Exhibit 10.1
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SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
Dated as of
March 17, 2006
among
VERTRUE INCORPORATED,
THE LENDERS PARTIES HERETO,
and
LASALLE BANK NATIONAL ASSOCIATION,
as Agent
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TABLE OF CONTENTS
PAGE
SECTION 1. DEFINITIONS..........................................1
SECTION 2. CREDIT FACILITY.....................................14
SECTION 3. FEES; PAYMENTS......................................24
SECTION 4. CONDITIONS PRECEDENT................................26
SECTION 5. REPRESENTATIONS AND WARRANTIES......................28
SECTION 6. AFFIRMATIVE COVENANTS...............................34
SECTION 7. NEGATIVE COVENANTS..................................40
SECTION 8. EVENTS OF DEFAULT...................................44
SECTION 9. THE AGENT AND THE COLLATERAL AGENT..................47
SECTION 10. GENERAL PROVISIONS..................................50
SCHEDULES
Schedule 1 - List of Lending Offices
Schedule 4.1 - List of Leased Premises
Schedule 5.3 - Subsidiaries/Foreign Qualifications
Schedule 5.7 - Material Litigation
Schedule 5.9 - Liens
Schedule 5.18 - List of Employment Agreements
Schedule 5.19 - List of Dividends Paid
Schedule 7.4 - Permitted Investments, Loans and Advances
EXHIBITS
A - Form of Note
B-1 - Form of Notice of Borrowing
B-2 - Form of Notice of Continuation or Conversion
C - Form of Assignment and Assumption Agreement
i
SECOND AMENDED AND RESTATED CREDIT AGREEMENT dated as of March 17, 2006
among VERTRUE INCORPORATED, a Delaware corporation (formerly known as
Memberworks Incorporated) (the "Company"), the lenders parties hereto (each a
"Lender") and, collectively, the "Lenders"), and LASALLE BANK NATIONAL
ASSOCIATION ("LaSalle"), as agent for the Lenders (in such capacity, the
"Agent").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Company, Xxxxx Brothers Xxxxxxxx & Co., as administrative
agent, Xxxxx Brothers Xxxxxxxx & Co. and LaSalle Bank National Association, as
co-agents and the lenders party thereto have entered into that certain Credit
Agreement dated as of March 31, 2003, as heretofore amended and as amended and
restated pursuant to that certain Amended and Restated Credit Agreement dated as
of March 25, 2004, as amended among the Company, the lenders party thereto and
hereto and the Agent (the "Existing Credit Agreement") pursuant to which such
lenders have made a revolving credit facility available to the Company; and
WHEREAS, the Company has requested that the Existing Credit Agreement be
amended to increase the amount of Credit available thereunder and to make
certain other amendments thereto; and
WHEREAS, for the sake of convenience and clarity, the parties to the
Existing Credit Agreement desire to amend and restate the Existing Credit
Agreement in its entirety to give effect to such amendments.
NOW, THEREFORE, in consideration of the premises and agreements herein
contained, the parties hereto agree to amend and restate the Existing Credit
Agreement in its entirety to read as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms shall
have the following meanings:
"Acquisition" shall have the meaning given to such term in Subsection 7.6.
"Affiliate" shall mean as to any Person, (a) any other Person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person or (b) any Person who is a director or officer of (i)
such Person or (ii) any Person described in clause (a) above.
"Agent Fee Letter" means the letter dated March 17, 2006 between the
Company and the Agent.
"Agreement" shall mean this Second Amended and Restated Credit Agreement,
as amended, restated, supplemented or otherwise modified from time to time.
"Applicable Interest Rate" means for any Loan, the Base Rate or Eurodollar
Rate for such Loan, plus in each case the Applicable Margin.
1
"Applicable Margin" means:
(a) with respect to Base Rate Loans, the Base Rate Margin from time to time
in effect pursuant to the Pricing Schedule;
(b) with respect to Eurodollar Rate Loans, the Eurodollar Rate Margin from
time to time in effect pursuant to the Pricing Schedule.
"Assessment Rate" means, at any time, the average of the rates (rounded
upwards, if necessary, to the nearest 1/100 of 1%) then charged by the Federal
Deposit Insurance Corporation (or any successor) to any Lender for deposit
insurance for Dollar time deposits with such Lender as determined by the Lender.
"Bank Product Agreements" means any agreements entered into from time to
time by the Company or any Subsidiary with any Lender or any Affiliate of a
Lender in connection with Bank Products.
"Bank Product Obligations" means all obligations, liabilities, contingent
reimbursement obligations, fees and expenses owing by the Company or any
Subsidiary to any Lender or any Affiliate of a Lender pursuant to or evidenced
by the Bank Product Agreements and irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising.
"Bank Products" means any of the following services or facilities extended
to the Company or any Subsidiary by any Lender or any Affiliate of a Lender: (a)
credit cards, (b) debit cards, (c) purchase cards, (d) ACH transactions, (e)
cash management, including controlled disbursements, accounts or services, or
(f) Hedging Agreements.
"Base Rate" shall mean, on any day, the Prime Rate. The interest rate of
each Base Rate Loan shall change on the date of any change in the Prime Rate.
"Base Rate Loan" shall mean a Loan which bears interest at the Base Rate,
plus the Applicable Margin.
"Best Benefits Pledge Agreement" shall mean the Best Benefits Pledge
Agreement dated March 25, 2004 from Best Benefits, Inc. in favor of the Agent
for the benefit of the Lenders as amended and restated and consolidated with the
other Existing Collateral Documents pursuant to the Guaranty and Collateral
Agreement.
"Borrowing" shall mean a borrowing hereunder consisting of Loans made at
the same time by the Lenders to the Company pursuant to Section 2.
"Business Day" shall mean a day on which commercial banks in Chicago,
Illinois are not authorized or required by law or executive order to remain
closed except that, with respect to Borrowings, notices, determinations and
payments with respect to Eurodollar Rate Loans, such day shall be a "Business
Day" only if it is also a day for trading by and between banks in the London
interbank Eurodollar market.
2
"Canada Holdco Pledge Agreement" shall mean the Pledge Agreement dated as
of April 1, 2004 from Memberworks Canada Holdings, Inc., a Delaware corporation
in favor of the Agent for the benefit of the Lenders as amended and restated and
consolidated with the other Existing Collateral Documents pursuant to the
Guaranty and Collateral Agreement.
"Canada Holdco Trademark Agreement" shall mean the Trademark Security
Agreement dated as of April 1, 2004 from Memberworks Canada Holdings, Inc., a
Delaware corporation in favor of the Agent for the benefit of the Lenders as
amended and restated and consolidated with the other Existing Collateral
Documents pursuant to the Guaranty and Collateral Agreement.
"Capital Expenditures" shall mean all expenditures which, in accordance
with GAAP, would be required to be capitalized and shown on a consolidated
balance sheet of the Company and its Subsidiaries.
"Capital Securities" means, with respect to any Person, all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's capital, whether now outstanding or
issued or acquired after the Closing Date, including common stock, preferred
shares, membership interests in a limited liability company, limited or general
partnership interests in a partnership, interests in a trust, interests in other
unincorporated organizations or any other equivalent of such ownership interest.
"Capitalized Lease" shall mean, as to any Person, (a) any lease of
property, real or personal, if the then present value of the minimum rental
commitment thereunder should, in accordance with GAAP, be capitalized on a
balance sheet of such Person and (b) any other such lease the obligations under
which are capitalized on the balance sheet of such Person.
"Cash Collateralize" means to deliver cash collateral to the Agent, to be
held as cash collateral for outstanding Letters of Credit, pursuant to
documentation satisfactory to the Agent and derivatives of such term shall have
corresponding meanings.
"Cash EBITDA" shall mean, for any period, net income (loss) and to the
extent deducted (added) in determining such net income (loss), plus (i) interest
expense, plus (ii) income tax expense, plus (iii) depreciation, amortization and
other non-cash items deducted in arriving at such net income (loss), minus
(plus) (iv) increase (decrease) in membership solicitation and other deferred
costs, plus (minus) (v) any negative (positive) cumulative effect of any change
in accounting principles, and plus (minus) (vi) the increase (decrease) in
deferred membership fees; in each case, calculated on a consolidated basis for
the Company and its Subsidiaries in accordance with GAAP.
"Cash Equivalents" means, at any time, (a) any evidence of indebtedness,
maturing not more than one year after such time, issued or guaranteed by the
United States Government or any agency thereof, including any auction rate
security resetting not more than one year from the prior reset date, rated at
least AAA/aaa and overcollateralized or insured, (b) commercial paper, maturing
not more than one year from the date of issue, or corporate demand notes, in
each case (unless issued by a Lender or its holding company) rated at least A-2
by Standard & Poor's Ratings Group or P-2 by Xxxxx'x Investors Service, Inc.,
(c) any certificate of deposit (or time deposits represented by such
certificates of deposit) or banker's acceptance, maturing not more than one year
after such time, or overnight Federal Funds transactions that are issued or sold
by any Lender or its holding company or by a commercial banking institution that
is a member of the Federal Reserve System and has a combined capital and surplus
and undivided profits of not less than $100,000,000 and (d) any repurchase
agreement entered into with any Lender (or other commercial banking institution
of the stature referred to in clause (c)) which (i) is secured by a fully
perfected security interest in any obligation of the type described in any of
clauses (a) through (c) and (ii) has a market value at the time such repurchase
agreement is entered into of not less than 100% of the repurchase obligation of
such Lender (or other commercial banking institution) thereunder.
3
"CERCLA" shall have the meaning given to such term in Subsection 5.15.
"Closing Date" shall mean March 17, 2006.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" shall mean any property in which the Collateral Agent, for the
benefit of the Agent and the Lenders, has been granted a security interest
pursuant to the Collateral Documents.
"Collateral Agent" shall mean LaSalle, in its capacity as collateral agent.
"Collateral Documents" means the Guaranty and Collateral Agreement which
amends and restates and consolidates each of the Existing Collateral Documents
together with any other agreement or instrument pursuant to which the Company,
any Subsidiary or any other Person grants or purports to grant collateral to the
Agent for the benefit of the Lenders or otherwise relates to such collateral.
"Commitment" shall mean, as to each Lender, the obligation of such Lender
to make Loans in an aggregate principal amount at any one time outstanding up to
but not exceeding the amount set forth opposite such Lender's name on the
signature pages hereof under the heading "Commitment" or in an assignment
agreement executed and delivered by such Lender pursuant to Subsection 10.6 (as
the same may be increased or reduced pursuant to the terms hereof).
"Commitment Fee Rate" means the commitment fee rate from time to time in
effect pursuant to the Pricing Schedule.
"Commitment Percentage" shall mean, as to each Lender, the percentage
determined by dividing such Lender's Commitment by the Total Commitment.
"Continue", "Continuation", and "Continued" shall refer to the continuation
pursuant to Subsection 2.7 hereof of a Eurodollar Rate Loan from one Interest
Period to the next Interest Period.
"Control" shall mean, with respect to any Person, the power, direct or
indirect, to vote 5% or more of the securities having ordinary voting power for
the election of directors (or persons performing similar functions) of such
Person or to direct or cause the direction of the management and policies of
such Person whether through ownership of voting securities, by contract or
otherwise.
4
"Convert", "Conversion", and "Converted" shall refer to a conversion
pursuant to Subsection 2.7 hereof of Base Rate Loans into Eurodollar Rate Loans
or of Eurodollar Rate Loans into Base Rate Loans.
"Xxxxxxxxx" shall mean Xxxxxxxxx & Company, Inc., a company organized under
the laws of Georgia.
"Default" shall mean any Event of Default or any event which with the
giving of notice, the lapse of time, or both, would become an Event of Default.
"Discount Development Pledge Agreement" shall mean the Discount Development
Pledge Agreement dated March 25, 2004 from Discount Development, L.L.C. in favor
of the Agent for the benefit of the Lenders as amended and restated and
consolidated with the other Existing Collateral Documents pursuant to the
Guaranty and Collateral Agreement.
"Dollars" and "$" shall mean lawful currency of the United States of
America.
"Domestic Subsidiary" means any Subsidiary which is organized under the
laws of any state in the United States or the District of Columbia.
"Eligible Securities" shall mean (a) direct obligations of the U.S.
Treasury including Treasury bills, notes, and bonds having a maturity of three
years or less; (b) Federal Agency Securities having a maturity of three years or
less; (c) Repurchase and Reverse Repurchase Agreements collateralized by U.S.
Treasury and Federal Agency Securities having a maturity of one month or less;
(d) U.S. Dollar-denominated Certificates of Deposit, Time Deposits, and Banker's
Acceptances having a maturity of one year or less (three months or less in the
case of Time Deposits and six months or less in the case of Bankers Acceptances)
and issued by U.S. or foreign banks having a short term debt rating of A1/P1 or
higher and an investment grade long-term debt rating, or a rating of A from
Thomson BankWatch; (e) U.S. Dollar-denominated corporate obligations including
commercial paper, corporate bonds, medium notes and euronotes, and asset-backed
securities having a maturity of three years or less (nine months or less in the
case of commercial paper) and issued by U.S. or foreign entities having a short
term debt rating of A1/P1 or higher and an investment grade long-term debt
rating; and (f) money market funds which maintain a constant net asset value and
provide daily liquidity.
"Environmental Laws" shall mean any and all federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment including, without limitation, ambient air, surface water, ground
water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes.
5
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Group" shall mean the Company and all members of a controlled group
of corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Company, are treated as a single
employer under Section 4001 of ERISA or Section 414(b), (c), (m), (n) or (o) of
the Code.
"Eurodollar Rate" shall mean, for any Interest Period applicable to a
Eurodollar Rate Loan, the rate per annum as determined on the basis of the
offered rates for deposits in Dollars in an amount comparable to the amount of
the relevant Eurodollar Rate Loan, for a period of time comparable to such
Interest Period which appears on the Bloomberg system as of 11:00 a.m. London
time on the day that is two London Banking Days preceding the first day of such
Interest Period; provided however, if the rate described above does not appear
on the Bloomberg Financial Markets system (or other authoritative source
selected by the Agent in its reasonable discretion) on any applicable interest
determination date, the Eurodollar Rate shall be the rate (rounded upwards as
described above, if necessary) which appears on the Telerate page 3750, British
Bankers Association Interest Settlement Rates as of 11:00 a.m. London time on
the day that is two London Banking Days preceding the first day of such Interest
Period; provided further however, if the rate described above does not appear on
the Telerate System on any applicable interest determination date, the
Eurodollar Rate shall be the rate for deposits in dollars in an amount
comparable to the amount of the relevant Eurodollar Rate Loan for a period
substantially equal to the Interest Period on the Reuters Page "LIBO" (or such
other page as may replace the LIBO Page on that service for the purpose of
displaying such rates), as of 11:00 a.m. (London Time), on the day that is two
(2) London Banking Days prior to the beginning of such Interest Period. "Banking
Day" shall mean, in respect of any city, any date on which commercial banks are
open for business in that city
If the Bloomberg, Telerate and Reuters systems are unavailable, then the
rate for that date will be determined on the basis of the offered rates for
deposits in U.S. dollars for a period of time comparable to such Interest Period
which are offered by four major banks in the London interbank market at
approximately 11:00 a.m. London time, on the day that is two (2) London Banking
Days preceding the first day of such Interest Period as selected by the Agent.
The principal London office of no fewer than two major London banks will be
requested to provide a quotation of its U.S. dollar deposit offered rate. If at
least two such quotations are provided, the rate for that date will be
arithmetic mean of the quotations. If fewer than two quotations are provided as
requested, the rate for that date will be determined on the basis of the basis
of the rates quoted for loans in U.S. dollars to leading European banks for a
period of time comparable to such Interest Period offered by major banks in New
York City at approximately 11:00 a.m. New York City time, on the day that its
two London Banking Days preceding the first day of such Interest Period. In the
event that the Agent is unable to obtain any such quotation as provided above,
it will be deemed that the Eurodollar Rate pursuant to a Eurodollar Rate Loan
cannot be determined and in such event the Eurodollar Rate shall be the Base
Rate pursuant to the terms and conditions of a Base Rate Loan.
6
In the event that the Board of Governors of the Federal Reserve System
shall impose a Reserve Requirement with respect to Eurodollar Rate deposits,
then for any period during which such Reserve Requirement shall apply, the
Eurodollar Rate shall be equal to the amount determined above divided by an
amount equal to one (1) minus the Reserve Requirement.
"Eurodollar Rate Loan" means a Loan which bears interest at the Eurodollar
Rate, plus the Applicable Margin.
"Event of Default" shall mean any of the events specified in Subsection
8.1.
"Excluded Subsidiaries" shall mean all Subsidiaries of the Company which
are not Material Subsidiaries and all Subsidiaries which are designated as such
on Schedule 5.3 hereof, as such schedule may be amended or supplemented from
time to time at the request of the Company and with the approval of the Required
Lenders.
"Existing Collateral Documents" means the Security Agreement, each
Subsidiary Guaranty, each Subsidiary Security Agreement, the Best Benefits
Pledge Agreement, the Discount Development Pledge Agreement, the Pledge
Agreement, the Canada Holdco Pledge Agreement, the Nova Scotia Pledge Agreement,
and the Canada Holdco Trademark Agreement and any other agreement listed on
Exhibit A to the Guaranty and Collateral Agreement.
"Existing Letters of Credit" shall mean those letters of credit issued and
outstanding under the Existing Credit Agreement.
"Federal Funds Rate" shall mean, for any day or any other period, 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 it.
"Final Maturity Date" shall mean March 31, 2009.
"Foreign Subsidiary" shall mean each Subsidiary which is not a Domestic
Subsidiary.
"GAAP" shall mean generally accepted accounting principles in the United
States of America in effect from time to time and used in the preparation of the
Company's annual 10-K filing with the Securities and Exchange Commission.
"Governmental Authority" shall mean any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guarantor" shall have the same meaning herein as such term is defined in
the Guaranty and Collateral Agreement.
"Guaranty" by any Person shall mean any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Indebtedness
or other obligation of any other Person and, without limiting the generality of
the foregoing, any obligation, direct or indirect, contingent or otherwise, of
such Person (i) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness or other obligation (whether arising by virtue
of partnership arrangements, by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for the purpose of
assuring in any other manner the obligee of such Indebtedness or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part), provided that the term Guaranty shall not
include endorsements for collection or deposit in the ordinary course of
business. The term "Guaranty" used as a verb has a corresponding meaning.
7
"Guaranty and Collateral Agreement" means the Guaranty and Collateral
Agreement from the Company and its Material Subsidiaries which amends and
restates and consolidates the Existing Collateral Documents, as the same may be
amended, restated, supplemented or otherwise modified from time to time.
"Hedging Agreement" shall mean any interest rate, currency or commodity
swap agreement, cap agreement or collar agreement, and any other agreement or
arrangement designed to protect a Person against fluctuations in interest rates,
currency exchange rates or commodity prices.
"Hedging Obligation" shall mean, with respect to any Person, any liability
of such Person under any Hedging Agreement.
"Indebtedness" shall mean, for any Person (without duplication), (i) all
indebtedness or other obligations of such Person for borrowed money and all
indebtedness of such Person with respect to any other items (including, without
limitation, obligations evidenced by bonds, debentures, notes or other similar
instruments but excluding accounts payable in the ordinary course of business,
deferred revenue and accrued expenses) which would, in accordance with GAAP, be
classified as a liability on the balance sheet of such Person, (ii) all
obligations of such Person to pay the deferred purchase price of property or
services other than multi-year marketing plans in the ordinary course of
business (including indebtedness created under or arising out of any conditional
sale or other title retention agreement), (iii) all obligations of such Person
(contingent or otherwise) under reimbursement or similar agreements with respect
to the issuance of letters of credit, (iv) all indebtedness or other obligations
of such Person under or with respect to any swap or other financial hedging
arrangement, (v) all obligations of such Person under any Capitalized Lease,
(vi) all indebtedness or other obligations of any other Person (other than a
wholly owned Subsidiary) of the type specified in clause (i), (ii), (iii), (iv)
or (v) above, the payment or collection of which such Person has Guaranteed and
(vii) all indebtedness or other obligations of any other Person of the type
specified in clause (i), (ii), (iii), (iv), (v) or (vi) above secured by (or for
which the holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including, without
limitation, accounts and contract rights) owned by such Person, whether or not
such Person has assumed or becomes liable for the payment of such indebtedness
or obligations.
"Interest Period" means for each Eurodollar Rate Loan comprising part of
the same Borrowing, the period commencing on the date of such Eurodollar Rate
Loan or on the last day of the preceding Interest Period, as the case may be,
and ending on the numerically corresponding day of the last month of the period
selected by the Company pursuant to the following provisions: the duration of
each Eurodollar Rate Loan Interest Period shall be one (1), two (2), three (3),
six (6), nine (9) or twelve (12) months, in each case as the Company may select,
upon notice received by the Agent not later than 11:00 a.m. (Chicago time) on
the third Business Day prior to the first day of such Interest Period; provided,
however, that:
8
(i) all Eurodollar Rate Loans comprising part of the same Borrowing shall
be of the same duration;
(ii) whenever the last day of any Interest Period would otherwise occur on
a day other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day; provided that, if such
extension would cause the last day of such Interest Period to occur in the next
following calendar month, the last day of such Interest Period shall occur on
the next preceding Business Day;
(iii) each Interest Period that commences on the last Business Day of a
calendar month (or on any day for which there is no numerically corresponding
day in the applicable subsequent calendar month) shall end on the last Business
Day of the applicable subsequent month; and
(iv) no Interest Period for any Loan shall extend beyond the Final Maturity
Date.
"Investment Property" shall mean "investment property", as such term is
defined in the UCC.
"Issuing Lender" shall mean LaSalle, in its capacity as a Lender hereunder.
"LaSalle" shall mean LaSalle Bank National Association, a national banking
association.
"Lavalife Acquisition" shall mean the acquisition by the Company of certain
assets of Lavalife Inc., an Ontario, Canada corporation, and certain outstanding
capital stock of Lavalife Inc. pursuant to the Master Transaction Agreement
dated March 3, 2004 by and among Lavalife, Inc., CMS/Mid-Atlantic Business
Opportunity Partners, L.P., ECP-IMG Limited Partnership, ECP-IMG GP Inc.,
Canadian Imperial Bank of Commerce, The VenGrowth Investment Fund Inc., MWI
Nominee Company Ltd., 1389122 Ontario Inc., Octennial Corporation, Tritrust,
Xonkor Holding Limited, Machkor Holding Limited, Mulkor Holding Ltd., Hexta
Corporation Ltd., Septus Corporation Limited, Xxx Xxxx, Xxxx Xxxxxxxx, Xxxxx
Xxxxxx and the Company.
"L/C Application" means, with respect to any request for the issuance of a
Letter of Credit, a letter of credit application in the form being used by the
Issuing Lender at the time of such request for the type of letter of credit
requested.
"L/C Fee Rate" shall mean the L/C Fee Rate from time to time in effect
pursuant to the Pricing Schedule.
9
"Lending Office" shall mean, with respect to each Lender the office
specified opposite such Lender's name on Schedule I or such other office as such
Lender may designate in writing from time to time to the Company and the Agent.
"Letters of Credit" shall mean irrevocable standby letters of credit for
the account of the Company, issued by the Issuing Lender pursuant to Section
2.1(b) and the Existing Letters of Credit.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, security interest, lien (statutory or other) or
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement, any Capitalized Lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the Uniform Commercial Code or comparable law
of any jurisdiction in respect of any of the foregoing).
"Loan" shall mean a loan by a Lender pursuant to Subsection 2.1(a). Each
Loan shall be a Base Rate Loan or a Eurodollar Rate Loan.
"Loan Documents" means this Agreement and the Related Documents.
"Loan Party" means the Company and each Material Subsidiary.
"Master Letter of Credit Agreement" means, at any time, with respect to the
issuance of Letters of Credit, a master letter of credit agreement or
reimbursement agreement in the form, if any, being used by the Issuing Lender at
such time.
"Material Subsidiary" means any Domestic Subsidiary of the Company or any
Foreign Subsidiary which either contributes 5% or more of the Revenues of the
Company and its Subsidiaries on a consolidated basis or has tangible assets
constituting 5% or more of the total tangible assets of the Company and its
Subsidiary on a consolidated basis, in each case, computed as of the end of the
most recently completed fiscal year and in the case of any Subsidiary acquired
or created after the date hereof computed, in a manner acceptable to the Agent,
as if such Subsidiary had been acquired on the first day of such fiscal year,
other than any Excluded Subsidiary.
"Multiemployer Plan" shall mean a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"My Choice Medical Acquisition" shall mean the acquisition of My Choice
Medical Inc. by the Company.
"Note" shall mean a promissory note of the Company payable to the order of
a Lender, evidencing the Loans made by such Lender as provided for herein,
substantially in the form of Exhibit A, and any promissory note or notes of the
Company issued in substitution thereof.
"Notice of Borrowing" shall mean an irrevocable notice from the Company to
the Agent, substantially in the form of Exhibit B-1, pursuant to which the
Company requests a Borrowing.
10
"Notice of Continuation or Conversion" means the certificate, in the form
of Exhibit B-2, to be delivered by the Company to the Agent pursuant to
Subsection 2.7.
"Nova Scotia" shall mean 3087739 Nova Scotia Company, a company
incorporated under the laws of Nova Scotia.
"Nova Scotia Pledge Agreement" shall mean the Pledge Agreement dated as of
April 1, 2004 from Nova Scotia in favor of the Agent for the benefit of the
Lenders as amended and restated and consolidated with the other Existing
Collateral Documents pursuant to the Guaranty and Collateral Agreement.
"Obligations" shall mean (a) any and all of the debts, obligations and
liabilities of the Company or any Subsidiary to the Lenders or the Agent
provided for or arising under this Agreement or the Related Documents to which
the Company is a party (including, without limitation, the obligation to repay
all Loans and to pay interest thereon or fees related thereto, the obligation to
reimburse the Lenders for the amount of any draft presented under any Letter of
Credit and paid by the Issuing Lender and to pay interest thereon or fees
related thereto, (b) all Hedging Obligations and Bank Product Obligations of the
Company or any Subsidiary to any Lender or any Affiliate of a Lender and (c) the
obligation to pay all costs of collection, including the fees and disbursements
of counsel), in each case, whether now existing or hereafter arising, voluntary
or involuntary, direct or indirect, absolute or contingent, liquidated or
unliquidated, and whether or not from time to time decreased or extinguished and
later increased, created or incurred.
"Operating Lease" shall mean any lease of real or personal property other
than a Capitalized Lease.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor thereto.
"Percentage of Total Commitment" shall mean, with respect to any Lender,
the percentage of the Total Commitment represented by such Lender's Commitment
to make Loans to the Company.
"Person" shall mean an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.
"Plan" shall mean any employee benefit plan which is covered by Title IV of
ERISA or is subject to the funding requirements under Section 412 of the Code
(or the corresponding provisions of ERISA) and in respect of which the Company
or any member of the ERISA Group is (or, if such plan were terminated at such
time, would under Section 4069 of ERISA be deemed to be) an "employer" as
defined in Section 3(5) of ERISA.
"Pledge Agreement" shall mean the Pledge Agreement dated March 25, 2004
from the Company in favor of the Agent for the benefit of the Lenders as amended
and restated and consolidated with the other Existing Collateral Documents
pursuant to the Guaranty and Collateral Agreement.
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"Prime Rate" shall mean, for any day, the rate of interest in effect for
such day as publicly announced from time to time by LaSalle as its prime rate
(whether or not such rate is actually charged by LaSalle). Any change in the
Prime Rate announced by LaSalle shall take effect at the opening of business on
the day specified in the public announcement of such change.
"Quarterly Payment Dates" shall mean the first day of each April, July,
October and January of each year, commencing July 1, 2003.
"RCRA" shall have the meaning given to such term in Subsection 5.15.
"Regulatory Change" means any change after the date of this Agreement in
United States federal, state or foreign laws or regulations (including
Regulation D and the laws or regulations which designate any assessment rate
relating to certificates of deposit or otherwise (including the "Assessment
Rate" if applicable to any Loan)) or the adoption or making after such date of
any orders, rulings, interpretations, directives, guidelines or requests
applying to a class of banks including the Lenders, of or under any United
States federal, state, or foreign laws or regulations (whether or not having the
force of law) by any court or governmental or monetary authority charged with
the interpretation or administration thereof.
"Related Documents" shall mean each Note, the Master Letter of Credit
Agreement, the Agent Fee Letter, the L/C Applications and the Collateral
Documents.
"Reportable Event" shall mean any of the events set forth in Section
4043(b) of ERISA.
"Required Lenders" shall mean Lenders holding sixty-six and two-thirds
percent (66-2/3%) of the aggregate amount of the Commitments, or, if the
Commitments have been terminated, Banks holding sixty-six and two-thirds percent
(66-2/3%) of the aggregate principal amount of the Loans outstanding.
"Reserve Requirement" means for any Eurodollar Rate Loans for any quarterly
period (or, as the case may be, shorter period) as to which interest is payable
hereunder, the average maximum rate at which reserves (including any marginal,
supplemental or emergency reserves) are required to be maintained during such
period under Regulation D by member banks of the Federal Reserve System in
Boston, Massachusetts with deposits exceeding one billion Dollars against
"Eurocurrency liabilities" (as such term is used in Regulation D). Without
limiting the effect of the foregoing, the Reserve Requirement shall reflect any
other reserves required to be maintained by such member banks by reason of any
Regulatory Change against: (i) any category of liabilities which includes
deposits by references to which the Eurodollar Rate for Eurodollar Rate Loans is
to be determined as provided in the definition of "Eurodollar Rate" in this
Article 1, or (ii) any category of extensions of credit or other assets which
include Eurodollar Rate Loans.
"Security Agreement" shall mean the Security Agreement dated March 31, 2003
between the Company and the Collateral Agent, as amended and restated and
consolidated with the other Existing Collateral Documents pursuant to the
Guaranty and Collateral Agreement.
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"Senior Unsecured Notes" shall mean unsecured notes of the Company with a
maturity of no earlier than three (3) years from the Closing Date and containing
terms and issued pursuant to agreements reasonably satisfactory to the Agent.
"Single Employer Plan" shall mean any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.
"Subsidiary" shall mean as to any Person, a corporation or other business
entity of which shares of stock or other ownership interests having ordinary
voting power to elect a majority of the board of directors or other managers of
such corporation or other business entity are at the time owned, directly or
indirectly through one or more intermediaries, by such Person. Unless otherwise
qualified, all references to a "Subsidiary" or to "Subsidiaries" in this
Agreement shall refer to a Subsidiary or Subsidiaries of the Company.
"Subsidiary Guaranty" shall mean the Guaranty dated March 31, 2003 as
amended by the Joinder and Amendment to Guaranty dated March 25, 2004 executed
by each Material Subsidiary of the Company, as amended and restated, and
consolidated with the other Existing Collateral Documents pursuant to the
Guaranty and Collateral Agreement.
"Subsidiary Security Agreement" shall mean the Subsidiary Security
Agreement dated March 31, 2003 as amended by the Joinder and Amendment to
Subsidiary Security Agreement dated March 25, 2004 as amended and restated, and
consolidated with the other Existing Collateral Documents pursuant to the
Guaranty and Collateral Agreement.
"Test Period" shall mean each period of four consecutive fiscal quarters of
the Company ending on the last day of each fiscal quarter.
"Total Commitment" shall mean $50,000,000, as the same may be increased or
decreased pursuant to the terms hereof.
"Total Debt" shall mean, at any date, all Indebtedness of the Company and
its Subsidiaries computed on a consolidated basis in accordance with GAAP.
"Total Net Debt" shall mean, at any date, Total Debt minus the sum of cash
on hand plus Cash Equivalents of the Company and its Subsidiaries, computed on a
consolidated basis in accordance with GAAP.
"UCC" shall mean the Uniform Commercial Code as in effect on the date
hereof in the State of Illinois, as amended from time to time.
"Unused Availability" shall mean, as of any date the same is determined,
the difference between (a) the Total Commitment less (b) the outstanding amount
of Loans and Letters of Credit.
1.2 Other Definitional Provisions. (a) Unless otherwise specified therein,
all terms defined in this Agreement shall have the defined meanings when used in
the Related Documents or any certificate or other document made or delivered
pursuant hereto or thereto.
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(a) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section, Subsection,
schedule and exhibit references are to this Agreement unless otherwise
specified.
(b) Defined terms in this Agreement shall include in the singular number,
the plural and in the plural number, the singular. The correlative of any term
defined in this Agreement shall, unless the context otherwise requires, have the
same meaning as such defined term.
(c) Unless the context otherwise requires, any pronoun shall include the
corresponding masculine, feminine and neuter forms.
(d) References in this Agreement to any other agreement, document or
instrument shall, unless the context otherwise requires, include such other
agreement, document or instrument as the same may be from time to amended,
restated, supplemented or otherwise modified.
1.3 Accounting Principles. (a) As used herein and in the Related Documents
and in any other certificate or document made or delivered pursuant hereto or
thereto, accounting terms relating to the Company not defined in Subsection 1.1
shall have the respective meanings given to them under GAAP.
(a) Unless (i) otherwise required under applicable accounting rules, (ii)
required in the case of a filing of a registration statement with the Securities
and Exchange Commission in connection with an initial public offering of
securities by the Company or (iii) the Company and its firm of independent
accountants of nationally recognized standing acceptable to the Lenders deem a
change to be appropriate, the Company shall not make any change in the
accounting treatment utilized by the Company under GAAP without the consent of
the Lenders; provided, that if any of clause (i), (ii) or (iii) is applicable,
the Company will notify the Lenders prior thereto and advise the Lenders of the
effect, if any, such change will have on the presentation of the Company's
financial statements and the financial computations required hereunder.
SECTION 2. CREDIT FACILITY
2.1 Loans and Letters of Credit. (a) Each Lender severally agrees, on the
terms and subject to the conditions of this Agreement, from time to time during
the period from the Closing Date to but not including the Final Maturity Date,
to make Loans to the Company in an aggregate principal amount at any one time
outstanding up to but not exceeding the amount of its Commitment; provided that
(i) to the extent any Letters of Credit have been issued by the Issuing Lender
or constitute Existing Letters of Credit and remain outstanding, the Commitment
of each Lender shall be reduced by such Lender's Commitment Percentage of the
aggregate principal amount of such outstanding Letters of Credit and (ii) the
sum of all outstanding Loans and Letters of Credit immediately after the making
of each Loan shall not exceed the Total Commitment. Within such limit, the
Company may borrow, prepay, repay and reborrow pursuant to this Subsection
2.1(a).
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(b) The Issuing Lender agrees, upon the request of the Company and on such
terms and conditions as the Lenders, the Agent and the Company may from time to
time agree, during the period from the Closing Date to the date which is prior
to the Final Maturity Date (or such later date as may be consented to by the
Required Lenders (such consent not to be unreasonably withheld)), to issue
Letters of Credit in an aggregate principal amount at any one time outstanding
up to but not exceeding the amount of the Total Commitment, provided that (i) no
Letter of Credit shall be issued if immediately following such issuance, with
respect to any Lender, such Lender's Commitment Percentage of the aggregate
principal balance of all outstanding Letters of Credit, when added to the
aggregate principal balance of all outstanding Loans made by such Lender,
exceeds such Lender's Commitment and (ii) the sum of all outstanding Loans and
Letters of Credit immediately after the issuance of each Letter of Credit shall
not exceed the Total Commitment and (iii) the outstanding amount of all Letters
of Credit shall not exceed $15,000,000. The Company shall execute and deliver to
the Issuing Lender the Master Letter of Credit Agreement from time to time in
effect. The Company shall give notice to the Agent and the Issuing Lender of the
proposed issuance of each Letter of Credit on a Business Day which is at least
three Business Days (or such lesser number of days as the Agent and the Issuing
Lender shall agree in any particular instance in their sole discretion) prior to
the proposed date of issuance of such Letter of Credit. Each such notice shall
be accompanied by an L/C Application, duly executed by the Company and in all
respects satisfactory to the Agent and the Issuing Lender, together with such
other documentation as the Agent or the Issuing Lender may request in support
thereof, it being understood that each L/C Application shall specify, among
other things, the date on which the proposed Letter of Credit is to be issued,
the expiration date of such Letter of Credit (which shall not be later than the
Final Maturity Date (unless such Letter of Credit is Cash Collateralized)) and
whether such Letter of Credit is to be transferable in whole or in part. Any
Letter of Credit outstanding after the Final Maturity Date which is Cash
Collateralized for the benefit of the Issuing Lender shall be the sole
responsibility of the Issuing Lender. So long as the Issuing Lender has not
received written notice that the conditions precedent set forth in Section 4
with respect to the issuance of such Letter of Credit have not been satisfied,
the Issuing Lender shall issue such Letter of Credit on the requested issuance
date. The Issuing Lender shall promptly advise the Agent of the issuance of each
Letter of Credit and of any amendment thereto, extension thereof or event or
circumstance changing the amount available for drawing thereunder. In the event
of any inconsistency between the terms of the Master Letter of Credit Agreement,
any L/C Application and the terms of this Agreement, the terms of this Agreement
shall control.
(c) If any draft shall be presented for payment under any Letter of Credit,
the Issuing Lender shall promptly notify the Company and the other Lenders of
the date and amount thereof. The Company agrees to reimburse the Issuing Lender
on each date on which the Issuing Lender notifies the Company in writing of the
date and amount of a draft presented under any Letter of Credit and paid by the
Issuing Lender for the amount of (a) such draft so paid and (b) any taxes (other
than income taxes), fees, charges or other costs and expenses incurred by the
Issuing Lender in connection with such payment. Each such payment shall be made
to the Issuing Lender at its Lending Office specified herein and in Dollars and
in immediately available funds. Each drawing under any Letter of Credit shall
constitute a request by the Company to the Agent for the borrowing of Loans in
the amount of such drawing and any reimbursement made by a Lender pursuant to
Subsection 2.1(e) shall constitute a Loan pursuant to Section 2.1(a) subject to
the repayment obligations set forth in this subsection 2.1(c). Interest shall be
payable on any and all amounts remaining unpaid by the Company under this
subsection from the date of the draw on the Letter of Credit until payment in
full at a rate equal to the sum of the Base Rate plus 2% per annum, such rate to
change as and when the Base Rate changes. The Company agrees that its
reimbursement obligations hereunder (collectively, the "Reimbursement
Obligations") shall be payable irrespective of any claim, set-off, defense or
other right which the Company or any Subsidiary may have at any time against the
Issuing Lender, any other Lender, or any other Person, under all circumstances.
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(d) (1) As among the Company, the Issuing Lender and the other Lenders, the
Company assumes all risks of the acts and omissions of, or misuse of the Letters
of Credit by, the respective beneficiaries of the Letters of Credit. In
furtherance and not in limitation of the foregoing, the Issuing Lender, the
Agent and the other Lenders shall not be responsible for (i) the form, validity,
sufficiency, accuracy, genuineness or legal effect of any document submitted by
any party in connection with the application for and issuance of any Letter of
Credit, even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or part, which may prove to be invalid or ineffective for any reason;
(iii) failure of the beneficiary of a Letter of Credit to comply fully with
conditions required in order to draw upon such Letter of Credit, (iv) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise; (v) errors in interpretation of
technical terms; (vi) misapplication by the beneficiary of a Letter of Credit of
the proceeds of any drawing under such Letter of Credit; (vii) any consequences
arising from causes beyond the control of the Issuing Lender and to the extent
not avoidable by the Issuing Lender by the observance of reasonable commercial
standards prevailing in the geographic area where such Issuing Lender is
located; (viii) the existence of any claim, setoff, defense or other right which
the Company or any Subsidiary may have at any time against a beneficiary named
in a Letter of Credit or any transferee of any Letter of Credit (or any Person
for whom any such transferee may be acting), the Issuing Lender, any other
Lender, or any other Person, whether in connection with this Agreement, any of
the Related Documents, any Letter of Credit, the transactions contemplated
herein or any unrelated transactions (including any underlying transactions
between the Company or any Subsidiary and the beneficiary named in any Letter of
Credit); (ix) any draft, certificate or any other document presented under any
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect;
and (x) the surrender or impairment of any security for the performance or
observance of any of the terms of any of this Agreement or the Related
Documents. Notwithstanding the foregoing, nothing contained herein shall be
deemed to relieve the Issuing Lender from responsibility for any of the
foregoing consequences to the extent arising from the Issuing Lender's willful
or intentional breach of the terms hereof or its gross negligence.
(2) In furtherance and extension and not in limitation of the specific
provisions hereinabove set forth, any action taken or omitted by the Issuing
Lender, the Agent or any other Lender under or in connection with any Letter of
Credit or any related certificates, if taken or omitted in good faith, shall not
put the Issuing Lender, the Agent or such other Lender under any resulting
liability to the Company or relieve the Company of any of its obligations
hereunder to the Issuing Lender, the Agent or any other Lender.
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(e) Each Lender (other than the Issuing Lender) unconditionally and
irrevocably agrees with the Issuing Lender that, if a draft is paid under any
Letter of Credit for which the Issuing Lender is not reimbursed in full by the
Company in accordance with the terms of this Agreement, such Lender shall pay to
the Issuing Lender upon demand at the Issuing Lender's Lending Office as
specified herein an amount equal to such Lender's Commitment Percentage of the
amount of such draft, or any part thereof, which is not reimbursed. In
furtherance of the foregoing, the Issuing Lender irrevocably agrees to grant and
hereby grants to each other Lender, and, to induce the Issuing Lender to issue
Letters of Credit hereunder, each Lender (other than the Issuing Lender)
irrevocably agrees to accept and purchase and hereby accepts and purchases from
the Issuing Lender, for such Lender's own account and risk, an undivided
interest equal to such Lender's Commitment Percentage in the Issuing Lender's
obligations and rights under each Letter of Credit issued hereunder and the
amount of each draft paid by the Issuing Lender hereunder.
(f) Whenever, at any time after the Issuing Lender has made payment under
any Letter of Credit and has received from any other Lender its share of such
payment in accordance with Subsection 2.1(e), the Issuing Lender receives any
payment related to such Letter of Credit (whether directly from the Company or
otherwise, including proceeds of collateral applied thereto by the Agent), or
any payment of interest on account thereof, the Issuing Lender will distribute
to such other Lender at such other Lender's Lending Office as provided herein
its share thereof (provided, the amount of interest the Issuing Lender is to
share with any other Lender from any interest received by the Issuing Lender
shall be calculated from the date the Issuing Lender actually received from such
other Lender its share of any payment); provided, however, that in the event
that any such payment received by the Issuing Lender shall be required to be
returned by the Issuing Lender, such other Lender shall return to the Issuing
Lender the portion thereof previously distributed by the Issuing Lender to it.
2.2 Manner of Borrowing. The Company shall give the Agent a duly completed
Notice of Borrowing not later than 11:00 a.m., Chicago time, on the date of
Borrowing of any Base Rate Loan and at least three Business Days prior to the
date of Borrowing of any Eurodollar Rate Loan. Each such Notice of Borrowing
shall be irrevocable and shall specify: (i) the amount of such Borrowing, which
in the case of a Base Rate Loan shall be in the principal amount of not less
than $100,000 or any greater amount which is an integral multiple thereof and in
the case of a Eurodollar Rate Loan shall be in the principal amount of not less
than $250,000 or any greater amount which is an integral multiple thereof; (ii)
the date of such Borrowing, which shall be a Business Day; and (iii) whether the
Loan comprising such Borrowing is to be a Base Rate Loan or a Eurodollar Rate
Loan; and if a Eurodollar Rate Loan, the initial Interest Period with respect to
such Borrowing. Each Borrowing shall be made ratably from the Lenders in
proportion to each Lender's Percentage of the Total Commitment. Upon receipt by
the Agent of a Notice of Borrowing as aforesaid, the Agent shall promptly advise
each Lender of the details thereof. There shall be no more than three Interest
Periods relating to Eurodollar Rate Loans.
2.3 Disbursement of Loans. Upon notification from the Agent that a
Borrowing has been requested by the Company pursuant to Subsection 2.2, each
Lender shall make the Loans to be made by it available by transferring the
amount thereof in Dollars to the Agent not later than 12:00 noon, Chicago time,
on the relevant borrowing date. The Agent shall make the amounts received from
the Lenders immediately available to the Company by crediting the amount thereof
on the date of borrowing to the Company's account with the Agent.
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2.4 Notes. The Loans made by each Lender shall be evidenced by a Note. Each
Lender will note on its internal records the date and amount of each Loan made
by such Lender, the date and amount of each repayment of principal thereof and
will, prior to any transfer of its Note, endorse on the reverse side thereof the
outstanding principal amount of the Loans evidenced thereby and the aggregate
unpaid principal amount so recorded shall be prima facie evidence of the
principal amount owing and unpaid on such Note. Failure to so record or any
error in so recording any such information shall not alter the obligations of
the Company under this Agreement or such Note.
2.5 Repayment of Principal; Voluntary Prepayments; Reduction; Termination
or Suspension of Total Commitment.
(a) Mandatory Payments. The Company shall repay to the Agent for the
account of the Lenders the outstanding principal amount of each Lender's Loans
on the Final Maturity Date. In addition, if at any time the aggregate
outstanding principal amount of all Loans and Letters of Credit exceeds the
difference between Total Commitment less the Reserve, then the Company shall
immediately prepay to the Agent for the account of the Lenders the Loans and/or
Cash Collateralize the Letters of Credit or do a combination of the foregoing,
in an amount equal to such excess, together with accrued interest thereon.
(b) Voluntary Prepayments. Anything herein to the contrary notwithstanding,
the Company may at any time and from time to time prepay the then outstanding
Base Rate Loans comprising any Borrowing, in whole or in part, without premium
or penalty, upon not less than one (1) Business Day's irrevocable notice to the
Agent, specifying the date and amount of prepayment and, if more than one such
Borrowing is outstanding, which Borrowing is to be prepaid. Upon receipt of any
such notice, the Agent shall promptly notify each Lender thereof. Any notice of
prepayment given by the Company shall obligate the Company to make the
prepayment specified in such notice on the date specified therein. Accrued
interest on any amount prepaid in accordance with the terms hereof shall, in
accordance with Subsection 2.6, be payable on the date such prepayment is
required to be made as provided herein. Any partial prepayment of a Borrowing
comprised of Base Rate Loans shall be in an aggregate principal amount of
$100,000 or whole multiples of $100,000 in excess thereof, and shall not result
in the remaining amount of such Borrowing being less than $100,000.
(c) Anything herein to the contrary notwithstanding, the Company may at any
time and from time to time prepay the then outstanding Eurodollar Rate Loans
comprising any Borrowing, in whole or in part, without premium or penalty, upon
not less than three (3) Business Days' irrevocable notice to the Agent,
specifying the date and amount of prepayment and, if more than one such
Borrowing is outstanding, which Borrowing is to be prepaid. Upon receipt of any
such notice, the Agent shall promptly notify each Lender thereof. Any notice of
prepayment given by the Company shall obligate the Company to make the
prepayment specified in such notice on the date specified therein. Accrued
interest on any amount prepaid in accordance with the terms hereof shall, in
accordance with Subsection 2.6, be payable on the date such prepayment is
required to be made as provided herein. If such prepayment occurs on a date that
is not the last day of the Interest Period applicable to such Eurodollar Rate
Loan, the Company shall pay any amounts as shall be sufficient (in the
reasonable opinion of each Lender) to compensate such Lender for any reasonable
losses, costs or expenses (excluding any losses of anticipated profit), as
certified by such Lender (such certification setting forth the basis for such
compensation), which such Lender may reasonably incur as a result of such
prepayment, including without limitation, any loss, cost or expense incurred by
reason of funds liquidation or reemployment of deposits or other funds acquired
by such Lender to fund or maintain such Eurodollar Rate Loan and any
administrative costs, expenses or charges of the Lender as a result thereof. Any
partial prepayment of a Borrowing comprised of a Eurodollar Rate Loan shall be
in an aggregate principal amount of $250,000 or whole multiples of $250,000 in
excess thereof, and shall not result in the remaining amount of such Borrowing
being less than $250,000.
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Without limiting the effect of the preceding paragraph, compensation shall
include an amount equal to the excess, if any, of (i) the amount of interest
that otherwise would have accrued on the principal amount so prepaid for the
period from the date of such prepayment to the last day of the then current
Interest Period for such Eurodollar Rate Loan at the applicable rate of interest
for such Eurodollar Rate Loan provided for herein over (ii) the amount of
interest that otherwise would have accrued on such principal amount at a rate
per annum equal to the interest component of the amount the Lender would have
bid in the London interbank market for Dollar deposits of leading banks in
amounts comparable to such principal amount and with maturities comparable to
such period (as reasonably determined by the Lender), if the Lender has
match-funded such Eurodollar Rate Loan, or the Lender's cost of funds, if the
Lender has not match-funded. Such Lender will furnish to the Company a
certificate setting forth the basis and amount of each request by the Lender for
compensation under this Subsection 2.5(c).
(d) Voluntary Reduction or Termination of Total Commitment. The Company may
from time to time on at least three (3) Business Days' written notice received
by the Agent (which shall promptly advise each Lender thereof) permanently
reduce the Total Commitment to an amount not less than the sum of the
outstanding Loans and Letters of Credit. Any such reduction shall be in an
amount not less than $1,000,000 or higher integral multiple thereof.
(e) All Reductions of Total Commitment. All reductions of the Total
Commitment shall reduce the Commitments of the Lenders pro rata in accordance
with their respective Percentages of Total Commitment.
(f) Termination in Full. Concurrently with any reduction of the Total
Commitment to zero, the Company shall pay all accrued interest, fees and other
amounts payable hereunder and Cash Collateralize all outstanding Letters of
Credit.
2.6 Payment of Interest.
(a) The Company shall pay interest on the unpaid principal amount of each
Base Rate Loan from and including the date of such Base Rate Loan to but not
including the date on which such Loan is paid in full at a fluctuating rate per
annum equal to the Base Rate in effect from time to time plus the Applicable
Margin. Such interest shall be due and payable on each Quarterly Payment Date.
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(b) The Company shall pay interest on the unpaid principal amount of each
Eurodollar Rate Loan from and including the date of such Loan to but not
including the date on which such Loan is paid in full at a rate per annum equal
to the Eurodollar Rate in effect for the relevant Interest Period plus the
Applicable Margin. Such interest shall be due and payable on the last day of the
Interest Period applicable thereto and in the case of a Eurodollar Rate Loan
with a six month Interest Period, on the three-month anniversary of the first
day of such Interest Period.
(c) Notwithstanding the foregoing subparagraphs (a) and (b), if the Company
shall fail to pay any installment of principal of or interest on any Loan when
due, or if any other Event of Default shall occur, then the Company shall pay
interest as provided in Subsection 8.4.
2.7 Conversion or Continuation of Loans. The Company shall have the right
to Convert Loans of one type into Loans of another type or to Continue
Eurodollar Rate Loans, at any time or from time to time, provided that: (a) the
Company shall give the Agent a Notice of Continuation or Conversion in the form
of Exhibit B-2, as applicable, prior to 10:00 a.m. (Chicago time) on the date at
least (i) three (3) Business Days prior to the last day of the Interest Period
of any Loan to be Converted into or Continued as a Eurodollar Rate Loan and (ii)
one (1) Business Day prior to the last day of the Interest Period of any Loan to
be Converted into a Base Rate Loan; (b) Eurodollar Rate Loans may be Converted
or Continued only on the last day of an Interest Period for such Loans; (c) each
Conversion or Continuation of a Eurodollar Rate Loan shall be in an amount at
least equal to $250,000 or in any greater amount which is an integral multiple
thereof; (d) no Event of Default shall have occurred and be continuing at the
time of any Conversion or Continuation of any such Loan into a subsequent
Interest Period; (e) accrued interest on the Loan (or portion thereof) being
Converted or Continued shall be paid by the Company at the time of Continuation
or Conversion; and (f) each request for a Continuation as or Conversion to a
Eurodollar Rate Loan which fails to state an applicable Interest Period shall be
deemed to be a request for an Interest Period of one (1) month.
Notwithstanding anything to the contrary herein contained, if, upon the
expiration of any Interest Period applicable to any Eurodollar Rate Loan, the
Company shall fail to give a Notice of Continuation or Conversion as set forth
in this Subsection 2.7, the Company shall be deemed to have given a Notice of
Continuation of such Eurodollar Rate Loan in principal amount equal to the
outstanding principal amount of such Eurodollar Rate Loan and having an Interest
Period of one (1) month.
2.8 Computation of Interest and Fees. All interest and fees shall be
calculated on the basis of a 360-day year and paid for the actual days elapsed.
Any change in the interest rate on a Loan resulting from a change in the Base
Rate shall become effective as of the opening of business on the day on which
such change is announced. In computing the amount of interest or fees payable in
respect of any period, the first day of such period shall be included and the
last day of such period shall be excluded. All computations of interest and like
payments hereunder on the Loans shall, in the absence of clearly demonstrable
error, be considered correct and binding on the Company and each Lender, unless
within thirty (30) Business Days after receipt of any notice by the Agent of
such outstanding amount, the Company or any Lender notifies the Agent to the
contrary.
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2.9 Capital Adequacy.
(a) In the event that any Lender shall have determined that the adoption or
implementation of, or any change in, any law, rule, regulation or guideline
regarding capital adequacy, capital maintenance or similar requirement or any
change in the interpretation or application thereof or compliance by any Lender
or any corporation controlling any Lender with any request, guideline, policy or
directive regarding capital adequacy (whether or not having the force of law)
from any central bank or other Governmental Authority, has or would have the
effect of reducing the rate of return on such Lender's or such Lender's
controlling corporation's capital as a consequence of its obligations hereunder
or its Loans to a level below that which such Lender or such Lender's
controlling corporation could have achieved but for such adoption,
implementation, change or compliance (taking into consideration such Lender's or
such Lender's controlling corporation's policies with respect to capital
adequacy), then from time to time, upon demand by such Lender to the Company
(with a copy to the Agent), the Company shall pay to such Lender such additional
amount or amounts as will compensate such Lender for such reduction.
(b) Any such Lender will promptly notify the Company and the Agent upon
becoming aware of any event which will cause it to demand payment of any
additional amount pursuant to paragraph (a) above and shall furnish to the
Company a certificate containing a determination made in good faith of such
additional amount and the justification therefor and showing in reasonable
detail the computation thereof. Determinations and allocations by any Lender of
any additional amounts payable by the Company pursuant to paragraph (a) of this
Subsection 2.9 shall be conclusive absent manifest error.
(c) If any additional amount becomes or will in the future become payable
for the account of any Lender under paragraph (a) of this Subsection 2.9, then
such Lender will (if so requested by the Company, but without prejudice to the
provisions of this Subsection 2.9 ) consult with the Company and the Agent with
a view to agreeing upon a mutually acceptable alternative arrangement (including
the transfer of such Lender's Lending Office to another jurisdiction, if, in its
sole discretion, such transfer is not in any way disadvantageous to it or
contrary to its policies) which will avoid or minimize the payment of such
additional amount in the future and which is not prejudicial to it.
(d) The agreements contained in this Subsection 2.9 shall survive for a
period of one year following repayment of the Obligations.
2.10 Increased Costs.
(a) If after the date hereof, due to either (i) the introduction of or any
change in or in the interpretation or enforcement of, any law, regulation,
order, ruling, directive, guideline or request, or (ii) the compliance with any
order, ruling, directive, guideline or request from any central bank or other
governmental authority (whether or not having the force of law) issued,
announced, published, promulgated or made after the date hereof, there shall be
any increase in the cost to any Lender of agreeing to make or making, funding or
maintaining Eurodollar Rate Loans, then the Company shall be liable for, and
shall from time to time, within thirty (30) days following a demand by the
Lender, pay to the Agent for the account of the Lender additional amounts
sufficient to compensate such Lender for such increased cost; provided, however,
that before making any such demand, the Lender agrees to use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to
designate a different Lending Office if the making of such a designation would
allow the Lender or its Lending Office to continue to perform its obligations to
make Eurodollar Rate Loans or to continue to fund or maintain Eurodollar Rate
Loans and would not, in the reasonable judgment of the Lender, be otherwise
disadvantageous to the Lender. A certificate substantiating the amount of such
increased cost, submitted to the Company by the Lender, shall be conclusive,
absent demonstrable error.
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(b) Any such Lender will promptly notify the Company and the Agent upon
becoming aware of any event which will cause it to demand payment of any
additional amount pursuant to paragraph (a) above and shall furnish to the
Company a certificate containing a determination made in good faith of such
additional amount and the justification therefor and showing in reasonable
detail the computation thereof. Determinations and allocations by any Lender of
any additional amounts payable by the Company pursuant to paragraph (a) of this
Subsection 2.10 shall be conclusive absent manifest error.
(c) If any additional amount becomes or will in the future become payable
for the account of any Lender under paragraph (a) of this Subsection 2.10, then
such Lender will (if so requested by the Company, but without prejudice to the
provisions of this Subsection 2.10) consult with the Company and the Agent with
a view to agreeing upon a mutually acceptable alternative arrangement (including
the transfer of such Lender's Lending Office to another jurisdiction, if, in its
sole discretion, such transfer is not in any way disadvantageous to it or
contrary to its policies) which will avoid or minimize the payment of such
additional amount in the future and which is not prejudicial to it.
(d) The agreements contained in this Subsection 2.10 shall survive for a
period of one year following repayment of the Obligations.
2.11 Illegality. Notwithstanding any other provision of this Agreement, if
after the date hereof the introduction of, or any change in or in the
interpretation or enforcement of, any law, regulation, order, ruling, directive,
guideline or request shall make it unlawful, or any central bank or other
governmental authority shall assert that it is unlawful, for any Lender or its
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Loans or to continue to fund or maintain Eurodollar Rate Loans hereunder, then,
on notice thereof by such Lender to the Company, (i) the obligation of the
Lender to make Eurodollar Rate Loans shall terminate (and the Lender shall make
all of its Loans as Base Rate Loans notwithstanding any election by the Company
to have the Lender make Eurodollar Rate Loans) and (ii) if legally permissible,
at the end of the current Interest Period for such Eurodollar Rate Loans,
otherwise five Business Days after such notice and demand, all Eurodollar Rate
Loans of the Lender then outstanding will automatically convert into Base Rate
Loans; provided, however, that before making any such demand, the Lender agrees
to use reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions) to designate a different Lending Office if the making
of such a designation would allow the Lender or its Lending Office to continue
to perform its obligations to make Eurodollar Rate Loans and would not, in the
judgment of the Lender, be otherwise disadvantageous to the Lender. A
certificate describing such introduction or change in or in the interpretation
or enforcement of such law, regulation, order, ruling, directive, guideline or
request, submitted to the Company by such Lender, shall be conclusive evidence
of such introduction, change, interpretation or enforcement, absent demonstrable
error. The Lender and the Company agree to negotiate in good faith in order to
agree upon a mutually acceptable mechanism to provide that Eurodollar Rate Loans
made by the Lender as to which the foregoing conditions occur shall convert into
Base Rate Loans.
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2.12 Increase in Total Commitment.
(a) Provided there exists no Default, upon notice to the Agent (which shall
promptly notify the Lenders), the Company may from time to time, with the
consent of all of the Lenders, request an increase in the Total Commitment by an
amount not exceeding $30,000,000. At the time of sending such notice, the
Company (in consultation with the Agent) shall specify the time period within
which each Lender is requested to respond (which shall in no event be less than
ten Business Days from the date of delivery of such notice to the Lenders). Each
Lender shall notify the Agent within such time period whether or not it agrees
to the increase in the Total Commitment and if it is willing to increase its
Commitment. Any Lender not responding within such time period shall be deemed to
have declined the Company's request. The Agent shall notify the Company and each
Lender of the Lenders' responses to each request made hereunder. In the event
all of the Lenders have agreed to the requested increase in the Total Commitment
but one or more Lenders have declined to increase their own Commitment, to
achieve the full amount of a requested increase, the Company may also invite
additional banks or financial institutions satisfactory to the Agent and the
Lenders to become Lenders pursuant to a joinder agreement in form and substance
satisfactory to the Agent and its counsel.
(b) If the Aggregate Commitments are increased in accordance with this
Section, the Agent and the Company shall determine the effective date (the
"Increase Effective Date") and the final allocation of such increase, in
accordance with Lender's notice given pursuant to Subsection 2.12(a). The Agent
shall promptly notify the Company and the Lenders of the final allocation of
such increase and the Increase Effective Date. As a condition precedent to such
increase, the Company shall deliver to the Agent a certificate of the Company
dated as of the Increase Effective Date (in sufficient copies for each Lender)
signed by a responsible officer of the Company (i) certifying and attaching the
resolutions adopted by the Company approving or consenting to such increase, and
(ii) certifying that, before and after giving effect to such increase, (A) the
representations and warranties contained in Section 5 hereof and the other Loan
Documents are true and correct on and as of the Extension Effective Date, except
to the extent that such representations and warranties specifically refer to an
earlier date in which case they are true and correct as of such earlier date,
and except that for purposes of this Section 2.12, the representations and
warranties contained in subsection (a) of Section 5.1 shall be deemed to refer
to the most recent statements furnished pursuant to subsections (a) and (b),
respectively, of Section 6.1, and (B) no Default exists. The Company shall
prepay any Loans outstanding on the Increase Effective Date (and pay any
additional amounts required pursuant to Section 2.5(c)) to the extent necessary
to keep the outstanding Loans ratable with any revised pro rata shares arising
from any nonratable increase in the Commitments under this Section.
2.13 Due Date Extension. If any payment of principal or interest with
respect to any of the Loans, or of any fees, falls due on a day which is not a
Business Day, then such due date shall be extended to the immediately following
Business Day (unless, in the case of a Eurodollar Rate Loan, such immediately
following Business Day is the first Business Day of a calendar month, in which
case such due date shall be the immediately preceding Business Day) and, in the
case of principal, additional interest shall accrue and be payable for the
period of any such extension.
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SECTION 3. FEES; PAYMENTS
3.1 Fees.
(a) Closing Fee. The Company shall pay to the Agent, for the pro rata
account of the Lenders, on the Closing Date a nonrefundable closing fee equal to
$75,000.
(b) Agent Fee. The Company shall pay to the Agent, for its own account,
such agent's fees as are mutually agreed to from time to time by the Company and
the Agent, including the fees set forth in the Agent Fee Letter.
(c) Commitment Fee. The Company shall pay to the Agent, for the account of
each Lender, a commitment fee computed at the Commitment Fee Rate from time to
time in effect on the average daily unused portion of each Lender's Commitment.
Such fee shall be payable quarterly in arrears on the Quarterly Payment Date.
(d) Letter of Credit Fees. In connection with the Letters of Credit, the
Company shall pay (i) a nonrefundable issuing fee to the Issuing Lender for each
Letter of Credit in an amount equal to $200, (ii) to the Agent, for the pro rata
account of each Lender, a per annum Letter of Credit fee equal to the LC Fee
Rate in effect from time to time of the average daily undrawn amount of Letters
of Credit, such Letter of Credit fee to be payable quarterly in arrears on each
Quarterly Payment Date and on the Final Maturity Date (or such later date on
which all outstanding Letters of Credit are terminated) plus (iii) to the
Issuing Lender, such costs, fees and expenses as Issuing Bank customarily
charges in connection with the issuance, negotiation, processing and/or
administration of letters of credit.
(e) Arrangement Fee. The Company shall pay to the Agent for its own account
such arrangement and syndication fees as are mutually agreed to from time to
time by the Company and the Agent, including the fees set forth in the Agent Fee
Letter.
(f) Termination Fee. The Company shall pay a termination fee to the Agent
for the pro rata account of each Lender if the Company should terminate the
facility prior to March 17, 2007. The amount of the fee will be calculated as:
50 bps divided by 360, multiplied by the Total Commitment, multiplied by the
days from the date of such termination to March 17, 2007.
3.2 Pro Rata Treatment and Payments. Each Borrowing by the Company from the
Lenders and each payment by the Company on account of any fee (other than fees
for the account of the Agent) shall be made pro rata according to each Lender's
Commitment Percentage, except as otherwise expressly provided herein. Each
payment by the Company on account of principal of and interest on the Loans
shall be made pro rata according to the respective outstanding principal amounts
of such Loans held by each Lender. All payments to be made by the Company on
account of principal, interest and fees shall be made without set-off or
counterclaim and shall be made to the Agent, for the account of the Lenders
(except for fees for the account of the Agent), at the Agent's office designated
for such purpose, in Dollars and in immediately available funds not later than
12:00 noon, Chicago time, on the date on which such payment shall become due.
Any payment received after such time on any Business Day shall be deemed to have
been received on the next Business Day. The Agent shall distribute such payments
to the Lenders in like funds on the day of receipt or deemed receipt of such
payments. If any payment hereunder becomes due and payable on a day other than a
Business Day, such payment shall be extended to the next succeeding Business
Day, and, with respect to payments of principal, interest thereon shall be
payable at the then applicable rate during such extension. Anything contained
herein to the contrary notwithstanding, any payments received by any Lender or
its Affiliates on account of Bank Product Obligations or Hedging Obligations
after the occurrence and during the continuance of any Default or Event of
Default shall be reapplied in accordance with Section 6.5 of the Guaranty and
Collateral Agreement and to that end, the Lenders shall, if necessary, purchase
participation in the Obligations of other Lenders to effectuate such
application.
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3.3 Taxes.
(a) All payments made by the Company under this Agreement and the Notes
shall be made free and clear of, and without reduction for or on account of, any
present or future taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or assessed
by any Governmental Authority, excluding, in the case of the Agent and each
Lender, net income and franchise taxes imposed on it by the jurisdiction under
the laws of which it is organized or in which it has its principal office or its
Lending Office or any political subdivision or taxing authority thereof or
therein (such non-excluded taxes being called "Taxes"). If any Taxes are
required to be withheld from any amounts payable to the Agent or any Lender
hereunder or under the Notes, the amounts so payable shall be increased to the
extent necessary to yield to the Agent or such Lender (after payment of all
Taxes) interest or any such other amounts payable hereunder or under the Notes
at the rates or in the amounts specified in this Agreement and the Notes.
Whenever any Taxes are payable by the Company, as promptly as possible
thereafter, the Company shall send to the Agent for its own account or for the
account of each Lender, as the case may be, a certified copy of an original
official receipt showing payment thereof. If the Company fails to pay Taxes when
due to the appropriate taxing authority or fails to remit to the Agent the
required receipts or other required documentary evidence, the Company shall
indemnify and hold harmless the Agent and the Lenders against, and reimburse the
Agent and the Lenders upon demand for, any incremental taxes, interest or
penalties that may become payable by the Agent or any Lender as a result of any
such failure.
(b) Each Lender will promptly notify the Company and the Agent upon
becoming aware of any event which will cause the Company to pay any additional
amount pursuant to paragraph (a) above.
3.4 Assumed Payments. Unless the Agent shall have been notified by a Lender
or the Company prior to the date on which such Lender or the Company is
scheduled to make payment to the Agent of (in the case of a Lender) the proceeds
of a Loan to be made by it hereunder or (in the case of the Company) a payment
to the Agent for account of one or more of the Lenders hereunder (such payment
being herein called the "Required Payment"), which notice shall be effective
upon receipt, that it does not intend to make the Required Payment to the Agent,
the Agent may assume that the Required Payment has been made and may, in
reliance upon such assumption (but shall not be required to), make the amount
thereof available to the intended recipient(s) on such date and, if such Lender
or the Company (as the case may be) has not in fact made the Required Payment to
the Agent, the recipient(s) of such payment shall, on demand, repay to the Agent
the amount so made available. In addition, the party that failed to make the
Required Payment shall, on demand, pay interest to the Agent for its own account
in respect of each day during the period commencing on the date such amount was
so made available by the Agent until the date the Agent recovers such amount at
a rate equal to the sum of the Base Rate plus 2% per annum; provided, however,
that if the party that failed to make the Required Payment is a Lender, such
interest shall accrue at the Federal Funds Rate for the first three Business
Days such amount is unpaid and thereafter at the Base Rate plus 2% per annum.
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SECTION 4. CONDITIONS PRECEDENT
4.1 Conditions to Effectiveness. This Agreement shall be effective upon the
satisfaction of each of the following conditions precedent:
(a) This Agreement. The Agent shall have received, with copies for each
Lender, a counterpart hereof duly executed by the Company;
(b) Notes. The Agent shall have received duly executed Notes payable to
each Lender;
(c) Related Documents. The Agent shall have received, with copies for each
Lender, a counterpart of the Guaranty and Collateral Agreement duly executed by
the Company and each Material Subsidiary;
(d) Legal Opinion of Counsel to the Company. The Agent shall have received,
with copies for each Lender, an executed legal opinion dated the Closing Date
and addressed to the Agent and the Lenders, of Xxxxxxx Xxxxxx X'Xxxxxx &
Xxxxxxxxxxx LLP, counsel to the Company and the Subsidiaries, in a form
reasonably satisfactory to the Agent, the Lenders and each of their special
counsel;
(e) Corporate Proceedings. The Agent shall have received, with a copy for
each Lender, a copy of resolutions, in form and substance reasonably
satisfactory to the Agent, of the Board of Directors of the Company and each
Subsidiary authorizing the execution, delivery and performance by it of this
Agreement, the Notes and the Related Documents (as applicable) certified by the
Secretary or an Assistant Secretary of the Company or such Subsidiary, which
certificate shall state that the resolutions thereby certified are in full force
and effect and have not been amended, modified, revoked or rescinded as of the
Closing Date;
(f) Good Standing Certificates. The Agent shall have received, with a copy
for each Lender, a certificate of recent date from the Secretary of State, or
other appropriate authority, evidencing the good standing of the Company and
each Subsidiary in its jurisdiction of incorporation and, if different, its
principal place of business;
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(g) Tax Good Standing. The Agent shall have received, with a copy for each
Lender, a certificate of recent date or similar instrument from the appropriate
tax authority in its jurisdiction of incorporation and, if different, its
principal place of business, as to the payment by the Company of all taxes owed;
(h) Corporate Documents. The Agent shall have received, with a copy for
each Lender, a copy of (i) the charter of the Company and each Material
Subsidiary and all amendments thereto, certified as of a recent date by the
Secretary of State, or other appropriate authority, of the jurisdiction of its
incorporation, and (ii) the by-laws of the Company and each Material Subsidiary,
certified as of the Closing Date by its Secretary or an Assistant Secretary;
(i) Incumbency Certificate. The Agent shall have received, with an executed
counterpart for each Lender, a certificate dated the Closing Date of the
Secretary or an Assistant Secretary of the Company and each Material Subsidiary
certifying as to the incumbency and signatures of its officers executing this
Agreement, the Notes and the Related Documents (as applicable) and any
certificate or other document to be delivered by it pursuant hereto and thereto,
together with evidence of the incumbency of such Secretary or Assistant
Secretary;
(j) Officer's Certificate. The Agent shall have received, with a copy for
each Lender, a certificate dated the Closing Date from an appropriate officer of
the Company certifying that (i) the representations and warranties contained in
Section 5 and in the Related Documents are accurate and complete and (ii) no
Default has occurred and is continuing or will occur as a result of the initial
Loans;
(k) Fees and Expenses. The Agent shall have received all compensation and
other amounts payable to it, including, without limitation, all amounts payable
under Subsections 3.1(a), 3.1(b), 3.1(e) and 10.5(a), on or prior to the date of
the initial Loan;
(l) Collateral. The Collateral Agent shall have received (i) evidence that
all filings and other action necessary to perfect the Collateral Agent's
security interest in the Collateral or any other filings or recordings
necessary, on behalf of the Agent and the Lenders, have been made and the Lien
perfected by any such filings has priority over any other Liens except as
otherwise provided herein, (ii) to the extent Collateral is maintained on any of
the leased premises listed on Schedule 4.1, an agreement from the landlord of
the premises confirming that such landlord has subordinated its landlord lien in
the Company's personal property to the security interest of the Collateral
Agent, for the benefit of the Agent and the Lenders, and that such landlord will
provide the Collateral Agent with reasonable access to such facility to
exercise, to the extent permitted by law, the Collateral Agent's remedies and
(iii) original certificates representing all collateral pledged pursuant to the
Collateral Documents together with an undated stock power for each such
certificate duly executed in blank by the applicable pledgor.
(m) Supporting Documents. The Agent shall have received, with copies for
each Lender, such other documents, certificates, opinions or financial or other
information as the Agent or any of the Lenders may reasonably request; and
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(n) Other. All corporate and other proceedings, and all documents,
instruments and other legal matters in connection with the transactions
contemplated by this Agreement and the Related Documents, shall be reasonably
satisfactory in form and substance to the Agent and its counsel.
4.2 Conditions to Each Extension of Credit. The obligation of (a) each
Lender to make any Loan and (b) of the Issuing Lender to issue any Letter of
Credit (including, without limitation, its initial Loan and the initial Letter
of Credit) is subject to the satisfaction of the following conditions precedent
as of the date such Loan is made or such Letter of Credit is issued:
(a) Representations and Warranties. Each of the representations and
warranties made by the Company pursuant to this Agreement and the Related
Documents, and each of the representations and warranties contained in any
certificate, document or financial or other statement furnished at any time
under or in connection with this Agreement or any of the Related Documents,
shall be true and complete on and as of such date as if made on and as of such
date, except to the extent that such representations and warranties expressly
relate to particular date; and
(b) No Default. No Default shall have occurred and be continuing on such
date or after giving effect to the Loans requested to be made on such date.
(c) No Material Adverse Change. There shall have been no material adverse
change in the financial condition, operations, properties, business or prospects
of the Company and its Subsidiaries, if any, taken as a whole, since the date of
the last Borrowing under this Agreement (or if no Borrowing has occurred, since
the date of this Agreement); and
(d) Notice. In the case of a Loan, the Agent shall have received a Notice
of Borrowing in the form of Exhibit B-1.
(e) Letter of Credit Documentation. In the case of a Letter of Credit, the
Issuing Bank and Agent shall have received notice in accordance with Section
2.1(b) hereof and the Issuing Bank shall have received the Master Letter of
Credit Agreement and an L/C application for such Letter of Credit duly executed
by the Company.
Each Borrowing or request for the issuance of a Letter of Credit hereunder
shall constitute a representation and warranty by the Company as of the date of
such Borrowing that the conditions contained in this Subsection 4.2 have been
satisfied.
SECTION 5. REPRESENTATIONS AND WARRANTIES
The Company hereby makes the following representations and warranties to
the Agent and to each Lender.
5.1 Financial Condition.
(a) The consolidated balance sheets of the Company as of June 30, 2005 and
the related consolidated statements of income, stockholders' investment and cash
flows for the fiscal year ended on such date, audited by PricewaterhouseCoopers,
and the unaudited consolidated financial statements of the Company and its
Subsidiaries as at December 31, 2005, copies of which have heretofore been
furnished to the Agent and to each Lender, are complete and correct and present
fairly the consolidated financial condition of the Company as at such dates, and
the consolidated results of its operations and cash flows for the periods then
ended. All such financial statements, including the related schedules and notes
thereto, have been prepared in accordance with GAAP (subject, in the case of
such unaudited statements, to the absence of footnotes, and to normal year-end
adjustments) applied consistently throughout the periods involved (except as
approved by such accountants or officer, as the case may be, and as disclosed
therein).
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(b) As of the date hereof, the Company does not have any material liability
or obligation of any nature, absolute, accrued, contingent or otherwise, or any
material judgment or long term lease or unusual forward or long term commitment,
which is not reflected in the financial statements referred to in Subsection
5.1(a), or the notes accompanying such financial statements, or otherwise set
forth on Schedule 4.1 other than liabilities and obligations incurred under this
Agreement.
(c) The Company is not entering into the arrangements contemplated hereby
and by the Related Documents nor does it intend to make any transfer or incur
any obligations hereunder or thereunder with actual intent to hinder, delay or
defraud either present or future creditors. On and as of the Closing Date, on a
pro forma basis after giving effect to the transactions, contemplated hereby (x)
the Company will not have incurred nor does the Company intend or believe that
it will incur debts beyond its ability to pay such debts as such debts mature
(taking into account the timing and amounts of cash to be received from any
source and amounts payable on or in respect of any of its debts); (y) the
Company, after taking into account all other anticipated uses of its cash,
anticipates being able to pay all amounts on or in respect of its debts when
such amounts are required to be paid; and (z) the Company has sufficient capital
with which to conduct its present and proposed business and its property does
not constitute unreasonably small capital with which to conduct its present or
proposed business. For purposes of this Subsection 5.1(c), "debt" means any
liability on a claim, and a "claim" means a (i) right to payment whether or not
such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured; or (ii) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured. On the date of each Borrowing (and after
giving effect to all Borrowings as of such date), the representations set forth
in this Subsection 5.1(c) shall be true and correct with respect to the Company
on such date.
5.2 No Change. Since June 30, 2005, there has been no material adverse
change in the business, operations, prospects, or financial condition of the
Company or any of its Subsidiaries or in any of the Collateral or the ability of
the Company or any Subsidiary to perform its obligations under this Agreement,
the Notes or any other Related Document to which it is a party.
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5.3 Corporate Existence. The Company and each of its Subsidiaries (a) is
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, (b) has the corporate power and authority to own
and operate its property, to lease the property it operates as lessee and to
conduct the business in which it is currently engaged, (c) has obtained all
licenses (governmental or otherwise), authorizations and consents necessary to
own and operate its properties and transact its business and (d) is duly
qualified as a foreign corporation and in good standing under the laws of each
jurisdiction in which a failure so to qualify could reasonably be expected to
have a material adverse effect on its business, operations, prospects or
financial condition. The Company and each of its Subsidiaries is duly qualified
as a foreign corporation in each of the respective jurisdictions identified on
Schedule 5.3. As of the Closing Date, the Company has no Subsidiaries other than
the Subsidiaries listed on Schedule 5.3 hereto.
5.4 Corporate Power; Authorization. The Company has the corporate power and
authority to execute, deliver and perform its obligations under this Agreement
and the Related Documents to which it is a party and to consummate the
transactions contemplated herein and therein and has taken all necessary
corporate action to authorize the execution and delivery of this Agreement and
the Related Documents to which it is a party and the consummation of the
transactions contemplated herein and therein. Each Subsidiary has the corporate
power and authority to execute, deliver and perform its obligations under the
Related Documents to which it is a party and to consummate the transactions
contemplated therein and has taken all necessary corporate action to authorize
the execution, delivery and performance of the Related Documents to which it is
a party and the consummation of the transactions contemplated therein.
5.5 Binding Effect. This Agreement and the Related Documents to which the
Company is a party have been duly executed and delivered by the Company and
constitute its legal, valid and binding obligations enforceable against it in
accordance with their respective terms except as enforcement of such terms may
be limited by bankruptcy, insolvency or other similar laws affecting the rights
of creditors generally. The Related Documents to which each Subsidiary is a
party have been duly executed and delivered by such Subsidiary and constitute
its legal, valid and binding obligations enforceable against it in accordance
with their terms except as enforcement of such terms may be limited by
bankruptcy, insolvency or other similar laws affecting the rights of creditors
generally.
5.6 Consents; Non-Contravention. No consent or authorization of, filing
with or other act by or in respect of any Governmental Authority or any other
Person is required in connection with the execution, delivery or performance by
the Company or any Subsidiary of this Agreement and the Related Documents or the
consummation of the transactions contemplated herein and therein, except such as
have been obtained or made and are in full force and effect. The execution and
delivery of this Agreement and the Related Documents and the consummation of the
transactions contemplated hereby and thereby, will not (a) violate any law, rule
or regulation applicable to the Company or its Subsidiaries or any provision of
the charter or by-laws of the Company or any of its Subsidiaries, (b) conflict
with, result in a breach or termination of, or constitute a default under, any
provision of any indenture, mortgage, lease (capital or operating) or other
agreement or instrument to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries or any of their
respective assets is bound, or any license, judgment, order or decree of any
Governmental Authority having jurisdiction over the Company or any of its
Subsidiaries or any of their respective activities or properties or (c) result
in, or require the creation or imposition of, any Lien upon or with respect to
any properties now or hereafter owned by the Company or any of its Subsidiaries
other than the Liens created under the Collateral Documents.
30
5.7 No Material Litigation. Except as set forth on Schedule 5.7, no
litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of the Company,
threatened by or against the Company or any of its Subsidiaries or against any
of their respective properties or revenues (a) which if adversely determined may
have a material adverse effect on the business, operations, prospects or
financial condition of the Company and its Subsidiaries, taken as a whole, or on
the ability of the Company to perform its obligations under this Agreement and
the Related Documents to which it is a party or (b) which questions or would
question the validity or enforceability of this Agreement or the Related
Documents.
5.8 No Default. Neither the Company nor any of its Subsidiaries is in
violation of or in default under any term or provision of any (a) charter or
by-law or (b) mortgage, indenture, lease, agreement, instrument, law, rule,
regulation, judgment, decree, order, writ or injunction applicable to it, except
in the case of this clause (b) for such violations or defaults that would not
have a material adverse effect on the business, operations, prospects or
financial condition of the Company and its Subsidiaries, taken as a whole, or on
the ability of the Company or any Subsidiary to perform its obligations under
this Agreement and the Related Documents to which it is a party. No Default has
occurred and is continuing.
5.9 Ownership of Property; Liens.
(a) The Company and each of its Subsidiaries has good and valid title to,
or valid leasehold interests in, all its real property and other property,
subject in each case only to encumbrances that do not materially adversely
affect its ability to use such property for the purposes for which it is
currently being used, and none of such property is subject to any Lien, except
as set forth in Schedule 5.9 hereof and any Lien previously granted in favor of
the Collateral Agent.
(b) The Company and each of its Subsidiaries possesses sufficient permits,
licenses, patents, patent rights, trademarks, trademark rights, trade names,
trade name rights, service marks, service xxxx rights and copyrights necessary
for the conduct of the business of the Company and each of its Subsidiaries.
5.10 No Burdensome Restrictions. Neither the Company nor any of its
Subsidiaries is party to any agreement or instrument or subject to any
legislative or charter or other corporate restriction or any judgment, order,
writ, injunction, decree, or to the best of its knowledge, any rule or
regulation, which could reasonably be expected to materially and adversely
affect its business, operations, prospects or financial condition; provided
however, it is understood by the parties hereto that (i) any such restrictions
and regulations in existence on the Closing Date which do not prohibit the
Company or any of its Subsidiaries and (ii) any future legislative enactments
and regulations which do not prohibit the Company or any of its Subsidiaries,
taken as a whole, from conducting its business as presently conducted shall not
be deemed to materially and adversely affect its business, operations, prospects
or financial condition.
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5.11 Taxes. The Company and each of its Subsidiaries have filed or caused
to be filed all tax returns that are required to be filed and have paid all
taxes shown to be due and payable on said returns or on any assessment relating
to such tax returns made against it or any of its properties and all other
taxes, assessments, fees or other charges imposed on it or any of its properties
by any Governmental Authority or agency which are not yet delinquent, except for
any taxes, assessments, fees or other charges which are being contested in good
faith by appropriate proceedings and for which adequate reserves, to the extent
required by GAAP, have been established; no tax liens have been filed other than
Liens for taxes on property not yet delinquent, and, to the knowledge of the
Company, no material claims are being asserted with respect to any such taxes,
fees or other charges, except for any claims which are being contested in good
faith by appropriate proceedings and for which adequate reserves, to the extent
required by GAAP, have been established.
5.12 Margin Regulations. Neither the Company 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" any "margin
stock" within the respective meanings of each of the quoted terms under
Regulations U and T of the Board of Governors of the Federal Reserve System. No
part of the proceeds of any Loans hereunder will be used directly or indirectly
for "purchasing" or "carrying" any "margin stock" within the respective meanings
of each of the quoted terms under Regulations U and T of the Board of Governors
of the Federal Reserve System or for any purpose which violates, or which would
be inconsistent with, the provisions of the regulations of such Board of
Governors. Without limiting the foregoing, the Company shall not use the
proceeds of any Loan hereunder for the purchase of the Company's common stock
other than for the purposes of retiring such stock, unless the Company maintains
an amount of Collateral sufficient to ensure that such Loan will not result in a
violation of such regulations of the Board of Governors.
5.13 Investment Company Act. Neither the Company nor any of its
Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
5.14 Compliance with ERISA. Each member of the ERISA Group has fulfilled
its obligations under the minimum funding standards of ERISA and the Code with
respect to each Single Employer Plan and is in compliance in all material
respects with the presently applicable provisions of ERISA and the Code with
respect to each Single Employer Plan. No member of the ERISA Group has (i)
sought a waiver of the minimum funding standard under Section 412 of the Code in
respect of any Single Employer Plan, (ii) failed to make any contribution or
payment to any Single Employer Plan or Multiemployer Plan, or made any amendment
to any Single Employer Plan, which has resulted in, or could result in, the
imposition of a Lien or the posting of a bond or other security under ERISA or
the Code, (iii) incurred any liability under Title IV of ERISA with respect to
any Plan which has not been paid in full, other than a liability to the PBGC for
premiums under Section 4007 of ERISA, (iv) taken any steps to terminate any
Single Employer Plan or to appoint a receiver to administer any such Plan, or to
withdraw from any Multiemployer Plan or initiated steps to do so or (v) adopted
any amendment to a Plan with respect to which security is required pursuant to
Section 401 (a) (29) of the Code or initiated any steps to do so. No Reportable
Event or non-exempt "prohibited transaction" (as defined in Section 4975 of the
Code or Section 406 of ERISA) has occurred with respect to any Single Employer
Plan or, to the best of its knowledge, any Multiemployer Plan. No condition
exists under which any member of the ERISA Group could have liability under
Section 4069 or 4212 of ERISA.
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5.15 Environmental Matters. (a) To the best of the Company's knowledge, the
Company and each of its Subsidiaries has complied and is currently in compliance
with all Environmental Laws; (b) to the best of the Company's knowledge, no
solid or hazardous or toxic wastes or hazardous substances (as defined in the
Comprehensive Environmental Response, Compensation and Liability Act, as amended
("CERCLA"), or the Resources Conservation and Recovery Act, as amended ("RCRA"),
or under any successor or similar law or any applicable state or local law) are
processed, discharged, stored, treated, disposed of, or managed at any facility
owned, leased or operated by the Company or any of its Subsidiaries or, at the
request or behest of the Company or any of its Subsidiaries, at any adjoining
site, so as to require a license, permit or authorization of any type from any
Governmental Authority other than licenses, permits or authorizations which have
been obtained or applied for or where the failure to obtain such licenses,
permits or authorizations could not have a material adverse effect on the
Company or any of its Subsidiaries; and (c) no claim has been made against the
Company or any of its Subsidiaries or, to the best of its knowledge, against any
predecessor in respect of any "facility" owned, leased or operated by it under
CERCLA, or under a federal, state, local or municipal statute, ordinance or
regulation in respect of the environment, or by the Environmental Protection
Agency or by any federal, state, local or municipal enforcement agency having
jurisdiction over the protection of the environment, or by any private Person
bringing an action in respect of or under any law designed to protect the
environment. To the best of the Company's knowledge, the Company and each of its
Subsidiaries is in compliance with all applicable zoning and land use and
building codes, laws, rules, regulations and ordinances.
5.16 Disclosure. No representation or warranty made by the Company in this
Agreement, or by the Company or any Subsidiary in the Related Documents to which
it is a party or in any other document furnished from time to time in connection
herewith or therewith, contains any misrepresentation of a material fact or
omits to state any material fact necessary to make the statements herein or
therein not misleading. There is no fact known to the Company which materially
adversely affects, or which reasonably could be expected in the future to
materially adversely affect, the business, operations, prospects or financial
condition of the Company or any of its Subsidiaries or the ability of the
Company and its Subsidiaries to perform their respective obligations under this
Agreement and the Related Documents.
5.17 Collateral. The Collateral Documents create or will create a valid
security interest in favor of the Collateral Agent, acting on behalf of the
Agent and the Lenders, in the Collateral described therein securing the payment
of the obligations secured thereby. All action necessary to perfect the security
interest of the Collateral Agent, for the benefit of the Agent and the Lender,
in such Collateral has been, or will be, taken, and such security interest has,
or will have, priority over all other Liens except any perfected Liens arising
in connection with any Capitalized Lease entered into by the Company.
33
5.18 Employment Agreements. Set forth on Schedule 5.18 is a complete list
of agreements between the Company or any of its Subsidiaries and any other
Person providing for employment, severance, deferred or bonus payments, stock
options or similar payments or arrangements for the benefit of any current
officer or director of the Company or any of its Subsidiaries. A true, correct
and complete copy of each agreement or other document listed on Schedule 5.18
has been provided to the Agent which shall provide copies to each of the
Lenders.
5.19 Dividends. Since June 30, 2005, the Company has not declared or paid
any dividends (other than dividends declared but not paid on the Series E
Preferred Stock and the Series F Preferred Stock of the Company) or made any
other distributions in respect of its capital stock or redeemed, retired,
purchased or otherwise acquired for value any shares of its capital stock other
than with respect to the Series G Preferred Stock and as set forth in Schedule
5.19.
5.20 Projections. The projected income statements, balance sheets and cash
flow statements for the Company's fiscal years 2006, 2007 and 2008 heretofore
furnished to the Lenders were prepared by the Company in good faith based on
assumptions believed by the Company to be reasonable after giving effect to the
credit being extended hereunder.
5.21 Use of Proceeds. The Company shall use the proceeds of each Loan
(other than Loans resulting from a draw under a Letter of Credit) for working
capital and general corporate purposes.
SECTION 6. AFFIRMATIVE COVENANTS
The Company hereby agrees that, so long as the Commitments remain in
effect, and until the payment and performance in full of all Obligations:
6.1 Financial Statements. The Company will furnish to the Agent and each
Lender:
(a) as soon as available, but in any event within 90 days after the end of
each fiscal year of the Company, a copy of (i) the audited consolidated balance
sheet of the Company as at the end of such year and the related audited
consolidated statements of income, stockholders' equity and cash flows for such
year, setting forth in each case in comparative form the figures as of the end
of and for the previous year, all in reasonable detail, certified, without
qualification, by a firm of independent accountants of nationally recognized
standing acceptable to the Lenders; provided however, that the firm
PricewaterhouseCoopers LLP shall be acceptable to the Lenders; and
(b) as soon as available, but in any event not later than 45 days after the
end of each of the first three fiscal quarters of each fiscal year of the
Company, a copy of the unaudited consolidated balance sheet of the Company as at
the end of each such fiscal quarter and the related unaudited consolidated
statements of income, stockholders' investment and cash flows of the Company for
such quarter and the portion of the fiscal year through such date, all in
reasonable detail and setting forth in comparative form the figures as of the
end of and for the corresponding period of the previous year, certified as to
fairness of presentation by the chief financial officer, treasurer or controller
of the Company;
34
all such financial statements to be complete and correct in all material
respects (subject, in the case of interim statements, to normal year-end audit
adjustments) and to be prepared in reasonable detail and in accordance with GAAP
(except, in the case of interim financial statements, that such financial
statements need not contain footnotes and shall be prepared substantially in
accordance with GAAP) applied consistently throughout the periods reflected
therein (except as approved by the Company's independent accountants and
disclosed therein). In addition to the financial statements required to be
delivered pursuant to (a) and (b) above, the Company agrees to deliver
consolidating financial statements (including a balance sheet and statements of
income, stockholders' investment and cash flows) at the same time it delivers
its consolidated financial statements if the Company begins preparing
consolidating financial statements in the ordinary course of its business or
otherwise for filing with the Securities and Exchange Commission.
6.2 Certificates; Other Information. The Company will furnish to the Agent
and each Lender:
(a) concurrently with the delivery of the financial statements referred to
in Subsection 6.1(a) (or on such later date as received by the Company), (i) a
certificate of the independent accountants reporting on such financial
information stating that in the course of performing its audit of the Company's
financial statements, no knowledge was obtained of any Default, except as
specified in such certificate and (ii) a copy of the management letter delivered
to the Company by its independent accountants in connection with such financial
statements or, if there is no management letter, a letter from such independent
accountants that no material weakness in internal control came to the attention
of such accountants during such examinations other than weaknesses that have
been corrected;
(b) concurrently with the delivery of the financial statements referred to
in Subsections 6.1(a) and (b), a certificate signed by the chief financial
officer of the Company setting forth computations in reasonable detail
demonstrating compliance with the financial covenants set forth in Section 7,
together with a statement that, to the best of such officer's knowledge, the
Company during the relevant period has observed or performed all of its
covenants and other agreements hereunder, and satisfied every condition
contained in this Agreement to be observed, performed or satisfied by it, and
that such officer has obtained no knowledge of any Default except as described
in such certificate (any such description to be in reasonable detail and to
include a description of any action to be taken with respect to such Default);
(c) promptly, copies of any regular and periodic financial information, and
any other information and reports, which the Company shall send or make
generally available to its security holders;
(d) within 45 days after the end of each fiscal year of the Company, a
report in form and substance reasonably satisfactory to the Agent outlining any
changes in the Company's insurance coverage during such year and any changes
planned in the subsequent fiscal year which materially affect such insurance
coverage and evidence of its insurance coverage for casualty losses and
professional liability;
35
(e) at least once during any 90 day period, a certificate of recent date
from the Secretary of State, or other appropriate authority, evidencing the good
standing of the Company and each Subsidiary in its jurisdiction of incorporation
and, if different, its principal place of business;
(f) promptly, and in any event within 90 days after the commencement of
each fiscal year commencing with the fiscal year ending June 30, 2006, financial
projections for the Company and its Subsidiaries for such fiscal year,
(including an operating budget, cash flow budget and balance sheet) prepared in
a manner consistent with the projections delivered by the Company to the Lenders
prior to the Closing Date or otherwise in a manner reasonably satisfactory to
the Agent; and
(g) promptly, such additional financial and other information as the Agent
or any Lender (acting through the Agent) may from time to time reasonably
request.
It is understood that the foregoing certificates may be made by officers of the
Company in reliance on information provided by other officers, employees or
agents of the Company and its Subsidiaries. As long as any of the foregoing
certificates is provided in good faith and without actual knowledge that such
certificate contains any inaccuracy or material omission, the officer signing
such certificate shall not be personally liable to the Agent or any Lender for
omissions or inaccuracies contained in any such certificate.
6.3 Compliance with Laws. The Company will (a) comply, and cause each of
its Subsidiaries to comply, with all laws, rules and regulations applicable to
it (including, without limitation, all Environmental Laws) , non-compliance with
which could, singly or in the aggregate, materially adversely affect its
business, operations, prospects or financial condition or which could impair the
ability of the Company or any Subsidiary to perform its obligations under this
Agreement, the Notes or any of the other Related Documents to which it is a
party, (b) without limiting clause a above, ensure and cause each of its
Subsidiaries to ensure, that no person who owns a controlling interest in or
otherwise controls the Company or any of its Subsidiaries is or shall be (i)
listed on the Specially Designated Nationals and Blocked Person List maintained
by the Office of Foreign Assets Control ("OFAC"), Department of the Treasury,
and/or any other similar lists maintained by OFAC pursuant to any authorizing
statute, Executive Order or regulation or (ii) a person designated under Section
1(b), (c) or (d) of Executive Order No. 13224 (September 23, 2001), any related
enabling legislation or any other similar Executive Orders, and (c) without
limiting clause (a) above, comply, and cause each Subsidiary to comply, with all
applicable Bank Secrecy Act ("BSA") and anti-money laundering laws and
regulations.
6.4 Conduct of Business and Maintenance of Existence. The Company will
continue, and cause each of its Subsidiaries to continue, to engage in business
of the same general type as now conducted by it and reasonable extensions
thereof and preserve, renew and keep in full force and effect its corporate
existence and take all reasonable action to maintain, and cause each of its
Subsidiaries to maintain, all rights, privileges, contracts, copyrights,
patents, trademarks, trade names and franchises necessary or desirable in the
normal conduct of its business.
36
6.5 Maintenance of Property; Insurance. The Company will keep, and cause
each of its Subsidiaries to keep, all property useful and necessary in its
business in good working order and condition; maintain, and cause each of its
Subsidiaries to maintain, with financially sound and reputable insurance
companies insurance on all its and its Subsidiaries' property in at least such
amounts and against at least such risks (but including, in any event, public
liability and product liability insurance if available) as are usually insured
against in the same general area by companies engaged in the same or a similar
business and furnish to the Agent on behalf of the Lenders, upon written
request, full information as to all insurance carried. All insurance policies
required by this Subsection 6.5 shall be in form and substance and issued by
companies reasonably satisfactory to the Agent and the Lenders. The Company may
maintain the coverages required by this Subsection 6.5 under blanket policies
covering the premises and other locations owned or operated by the Company or
any of its Subsidiaries if the terms of such blanket policies otherwise comply
with the provisions of this Subsection 6.5. Each policy of insurance required
under this Subsection 6.5 shall provide that it may not be canceled or otherwise
terminated without at least 30 days' prior written notice (or such other period
as the Lenders may agree) to the Collateral Agent and shall permit (but not
require or obligate) the Collateral Agent to pay any premium therefor within 10
days after receipt of any notice stating that such premium has not been paid
when due. Settlement of any claim under any of the insurance policies referred
to in this Subsection 6.5 involving a loss of $250,000 or more (in the
reasonable judgment of the Agent) shall require the prior written approval of
the Agent and all the Lenders. At least 30 days prior to the expiration of any
insurance policy (or such other period as the Lenders may agree), a policy or
policies renewing or extending such expiring policy or renewal or extension
certificates shall be delivered to the Collateral Agent, together with a receipt
showing payment of the premium therefor. The Company shall not purchase separate
insurance policies concurrent in form or contributing in the event of loss with
those policies required to be maintained under this Subsection 6.5 unless the
policy evidencing such insurance otherwise complies with the requirements of
this Subsection 6.5. The Company shall immediately notify the Agent whenever any
such separate insurance policy is obtained and shall promptly deliver to the
Collateral Agent the policy or certificate evidencing such insurance. The
Company shall, immediately upon receipt of any written notice of any failure by
the Company to pay any insurance premium in respect of any insurance required to
be maintained under this Subsection 6.5, furnish a copy of such notice to the
Agent and the Collateral Agent. Upon the occurrence of an Event of Default
hereunder, all insurance policies shall name the Collateral Agent, for the
benefit of the Agent and the Lenders, as sole loss payee and as an additional
insured under all such policies and thereafter the Collateral Agent shall
continue to be named as sole loss payee and as an additional named insured
whether or not an Event of Default shall be continuing.
6.6 Inspection of Property; Books and Records; Discussions. (a) The Company
will keep, and cause each of its Subsidiaries to keep, proper books and records
and accounts in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all dealings and transactions in relation
to its business and activities; and (b) permit, and cause its Subsidiaries to
permit, representatives and agents of the Agent or any Lender to visit and
inspect any of its properties and examine and make abstracts from any of its
books and records upon reasonable notice at any reasonable time and as often as
may reasonably be desired, and to discuss its business, operations, properties
and financial and other condition with its officers, employees and independent
accountants.
6.7 Notice of Certain Events. The Company will furnish to the Agent (which
shall provide copies to each Lender):
37
(a) promptly, and in any event within two Business Days of obtaining
knowledge thereof, written notice of the occurrence of any Default, which notice
shall be accompanied by a reasonably detailed description of such Default and of
any action to be taken with respect thereto;
(b) promptly, and in any event within five Business Days of obtaining
knowledge thereof, notice of any (i) litigation, investigation or proceeding
which may exist at any time between the Company or any of its Subsidiaries and
any Governmental Authority or other Person, which if adversely determined would
have a material adverse effect on the business, operations, prospects or
financial condition of the Company or any of its Subsidiaries or on the ability
of the Company to perform its obligations under this Agreement, the Notes or any
of the other Related Documents to which it is a party, (ii) any litigation,
investigation or proceeding which questions the validity or enforceability of
this Agreement or any of the Related Documents, (iii) any litigation or
proceeding potentially adversely affecting the Company or any of its
Subsidiaries (A) if the amount involved among all such litigations or
proceedings in the aggregate is $5,000,000 or more or (B) in which injunctive or
similar relief is sought, or (iv) any judgment or decree entered against the
Company or any of its Subsidiaries (A) involving a liability of $1,000,000 or
more (singly or in the aggregate) to the extent not paid or fully covered by
insurance for which the insurer has accepted liability in writing or (B) in
which injunctive or similar relief is granted;
(c) if and when the Company knows that any member of the ERISA Group (i)
gives or is required to give notice to the PBGC of any Reportable Event with
respect to any Single Employer Plan which might constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Single Employer Plan has given or is required to give
notice of any such Reportable Event, a copy of the notice of such Reportable
Event given or required to be given to the PBGC; (ii) receives notice of
complete or partial withdrawal liability under Title IV of ERISA with respect to
any Multiemployer Plan or notice that any Multiemployer Plan is in
reorganization, is insolvent or has been terminated, a copy of such notice;
(iii) receives notice from the PBGC under Title IV of ERISA of an intent to
terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or appoint a trustee to administer, any Single Employer
Plan, a copy of such notice; (iv) applies for a waiver of the minimum funding
standard under Section 412 of the Code, a copy of such application; (v) gives
notice of intent to terminate any Single Employer Plan under Section 4041(c) of
ERISA, a copy of such notice and other information filed with the PBGC; (vi)
gives notice of withdrawal from any Single Employer Plan pursuant to Section
4063 of ERISA, a copy of such notice; or (vii) fails to make any material
payment or contribution to any Single Employer Plan or Multiemployer Plan or
makes any amendment to any Single Employer Plan which has resulted or could
result in the imposition of a Lien or the posting of a bond or other security, a
certificate of the chief financial officer of the Company setting forth details
as to such occurrence;
(d) promptly, and in any event, within five Business Days of obtaining
knowledge thereof, notice of any occurrence or development which causes the
representation contained in Subsection 5.15 to be incorrect in any material
respect;
38
(e) promptly, and in any event at least five Business Days prior to the
filing thereof with any Governmental Authority, copies of any amendment or
supplement to its charter;
(f) promptly, and in any event within five Business Days after obtaining
knowledge thereof, notice of any change or proposed change in any law, statute,
rule or regulation applicable to the Company or any of its Subsidiaries,
including, without limitation, any law, statute, rule or regulation governing
automatic renewals of membership or contract terms, that has or may reasonably
be expected to have a material adverse effect on the business, operations,
prospects or financial condition of the Company or any of its Subsidiaries; and
(g) promptly, and in any event, within five Business Days of obtaining
knowledge thereof, notice of any material adverse change in the business,
operations, prospects or financial condition of the Company or any of its
Subsidiaries.
Each notice pursuant to this Subsection 6.7 shall be accompanied by a statement
of an appropriate officer of the Company setting forth details of the occurrence
referred to therein and stating what action the Company or, if applicable, the
member of the ERISA Group proposes to take with respect thereto.
6.8 Payment of Taxes and Claims. The Company will pay and discharge, and
cause each of its Subsidiaries to pay and discharge, promptly all taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits or upon any of its properties, as well as all lawful claims
for labor, materials and supplies which, if unpaid, will by law become a Lien
upon any of its properties; provided that the payment of any such tax,
assessment, charge, levy or claim shall not be required so long as the amount,
applicability or validity thereof shall be contested in good faith by
appropriate proceedings and adequate reserves are established with respect
thereto in accordance with GAAP.
6.9 Use of Proceeds. The proceeds of the Loans (other than Loans resulting
from a draw under a Letter of Credit) shall be used for working capital and
general corporate purposes.
6.10 Further Assurances. The Company will take and will cause each Material
Subsidiary (including, for all purposes of this Section 6.10, upon the
acquisition or creation thereof, any Material Subsidiary acquired or created, or
any other Subsidiary which becomes a Material Subsidiary, after the Closing
Date) to take, all such actions as are necessary or as the Agent may reasonably
request, from time to time to ensure that the Obligations of each Loan Party
under the Loan Documents are guaranteed by each Material Subsidiary and are
secured by substantially all the assets of the Company and each Material
Subsidiary as well as all Capital Securities of each Domestic Subsidiary, and
65% of each Foreign Subsidiary in each case as the Agent may determine,
including (a) the execution and delivery of guaranties, security agreements,
pledge agreements, mortgages, deeds of trust, financing statements and other
documents, and the filing or recording of any of the foregoing, (b) the delivery
of certificated securities and other Collateral with respect to which perfection
is obtained by perfection and (c) any opinions, corporate documents,
certificates and any other documents reasonably requested by the Agent in form
and substance satisfactory to the Agent, in each case, within 30 days of such
Subsidiary becoming a Material Subsidiary provided, however, that the Required
Lenders, in their reasonable discretion, may, upon the written request of the
Company to do so, waive compliance with this Section if the guarantee by a
Foreign Subsidiary would result in material adverse tax consequences to the
Company or if the cost of obtaining a lien on the assets of any Foreign
Subsidiary would be excessive relative to the benefits to the Lenders including
such assets as Collateral.
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6.11 Maintenance of Operating Accounts. The Company shall at all times
maintain its principal operating accounts with a Lender.
SECTION 7. NEGATIVE COVENANTS
The Company hereby agrees that, so long as the Commitments remain in
effect, and until the payment and performance in full of all Obligations:
7.1 Negative Pledge. (a) The Company will not, and will not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any
of its property, assets or revenues, whether now owned or hereafter acquired,
except for:
(i) Liens created pursuant to the Related Documents;
(ii) Liens arising under any Capitalized Lease permitted under Subsection
7.9;
(iii) Liens constituting purchase money security interests that secure
Indebtedness in an amount not to exceed in the aggregate $1,000,000 at any time;
provided that each such lien covers only the particular equipment or property
purchased with such Indebtedness;
(iv) Liens for taxes, assessments or governmental charges or claims not yet
delinquent or Liens for taxes, assessments or governmental charges or claims
being contested in good faith and by appropriate proceedings for which adequate
reserves, as may be required by GAAP, have been established;
(v) Deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations incurred in the ordinary
course of business (exclusive of obligations in respect of the payment for
borrowed money or the equivalent); and
(vi) Liens for secured Indebtedness (other than arising in connection with
this Agreement and the Related Documents) not exceeding in the aggregate
$5,000,000 at any time.
The Company will not, and will not permit any of its Subsidiaries to, enter
into any agreement prohibiting the creation or assumption of any Liens upon its
property or assets whether now owned or hereafter acquired, other than this
Agreement and the Related Documents.
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7.2 Merger. The Company will not, and will not permit any of its
Subsidiaries to, liquidate or dissolve or merge with or into or consolidate with
any other Person, or agree to do any of the foregoing. For purposes of this
Subsection 7.2, the term "merge" includes but is not limited to a sale of all or
substantially all assets, or substantially all operating assets, to another
Person or to Persons under common control.
7.3 Sale of Assets. The Company will not, and will not permit any of its
Subsidiaries to, sell, lease, assign, transfer, or otherwise dispose of any of
its now owned or hereafter acquired assets (including, without limitation,
shares of stock of other Persons owned by it and leasehold interests and the
ownership or control of its financial interest in memberships sold by the
Company or any of its Subsidiaries and contracts evidencing such memberships),
except for:
(i) inventory disposed of in the ordinary course of business,
(ii) old or outdated equipment to be replaced by new equipment,
(iii) assets no longer used or useful in the conduct of its business.
Notwithstanding the foregoing, it is understood that in no event shall the
Company or any of its Subsidiaries sell, lease, assign, transfer, or otherwise
dispose of any of its now or hereafter acquired assets, cash or Eligible
Securities to an Affiliate pursuant to subsection (iii) above.
7.4 Loans and Investments. The Company will not, and will not permit any of
its Subsidiaries to, at any time make or suffer to remain outstanding any loan
or advance to, or purchase, acquire or own any stock, bonds, notes or securities
of, or any partnership interest (whether general or limited) in, or acquire all
or substantially all of the business or assets of or any other interest in, or
make any capital contribution to, any other Person, or agree, become or remain
liable to do any of the foregoing, except that (a) the Company shall be
permitted to make investments in Eligible Securities and the investments, loans
and advances disclosed on Schedule 7.4 hereto, (b) the Company and its wholly
owned Subsidiaries which are parties to the Guaranty and Collateral Agreement
shall be permitted to make intercompany loans and advances to, and investments
in, each other, and (c) as permitted pursuant to Subsection 7.6 hereof.
7.5 Restricted Payments. The Company will not, and will not permit any of
its Subsidiaries to, declare any dividend on, or make any payment on account of,
any shares of any class of stock of the Company or any option or warrant
thereon, whether now or hereafter outstanding, or make any other distribution in
respect thereof or on any option or warrant thereon, either directly or
indirectly, whether in cash or property or in obligations of the Company or such
Subsidiary.
7.6 Acquisitions. Without the consent of each Lender the Company will not,
and will not permit its Subsidiaries to, acquire all or substantially all of the
assets or capital stock of another Person (as used in this Section 7.6, an
"Acquisition") other than the Lavalife Acquisition and the My Choice Medical
Acquisition unless;
(a) the aggregate amount of cash and noncash consideration (including
Indebtedness assumed by the Company or any Subsidiary but excluding any equity
securities issued by the Company or such Subsidiary in connection with such
transaction) paid by the Company and its Subsidiaries shall not exceed
$25,000,000 for any single such Acquisition or related series of Acquisitions
other than the Lavalife Acquisition and the My Choice Medical Acquisition;
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(b) the aggregate amount of cash and non-cash consideration (including any
Indebtedness assumed by the Company or any Subsidiary but excluding any equity
securities issued by the Company or such Subsidiary in connection with such
transaction) paid by the Company and its Subsidiaries for all Acquisitions
during any fiscal year (commencing with its fiscal year ending June 30, 2006)
shall not exceed $50,000,000;
(c) the board of directors of the target entity ("Target") shall have
approved such Acquisition (to such extent such board approval is required) and
the Target shall have had Cash EBITDA of not less than negative $5,000,000 for
the 12 months preceding the Acquisition;
(d) the Company shall have provided each Lender with such historical and
pro forma financial information with respect to such Acquisition as any Lender
(through the Agent) shall reasonably request;
(e) after giving effect to such Acquisition the Company shall be in pro
forma compliance with all of the financial covenants contained in Section 7
hereof;
(f) after giving effect to such Acquisition and for a period of 90 days
thereafter there shall be Unused Availability hereunder in a minimum equal to
20% of the Total Commitment; and
(g) no Default shall have occurred and be continuing or would occur as a
result of such Acquisition.
7.7 Stock Buyback. During any two consecutive fiscal quarters, measured as
of the end of such period, the Company will not, and will not permit any of its
Subsidiaries to, purchase, redeem, defease, retire or otherwise acquire any
shares of any class of stock of the Company or any option or warrant thereon,
whether now or hereafter outstanding (herein called "Stock Buybacks"), either
directly or indirectly, for total consideration in an amount in excess of the
sum of (i) its Cash EBITDA during such two consecutive fiscal quarters plus (ii)
the aggregate net proceeds from sales of capital stock of the Company or the
exercise of options of the Company during such two consecutive fiscal quarters.
7.8 Transactions with Affiliates. The Company will not, and will not permit
any of its Subsidiaries to, enter into any transaction, including, without
limitation, any purchase, sale, lease or exchange of property or the rendering
of any service, with any Affiliate unless such transactions are otherwise
permitted under this Agreement (including, without limitation, Section 7.4
hereof), are in the ordinary course of its business and are upon fair and
reasonable terms no less favorable to it than it would obtain in a comparable
arm's-length transaction with a Person not an Affiliate.
7.9 Indebtedness. The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume, Guaranty, suffer
to exist, or otherwise become or remain directly or indirectly liable with
respect to, any Indebtedness except:
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(a) the Obligations;
(b) Capitalized Leases to which the Company or any Subsidiary is a party
which, in the aggregate, are less than or equal to $5,000,000;
(c) Hedging Obligations and Bank Product Obligations owing to any Lender,
provided, however, that Bank Product Obligations with respect to corporate
credit card programs shall not exceed $12,000,000 at any time;
(d) Indebtedness not exceeding in the aggregate $1,000,000 at any time;
(e) Indebtedness secured by the purchase money security interests permitted
pursuant to Subsection 7.1(iii) not to exceed in the aggregate $1,000,000 at any
time;
(f) The Company's Subordinated Notes not exceeding in the aggregate
$90,000,000 so long as such Subordinated Notes continue to remain subordinate to
the Obligations of the Company arising under the Agreement and the Related
Documents;
(g) Senior Unsecured Notes of the Company not exceeding $150,000,000; and
(h) Indebtedness in respect of intercompany advances permitted under
Section 7.4 hereof.
7.10 Operating Leases. The Company will not, and will not permit any of its
Subsidiaries to, enter into, incur or assume (whether directly or contingently)
obligations under Operating Leases if the minimum rental commitment under
non-cancelable Operating Leases of the Company and its Subsidiaries for any
fiscal year would exceed $15,000,000.
7.11 Debt Coverage Ratio. For any Test Period, the Company will not permit
the ratio of (a) Total Net Debt as of the last day of such Test Period, to (b)
Cash EBITDA for such Test Period to be greater than 2.75 to 1.0 as of the end of
such Test Period.
7.12 Capital Expenditures. The Company will not, and will not permit its
Subsidiaries to, permit the aggregate amount of all Capital Expenditures made by
the Company and its Subsidiaries during any fiscal year to exceed $20,000,000
during its fiscal year ending in 2006 and $15,000,000 during any fiscal year
thereafter."
7.13 Cash EBITDA. The Company will not permit its Cash EBITDA for any Test
Period to be less than $50,000,000.
7.14 [Intentionally Omitted].
7.15 ERISA. The Company will not, and will not permit its Subsidiaries or
any other member of the ERISA Group to, adopt, maintain or sponsor or agree to
contribute to, or otherwise have any liability with respect to, any Plan other
than (a) as heretofore been disclosed to the Agent and the Lenders, unless each
of the Lenders provides prior written consent to such act, and (b) the
maintenance of and the making of contributions to the Vertrue Incorporated
401(k) plan.
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7.16 Fiscal Year. The Company will not change its fiscal year.
7.17 Amendment of Certain Documents. The Company will not, and will not
permit any of its Subsidiaries to amend, modify or change its charter
(including, without limitation, by the filing of any certificate of designation)
or by-laws, or any agreement with respect to its capital stock (including,
without limitation, any shareholders or other similar agreement), or enter into
any new agreement with respect to its capital stock.
SECTION 8. EVENTS OF DEFAULT
8.1 Events of Default. Each of the following events shall constitute an
Event of Default:
(a) The Company shall fail to pay (i) any principal of any Note or any Loan
when due (whether at stated maturity or otherwise) in accordance with the terms
thereof or hereof, (ii) any interest on any Note or any Loan within three
Business Days after the date on which such amount becomes due in accordance with
the terms hereof or thereof, or (iii) any other amount payable hereunder within
three Business Days after the date on which any such amount becomes due in
accordance with the terms hereof; or
(b) Any representation or warranty made or deemed made by the Company
herein, or by the Company or any Subsidiary in any Related Document to which it
is a party or in any certificate, document or financial or other statement
furnished at any time under or in connection with this Agreement or any of the
Related Documents to which it is a party, shall prove to have been incorrect in
any material respect on or as of the date made or deemed made; or
(c) The Company shall default in the observance or performance of any
covenant contained in Subsections 6.4, 6.5, 6.8 or 6.10 or Section 7 hereof or
the Company or any Subsidiary shall default in the observance or performance of
any covenant contained in any Collateral Document, and such default shall
continue unremedied for a period of 15 days; or
(d) The Company shall default in the observance or performance of any other
agreement or covenant contained in this Agreement or in any Related Document to
which it is a party, and such default shall continue unremedied for a period of
30 days after notice thereof to the Company by the Agent or any Lender; or
(e) (i) The Company or any or its Subsidiaries shall, with respect to any
Indebtedness (other than the Notes) having an outstanding aggregate principal
amount in excess of $200,000, (A) default in any payment of principal of or
premium or interest on any such Indebtedness, beyond the grace period (not to
exceed 30 days), if any, provided in the instrument or agreement under which
such Indebtedness was incurred, or (B) default in the observance or performance
of any other agreement or condition relating to any such Indebtedness or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or any other condition shall exist, the
effect of which default or other event or condition is to cause, or to permit
the holder or holders of such Indebtedness (or a trustee or agent on behalf of
such holder or holders) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity, or (ii) any such
Indebtedness shall be declared to be due and payable, or required to be prepaid,
redeemed, purchased or deceased (other than by a regularly scheduled required
prepayment, redemption, purchase or defeasance) prior to the stated maturity
thereof; or
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(f) (i) The Company or any of its Subsidiaries shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian or other similar official
for it or for all or any substantial part of its assets, or the Company or any
of its Subsidiaries shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against the Company or any of its
Subsidiaries any case, proceeding or other action of a nature referred to in
clause (i) above which results in the entry of an order for relief or any such
adjudication or appointment; or (iii) the Company or any of its Subsidiaries
shall take any action in furtherance of, or indicating its consent to, approval
of, or acquiescence in, any of the acts set forth in clause (i) or (ii) above;
or (iv) the Company or any of its Subsidiaries shall generally not, or shall be
unable to, or shall admit in writing its inability to, pay its debts as they
become due; or
(g) (i) Any "accumulated funding deficiency" (as defined in Section 302 of
ERISA), whether or not waived, shall exist with respect to any Single Employer
Plan, (ii) a notice is provided or application is made with respect to a
"distress termination" of a Single Employer Plan under Section 4041 of ERISA,
(iii) the PBGC has initiated proceedings to terminate a Single Employer Plan or
cause a trustee to be appointed to administer a Single Employer Plan, (iv) any
Lien is imposed on the assets of the Company or any member of the ERISA Group
relating to any termination of a Single Employer Plan or failure to make a
contribution to a Single Employer Plan, (v) the Company or any member of the
ERISA Group shall incur any liability in connection with a withdrawal from, or
the insolvency or reorganization of, a Multiemployer Plan, (vi) any Reportable
Event or termination or other similar event or condition shall occur or exist
with respect to a Single Employer Plan or (vii) there shall occur any
"prohibited transaction" (as defined in Section 4975 of the Code) involving any
Single Employer Plan which results in a material liability of the Company for an
excise tax or civil penalty in connection therewith; or
(h) One or more judgments or decrees shall be entered against the Company
or any of its Subsidiaries involving in the aggregate a liability (to the extent
not paid or covered by insurance and for which the insurer has accepted
liability in writing) of $350,000 or more and all such judgments or decrees
shall not have been vacated, discharged, stayed or bonded (if required in order
to effect an appeal) pending appeal within 30 days from the entry thereof; or
(i) Any change in any law, statute, rule or regulation shall occur that
has, or reasonably could be expected to (A) have, a material adverse effect on
the business, operations, prospects or financial condition of the Company and
its Subsidiaries taken as a whole or (B) prohibit or render invalid the practice
of the automatic renewals of memberships or contract terms; provided such law,
statute, rule or regulation could reasonably be expected to have a material
adverse effect on the Company and its Subsidiaries, taken as a whole); or
45
(j) The Collateral Agent, on behalf of the Agent and the Lenders, does not
have or ceases to have a valid and perfected first priority security interest in
the Collateral; or any Collateral Document shall cease to be in full force and
effect; or any Person shall assert that any Collateral Document is not valid and
enforceable in accordance with its terms; or
(k) Any representation or warranty made by any Subsidiary in any Related
Document to which it is a party or in any certificate, document or financial or
other statement furnished to the Agent or any Lender in connection therewith
shall prove to be incorrect in any material respect on or as of the date made or
deemed made or shall be breached; or
(l) Any Subsidiary shall default in the observance or performance of any
covenant or agreement contained in any Related Document to which it is a party,
and such default shall continue unremedied for a period of 30 days after notice
thereof by the Agent or any Lender.
8.2 Remedies. If any Event of Default shall occur and be continuing, then,
and in any such event, (a) if such event is an Event of Default specified in
Subsection 8.1(f), automatically the Commitments shall immediately terminate and
the Obligations shall immediately become due and payable and the Company shall
immediately become obligated to Cash Collateralize all outstanding Letters of
Credit, and (b) if such event is any other Event of Default, either or both of
the following actions may be taken: (i) the Agent, or upon the request of the
Required Lenders, shall, by notice to the Company, declare the Commitments to be
terminated forthwith, whereupon the Commitments shall immediately terminate; and
(ii) the Agent, upon the request of the Required Lenders, shall, by notice of
default to the Company, declare the Obligations to be due and payable and/or
demand that the Company immediately Cash Collateralize all outstanding Letters
of Credit forthwith, whereupon the same shall immediately become due and payable
and/or the Company shall immediately become obligated to Cash Collateralize all
such Letters of Credit. In the event of a declaration by the Agent pursuant to
clause (b) (ii) above, the Agent, at the request of the Required Lenders, shall
enforce its rights and remedies hereunder and under any other document or
instrument delivered in connection herewith, including directing the Collateral
Agent to enforce any or all of its rights and remedies under the Collateral
Documents. Any cash collateral delivered hereunder or under any other provision
of this Agreement shall be held by the Agent (without any liability for interest
thereon) and applied to the Obligations arising in connection with any drawing
under a Letter of Credit. After the expiration or termination of all Letters of
Credit, such cash collateral shall be applied by the Agent to any remaining
Obligations hereunder and any excess shall be delivered to the Company or as a
court of competent jurisdiction shall direct. Except as expressly provided above
in this Subsection 8.2, presentment, demand, protest and all other notices of
any kind are hereby expressly waived. If any Lender becomes aware that an Event
of Default has occurred, it agrees to give notice thereof to the Agent and the
other Lenders, but shall have no liability to the Company or any other Lender or
any other Person for its failure to do so.
8.3 Set-Off. In addition to any rights and remedies of the Agent or the
Lenders provided by law, the Agent and each Lender shall have the right, without
prior notice to the Company, any such notice being expressly waived by the
Company to the extent permitted by applicable law, upon the occurrence of any
Event of Default, to set off and apply against any indebtedness, whether matured
or unmatured, of the Company to the Agent or such Lender, any amount owing from
the Agent or such Lender at any of its branches or offices or from a corporation
controlling the Agent or such Lender to the Company at, or at any time after,
the occurrence of such Event of Default. The Agent and each Lender agrees
promptly to notify the Company and the Agent after any such set-off and
application, provided that the failure to give such notice shall not affect the
validity of such set-off and application.
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8.4 Default Interest. Notwithstanding any other provision of this Agreement
to the contrary, (a) if the Company shall fail to pay any amount owing to the
Agent or any Lender under this Agreement when due (whether at stated due date,
on acceleration or otherwise), then the Company will pay interest (before, as
well as after, judgment) on demand to the Agent or such Lender, as the case may
be, on the amount in default from the date such payment became due until payment
in full at a rate equal to the sum of the Base Rate plus 2% per annum, such rate
to change as and when the Base Rate changes and (b) if any Event of Default
shall occur, upon election of the Required Lenders, then during the period such
Event of Default shall be continuing, the rate of interest payable hereunder
shall be the rate as provided in clause (a) above.
SECTION 9. THE AGENT AND THE COLLATERAL AGENT
9.1 Appointment. Each Lender hereby irrevocably designates and appoints
each of the Agent and the Collateral Agent as the agents of such Lender under
this Agreement and the Related Documents, and each Lender irrevocably authorizes
the Agent and the Collateral Agent to take such action on its behalf under the
provisions of this Agreement and the Related Documents and to exercise such
powers and perform such duties as are delegated to the Agent or the Collateral
Agent, as the case may be, by the terms hereof or thereof, together with such
other powers as are reasonably incidental thereto. Notwithstanding any provision
to the contrary elsewhere in this Agreement, neither the Agent nor the
Collateral Agent shall have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any Related Document or
otherwise exist against the Agent or the Collateral Agent.
9.2 Delegation of Duties. The Agent and the Collateral Agent may execute
any of their duties under this Agreement and the Related Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. Neither the Agent nor the
Collateral Agent shall be responsible for the negligence or misconduct of any
agents or attorneys-in-fact selected by them with reasonable care except to the
extent otherwise required by Subsection 9.3.
9.3 Exculpatory Provisions. Neither the Agent nor the Collateral Agent nor
any of their respective partners, officers, directors, employees, attorneys,
agents, attorneys-in-fact or Affiliates shall be (i) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement or any Related Document (except for its or such
Person's own gross negligence or willful misconduct), or (ii) responsible in any
manner to any of the Lenders for any recitals, statements, representations or
warranties made by the Company or any of its Affiliates or any officer thereof
contained in this Agreement or any Related Document or in any certificate,
report, statement or other document referred to or provided for in or received
by the Agent or the Collateral Agent under or in connection with this Agreement
or any Related Document or for the value, validity, effectiveness (except its
own due execution hereof), genuineness, enforceability or sufficiency of this
Agreement or any Related Document or for any failure of the Company to perform
its obligations hereunder or thereunder. Except as otherwise provided herein,
neither the Agent nor the Collateral Agent shall be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any Related
Document, or to inspect the properties, books or records of the Company or any
of its Affiliates. Neither the Agent nor the Collateral Agent shall be
responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any Related
Document or for any representations, warranties, recitals or statements made
herein or therein or made in any written or oral statement or any financial or
other statements, instruments, reports, certificates or any other documents in
connection herewith or therewith furnished, or made in reliance on information
furnished by or on behalf of the Company, by the Agent or the Collateral Agent
to the Lenders or by or on behalf of the Company to the Agent, the Collateral
Agent or any Lender.
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9.4 Reliance by Agent and Collateral Agent. The Agent and the Collateral
Agent shall be entitled to rely, and shall be fully protected in relying, upon
any Note, writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement, order or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons and upon advice
and statements of legal counsel (including, without limitation, counsel to the
Company), independent accountants and other experts selected by the Agent and
the Collateral Agent. The Agent and the Collateral Agent may deem and treat the
payee of any Note as the owner thereof for all purposes unless a written notice
of assignment, negotiation or transfer thereof shall have been filed with the
Agent or the Collateral Agent. The Agent and the Collateral Agent shall each be
fully justified in failing or refusing to take any action under this Agreement
or any Related Document unless it shall first receive such advice or concurrence
of the Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense (other
than any liability or expense resulting from the Agent's or the Collateral
Agent's gross negligence or willful misconduct) which may be incurred by it by
reason of taking or continuing to take any such action. The Agent and the
Collateral Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any Related Document in
accordance with a request of the Lenders, and such request and any action taken
or failure to act pursuant thereto shall be binding upon all future holders of
the Notes.
9.5 Notice of Failure to Perform. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or of the failure of the
Company to satisfy any condition to borrowing hereunder unless the Agent has
received written notice from a Lender or the Company referring to this
Agreement, describing such Default or failure and stating that such notice is a
"notice of failure to perform its obligations". In the event that the Agent
receives such a notice, the Agent shall promptly provide copies of such notice
to the Lenders. In the case of any Default, the Agent shall take such action
with respect to such Default as shall be reasonably directed by the Lenders,
provided, however, that unless and until the Agent shall have received such
directions, the Agent may (but shall not be obligated to) take such action for
the protection and preservation of the Collateral as it shall deem advisable in
the best interests of the Lenders. Each Lender agrees that it shall not make any
demand for repayment of any amounts payable to such Lender hereunder unless each
Lender agrees to make a demand for repayment of all amounts payable to such
Lender. Prior to taking any such actions, the Lenders shall consult with each
other and the Agent to determine the general plan of action and the steps to be
taken in connection with such action, and they shall continue to consult with
one another with respect thereto.
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9.6 Credit Decision. Each Lender expressly acknowledges that neither the
Agent nor the Collateral Agent nor any of their respective partners, officers,
directors, employees, attorneys, agents, attorneys-in-fact or Affiliates has
made any representations or warranties to it and that no act by the Agent or the
Collateral Agent hereafter taken, including any review of the affairs of the
Company, shall be deemed to constitute any representation or warranty by the
Agent or the Collateral Agent to any Lender. Each Lender represents to the Agent
and the Collateral Agent that it has, independently and without reliance upon
the Agent, the Collateral Agent or any other Lender, and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Company 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, the Collateral
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, operations, property, financial and other condition and
creditworthiness of the Company. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by the Agent hereunder or are
furnished to the Agent pursuant to the terms hereof in sufficient copies or
counterparts for or for the account of the Lenders, the Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, financial and other
condition or creditworthiness of the Company or any of its Affiliates which may
come into the possession of the Agent or any of its partners, officers,
directors, employees, agents, attorneys-in-fact or Affiliates.
9.7 Indemnification. The Lenders agree to indemnify the Agent and the
Collateral Agent and any partner, member, director, officer, official, employee,
counsel, consultant or agent of the Agent or the Collateral Agent (to the extent
not reimbursed by the Company and without limiting the obligation of the Company
to do so), ratably according to their respective Percentages of Total
Commitment, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including, without limitation, at
any time following the payment of the Notes) be imposed on, incurred by or
asserted against the Agent or the Collateral Agent in any way relating to or
arising out of this Agreement or the Related Documents, or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Agent or
the Collateral Agent under or in connection with any of the foregoing; provided,
however, that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting solely from the Agent's or the
Collateral Agent's gross negligence or willful misconduct, and provided further
that the Lenders shall not be responsible for the Agent's or the Collateral
Agent's administrative costs (excluding legal fees and damages) incurred in
connection with its ordinary duties under this Agreement and the Related
Documents. The agreements in this Subsection 9.7 shall survive the repayment of
the Obligations.
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9.8 Individual Capacity. The Agent, the Collateral Agent and their
respective Affiliates may make loans to, accept deposits from and generally
engage in any kind of business with the Company and any of its Subsidiaries as
though it were not the Agent or the Collateral Agent. With respect to its Loans
made or renewed by it and any Note issued to it, the Agent and the Collateral
Agent shall have the same rights and powers under this Agreement and the Related
Documents as any Lender and may exercise the same as though it were not the
Agent or the Collateral Agent, and the terms "Lender" and "Lenders" shall
include the Agent and the Collateral Agent in their individual capacities.
9.9 Successor Agents. Subject to the last sentence of this Subsection 9.9,
the Agent and the Collateral Agent may resign as Agent or Collateral Agent, as
the case may be, at any time by giving written notice thereof to the Lenders and
the Company and may be removed at any time with or without cause by the Required
Lenders, provided that no such resignation or removal shall become effective
until a successor Agent or Collateral Agent, as the case may be, shall have been
appointed and shall have accepted such appointment as provided in this
Subsection 9.9. Upon any such resignation or removal, the Required Lenders shall
have the right to appoint a successor Agent or Collateral Agent, as the case may
be. If no successor Agent or Collateral Agent shall have been so appointed by
the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Agent's or Collateral Agent's giving of notice of resignation
or the Required Lenders' removal of the retiring Agent or Collateral Agent,
then, upon five Business Days' notice to the Company and the Lenders, the
retiring Agent or Collateral Agent may, on behalf of the Lenders, appoint a
successor Agent or Collateral Agent, as the case may be, which shall be a bank
which maintains an office in the United States, or a commercial bank organized
under the laws of the United States of America or of any State thereof, or any
Affiliate of such a bank, having a combined capital and surplus of at least
$100,000,000. Upon the acceptance of any appointment as Agent or Collateral
Agent hereunder by a successor Agent or Collateral Agent, such successor Agent
or Collateral Agent, as the case may be, shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent
or Collateral Agent, as the case may be, and the retiring Agent or Collateral
Agent shall be discharged from its duties and obligations under this Agreement.
After the retiring Agent's or Collateral Agent's resignation or removal
hereunder as such agent, 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 such
agent under this Agreement. Anything in this Subsection 9.9 to the contrary
notwithstanding, so long as the Company has not failed to perform its
obligations under this Agreement or under any Related Document and so long as
LaSalle is a Lender, LaSalle agrees not to resign as Agent or Collateral Agent
or to take any action in its capacity as a Lender to remove itself as Agent or
Collateral Agent.
SECTION 10. GENERAL PROVISIONS
10.1 Amendments and Waivers. Neither this Agreement, any Note, any other
Related Document, nor any terms hereof or thereof may be amended, supplemented
or modified except in accordance with the provisions of this Section 10.1. With
the written consent of the Required Lenders and the Agent or the Collateral
Agent, as applicable, the Company may, from time to time enter into written
amendments, supplements or modifications hereto and to the Notes and the other
Related Documents, changing in any manner the rights of the Lenders or of the
Company hereunder or thereunder or waiving, on such terms and conditions as the
Required Lenders and the Agent or Collateral Agent, as applicable, may specify
in such instrument, any of the requirements of this Agreement, the Notes or the
other Related Documents or any Default and its consequences; provided, however,
that no such waiver and no such amendment, supplement or modification shall
reduce the amount or extend the maturity of any Note, or reduce the rate or
extend the time of payment of interest thereon, or reduce any fee payable to any
Lender hereunder, or change the amount of any Lender's Commitment, or change the
definition of Required Lenders, or amend, modify or waive any provision of
Section 9.5 or this Section 10.1, or release any Guaranty or any of the
Collateral, in each case without the written consent of the Agent and all of the
Lenders. Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Lenders and shall be binding upon the
Company, the Lenders, the Agent and all present and future holders of the Notes.
50
10.2 Notices. Except as expressly otherwise provided herein, all notices,
requests and demands to or upon the respective parties hereto shall be in
writing (including by telecopy or telex) and shall be effective when actually
received at the following address in the case of the Company, the Agent and the
Collateral Agent, and at the address set forth in Schedule I in the case of the
other parties hereto, or in each case at such other address as may be hereafter
notified by the respective parties hereto and any future holders of the Notes:
The Company:
Vertrue Incorporated
00 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with copies to:
Xxxxxx X.X. Xxxxxx, Esq.
Vertrue Incorporated
00 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
and
Xxxxxxx X. Xxxxxx III, Esq.
Xxxxxxx Xxxxxx X'Xxxxxx & Xxxxxxxxxxx LLP
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
51
The Agent:
LaSalle Bank National Association
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
The Collateral Agent:
LaSalle Bank National Association
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Any notice, request or demand received on a day which is not a Business Day
shall be deemed to have been received on the next following Business Day.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Agent or any Lender, any right, remedy, power or
privilege hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges herein provided
are cumulative and not exclusive of any rights, remedies, powers and privileges
provided at law, in equity or otherwise.
10.4 Survival of Representations and Warranties. All representations and
warranties made hereunder, in any Related Document and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the Related
Documents for a period of three (3) years after the repayment of the
Obligations.
10.5 Payment of Expenses and Taxes. The Company agrees (a) to pay or
reimburse each Lender and the Agent for all its out-of-pocket costs and expenses
incurred in connection with the preparation, execution and delivery of, and any
amendment, restatement, supplement or modification to, this Agreement and the
Related Documents, and the consummation of the transactions contemplated hereby
and thereby, including, without limitation, the reasonable fees and
disbursements of counsel to the Agent and such Lenders, (b) to pay or reimburse
each Lender and the Agent for all their out-of-pocket costs and expenses
incurred in connection with the enforcement or preservation of any rights under
this Agreement or the Related Documents, including, without limitation,
reasonable fees and disbursements of counsel to the Agent and to each Lender,
(c) to pay, and indemnify and hold harmless each Lender, the Agent and the
Collateral Agent from and against, any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any delay in paying,
documentary, stamp, excise and other taxes (other than income taxes), if any,
which may be payable or determined to be payable in connection with the
execution and delivery of, or consummation of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any waiver
or consent under or in respect of, this Agreement or the Related Documents, and
(d) to pay, and indemnify and hold harmless each Lender, the Agent and the
Collateral Agent and any partner, member, director, officer, official, employee,
counsel, consultant and Agent of the Lender from and against, any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including, without limitation, reasonable fees and
disbursements of counsel) or disbursements of any kind or nature whatsoever
incurred with respect to the execution, delivery, enforcement, performance and
administration of this Agreement and the Related Documents (all the foregoing,
collectively, the "indemnified liabilities"), provided that the Company shall
have no obligation hereunder to the Agent, the Collateral Agent or any Lender
with respect to indemnified liabilities arising from the gross negligence or
willful misconduct of the Agent, the Collateral Agent or any such Lender. The
agreements in this Subsection 10.5 shall survive the repayment of the
Obligations.
52
10.6 Benefit of Agreement; Participations; Assignments.
(a) This Agreement shall be binding upon and inure to the benefit of the
Company, the Lenders, the Agent, the Collateral Agent and their respective
successors and assigns, except that (i) the Company may not assign or transfer
any of its rights or obligations under this Agreement without the prior written
consent of each Lender and (ii) the Lenders may assign or transfer their
respective rights or obligations under this Agreement only as provided in
paragraphs (b) and (c) of this Subsection 10.6. Any Lender may from time to time
change the office, branch or agency of such Lender at which the Loans are made
or carried; provided that if at the time of any change from one office, branch
or agency to another the effect thereof would be to increase any amount payable
by the Company under this Agreement then such change shall not be made without
the prior written consent of the Company.
(b) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time sell to one or more
banks or other entities ("Participants") participating interests in any Loan
owing to such Lender, any Note held by such Lender, or any other rights and
obligations of such Lender hereunder. In the event of any such sale by a Lender
of participating interests to a Participant, such Lender's rights and
obligations under this Agreement to the other parties under this Agreement shall
remain unchanged, such Lender shall remain solely responsible for the
performance thereof, such Lender shall remain the holder of any such Note for
all purposes under this Agreement, and the Company and the Agent shall continue
to deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. The Company agrees that each
Participant shall be entitled to the benefits of Subsection 3.4 with respect to
its participation in the Loans outstanding from time to time; provided that no
Participant shall be entitled to receive any greater amount pursuant to such
Subsection than the transferor Lender would have been entitled to receive in
respect of the amount of the participation transferred by such transferor Lender
to such Participant had no such transfer occurred. No Participant shall have the
right to consent to any amendment to, or waiver of, any provision of this
Agreement, except any such amendment or waiver which would require the consent
of all of the Lenders pursuant to Subsection 9.1.
53
(c) Subject to the last sentence of this paragraph (c), any Lender may, in
the ordinary course of its commercial banking business and in accordance with
applicable law, at any time sell to any Lender or to one or more additional
banks or financial institutions (each an "Assignee") all or any part of its
rights and obligations under this Agreement and the Notes pursuant to an
assignment agreement between such Assignee and such transferor Lender,
substantially in the form of Exhibit C, with the consent of the Agent and, so
long as no Default has occurred and is continuing, the Company (which consent
shall not be unreasonably withheld). Such assignment agreement shall be executed
by such Assignee and such transferor Lender and shall be delivered to the Agent
for acceptance by the Agent not less than five Business Days before the proposed
effective date of such assignment, together with the payment of a $3,500
assignment fee for the Agent. Upon such execution, delivery, acceptance and
payment, from and after the effective date specified in such assignment
agreement, (x) the Assignee thereunder shall be a party hereto and, to the
extent of the portion of the rights and obligations of the transferor Lender
purchased by it, have the rights and obligations of a Lender hereunder and under
the Related Documents and (y) the transferor Lender thereunder shall, to the
extent of the portion of its rights and obligations so sold, be released from
its obligations under this Agreement (and, in the case of an assignment
agreement covering all or the remaining portion of a transferor Lender's rights
and obligations under this Agreement, such transferor Lender shall cease to be a
party hereto). On or after the effective date specified in such assignment
agreement, upon request of the transferor Lender or the Assignee, the Company
shall issue a new Note to the transferor Lender and/or the Assignee. Anything in
this paragraph (c) notwithstanding, no transfer shall be made pursuant to this
paragraph (c) if (i) such transfer by any one transferor Lender to any one
Assignee which is not a Lender is in respect of less than $2,000,000 of the
rights and obligations of such transferor Lender, or (ii) when less than all of
the rights and obligations of such transferor Lender is transferred, the amount
held by any transferor Lender would be less than $2,000,000 after giving effect
to such transfer.
(d) Notwithstanding anything to the contrary contained in this Agreement,
any Lender may pledge, hypothecate or otherwise grant a security interest in all
or any part of its rights hereunder or under its Note to any Federal Reserve
Bank; provided that no such pledge, hypothecation or grant shall relieve such
Lender of any of its obligations under this Agreement.
10.7 Sharing of Payments. If any Lender (a "benefited Lender") shall at any
time receive any payment of all or part of its Loans, or interest thereon, or
receive any Collateral in respect thereof (whether voluntarily or involuntarily,
by set-off, or otherwise) in a greater proportion than any such payment to and
Collateral received by any other Lender, if any, in respect of such other
Lender's Loans, or interest thereon, such benefited Lender shall purchase for
cash from the other Lenders such portion of each such other Lender's Loans, or
shall provide such other Lenders with the benefits of any such Collateral, or
the proceeds thereof, as shall be necessary to cause such benefited Lender to
share the excess payment or benefits of such Collateral or proceeds ratably with
each of the Lenders, it being understood and agreed that all proceeds of
Collateral (including setoffs) shall in any event be applied in accordance with
Section 6.5 of the Guaranty and Collateral Agreement; provided, however, that if
all or any portion of such excess payment or benefits is thereafter recovered
from such benefited Lender, such purchase shall be rescinded, and the purchase
price and benefits returned, to the extent of such recovery, but without
interest. The Company agrees, to the extent it may do so under applicable law,
that each Lender so purchasing a portion of another Lender's Loans may exercise
all rights of payment (including, without limitation, rights of set-off) with
respect to such portion as fully as if such Lender were the direct holder of
such portion.
54
10.8 Counterparts. This Agreement may be executed in one or more
counterparts and by the different parties hereto on separate counterparts, all
of which counterparts taken together shall be deemed to constitute one and the
same instrument. This Agreement shall be effective when it has been executed by
the Borrower, the Agent and the Lenders and each party has notified the Agent by
transmitting their respective original or facsimile signature to the Agent.
10.9 Headings. The Section and Subsection headings in this Agreement are
for convenience of reference only and shall not affect the interpretation
hereof.
10.10 Obligations Several. The rights and obligations of each Lender
hereunder is several, and no Lender shall be responsible for the obligations of
any other Lender hereunder. The amounts payable by the Company at any time
hereunder or under any Note to each Lender shall be a separate and independent
debt and each Lender shall be entitled to protect and enforce its rights arising
hereunder and thereunder and it shall not be necessary for any other Lender or
the Agent to consent to, or be joined as an additional party in, any proceedings
for such purpose. Nothing contained in this Agreement and no action taken by
Lenders pursuant hereto shall be deemed to constitute Lenders to be a
partnership, an association, a joint venture or any other kind of entity.
10.11 Governing Law. THIS AGREEMENT AND THE NOTES AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
ILLINOIS WITHOUT REGARD TO ITS CONFLICTS OF LAWS PRINCIPLES.
10.12 Submission to Jurisdiction. The Company hereby irrevocably and
unconditionally: (i) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any Related Document, or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of Illinois, the
courts of the United States of America for the Northern District of Illinois,
and appellate courts from any thereof; (ii) consents that any such action or
proceeding may be brought in such courts, and waives any objection that it may
now or hereafter have to the venue of any such action or proceeding in any such
court or that such action or proceeding was brought in an inconvenient forum and
agrees not to plead or claim the same; (iii) agrees that service of process in
any such action or proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar form of mail),
postage prepaid, to the Company at its address set forth in or designated
pursuant to Subsection 9.2; and (iv) agrees that nothing herein shall affect the
right to effect service of process in any other manner permitted by law or shall
limit the right to xxx in any other jurisdiction.
10.13 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT
IRREVOCABLY AND UNCONDITIONALLY WAIVES ALL RIGHT TO TRIAL BY JURY AS TO ANY
ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
55
10.14 Severability. Any provision of this Agreement (or any Related
Document) that is illegal, invalid or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity or unenforceability without invalidating the remaining provisions
hereof (or thereof) or affecting the legality, validity or enforceability of
such provision in any other jurisdiction. The parties hereto agree to negotiate
in good faith to replace any illegal, invalid or unenforceable provision of this
Agreement (or such Related Document) with a legal, valid and enforceable
provision that, to the extent possible, will preserve the economic bargain of
this Agreement (or such Related Document), or to otherwise amend this Agreement
(or such Related Document) to achieve such result.
10.15 Customer Identification - USA Patriot Act Notice. Each Lender and
LaSalle (for itself and not on behalf of any other party) hereby notifies the
Company and each Guarantor that, pursuant to the requirements of the USA Patriot
Act, Title III of Pub. L. 107-56, signed into law October 26, 2001 (the "Act"),
it is required to obtain, verify and record information that identifies the
Company and each Guarantor, which information includes the name and address of
the Company and each Guarantor and other information that will allow such Lender
or LaSalle, as applicable, to identify the Company and each Guarantor in
accordance with the Act.
[SIGNATURE PAGES ON THE FOLLOWING PAGES]
56
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
VERTRUE INCORPORATED
By: /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Executive Vice President, Chief
Financial Officer and Secretary
LASALLE BANK NATIONAL ASSOCIATION, as Agent,
Collateral Agent and Issuing Bank
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: First Vice President
Second Amended and Restated Credit
Agreement Signature Page
Commitment Percentage Commitment Lenders
--------------------- ---------- -------
50.000% $25,000,000 LASALLE BANK NATIONAL
ASSOCIATION, as Lender
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: First Vice President
30.000% $15,000,000 COMMERCE BANK, as Lender
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
20.000% $10,000,000 XXXXX BROTHERS XXXXXXXX & CO., as Lender
By: /s/ Xxxx X. Xxxx
--------------------------
Name: Xxxx X. Xxxx
Title: Senior Vice President
Total 100% $50,000,000
------------- -----------
Second Amended and Restated Credit
Agreement Signature Page
PRICING SCHEDULE
----------------
The Eurodollar Rate Margin, the Base Rate Margin, the Commitment Fee Rate and
the LC Fee Rate shall be determined as set forth below.
On and after Agent's receipt of the financial statements for the relevant fiscal
quarter, the Eurodollar Rate Margin, the Base Rate Margin, the Commitment Fee
Rate and the LC Fee Rate shall be equal to the applicable rate per annum set
forth in the applicable table below opposite the applicable Total Debt to Cash
EBITDA Ratio:
------------------------------------ ---------------- ---------------- ------------------- --------------------
Total Debt to Cash EBITDA Ratio Eurodollar Base Rate Commitment Fee LC Fee Rate
Margin for Margin for Rate
Revolving Loans Revolving Loans
------------------------------------ ---------------- ---------------- ------------------- --------------------
Greater than 3.25 :1.00 2.75% .50% .50% 2.75%
------------------------------------ ---------------- ---------------- ------------------- --------------------
Greater than 2.50:1.00 but less 2.50% .50% .50% 2.50%
than or equal to 3.25:1.00
------------------------------------ ---------------- ---------------- ------------------- --------------------
Greater than 1.75:1.00 but less 2.25% .25% .375% 2.25%
than or equal to 2.50:1.00
------------------------------------ ---------------- ---------------- ------------------- --------------------
Less than or equal to 1.75:1.00 2.00% .25% .375% 2.00%
------------------------------------ ---------------- ---------------- ------------------- --------------------
The Eurodollar Rate Margin, the Base Rate Margin, the Commitment Fee Rate and
the LC Fee Rate shall be adjusted, to the extent applicable, on the 45th (or, in
the case of the last Fiscal Quarter of each Fiscal Year, 90th) day after the end
of each Fiscal Quarter based on the Total Debt to Cash EBITDA Ratio as of the
last day of such Fiscal Quarter; it being understood that if the Company fails
to deliver the financial statements required by Section 10.1.1 or 10.1.2, as
applicable, and the related Compliance Certificate, required by Section 10.1.3
by the 55th day (or, if applicable, the 120th day) after any Fiscal Quarter, the
Eurodollar Rate Margin shall be 2.75%, the Base Rate Margin shall be .50%, the
Commitment Fee Rate shall be .50% and the LC Fee Rate shall be 2.75% until such
financial statements and Compliance Certificate are delivered. Notwithstanding
the foregoing, no reduction to the foregoing interest rate margins or fee rates
shall become effective at any time when Default has occurred and is continuing.
SCHEDULE 1
LIST OF LENDING OFFICES
LaSalle Bank National Association
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Xxxxx Brothers Xxxxxxxx & Co.
000 Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Chief Credit Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Commerce Bank
0000 Xxxxx 00 Xxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
SCHEDULE 4.1
LIST OF LEASED PREMISES
SCHEDULE 5.3
SUBSIDIARIES/FOREIGN QUALIFICATIONS
I.
Jurisdiction of Foreign Percentage
Name Incorporation Qualification Ownership Owner
---- ------------- ------------- --------- -----
II. Excluded Subsidiaries
Name
----
Adaptive Affinity Limited (UK)
Memberworks Canada Travel Services, Inc. (Quebec)
Memberworks Canada Services, Inc. (Ontario)
Lavalife BV (NE)
Lavalife UK Limited (UK)
IMC Interactive Media Corporation Pty Ltd. (Aus)
Interactive Media Group (Australia) Pty Ltd. (Aus)
Interactive (TX) Voice Media Corp. (TX)
Interactive CA Voice Media Corp. (CA)
Interactive Media (IL) Corp. (IL)
Interactive MO Corp. (MO)
Xxxxxx Holding Corp. (NY)
Interactive SJ Voice Media Corp (CA)
Interactive Voice Media (CA) Corp. (CA)
Interactive Voice Media (MN) Corp. (MN)
Interactive Voice Media (Sacramento) Corp. (CA)
Interactive Voice Media New York LLC (DE)
Interactive Voice Media Baltimore LLC (DE)
Interactive Voice Media Michigan LLC (DE)
Lavalife Washington DC LLC (DE)
Interactive Voice Media Colorado LLC (DE)
Interactive Voice Media Georgia LLC (DE)
Interactive Voice Media New Jersey LLC (DE)
Interactive Voice Media Ohio LLC (DE)
Interactive Voice Media Pennsylvania LLC (DE)
SCHEDULE 5.7
------------
MATERIAL LITIGATION
SCHEDULE 5.9
------------
LIENS
SCHEDULE 5.18
-------------
LIST OF EMPLOYMENT AGREEMENTS
SCHEDULE 5.19
-------------
LIST OF DIVIDENDS PAID
SCHEDULE 7.4
------------
PERMITTED INVESTMENTS, LOANS AND ADVANCES
EXHIBIT A
FORM OF REPLACEMENT NOTE
$ March 17, 2006
------------------------
Chicago, Illinois
VERTRUE INCORPORATED, a Delaware corporation (the "Company"), for value
received, hereby unconditionally promises to pay to the order of
_________________________ (the "Lender") at the office of LASALLE BANK NATIONAL
ASSOCIATION (the "Agent") located at 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx, for the account of the appropriate Lending Office of the Lender, the
principal sum of __________ Dollars ($________) or, if less, the unpaid
principal amount loaned by the Lender to the Company pursuant to the Agreement
referred to below, in lawful money of the United States of America and in
immediately available funds, on the date(s) and in the manner provided in said
Agreement. The Company also promises to pay interest on the unpaid principal
balance hereof, for the period such balance is outstanding, at said principal
office for the account of said Lending Office, in like money, at the rates of
interest, on the date(s) and in the manner provided in said Agreement; and to
pay interest on any overdue principal and interest at the rate set for in said
Agreement.
The date, type, amount and maturity date for each Loan made by the Lender
to the Company under the Agreement referred to below, and each payment of
principal thereof, shall be recorded by the Lender on its books and, prior to
any transfer of this Note (or, at the discretion of the Lender, at any other
time), endorsed by the Lender on the schedule attached hereto or any
continuation thereof or otherwise recorded and maintained in its internal
records. The failure to make or any error in making any such endorsement shall
not limit, extinguish or in any way modify the Company's obligations under the
Credit Agreement or this Note, including, without limitation, the obligation of
the Company to repay the Lender's Loans, together with interest thereon,
strictly in accordance with the terms of the Credit Agreement and this Note.
This is a Note referred to in that certain Second Amended and Restated
Credit Agreement dated as of March 17, 2006, among the Company, the lenders
party thereto (the "Lenders") and the Agent (as hereafter amended from time to
time, the "Agreement") and evidences the Loans made by the Lender thereunder and
is entitled to the benefits thereof. All terms not defined herein shall have the
meanings given to them in the Agreement.
The Agreement provides for the acceleration of the maturity of this Note
upon the occurrence of certain Events of Default and for optional prepayments on
the terms and conditions specified therein.
[This Note is issued in substitution and replacement for and also evidences
the indebtedness owing by the Company evidenced by that certain Note of the
Company dated March 31, 2003 payable to the order of the Lender].
The Company waives presentment, notice of dishonor, protest and any other
notice or formality with respect to this Note.
No waiver of any right or remedy under this Note shall in any event be
effective unless the same shall be in writing and signed by the Lenders, as
required by the Agreement, and the Company, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
In accordance with the provisions of the Agreement, the Company shall
reimburse the Lender on demand for all reasonable costs, expenses and charges
(including without limitation, reasonable fees and charges of external legal
counsel for the Lender incurred by the Lender in connection with the
preparation, performance or enforcement of this Note.
This Note shall be binding on the Company and its permitted successors and
assigns and shall inure to the benefit of the Lender and its permitted
successors and assigns, provided that the Company may not delegate any
obligations hereunder without the prior written consent of the Lender.
THIS NOTE SHALL BE GOVERNED BY, AND INTERPRETED AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF ILLINOIS.
IN WITNESS WHEREOF, the undersigned has caused this Note to be duly
executed as of the day and year first above written.
VERTRUE INCORPORATED
By:
--------------------------
Name:
------------------------
Title:
-----------------------
2
Schedule
--------
Principal Payments or
Date Amount and Prepayments of Balance Notation
of Loan Type of Loan Principal Outstanding Made By
------- ------------ --------- ----------- -------
3
EXHIBIT B-1
FORM OF NOTICE OF BORROWING
LaSalle Bank National Association,
as Agent
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Facsimile No.: (000) 000-0000
Re: Notice of Borrowing
--------------------
Gentlemen:
Pursuant to Subsection 2.2 of the Second Amended and Restated Credit
Agreement dated as of March 17, 2006 (the "Credit Agreement") among the
undersigned, the lenders parties thereto, and you, as agent for such lenders, we
hereby give you irrevocable notice that we request a Borrowing as follows:
1. Amount of Borrowing: $ .
--------------------------
2. Date of Borrowing: __________________, 200_.
3. Type of Loan (Base Rate or
Eurodollar Rate):
---------------------------
4. Interest Period Duration: (For Eurodollar Rate Loans)
5. Aggregate Principal Amount
Previously Borrowed: $
--------------------------
6. Remaining Commitment
after this Borrowing: $
--------------------------
The undersigned hereby certifies that the following statements are true and
correct on and as of the date hereof, and will be true and correct on and as of
the date of Borrowing, before and after giving effect thereto and to the
application of the proceeds therefrom:
(a) the representations and warranties of the undersigned contained in the
Credit Agreement and the Related Documents, and in any certificate, document of
financial or other statement furnished at any time under of in connection with
the Credit Agreement or any Related Document, are true and correct with the same
effect as if made on and as of such date of Borrowing (except to the extent that
such representations and warranties expressly relate to an earlier date);
4
(b) no failure to perform any of its obligations under the Credit Agreement
or any Related Document exists or shall result from such proposed Borrowing; and
(c) each of the other conditions precedent set forth in Subsection 4.2 have
been satisfied and complied with.
Capitalized terms used but not defined shall have the respective meanings
given to them in the Credit Agreement.
Dated this day of , 200_.
-------------- ------------------------------
VERTRUE INCORPORATED
By:
--------------------------
Name:
------------------------
Title:
-----------------------
5
EXHIBIT B-2
Notice of Continuation or Conversion
,
---------------- --
LaSalle Bank National Association,
as Agent
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Facsimile No.: (000) 000-0000
Re: Second Amended and Restated Credit Agreement dated as of March
17, 2006 (the "Agreement") among Vertrue Incorporated (the
"Company") and LaSalle Bank National Association, as Agent for
the Lenders party thereto.
Ladies and Gentlemen:
Pursuant to Subsection 2.7 of the Agreement, the undersigned Company hereby
gives you irrevocable notice that the Company requests the Conversion or
Continuation of a Loan under the Agreement, and in that connection Company sets
forth below the information relating to such Loan:
Name of Company:
--------------------------------------
Conversion/Continuation
Date:
--------------------------------------
Aggregate Principal
Amount to be Converted or
Continued
--------------------------------------
Type of Loan (Base Rate,
or Eurodollar Rate):
--------------------------------------
Interest Period Duration:
(For Eurodollar Rate Loans) --------------------------------------
The undersigned officer on behalf of the Company hereby certifies that:
(a) the representations and warranties contained in Article 5 of the
Agreement are true and correct in all material respects on and as of the date
hereof (or, if such representation or warranty is expressly stated to have been
made as of a specific date, as of such specific date); and
(b) there does not exist any Default under the Agreement.
All capitalized terms used in this notice not otherwise defined herein shall
have the same meaning as assigned to them in the Agreement.
VERTRUE INCORPORATED
By:
--------------------------
Name:
------------------------
Title:
-----------------------
2
EXHIBIT C
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
ASSIGNMENT AND ASSUMPTION AGREEMENT (the "Agreement") dated as of
______________, _____ between ____________________________ ("Assignor") and
_______________________ ("Assignee"). All capitalized terms used herein and not
otherwise defined shall have the respective meanings provided such terms in the
Credit Agreement referred to below.
W I T N E S S E T H:
WHEREAS, the Assignor is a party to a Second Amended and Restated Credit
Agreement, dated as of March 17, 2006 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among Vertrue Incorporated,
a Delaware corporation, the lenders parties thereto (including Assignor) (the
"Lenders") and LaSalle Bank National Association, as agent (in such capacity,
the "Agent") for such Lenders; and
WHEREAS, the Assignee proposes to assume all of the rights and obligations
of the Assignor under the Credit Agreement and the Related Documents in respect
of the portion of the Assignor's Commitment and outstanding Loans, if any, under
the Credit Agreement as set forth in Item 6(c) of Annex I (the "Assignee's
Share").
NOW, THEREFORE, in consideration of the mutual agreements herein contained,
the parties hereto agree as follows:
1. Assignment. Effective on the Assignment Effective Date (as defined
below), the Assignor hereby assigns to the Assignee, without recourse and
without representation or warranty (other than expressly provided herein), that
dollar amount listed in Item 6(c) of Annex I hereto as the "Assignee's Share"
(which shall be an amount permitted under Subsection 10.6(c) of the Credit
Agreement) of the Assignor's rights, title, interest and obligations arising
under the Credit Agreement and the Related Documents in respect of the
Assignor's Commitment and Loans, including, without limitation (but subject to
paragraph 4(a) hereof), in the case of the assignment of outstanding Loans, all
rights of the Assignor with respect to the Assignee's Share of such outstanding
Loans.
2. Assumption. Effective on the Assignment Effective Date, the Assignee
hereby assumes from the Assignor all of the Assignor's obligations arising under
the Credit Agreement relating to the Assignee's Share. Effective on the
Assignment Effective Date, the Assignor shall be released from all of its
obligations under the Credit Agreement relating to the Assignee's Share pursuant
to the terms of the Credit Agreement.
3. Assignments; Participations. On and after the Assignment Effective Date,
the Assignee may assign all or any part of the rights granted to it as an
Assignee hereunder in accordance with the applicable provisions of Subsection
10.6(c) of the Credit Agreement. On and after the Assignment Effective Date, the
Assignee may sell or grant participations in all or any part of the rights
granted to it as an Assignee hereunder in accordance with the applicable
provisions of Subsection 10.6(b) of the Credit Agreement.
4. Payment of Interest and Fees to Assignee.
(a) Interest is payable by the Company in respect of the Assignee's Share
of the Loans at the rates set forth in Subsection 2.6 of the Credit Agreement. A
facility fee is payable by the Company in respect of the Assignee's Commitment
at the rate set forth in Subsection 3.1(c) of the Credit Agreement. All interest
on any Loan attributable to the Assignee's Share and all facility fees
attributable to the Assignee's Share, which, in each case, accrues on and after
the Assignment Effective Date shall be paid directly to the Assignee.
Notwithstanding anything to the contrary contained above, all payments with
respect to the Assignee's Share made or accrued to but not including the
Assignment Effective Date shall be for the account of the Assignor.
(b) Notwithstanding anything to the contrary contained in this Agreement,
if and when the Assignor receives or collects any payment of interest on any
Loan attributable to the Assignee's Share or any payment of the facility fee
attributable to the Assignee's Share which, in any such case, is required to be
paid to the Assignee pursuant to clause (a) above, the Assignor shall distribute
to the Assignee such payment but only to the extent such interest or facility
fee accrued on or after the Assignment Effective Date.
(c) Notwithstanding anything to the contrary contained in this Agreement,
if and when the Assignee receives or collects any payment of interest on any
Loan or any payment of the facility fee which, in any such case, is required to
be paid to the Assignor pursuant to this paragraph 4, the Assignee shall
distribute to the Assignor such payment.
5. Payments on Assignment, Effective Date. In consideration of the
assignment by the Assignor to the Assignee of the Assignee's Share, the Assignee
agrees to pay to the Assignor on or prior to the Assignment Effective Date an
amount specified by the Assignor in writing on or prior to the Assignment
Effective Date.
6. Effectiveness. The Assignment hereunder shall become effective on the
date (the "Assignment Effective Date") on which (i) the Assignor and the
Assignee shall have signed a copy hereof (whether the same or different copies)
and, in the case of the Assignee, shall have delivered the same to the Assignor,
(ii) the Assignee shall have paid to the Assignor the amount described in
paragraph 5 hereof, (iii) the Agent shall have signed a copy hereof, and (iv)
the Assignor shall have paid to the Agent an assignment fee as provided in the
Credit Agreement.
7. Issuance of New Notes on the Assignment Effective Date. On or after the
Assignment Effective Date, upon the request of the Assignor or the Assignee, a
new Note will be issued to the Assignor and/or the Assignee, as the case may be.
On the Assignment Effective Date, the Assignee shall be deemed a "Lender" for
all purposes under the Credit Agreement and the Related Documents, and shall be
subject to and shall benefit from all of the rights and obligations of a Lender
under the Credit Agreement and the Related Documents, and the address of the
Assignee for notice purposes shall be as set forth in Item 7 of Annex I hereto.
2
8. Representations and Warranties. (a) Each of the Assignor and the
Assignee represents and warrants to the other party that as of the date hereof:
(ii) it has full power and authority, and has taken all action necessary,
to execute and deliver this Agreement and to fulfill its obligations under, and
to consummate the transactions contemplated by, this Agreement;
(iii) the making and performance by it of this Agreement and all documents
required to be executed and delivered by it hereunder do not and will not
violate any law or regulation of the jurisdiction of its incorporation or any
other law or regulation applicable to it;
(iv) this Agreement has been duly executed and delivered by it and
constitutes its legal, valid and binding obligation; and
(v) all approvals, authorizations, or other actions by, or filings with,
any governmental authority necessary for the validity or enforceability of its
obligations under this Agreement have been obtained.
(d) The Assignor represents and warrants to the Assignee that the
Assignee's Share is subject to no Liens created by the Assignor.
9. Expenses. The Assignor and the Assignee agree that each party shall bear
its own expenses in connection with the preparation and execution of this
Agreement.
10. Miscellaneous.
(a) The Assignor shall not be responsible to the Assignee for the execution
(by any party other than the Assignor), effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of any of the Credit Agreement or
Related Documents or for any representations, warranties, recitals or statements
made therein or in any written or oral statement or in any financial or other
statements, instruments, reports, certificates or any other documents made or
furnished or made available by the Assignor to the Assignee or by or on behalf
of the Company to the Assignor or the Assignee in connection with the Credit
Agreement or Related Documents and the transactions contemplated thereby. The
Assignor shall not be required to ascertain or inquire as to the performance or
observance of any of the terms, conditions, provisions, covenants or agreements
contained in the Credit Agreement or any of the Related Documents or as to the
use of the proceeds of the Loans or as to the existence or possible existence of
any Default.
(b) The Assignee represents and warrants that it (i) has made its own
independent investigation, without reliance upon the Agent, the Assignor or any
other Lender, of the financial condition and affairs of the Company in
connection with this Agreement, the making of the Loans and the assignment of
the Assignee's Share hereunder to the Assignee and (ii) has made and shall
continue to make its own appraisal of the creditworthiness of the Company. The
Assignor shall have no duty or responsibility either initially or on a
continuing basis to make any such investigation or any such appraisal on behalf
of the Assignee or to provide the Assignee with any credit or other information
with respect thereto whether coming into its possession before the making of any
Loan or at any time or times thereafter and shall further have no responsibility
with respect to the accuracy of, or the completeness of, any information
provided to the Assignee, whether by the transferor or by or on behalf of any
other Person.
3
(c) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF ILLINOIS.
(d) No term or provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
all parties hereto.
(e) This Agreement may be executed in two or more counterparts, each of
which shall be an original but all of which, taken together, shall constitute
one and the same instrument.
(f) The Assignor may at any time or from time to time grant to others
assignments or participations in its Commitment or Loans but not in the portions
thereof sold as an assignment to the Assignee pursuant to this Agreement.
(g) All payments hereunder or in connection herewith shall be made in
Dollars and in immediately available funds, if payable to the Assignor, to the
account of the Assignor at its offices as designated in Item 8 of Annex I
hereto, and, if payable to the Assignee, to the account of the Assignee, as
designated in Item 8 of Annex I hereto.
(h) This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns. Neither of
the parties hereto may assign or transfer any of its rights or obligations under
this Agreement without the prior consent of the other party. The preceding
sentence shall not limit the right of the Assignee to assign all or part of the
Assignee's Share, if assigned in the manner contemplated by the Credit Agreement
and paragraph 3 hereof.
(i) All representations and warranties made herein and indemnities provided
for herein shall survive the consummation of the transactions contemplated
hereby.
(j) To the fullest extent they may effectively do so, the parties hereto
agree that any provision hereof which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity of enforceability of such provision
in any other jurisdiction.
4
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
--------------------------------------
as Assignor
By:
------------------------------------
Name:
Title:
Date:
--------------------------------------
as Assignee
By:
-------------------------------------
Name:
Title:
Date:
We hereby consent to the foregoing assignment and acknowledge receipt of notice
thereof:
LASALLE BANK NATIONAL ASSOCIATION,
as Agent
By:
------------------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
5
ANNEX I
to
Assignment and Assumption Agreement
1. Company: Vertrue Incorporated
2. Date of Credit Agreement: March 17, 2006
3. Assignor:
4. Assignee:
5. Date of Assignment and Assumption Agreement:
6. Assignee's Share:
(A) (B)
Outstanding
Commitment Principal
Amount of Loans
(a) Assignor's Amount $______________ $_____________
(b) Assignee's Commitment Percentage _____% ____%
(c) Assignee's Share $______________ $_____________
(d) Assignor's Commitment Percentage _____% ____%
7. Notice Instructions:
Assignee:
Attention:
Telephone:
Telecopier:
Reference:
Assignor:
Attention:
Telephone:
Telecopier:
Reference:
8. Payment Instructions:
Assignee:
Assignor:
Agent:
Accepted and Agreed:
-------------------------------, -------------------------------,
as Assignee as Assignor
By: By:
--------------------------------- ---------------------------------
Name: Name:
Title: Title:
2
