees to execute
the notation of Guarantee in substantially the form included in EXHIBIT IX.
Each such notation of Guarantee shall be signed on behalf of each Guarantor by
two Officers, or an Officer and an assistant Secretary or one Officer shall sign
and one Officer or an assistant Secretary (each of whom shall, in each case,
have been duly authorized by all requisite corporate actions) shall attest to
such notation of Guarantee.
10.10 Waiver of Stay, Extension or Usury Laws. Each Guarantor
---------------------------------------
covenants that it will not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
or any usury law or other law that would prohibit or forgive such Guarantor from
performing its Guarantee as contemplated herein, wherever enacted, now or at any
time hereafter in force, or which may affect the covenants or
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the performance of this Agreement; and each Guarantor hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Agent, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
10.11 Guarantor Covenant. Holdings shall not, directly or
------------------
indirectly, incur or remain or become directly or indirectly liable with respect
to any Indebtedness except that Holdings (a) may guarantee (i) the Obligations,
(ii) the Bridge Notes, Term Notes, Take-Out Securities and Exchange Notes and
(iii) the indebtedness of the Borrower under the Senior Credit Facility and the
other Credit documents, as defined in the Senior Credit Facility and (b) may
incur Indebtedness in an aggregate principal amount not exceeding $5,000,000
outstanding at any time issued to repurchase its Capital Stock from former
management employees in connection with their termination or departure (provided
--------
that such Indebtedness is subordinated in right and time of payment to (i)
through (iii) of (a) above on terms and conditions satisfactory to the Agent in
its sole discretion (which terms and conditions may, at the sole discretion of
the Agent, provided that such Indebtedness shall not mature or require any cash
payment of principal or interest at any time prior to the first anniversary of
the Tranche B Maturity Date as defined in the Senior Credit Facility)).
SECTION 11 SUBORDINATION OF GUARANTEE OBLIGATIONS
11.1 Guarantee Obligations Subordinated to Senior Indebtedness. The
---------------------------------------------------------
Lenders covenant and agree that payments in respect of the obligations by a
Guarantor in respect of its Guarantee (collectively, as to any Guarantor, its
"Guarantee Obligations") shall be subordinated in accordance with the provisions
of this SECTION 11 to the prior payment in full, in cash or Cash Equivalents, of
all amounts payable in respect of Guarantor Senior Indebtedness of such
Guarantor whether now outstanding or hereafter created (including any interest
accruing subsequent to an event specified in SECTION 7.6 or 7.7 whether or not
such interest
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is an allowed claim against such Guarantor), that the subordination is for the
benefit of the holders of Guarantor Senior Indebtedness, and that each holder of
Guarantor Senior Indebtedness whether now outstanding or hereafter created,
incurred, assumed or guaranteed shall be deemed to have acquired Guarantor
Senior Indebtedness in reliance upon the covenants and provisions contained in
this Agreement.
11.2 Priority and Payment Over of Proceeds in Certain Events.
-------------------------------------------------------
(a) Subordination of Guarantee Obligations on Dissolution, Liquidation
------------------------------------------------------------------
or Reorganization of Such Guarantor. Upon any payment or distribution of assets
-----------------------------------
or securities of any Guarantor of any kind or character, whether in cash,
property or securities, upon any dissolution or winding up or total or partial
liquidation or reorganization of such Guarantor, whether voluntary or
involuntary or in bankruptcy, insolvency, receivership or other proceedings
(other than a liquidation or dissolution of such Guarantor into the Borrower or
another Guarantor), all Guarantor Senior Indebtedness of such Guarantor
(including any interest accruing subsequent to an event specified in SECTION 7.6
or 7.7 whether or not such interest is an allowed claim enforceable against such
Guarantor) shall first be paid in full in cash or Cash Equivalents, before the
Lenders shall be entitled to receive any payment or distribution with respect to
any Guarantee Obligations of such Guarantor and upon any such dissolution or
winding up or liquidation or reorganization, any payment or distribution of
assets or securities of such Guarantor of any kind or character, whether in
cash, property or securities, to which the Lenders would be entitled except for
the provisions of this SECTION 11 shall be made by such Guarantor or by any
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, directly to the holders of the Guarantor
Senior Indebtedness of such Guarantor or their representatives to the extent
necessary to pay all of the Guarantor Senior Indebtedness of such Guarantor in
full and in cash or Cash Equivalents to the holders of such Guarantor Senior
Indebtedness.
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(b) Subordination of Guarantee Obligations on Default on Senior
-----------------------------------------------------------
Indebtedness. Upon the maturity of any Senior Indebtedness of a Guarantor by
------------
lapse of time, acceleration or otherwise, all Senior Indebtedness of such
Guarantor then due and payable shall first be paid in full in cash or Cash
Equivalents, before any payment or distribution is made by such Guarantor or any
Person acting on behalf of such Guarantor with respect to the Guarantee
Obligations of such Guarantor. No direct or indirect payment or distribution by
any Guarantor or any Person acting on behalf of such Guarantor of or in respect
of any Guarantee Obligations of such Guarantor whether pursuant to the terms of
the Loans or upon acceleration or otherwise shall be made, if at the time of
such payment, there exists a default in the payment of all or any portion of any
principal, interest, fees, letter of credit reimbursement obligations or other
amounts payable in respect of any Senior Indebtedness of such Guarantor and such
default shall not have been cured or waived or the benefits of this sentence
waived by or on behalf of the holders of such Senior Indebtedness. In addition,
during the continuation of any Non-Payment Default, upon the receipt by the
Agent of written notice from the agent or representative of the holders of such
Senior Indebtedness, no such payment may be made by such Guarantor under its
Guarantee for a period ("Guarantor Payment Blockage Period") commencing on the
date of receipt of such notice and ending 179 days after receipt of such written
notice by the Agent (unless such Guarantor Payment Blockage Period shall be
terminated by written notice to the Agent from such agent), as the case may be
(provided such Guarantor Senior Indebtedness shall theretofore not have been
accelerated). Notwithstanding anything herein to the contrary, (x) in no event
will a Guarantor Payment Blockage Period or successive Guarantor Payment
Blockage Periods with respect to the same payment on such Guarantee extend
beyond 179 days from the date the payment on such Guarantee was due and (y)
there must be 180 consecutive days in any 365-day period during which no
Guarantor Payment Blockage Period is in effect. For all purposes of this SECTION
11.2(B), no Non-Payment Default which existed or was continuing on the date of
the commencement of any Guarantor Payment Blockage Period with respect to the
Senior Indebtedness initiating such Guarantor Payment Blockage Period shall be,
or be made, the basis for the
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commencement of a second Guarantor Payment Blockage Period by the holders or by
the agent or other representative of such Senior Indebtedness whether or not
within a period of 365 consecutive days, unless such Non-Payment Default shall
have been cured or waived for a period of not less than 90 consecutive days.
(c) Rights and Obligations of the Lenders. In the event that,
-------------------------------------
notwithstanding the foregoing provisions prohibiting such payment or
distribution, the Agent or any Lender shall have received any payment or
distribution in respect of any Guarantee Obligation with respect to the Loans
(other than as permitted by Sections (a) and (b) of this SECTION 11.2) at a time
when such payment is prohibited by this SECTION 11.2, then and in such event
such payment or distribution shall be received and held in trust for the holders
of the Guarantor Senior Indebtedness and shall be paid over or delivered to the
holders of the Guarantor Senior Indebtedness remaining unpaid to the extent
necessary to pay in full in cash or Cash Equivalents all Guarantor Senior
Indebtedness in accordance with its terms after giving effect to any concurrent
payment or distribution to the holders of such Guarantor Senior Indebtedness.
Nothing contained in this SECTION 11 will limit the right of the
Lenders to take any action to accelerate the maturity of the Loans pursuant to
SECTION 7 or to pursue any rights or remedies hereunder or otherwise.
Upon any payment or distribution of assets or securities referred to
in this SECTION 11, the Lenders (notwithstanding any other provision of this
Agreement) shall be entitled to rely upon any order or decree of a court of
competent jurisdiction in which such dissolution, winding up, liquidation or
reorganization proceedings are pending, and upon a certificate of the receiver,
trustee in bankruptcy, liquidating trustee, agent or other Person making any
such payment or distribution, delivered to the Lender for the purpose of
ascertaining the Persons entitled to participate in such distribution, the
holders of Guarantor Senior Indebtedness, the amount thereof or payable thereon,
the amount or amounts paid
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or distributed thereon and all other facts pertinent thereto or to this SECTION
11.
The Guarantors shall promptly give written notice to each of the
Lenders of any default or event of default under the Senior Credit Facility,
and, in the event of any such event of default, shall provide to the Agent the
name and address of the agent under the Senior Credit Facility.
With respect to the holders and owners of Guarantor Senior
Indebtedness, each Lender undertakes to perform only such obligations on the
part of such Lender as are specifically set forth in this SECTION 11, and no
implied covenants or obligations with respect to the holders or owners of
Guarantor Senior Indebtedness shall be read into this Agreement against the
Lenders. The Lenders shall not be deemed to owe any fiduciary duty to the
holders or owners of Guarantor Senior Indebtedness or to the agent under the
Senior Credit Facility or any other representative of the holders of the
Guarantor Senior Indebtedness.
11.3 Payments May Be Paid Prior to Dissolution. Nothing contained in
-----------------------------------------
this SECTION 11 or elsewhere in this Agreement shall prevent or delay (i)
Guarantors, except under the conditions described in SECTION 11.2, from making
payments at any time for the purpose of making payments in respect of their
respective Guarantee Obligations, or from depositing with the Agent any moneys
for such payments, or (ii) subject to SECTION 11.2, the application by the Agent
of any moneys deposited with it for the purpose of making payments in respect of
Guarantee Obligations.
11.4 Rights of Holders of Guarantor Senior Indebtedness Not To Be
------------------------------------------------------------
Impaired. No right of any present or future holder of any Guarantor Senior
--------
Indebtedness to enforce subordination as provided in this SECTION 11 shall at
any time in any way be prejudiced or impaired by any act or failure to act by
any such holder, or by any noncompliance by the Guarantors with the terms and
provisions and covenants herein, regardless of any knowledge thereof any such
holder may have or otherwise be charged with. Without in any way limiting the
generality of the foregoing
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Section, such holders of Guarantor Senior Indebtedness may, at any time and from
time to time without impairing or releasing the subordination provided in this
SECTION 11 or the obligations of the Lenders hereunder to the holders of
Guarantor Senior Indebtedness, do any one or more of the following: (i) change
the manner, place, terms or time of payment of, or renew or alter, Guarantor
Senior Indebtedness or otherwise amend or supplement in any manner Guarantor
Senior Indebtedness or any instrument evidencing the same or any agreement under
which any Guarantor Senior Indebtedness is outstanding; (ii) sell, exchange,
release, or otherwise deal with any property pledged, mortgaged, or otherwise
securing Guarantor Senior Indebtedness or fail to perfect or delay in the
perfection of the security interest in such property; (iii) release any Person
liable in any manner for the collection of Guarantor Senior Indebtedness; and
(iv) exercise or refrain from exercising any rights against the Guarantors and
any other Person. Each Lender by purchasing or accepting a Note waives any and
all notice of the creation, modification, renewal, extension or accrual of any
Guarantor Senior Indebtedness and notice of or proof of reliance by any holder
or owner of Guarantor Senior Indebtedness upon this SECTION 11 and the Guarantor
Senior Indebtedness shall conclusively be deemed to have been created,
contracted or incurred in reliance upon this SECTION 11, and all dealings
between the Guarantors and the holders and owners of the Guarantor Senior
Indebtedness shall be deemed to have been consummated in reliance upon this
SECTION 11.
The provisions of this SECTION 11 are intended to be for the benefit
of, and shall be enforceable directly by, the holders of the Guarantor Senior
Indebtedness.
11.5 Subrogation. Upon the payment in full in accordance with the
-----------
terms of SECTION 11.2 of all amounts payable under or in respect of the
Guarantor Senior Indebtedness, the Lenders shall be subrogated to the rights of
the holders of such Guarantor Senior Indebtedness to receive payments or
distributions of assets of the Guarantors made on such Guarantor Senior
Indebtedness until the Guarantee Obligations shall be paid in full in cash or
Cash Equivalents in a manner satisfactory to the holders
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of such Guarantor Senior Indebtedness in accordance with the terms of SECTION
11.2; and for purposes of such subrogation no payments or distributions to
holders of such Guarantor Senior Indebtedness of any cash, property or
securities to which the Lenders would be entitled except for the provisions of
this SECTION 11, and no payment over pursuant to the provisions of this SECTION
11 to holders of such Guarantor Senior Indebtedness by the Lenders, shall, as
between such Guarantor, its creditors other than holders of such Guarantor
Senior Indebtedness and the Lenders, be deemed to be a payment by such Guarantor
to or on account of such Guarantor Senior Indebtedness, it being understood that
the provisions of this SECTION 11 are solely for the purpose of defining the
relative rights of the holders of such Guarantor Senior Indebtedness, on the one
hand, and the Lenders, on the other hand. A release of any claim by any holder
of Guarantor Senior Indebtedness shall not limit the Lenders' rights of
subrogation under this SECTION 11.5.
If any payment or distribution to which the Lenders would otherwise
have been entitled but for the provisions of this SECTION 11 shall have been
applied, pursuant to the provisions of this SECTION 11, to the payment of all
amounts payable under the Guarantor Senior Indebtedness, then and in such case,
the Lenders shall be entitled to receive from the holders of such Guarantor
Senior Indebtedness at the time outstanding the full amount of any payments or
distributions received by such holders of Guarantor Senior Indebtedness in
excess of the amount sufficient to pay all Guarantor Senior Indebtedness payable
under or in respect of the Guarantor Senior Indebtedness in full in cash or Cash
Equivalents in accordance with the terms of SECTION 11.2.
11.6 Obligations of the Guarantors Unconditional. Nothing contained
-------------------------------------------
in this SECTION 11 or elsewhere in this Agreement or in the Guarantees is
intended to or shall impair as between the Guarantors and the Lenders the
obligations of the Guarantors, which are absolute and unconditional, to pay to
the Lenders the Guarantee Obligations as and when the same shall become due and
payable in accordance with their terms, or is intended to or shall affect the
relative rights of the Lenders and creditors of the Guarantors other than the
holders of the Guarantor Senior Indebtedness, nor
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shall anything herein or therein prevent the Lenders from exercising all
remedies otherwise permitted by applicable law upon default under this
Agreement, subject to the rights, if any, under this SECTION 11 of the holders
of such Guarantor Senior Indebtedness in respect of cash, property or securities
of the Guarantors received upon the exercise of any such remedy.
The failure to make a payment in respect of Guarantee Obligations by
reason of any provision of this SECTION 11 shall not prevent the occurrence of
an Event of Default under SECTION 7.
11.7 Lenders Authorize Agent to Effectuate Subordination. Each
---------------------------------------------------
Lender hereby authorizes and expressly directs the Agent on its behalf to take
such action as may be necessary or appropriate to effectuate the subordination
provided in this SECTION 11 and appoints the Agent its attorney in fact for such
purpose, including, without limitation, in the event of any dissolution, winding
up, liquidation or reorganization of any Guarantor (whether in bankruptcy,
insolvency, receivership, reorganization or similar proceedings or upon an
assignment for the benefit of creditors or any other similar remedy or
otherwise) tending towards liquidation of the business and assets of any
Guarantor, the immediate filing of a claim for the unpaid balance of the
Guarantee Obligations in the form required in said proceedings and causing said
claim to be approved. If the Agent does not file a proper claim or proof of
debt in the form required in such proceeding prior to 30 days before the
expiration of the time to file such claim or claims, then the holders of the
Guarantor Senior Indebtedness are hereby authorized to have the right to file
and are hereby authorized to file, but shall have no obligation to file, an
appropriate claim for and on behalf of the Lenders. In the event of any such
proceeding, until the Guarantor Senior Indebtedness is paid in full in cash or
Cash Equivalents, without the consent of the holders of a majority in principal
amount outstanding of Guarantor Senior Indebtedness, no Lender shall waive,
settle or compromise any such claim or claims relating to the Obligations that
such Lender now or hereafter may have against the Guarantors.
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SECTION 12 MISCELLANEOUS
12.1 Representation of the Lenders. Each Lender hereby represents
-----------------------------
that it is a commercial lender which makes loans in the ordinary course of its
business and that it will make the Loans hereunder for its own account or the
account of its affiliates in the ordinary course of such business.
12.2 Participations in and Assignments of Loans and Notes.
----------------------------------------------------
A. Each Lender shall have the right at any time to sell, assign,
transfer or negotiate all or any portion of its Notes or its Loan Commitment in
an aggregate amount of not less than $2,500,000 to any Eligible Assignee. In the
case of any sale, transfer or negotiation of all or part of the Notes or any
Loan Commitment authorized under this SECTION 12.2A, the assignee, transferee or
recipient shall become a party to this Agreement as a Lender by execution of an
assignment and assumption agreement; provided that (i) at such time SECTION 2.1
--------
A OR 2.2A, as the case may be, shall be deemed modified to reflect the Loan
Commitment of such new Lender and of the existing Lenders and (ii) upon
surrender of the Notes, new Notes will be issued, at the Borrower's expense, to
such new Lender and to the assigning Lender, such new Notes to be in conformity
with the requirements of SECTION 2.1D OR 2.2E as the case may be (with
appropriate modifications) to the extent needed to reflect the revised Loan
Commitment; provided, further, that such transfer or assignment will not be
-------- -------
effective until recorded by the Agent on the Register pursuant to SECTION 5.11.
To the extent of any assignment pursuant to this SECTION 12.2A, the assigning
Lender shall be relieved of its obligations hereunder with respect to its
assigned Loan Commitment, and the assignee, transferee or recipient shall have,
to the extent of such sale, assignment, transfer or negotiation, the same
rights, benefits and obligations as it would if it were a Lender with respect to
such Notes or Loan Commitment, including, without limitation, the right to
approve or disapprove actions which, in accordance with the terms hereof,
require the approval of a Lender. At the time of each assignment pursuant to
this SECTION 12.2A to an Eligible
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Assignee which is not already a Lender hereunder and which is not a United
States Person (as such term is defined in Section 7701(a)(30) of the Internal
Revenue Code) for Federal income tax purposes, the respective Eligible Assignee
shall provide to the Borrower and the Agent the appropriate Internal Revenue
Service Forms (and, if applicable, a SECTION 12.2E(II) Certificate) described in
SECTION 12.2E. Any such sale, assignment, transfer or negotiation shall be
subject to compliance with applicable provisions of federal and state securities
laws.
B. Each Lender may grant participations in all or any part of its
Notes or its Loan Commitment in an aggregate amount of not less than $1,000,000
to any Eligible Assignee.
C. The Borrower shall, at its own cost and expense, provide such
certificates, acknowledgments and further assurances in respect of this
Agreement and the Loans as any Lender may reasonably require in connection with
any participation, transfer or assignment pursuant to this SECTION 12.2.
D. Nothing in this Agreement shall prevent or prohibit any Lender
from pledging its Loan and Notes hereunder to a Federal Reserve Bank in support
of borrowings made by such Lender from such Federal Reserve Bank.
E. Each Lender that is an assignee or transferee of an interest
under this Agreement pursuant to SECTION 12.2A (unless the respective Lender was
already a Lender hereunder immediately prior to such assignment or transfer) and
that is not a United States Person (as such term is defined in Section
7701(a)(30) of the Internal Revenue Code) agrees to deliver to the Borrower and
the Agent, on the date of such assignment or transfer to such Lender, (i) two
accurate and complete original signed copies of Internal Revenue Service Form
4224 or 1001 (or successor forms) certifying to such Lender's entitlement to a
complete exemption from United States withholding tax with respect to payments
to be made under this Agreement and under any Note, or (ii) if the Lender is not
a "bank" within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code
and cannot deliver either Internal Revenue Service
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Form 1001 or 4224 pursuant to clause (i) above, two accurate and complete
original signed copies of Internal Revenue Service Form W-8 (or successor form)
certifying to such Lender's entitlement to a complete exemption from United
States withholding tax with respect to payments of interest to be made under
this Agreement and under any Note. In addition, each Lender agrees that, when a
lapse in time or change in circumstances renders the previous certification
obsolete or inaccurate in any material respect, it will deliver to the Borrower
and the Agent two new accurate and complete original signed copies of Internal
Revenue Service Form 4224 or 1001, or Form W-8, as the case may be, and such
other forms as may be required in order to confirm or establish the entitlement
of such Lender to a continued exemption from or reduction in United States
withholding tax with respect to payments under this Agreement and any Note, or
it shall immediately notify the Borrower and the Agent of its inability to
deliver any such Form or Certificate. Subject to SECTION 12.2A and the
immediately succeeding sentence, the Borrower shall be entitled, to the extent
it is required to do so by law, to deduct or withhold income or similar taxes
imposed by the United States (or any political subdivision or taxing authority
thereof or therein) from interest, fees or other amounts payable hereunder or
made on any other Loan Document for the account of any Lender which is not a
United States Person (as such term is defined in Section 7701(a)(30) of the
Internal Revenue Code) for U.S. Federal income tax purposes to the extent that
such Lender has not provided to the Borrower U.S. Internal Revenue Service Forms
that establish a complete exemption from such deduction or withholding.
Notwithstanding anything to the contrary contained in the preceding sentence or
elsewhere in this SECTION 12.2E and except as set forth in SECTION 12.2A, the
Borrower agrees to pay additional amounts and to indemnify and hold harmless
each Lender (without regard to the identity of the jurisdiction requiring the
deduction or withholding), and reimburse such Lender upon its written request,
in respect of any amounts deducted or withheld by it as described in the
immediately preceding sentence as a result of any changes after the date of any
assignment or transfer in any applicable law, treaty, governmental rule,
regulation, guideline or order, or in the interpretation thereof, relating to
the deducting or withholding of income or similar Taxes.
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12.3 Fees and Expenses. The Borrower agrees (i) whether or not the
-----------------
transactions contemplated by this Agreement shall be consummated, to pay upon
demand all reasonable out-of-pocket costs and expenses of the Agent (including,
without limitation, the reasonable fees and expenses of counsel to the Agent,
and the allocated costs of internal counsel) in connection with the preparation,
negotiation, execution, delivery and syndication of this Agreement and the other
Loan Documents, and all reasonable out-of-pocket costs and expenses of the Agent
(including, without limitation, the reasonable fees and expenses of counsel to
the Agent, and the allocated costs of internal counsel) in connection with any
amendment, modification or waiver hereof or thereof or consent with respect
hereto or thereto, (ii) to pay upon demand all reasonable out-of-pocket costs
and expenses of the Agent and each Lender (including, without limitation, the
reasonable fees and expenses of counsel to the Agent or any Lender, including
the allocated costs of internal counsel) in connection with (y) after the
occurrence and during the continuance of an Event of Default, any refinancing or
restructuring of the credit arrangement provided under this Agreement, whether
in the nature of a "work-out," in any insolvency or bankruptcy proceeding or
otherwise and whether or not consummated, and (z) the enforcement, attempted
enforcement or preservation of any rights or remedies under this Agreement or
any of the other Loan Documents, whether in any action, suit or proceeding
(including any bankruptcy or insolvency proceeding) or otherwise, and (iii) to
pay and hold harmless the Agent and each Lender from and against all liability
for any intangibles, documentary, stamp or other similar taxes, fees and
excises, if any, including any interest and penalties, and any finder's or
brokerage fees, commissions and expenses (other than any fees, commissions or
expenses of finders or brokers engaged by the Agent or any Lender), that may be
payable in connection with the transactions contemplated by this Agreement and
the other Loan Documents.
12.4 Indemnity. In addition to the payment of expenses pursuant to
---------
SECTION 12.3, whether or not the transactions contemplated hereby shall be
consummated, the Borrower agrees to indemnify, pay and hold each of the Lenders,
the Agent and any
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holder of any of the Notes, and each of their respective officers, directors,
employees, agents, representatives and affiliates (collectively called the
"Indemnitees"), harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, claims,
costs, expenses and disbursements of any kind or nature whatsoever (including,
without limitation, the fees and disbursements of counsel for such Indemnitees
in connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not such Indemnitee shall be designated as a
party thereto), which may be suffered by, imposed on, incurred by, or asserted
against that Indemnitee, in any manner resulting from, connected with, in
respect of, relating to or arising out of this Agreement, the other Loan
Documents, the Commitment Letter, the Lenders' agreements to make the Loans or
the use or intended use of any of the proceeds of the Loans hereunder, the
issuance of the Exchange Notes or the Take-Out Securities or the Xxxxxxxx
Acquisition (the "Indemnified Liabilities"); provided that the Borrower shall
--------
have no obligation to an Indemnitee hereunder with respect to Indemnified
Liabilities (i) to the extent such liabilities are finally judicially determined
to have resulted solely from (A) the gross negligence or willful misconduct of
that Indemnitee or (B) the failure of such Indemnitee to perform its obligations
under any Loan Document or (C) such Indemnitee's violation of law or (ii) in
connection with the obligations of any Indemnitee under any Loan Document or for
any transfer fees. To the extent that the undertaking to indemnify, pay and hold
harmless set forth in the preceding sentence may be unenforceable because it is
violative of any law or public policy, the Borrower shall contribute the maximum
portion which it is permitted to pay and satisfy under applicable law to the
payment and satisfaction of all Indemnified Liabilities incurred by the
Indemnitees or any of them.
12.5 Setoff. Subject to SECTION 8, in addition to any rights now or
------
hereafter granted under applicable law and not by way of limitation of any such
rights, upon the occurrence of any Event of Default, each Lender, the Agent and
each subsequent holder of any Note is hereby authorized by the Borrower at any
time or from time to time, without notice to the Borrower, or to any other
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Person, any such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all deposits (general or special, including,
but not limited to, Indebtedness evidenced by certificates of deposit, whether
matured or unmatured but not including trust accounts or any other accounts held
for the benefit of another Person) and any other Indebtedness at any time held
or owing by such Person or any such subsequent holder to or for the credit or
the account of the Borrower against and on account of the obligations and
liabilities of the Borrower to such Person or such subsequent holder under this
Agreement and the Notes, including, but not limited to, all claims of any nature
or description arising out of or connected with this Agreement or the Notes,
irrespective of whether or not (a) such Person or such subsequent holder shall
have made any demand hereunder or (b) such Person or such subsequent holder
shall have declared the principal of or the interest on its portion of the Loans
and its Notes and other amounts due hereunder to be due and payable as permitted
by Section 7 and although said obligations and liabilities, or any of them, may
be contingent or unmatured.
12.6 Amendments and Waivers. No amendment, modification, termination
----------------------
or waiver of any term or provision of this Agreement, of the Notes, any
Guarantee or, prior to the execution and delivery thereof, of the form of the
Registration Rights Agreement or the form of the Senior Subordinated Indenture
or consent to any departure by the Borrower or any Guarantor therefrom, shall in
any event be effective without the prior written concurrence of the Borrower or
such Guarantor, as the case may be, and the Required Lenders, and, upon the
request of any Lender, the receipt of a written opinion of counsel of the
Borrower addressed to the Lenders to the effect that such amendment,
modification, termination, waiver or consent does not violate or conflict with
any of the terms and provisions of the Senior Credit Facility or any other
Contractual Obligation of the Borrower; provided that, notwithstanding the third
--------
sentence of SECTION 12.15, without the prior written consent of each Lender
affected, an amendment, modification, termination or waiver of this Agreement,
any Notes, any Guarantee, and, prior to the execution and delivery thereof, of
the form of Registration Rights Agreement and the form
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of Senior Subordinated Indenture or consent to departure from a term or
provision hereof or thereof may not: (i) reduce the principal amount of Notes
whose holders must consent to any such amendment, modification, termination,
waiver or consent; (ii) reduce the rate of or extend the time for payment of
principal or interest on any Note; (iii) reduce the principal amount of any
Note; (iv) make any Note payable in money other than that stated in the Note;
(v) make any change in SECTION 2.5 or in the definition of Change of Control, in
the last paragraph of SECTION 7 or in SECTION 8.5, 11.5 OR 12.6; (vi) reduce the
rate or extend the time of payment of fees or other compensation payable to the
Lenders hereunder; or (vii) modify the provisions of SECTION 8 or any of the
defined terms related thereto in any manner adverse to the Lenders; and
provided, further, that without the consent of the Agent, no such amendment,
modification, termination or waiver may amend, modify, terminate or waive any
provision of Section 9 as the same applies to the Agent or any other provision
of this Agreement as it relates to the rights or obligations of the Agent. No
amendment, modification or waiver of any provision of this Agreement, the Notes,
any Guarantee or the form of the Senior Subordinated Indenture shall adversely
affect the rights of the holders of Senior Indebtedness or the holders of
Guarantor Senior Indebtedness without their consent. Any waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which it was given. No notice to or demand on the Borrower in any case shall
entitle the Borrower to any further notice or demand in similar or other
circumstances. Any amendment, modification, termination, waiver or consent
effected in accordance with this SECTION 12.6 shall be binding upon each holder
of the Notes at the time outstanding, each further holder of the Notes, and, if
signed by the Borrower or a Guarantor, on the Borrower and such Guarantor.
12.7 Independence of Covenants. All covenants hereunder shall be
-------------------------
given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or be otherwise within the limitation of, another covenant shall
not avoid the occurrence
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of an Event of Default or Potential Event of Default if such action is taken or
condition exists.
12.8 Entirety. The Loan Documents and the Commitment Letter embody
--------
the entire agreement of the parties and supersede all prior agreements and
understandings, if any, relating to the subject matter hereof and thereof.
12.9 Notices. Unless otherwise provided herein, any notice or other
-------
communications herein required or permitted to be given shall be in writing and
may be personally served, telecopied, telexed or sent by mail and shall be
deemed to have been given when delivered in person, upon receipt of telecopy or
telex against receipt of answer back or four Business Days after depositing it
in the mail, registered or certified, with postage prepaid and properly
addressed; provided that notices shall not be effective until received. For the
--------
purposes hereof, the addresses of the parties hereto (until notice of a change
thereof is delivered as provided in this SECTION 12.9) shall be set forth under
each party's name on the signature pages hereto.
12.10 Survival of Warranties and Certain Agreements.
---------------------------------------------
A. All agreements, representations and warranties made herein shall
survive the execution and delivery of this Agreement and the Commitment Letter,
the making of the Loans hereunder and the execution and delivery of the Notes
and, notwithstanding the making of the Loans, the execution and delivery of the
Notes or any investigation made by or on behalf of any party, shall continue in
full force and effect. The closing of the transactions herein contemplated shall
not prejudice any right of one party against any other party in respect of
anything done or omitted hereunder or in respect of any right to damages or
other remedies.
B. Notwithstanding anything in this Agreement or implied by law to
the contrary, the agreements of the Borrower set forth in SECTIONS 12.3, 12.4,
12.14, 12.15, 12.17, 12.19 AND 12.22 shall survive the payment of the Loans and
the Notes and the termination of this Agreement.
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12.11 Failure or Indulgence Not Waiver; Remedies Cumulative. No
-----------------------------------------------------
failure or delay on the part of the Agent or any Lender or any holder of any
Note in the exercise of any power, right or privilege hereunder, under a
Guarantee or under the Notes shall impair such power, right or privilege or be
construed to be a waiver of any default or acquiescence therein, nor shall any
single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. All
rights and remedies existing under this Agreement, under a Guarantee or the
Notes are cumulative to and not exclusive of any rights or remedies otherwise
available.
12.12 Severability. In case any provision in or obligation under
------------
this Agreement, under a Guarantee or the Notes shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby.
12.13 Headings. Section and Section headings in this Agreement are
--------
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose or be given any substantive effect.
12.14 Applicable Law. THIS AGREEMENT, EACH GUARANTEE AND THE NOTES
--------------
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS
OF LAW.
12.15 Successors and Assigns; Subsequent Holders of Notes. This
---------------------------------------------------
Agreement shall be binding upon the parties hereto and their respective
successors and assigns and shall inure to the benefit of the parties hereto and
the successors and assigns of the Lenders. The terms and provisions of this
Agreement and each Guarantee shall inure to the benefit of any assignee or
transferee of the Notes pursuant to SECTION 12.2A, and in the event of such
transfer or assignment, the rights and privileges herein conferred upon the
Lenders shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and
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conditions hereof. Except as provided in SECTION12.6, in determining whether
the holders of a sufficient aggregate principal amount of the Loans shall have
consented to any action under this Agreement, any amount of the Loans owned or
held by the Borrower, any Guarantor or any of their respective Affiliates shall
be disregarded. The Borrower's rights or any interest therein hereunder may not
be assigned without the prior express written consent of each of the Lenders.
12.16 Counterparts; Effectiveness. This Agreement and any
---------------------------
amendments, waivers, consents or supplements may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument. This
Agreement shall become effective upon the execution of a counterpart hereof by
each of the parties hereto, and delivery thereof to the Agent or, in the case of
the Lenders, written telex or facsimile notice or telephonic notification
(confirmed in writing) of such execution and delivery. The Agent will give the
Borrower and each Lender prompt notice of the effectiveness of this Agreement.
12.17 Consent to Jurisdiction; Venue; Waiver of Jury Trial.
----------------------------------------------------
A. Any legal action or proceeding with respect to this Agreement,
any Note or any Guarantee may be brought in the courts of the State of New York
or of the United States for the Southern District of New York, and, by execution
and delivery of this Agreement, each of the parties to this Agreement hereby
irrevocably accepts for itself and in respect of its respective property,
generally and unconditionally, the nonexclusive jurisdiction of the aforesaid
courts. Each of the parties to this Agreement hereby further irrevocably waives
any claim that any such courts lack jurisdiction over such party, and agrees not
to plead or claim, in any legal action or proceeding with respect to this
Agreement, the Notes or the Guarantees brought in any of the aforesaid courts,
that any such court lacks jurisdiction over such party. Each of the parties to
this Agreement irrevocably consents to the service
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of process in any such action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to such party, at its respective
address for notices pursuant to SECTION 12.9, such service to become effective
30 days after such mailing. To the extent permitted by law, each of the parties
to this Agreement hereby irrevocably waives any objection to such service of
process and further irrevocably waives and agrees not to plead or claim in any
action or proceeding commenced hereunder or under any Note or any Guarantee that
service of process was in any way invalid or ineffective. Nothing herein shall
affect the right of any party to this Agreement to serve process in any other
manner permitted by law or to commence legal proceedings or otherwise proceed
against any party in any other jurisdiction.
B. Each of the parties to this Agreement 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 Agreement, the Notes or the Guarantees brought in the courts referred to in
clause A above 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. Each of the parties to this Agreement hereby irrevocably waives
all right to a trial by jury in any action, proceeding or counterclaim arising
out of or relating to this Agreement, the Notes or the Guarantees or the
transactions contemplated hereby or thereby.
12.18 Payments Pro Rata.
-----------------
A. The Agent agrees that promptly after its receipt of each payment
of any interest or premium on or principal of the Notes from or on behalf of the
Borrower or any Guarantor, it shall, except as otherwise provided in this
Agreement, distribute such payment to the Lenders (other than any Lender that
has consented in writing to waive its pro rata share of such payment) pro rata
--- ---- --- ----
based upon their respective pro rata shares, if any, of such payment.
--- ----
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B. Each of the Lenders agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Loan Documents, or otherwise)
which is applicable to the payment of the principal of, or interest on, the
Loans of a sum which with respect to the related sum or sums received by other
Lenders is in a greater proportion than the total of such Obligation then owed
and due to such Lender bears to the total of such Obligation then owed and due
to all of the Lenders immediately prior to such receipt, then such Lender
receiving such excess payment shall purchase for cash without recourse or
warranty from the other Lenders an interest in the Obligations of the Borrower
to such Lenders in such amount as shall result in a proportional participation
by all of the Lenders in such amount; provided that, if all or any portion of
--------
such excess amount is thereafter recovered from such Lender, such purchase shall
be rescinded and the purchase price restored to the extent of such recovery, but
without interest.
12.19 Taxes.
-----
A. Any and all payments by the Borrower hereunder or under any of
the other Loan Documents shall be made free and clear of and without deduction
or withholding for any and all present or future Taxes, unless such Taxes are
required by law or the administration thereof to be deducted or withheld and
excluding (i) in the case of each Lender and the Agent, Taxes imposed on its net
income and franchise taxes imposed on it by the jurisdiction under the laws of
which such Person is organized or any political subdivision thereof, (ii) in the
case of each such Lender and the Agent, any Taxes that are in effect and that
would apply to a payment to such Person, as applicable, as of the Closing Date,
and (iii) if any Person acquires any interest in this Agreement (a
"Transferee"), any Taxes to the extent that they are in effect and would apply
to a payment to such Transferee as of the date of the acquisition of such
interest, as the case may be (all such nonexcluded Taxes being hereinafter
referred to as "Covered Taxes"). If the Borrower shall be required by Law or
the
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administration thereof to deduct or withhold any Covered Taxes from or in
respect of any sum payable hereunder or under any other Loan Document, (a)
unless such requirement results from the failure of the payee to perform its
obligations under SECTION 12.2E, the sum payable shall be increased as may be
necessary so that after making all required deductions or withholdings
(including deductions or withholdings applicable to additional amounts paid
under this paragraph), the Lender receives an amount equal to the sum it would
have received if no such deduction or withholding had been made; (b) the
Borrower shall make such deductions or withholdings; and (c) the Borrower
forthwith shall pay the full amount deducted or withheld to the relevant
taxation or other authority in accordance with applicable Law.
B. The Borrower agrees to pay forthwith any present or future stamp
documentary taxes or any other excise or property taxes, charges or similar
levies (all such taxes, charges and levies being herein referred to as "Other
Taxes") imposed by any jurisdiction (or any political subdivision or taxing
authority thereof or therein) which arise from any payment made by the Borrower
hereunder or under any of the other Loan Documents or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement or any
of the other Loan Documents.
C. The Borrower agrees to indemnify the Agent and each of the
Lenders for the full amount of Covered Taxes or Other Taxes not deducted or
withheld and paid by the Borrower in accordance with SECTIONS 12.2A AND 12.10B
to the relevant taxation or other authority and any Taxes other than Covered
Taxes or Other Taxes imposed by any jurisdiction on amounts payable by the
Borrower under this SECTION 12.19 paid by the Lender or the Agent and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not any such Taxes or Other Taxes were correctly or
legally asserted. Payment under this indemnification shall be made within 30
days from the date the Agent or such Lender makes written demand therefor. A
certificate as to the amount of such Taxes or Other Taxes and evidence of
payment thereof submitted to the Borrower shall be prima facie
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evidence, absent manifest error, of the amount due from the Borrower to the
Agent or such Lender.
D. The Borrower shall furnish to the Agent and each of the Lenders
the original or a certified copy of a receipt evidencing any payment of Taxes or
Other Taxes made by the Borrower as soon as such receipt becomes available.
E. The provisions of this SECTION 12.19 shall survive the
termination of the Agreement and repayment of all Obligations.
F. Each of the Agent and Lenders agrees that if it subsequently
recovers, or receives a permanent net tax benefit with respect to, any amount of
Taxes (i) previously paid by it and as to which it has been indemnified by or on
behalf of the Borrower or (ii) previously deducted by the Borrower (including,
without limitation, any Taxes deducted from any additional sums payable under
clause 12.19A above), the Agent or such Lender, as the case may be, shall
reimburse the Borrower to the extent of the amount of any such recovery or
permanent net tax benefit (but only to the extent of indemnity payments made, or
additional amounts paid, by or on behalf of the Borrower under this SECTION
12.19 with respect to the Taxes giving rise to such recovery or tax benefit);
provided, however, that the Borrower, upon the request of the Agent or such
-------- -------
Lender, agrees to repay to the Agent or such Lender, as the case may be, the
amount paid over to the Borrower (together with any penalties, interest or other
charges), in the event the Agent or such Lender is required to repay such amount
to the relevant taxing authority or other Governmental Authority. The
determination by the Agent or any Lender of the amount of any such recovery or
permanent net tax benefit shall, in the absence of manifest error, be conclusive
and binding.
12.20 Replacement of Lenders. The Borrower may, at any time and so
----------------------
long as no Potential Event of Default or Event of Default has then occurred and
is continuing, replace any Lender that has requested additional amounts from the
Borrower under SECTION 12.2E, 12.19 OR 12.22 by written notice to such Lender
and the Agent given not more than thirty (30) days after any such event
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and identifying one or more Persons each of which shall be reasonably acceptable
to the Agent (each, a "Replacement Lender," and collectively, the "Replacement
Lenders") to replace such Lender (the "Replaced Lender"), provided that (i) the
--------
notice from the Borrower to the Replaced Lender and the Agent provided for
hereinabove shall specify an effective date for such replacement (the
"Replacement Effective Date"), which shall be at least five (5) Business Days
after such notice is given, (ii) as of the relevant Replacement Effective Date,
each Replacement Lender shall enter into an Assignment and Acceptance with the
Replaced Lender pursuant to SECTION 12.2A pursuant to which such Replacement
Lenders collectively shall acquire, in such proportion among them as they may
agree with the Borrower and the Agent, all (but not less than all) of the
Commitments and outstanding Loans of the Replaced Lender, and, in connection
therewith, shall pay to the Replaced Lender, as the purchase price in respect
thereof, an amount equal to the sum as of the Replacement Effective Date
(without duplication) of (y) the unpaid principal amount of, and all accrued but
unpaid interest on, all outstanding Loans of the Replaced Lender and (z) the
Replaced Lender's ratable share of all accrued but unpaid fees owing to the
Replaced Lender hereunder, and (iii) all other obligations of the Borrower owing
to the Replaced Lender under this Agreement (other than those specifically
described in clause (ii) above in respect of which the assignment purchase price
has been, or is concurrently being, paid), including, without limitation,
amounts payable under SECTION 12.2 as a result of the actions required to be
taken under this SECTION 12.20, shall be paid in full by the Borrower to the
Replaced Lender on or prior to the Replacement Effective Date.
12.21 Waiver of Stay, Extension or Usury Laws. The Borrower
---------------------------------------
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay or extension law or any usury law or other law that
would prohibit or forgive the Borrower from paying all or any portion of the
principal of or interest on the Loans as contemplated herein, wherever enacted,
now or at any time hereafter in force, or which may affect the covenants or the
performance of this Agreement; and
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(to the extent that it may lawfully do so) the Borrower hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Agent, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
12.22 Requirements of Law.
-------------------
(a) In the event that any change in law occurring after the date that
any lender becomes a Lender party to this Agreement with respect to such Lender
shall, in the opinion of such Lender, require that any Bridge Loan Commitment of
such Lender be treated as an asset or otherwise be included for purposes of
calculating the appropriate amount of capital to be maintained by such Lender or
any corporation controlling such Lender, and such change in law shall have the
effect of reducing the rate of return on such Lender's or such corporation's
capital, as the case may be, as a consequence of such Lender's obligations
hereunder to a level below that which such Lender or such corporation, as the
case may be, could have achieved but for such change in law (taking into account
such Lender's or such corporation's policies, as the case may be, with respect
to capital adequacy) by an amount deemed by such Lender to be material, then
from time to time following notice by such Lender to the Borrower of such change
in law as provided in paragraph (b) of this SECTION 12.21, within 15 days after
demand by such Lender, the Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender or such corporation, as the
case may be, for such reduction.
(b) The Borrower shall not be required to make any payments to any
Lender for any additional amounts pursuant to this SECTION 12.21 unless such
Lender has given written notice to the Borrower, through the Agent, of its
intent to request such payments prior to or within 60 days after the date on
which such Lender became entitled to claim such amounts. If any Lender requests
compensation from the Borrower under this SECTION 12.21, the Borrower may, by
notice to such Lender (with a copy to the Agent), suspend the obligation of such
Lender thereafter to make or
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continue Loans, until the requirement of law giving rise to such request ceases
to be in effect; provided that such suspension shall not affect the right of
--------
such Lender to receive the compensation so requested.
12.23 Confidentiality. Each Lender shall hold all non-public
---------------
information obtained pursuant to the requirements of or in connection with this
Agreement which has been identified as confidential by the Borrower or Xxxxxxxx
in accordance with such Lender's customary procedures for handling confidential
information of this nature and in accordance with safe and sound banking
practices, it being understood and agreed by Xxxxxxxx and the Borrower that (i)
in any event a Lender may make disclosures reasonably required by any bona fide
assignee, transferee or participant in connection with the contemplated
assignment or transfer by such Lender of any Loans or any participation therein
or as required or requested by any governmental agency or representative thereof
or pursuant to legal process; provided that unless specifically prohibited by
--------
applicable law or court order, each Lender shall notify the Borrower of any
request by any prospective transferee or governmental agency or representative
thereof (other than any such request in connection with any examination of the
financial condition of such Lender by such governmental agency) for disclosure
of any such non-public information prior to disclosure of such information and
(ii) a Lender may share with any of its affiliates, and such affiliates may
share with any Lender, any information related to the Borrower, Xxxxxxxx or the
Borrower's or their respective affiliates (including information relating to
creditworthiness), the Xxxxxxxx Acquisition or the financing therefor; and
provided, further, that in no event shall any Lender be obligated or required to
-------- -------
return any materials furnished by the Borrower or Xxxxxxxx. In connection with
any proposed sales, assignments or transfers referred to in SECTION 12.2A (and
prior to any delivery of non-public information hereunder), a Lender shall
obtain agreements from the purchasers, assignees or transferees, as the case may
be, reasonably satisfactory to the Borrower, that such parties will comply with
this SECTION 12.22.
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WITNESS the due execution hereof by the respective duly authorized
officers of the undersigned as of the date first written above.
COMPANY:
XXXXXXXX PUBLISHING COMPANY L.L.C.
By: _____________________________
Name:
Title:
Notice Address:
Attention:
Telephone:
Telecopy:
-153-
GUARANTORS:
XXXXXXXX HOLDINGS, L.L.C.
By: ______________________________
Name:
Title:
Notice Address:
Attention:
Telephone:
Telecopy:
BRIGHTVIEW COMMUNICATIONS GROUP,
INC.
By: ______________________________
Name:
Title:
Notice Address:
Attention:
Telephone:
Telecopy:
-154-
AGENT:
FIRST UNION CORPORATION,
as agent
By: ________________________________
Name:
Title:
Notice Address:
Xxx Xxxxx Xxxxx Xxxxxx, XX-00
Xxxxxxxxx, XX 00000-0000
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-155-
LENDERS:
Commitment: $ FIRST UNION CORPORATION
By: ________________________________
Name:
Title:
Notice Address:
Xxx Xxxxx Xxxxx Xxxxxx, XX-00
Xxxxxxxxx, XX 00000-0000
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Commitment: $ CIBC Inc.
By: ________________________________
Name:
Title:
Notice Address:
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
