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EXHIBIT 10.8
SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
$230,000,000 REVOLVING CREDIT LOAN
AMONG
GROUP MAINTENANCE AMERICA CORP.,
AS THE COMPANY,
THE SUBSIDIARIES OF THE COMPANY,
AS GUARANTORS
AND
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
AS THE AGENT
BANK OF AMERICA TEXAS, N.A.,
AS CO-AGENT
AND
PARIBAS,
AS SYNDICATION AGENT
AND
ABN AMRO BANK, N.V.,
AS DOCUMENTATION AGENT
AND
THE BANKS NAMED HEREIN
DATED AS OF OCTOBER 15, 1998
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS; ACCOUNTING TERMS; INTERPRETATION ........................ 2
Section 1.01 Definitions .......................................................... 2
Section 1.02 Types of Advances .................................................... 16
Section 1.03 Accounting Terms ..................................................... 16
Section 1.04 Schedules ............................................................ 16
ARTICLE II THE LOANS ............................................................ 16
Section 2.01 The Loans ............................................................ 16
Section 2.02 The Notes ............................................................ 17
Section 2.03 Notice of Advance .................................................... 17
Section 2.04 Disbursement of Funds for Loans ...................................... 17
Section 2.05 Conversions and Continuances ......................................... 18
Section 2.06 Voluntary Prepayments ................................................ 18
Section 2.07 Mandatory Repayments ................................................. 18
Section 2.08 Method and Place of Payment .......................................... 19
Section 2.09 Pro Rata Advances .................................................... 19
Section 2.10 Interest ............................................................. 19
Section 2.11 Interest Periods ..................................................... 20
Section 2.12 Interest Rate Not Ascertainable ...................................... 21
Section 2.13 Legality ............................................................. 21
Section 2.14 Increased Costs, Taxes or Capital Adequacy Requirements .............. 22
Section 2.15 Eurodollar Advance Prepayment and Default Penalties .................. 23
Section 2.16 Additional Costs, Taxes or Similar Requirements ...................... 24
Section 2.17 Tax Forms ............................................................ 24
Section 2.18 Voluntary Reduction of Commitment .................................... 25
Section 2.19 Fees ................................................................. 25
Section 2.20 Extension of Maturity Date ........................................... 25
Section 2.21 Replacement of Banks ................................................. 26
ARTICLE III LETTERS OF CREDIT .................................................... 26
Section 3.01 Letters of Credit .................................................... 26
Section 3.02 Letters of Credit Requests ........................................... 27
Section 3.03 Letter of Credit Participations 28
Section 3.04 Increased Costs ...................................................... 29
Section 3.05 Conflict between Applications and Agreement .......................... 30
ARTICLE IV CONDITIONS PRECEDENT ................................................. 30
Section 4.01 Conditions Precedent to the Initial Advance .......................... 30
Section 4.02 Conditions Precedent to All Credit Events ............................ 32
Section 4.03 Delivery of Documents ................................................ 00
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XXXXXXX X XXXXXXXXXXXXXXX AND WARRANTIES ....................................... 33
Section 5.01 Organization and Qualification ....................................... 33
Section 5.02 Authorization and Validity ........................................... 33
Section 5.03 Governmental Consents ................................................ 33
Section 5.04 Conflicting or Adverse Agreements or Restrictions .................... 34
Section 5.05 Title to Assets ...................................................... 34
Section 5.06 Litigation ........................................................... 34
Section 5.07 Financial Statements ................................................. 34
Section 5.08 Default .............................................................. 35
Section 5.09 Investment Company Act ............................................... 35
Section 5.10 Public Utility Holding Company Act ................................... 35
Section 5.11 ERISA ................................................................ 35
Section 5.12 Tax Returns and Payments ............................................. 35
Section 5.13 Environmental Matters ................................................ 35
Section 5.14 Purpose of Loans ..................................................... 36
Section 5.15 Franchises and Other Rights .......................................... 36
Section 5.16 Subsidiaries and Assets .............................................. 36
Section 5.17 Solvency ............................................................. 37
Section 5.18 Year 2000 ............................................................ 37
ARTICLE VI AFFIRMATIVE COVENANTS ................................................ 37
Section 6.01 Information Covenants ................................................ 37
Section 6.02 Books, Records and Inspections ....................................... 39
Section 6.03 Insurance and Maintenance of Properties .............................. 40
Section 6.04 Payment of Taxes ..................................................... 40
Section 6.05 Corporate Existence .................................................. 40
Section 6.06 Compliance with Statutes ............................................. 40
Section 6.07 Material Privileges, Permits, Licenses and Other Rights .............. 41
Section 6.08 ERISA ................................................................ 41
Section 6.09 Additional Subsidiaries .............................................. 41
Section 6.10 Acquisition Agreements ............................................... 41
Section 6.11 Material Contracts ................................................... 42
Section 6.12 Employee Agreements .................................................. 42
ARTICLE VII NEGATIVE COVENANTS ................................................... 42
Section 7.01 Change in Business ................................................... 42
Section 7.02 Consolidation, Merger or Sale of Assets .............................. 42
Section 7.03 Indebtedness ......................................................... 43
Section 7.04 Liens ................................................................ 44
Section 7.05 Investments .......................................................... 45
Section 7.06 Restricted Payments .................................................. 45
Section 7.07 Change in Accounting ................................................. 46
Section 7.08 Certain Indebtedness ................................................. 46
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Section 7.09 Transactions with Affiliates ......................................... 46
Section 7.10 Consolidated Net Worth ............................................... 46
Section 7.11 Funded Debt to EBITDA Ratio .......................................... 46
Section 7.12 Senior Debt to EBITDA Ratio .......................................... 47
Section 7.13 Funded Debt to Capitalization Ratio .................................. 47
Section 7.14 Capital Expenditures ................................................. 47
Section 7.15 Fixed Charge Coverage Ratio .......................................... 47
Section 7.16 Limitations on Acquisitions .......................................... 47
Section 7.17 Subordinated Debt .................................................... 47
ARTICLE VIII GUARANY .............................................................. 48
Section 8.01 Guaranty ............................................................. 48
Section 8.02 Continuing Guaranty .................................................. 48
Section 8.03 Effect of Debtor Relief Laws ......................................... 49
Section 8.04 Waiver of Subrogation ................................................ 50
Section 8.05 Subordination ........................................................ 50
Section 8.06 Waiver ............................................................... 51
Section 8.07 Full Force and Effect ................................................ 51
Section 8.08 Negative Pledge ...................................................... 51
ARTICLE IX EVENTS DEFAULT AND REMEDIES .......................................... 52
Section 9.01 Events of Default .................................................... 52
Section 9.02 Primary Remedies ..................................................... 54
Section 9.03 Other Remedies ....................................................... 54
ARTICLE X THE AGENT ........................................................... 54
Section 10.01 Authorization and Action ............................................ 54
Section 10.02 Agent's Reliance .................................................... 55
Section 10.03 Agent and Affiliates; Chase and Affiliates .......................... 56
Section 10.04 Banks' Credit Decision .............................................. 56
Section 10.05 Agent's Indemnity ................................................... 56
Section 10.06 Successor Agent ..................................................... 57
Section 10.07 Notice of Default ................................................... 58
ARTICLE XI MISCELLANEOUS ....................................................... 58
Section 11.01 Amendments .......................................................... 58
Section 11.02 Notices ............................................................. 58
Section 11.03 No Waiver; Remedies ................................................. 60
Section 11.04 Costs and Expenses .................................................. 60
Section 11.05 Release and Indemnity ............................................... 60
Section 11.06 Right of Setoff ..................................................... 61
Section 11.07 Governing Law ....................................................... 61
Section 11.08 Interest ............................................................ 62
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Section 11.09 Survival of Representations and Warranties .......................... 62
Section 11.10 Successors and Assigns; Participations .............................. 63
Section 11.11 Confidentiality ..................................................... 64
Section 11.12 Pro Rata Treatment .................................................. 65
Section 11.13 Separability ........................................................ 65
Section 11.14 Execution in Counterparts ........................................... 65
Section 11.15 Interpretation ...................................................... 65
Section 11.16 Submission to Jurisdiction .......................................... 66
Section 11.17 Waiver of Jury Trial ................................................ 67
Section 11.18 Final Agreement of The Parties ...................................... 67
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Exhibits and Schedules:
-----------------------
Exhibit 1.01A Administrative Questionnaire
Exhibit 1.01B Form of Adoption Agreement
Exhibit 2.02 Form of Note
Exhibit 2.03 Form of Notice of Advance
Exhibit 2.05 Form of Notice of Conversion
Exhibit 2.20 Form of Extension Request
Exhibit 3.02 Form of Letter of Credit Request
Exhibit 4.01(d)(i) Form of Security Agreement
Exhibit 4.01(d)(ii) Form of Pledge Agreement
Exhibit 4.01(h)(i) Form of Opinion of Borrower's Counsel - Xxxxxxxxx & Xxxxxxxxx
Exhibit 4.01(h)(ii) Form of Opinion of Borrower's Counsel - Xxxxxxxx X. Xxxxxx
Exhibit 11.10(c) Form of Assignment and Acceptance
Schedule 5.04 Agreements
Schedule 5.06 Litigation
Schedule 5.13 Exceptions to Environmental Matters
Schedule 5.16 Subsidiaries
Schedule 6.03 Existing Insurance Policies
Schedule 6.11 Material Contracts
Schedule 7.03(b) Existing Indebtedness
Schedule 7.04(a) Existing Liens
Schedule 7.05(b) Investments
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
This SECOND AMENDED AND RESTATED CREDIT AGREEMENT dated as of
October 15, 1998 (this "Agreement") is among GROUP MAINTENANCE AMERICA CORP., a
Texas corporation (the "Company"), the Subsidiaries of the Company listed on the
signature pages hereto as Guarantors (together with each other Person who
subsequently becomes a Guarantor, collectively the "Guarantors"), the banks and
other financial institutions listed on the signature pages hereto under the
caption "Banks" (together with each other person who becomes a Bank,
collectively the "Banks"), BANK OF AMERICA TEXAS, N.A., individually as a Bank
and as co-agent, PARIBAS, individually as a Bank and as syndication agent, ABN
AMRO BANK, N.V., as a Bank and as documentation agent, and CHASE BANK OF TEXAS,
NATIONAL ASSOCIATION, individually as a Bank ("Chase") and as agent for the
other Banks (in such capacity together with any other Person who becomes the
agent, the "Agent").
The Company, the Agent (then known as Texas Commerce Bank National
Association) and the banks listed on the signature pages thereto entered into
that one certain Credit Agreement dated December 11, 1997 (as amended, the
"First Credit Agreement"), relating to the extension of a series of loans with a
commitment totaling $75,000,000.00 by said banks to the Company. In 1998, the
Company and certain of its subsidiaries, as guarantors, the Agent, the banks and
financial institutions listed on the signature pages thereto, ABN Amro Bank,
N.V. and Paribas, as co-agents agreed to amend and restate the First Credit
Agreement pursuant to the terms and conditions of the Amended and Restated
Credit Agreement dated June 12, 1998 (the "Amended and Restated Credit
Agreement" and, together with the First Credit Agreement, the "Prior Credit
Agreement"), relating to the extension of a series of loans with a commitment
totaling $125,000,000.00 by said banks to the Company. The Company has now
requested the Agent and the Banks to amend and restate the prior Credit
Agreement to increase the amount of credit that may be extended to Borrower to
$230,000,000.00. The Agent and the Banks have agreed to do so, subject to the
terms and conditions hereof and wish to execute this document for the purpose of
setting forth their amended and restated agreement in regard thereto.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants set forth herein, the Company, the Agent, the Guarantors, and the
Banks agree to amend and restate the Prior Credit Agreement as follows:
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ARTICLE I
DEFINITIONS; ACCOUNTING TERMS; INTERPRETATION
SECTION 1.01 Definitions . As used in this Agreement, the
following terms have the following meanings:
"Accounts" means all accounts, accounts receivable or other
indebtedness owing to the Company or any Guarantor as consideration for
goods sold or services rendered and billed within thirty (30) days of the
providing of such goods or services.
"Acquisition Agreements" has the meaning set forth in Section
6.10.
"Add-Back Adjustments" means, with respect to any Qualified
Company and for any specified period, those pro forma adjustments for
such period referred to in 17 CFR 210.11-02(b)(6).
"Administrative Questionnaire" means the questionnaire attached
hereto as Exhibit 1.01A to be completed by each Bank and returned to the
Agent.
"Adoption Agreement" means an agreement in the form of Exhibit
1.01B pursuant to which one or more Subsidiaries may become a party
hereto and to the relevant Security Documents from time to time.
"Advance" means an advance, pursuant to a Notice of Advance,
comprised of a single Type of Loan from all the Banks (or resulting from
a conversion or conversions on the same date having, in the case of
Eurodollar Rate Advances, the same Interest Period (except as otherwise
provided in this Agreement)), made by all of the Banks concurrently to
the Company.
"Advance Date" means, with respect to each Advance, the Business
Day upon which the proceeds of such Advance are to be made available to
the Company.
"Affiliate" means any other Person directly or indirectly
controlling (including all directors and officers of such Person),
controlled by, or under direct or indirect common control with such
Person, and any other Person in which such Person's direct or indirect
equity interest is 20% or more of the total outstanding equity interests
of such Person and any immediate family member (parent, spouse or child)
and all spouses of said Persons.
"Agent" has the meaning specified in the introduction to this
Agreement.
"Agreement" has the meaning specified in the introduction to this
Agreement.
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"Alternate Base Rate" means, for any day, a rate per annum
(adjusted, to the nearest 1/16 of 1%) equal to the greater of (a) the
Federal Funds Effective Rate in effect on such day plus 1/2 of 1% and (b)
the Prime Rate in effect on such day. For purposes hereof, the term
"Prime Rate" means, as of a particular date, the prime rate of Chase most
recently announced by Chase and in effect on such date, automatically
fluctuating upward or downward, as the case may be, with and at the time
of each change therein without notice to the Company or any other Person,
which prime rate may not necessarily represent the lowest or best rate
actually charged to a customer. "Federal Funds Effective Rate" means, for
any day, the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by
federal funds brokers, as published 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. If, for any reason, the
Agent shall have determined (which determination shall be conclusive
absent manifest error) that it is unable to ascertain the Federal Funds
Effective Rate, including the inability or failure of the Agent to obtain
sufficient quotations in accordance with the terms hereof, the Alternate
Base Rate shall be determined without regard to clause (a) of the first
sentence of this definition until the circumstances giving rise to such
inability no longer exist. Any change in the Alternate Base Rate due to a
change in the Prime Rate or the Federal Funds Effective Rate shall be
effective on the effective date of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.
"Alternate Base Rate Advance" means any Advance bearing interest
at a rate determined by reference to the Alternate Base Rate in
accordance with the provisions of Article II.
"Alternative Facility" means, as of any day, the short term,
uncommitted working capital loan facility of the Company with any Bank or
Affiliate thereof other than those, if any, provided for in the Loan
Documents.
"Alternative Facilities Advances" means, on any day, the aggregate
advances made by any of the Banks under an Alternative Facility which are
outstanding as of such day.
"Applicable Lending Office" means, with respect to each Bank, such
Bank's Domestic Lending Office in the case of an Alternate Base Rate
Advance and such Bank's Eurodollar Lending Office in the case of a
Eurodollar Rate Advance.
"Assignment and Acceptance" has the meaning specified in Section
11.10 (c).
"Bank" has the meaning provided in the introduction to this
Agreement.
"Bankruptcy Code" has the meaning specified in Section 9.01(e).
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"Board" means the Board of Governors of the Federal Reserve System
of the United States (or any successor).
"Business Day" means any day (other than a day which is a
Saturday, Sunday or legal holiday in the State of Texas) on which most
banks are open for business in Houston, Texas.
"Capital Expenditures" means, with respect to any Person for any
period, the sum of all expenditures (whether paid in cash, capitalized as
an asset or accrued as a liability) by such Person and its consolidated
Subsidiaries during such period which, in accordance with GAAP, are or
should be included in capital expenditures or similar items reflected in
the consolidated statement of cash flows of such Person; provided,
however, that Capital Expenditures shall not include any such amounts
incurred in connection with the Investment in a Qualified Company
permitted by Section 7.05.
"Capitalization Ratio" means, at any date of determination, the
ratio of (i) Funded Debt of the Company and its consolidated Subsidiaries
determined on a consolidated basis, to (ii) the sum of Funded Debt of the
Company and its consolidated Subsidiaries determined on a consolidated
basis plus Consolidated Net Worth.
"Capitalized Lease Obligations" means all lease or rental
obligations which, pursuant to GAAP, are capitalized for balance sheet
purposes.
"Change of Control" means either (i) any Unrelated Person, or two
or more Unrelated Persons acting in concert, acquire after the date
hereof beneficial ownership of 50% or more of the shares of voting stock
of the Company outstanding at the time of such acquisition, or (ii) all
or substantially all of the assets of the Company are sold after the date
hereof in a single transaction or series of related transactions to any
Persons, if the effect of such transaction or transactions is to change
the Persons controlling the Company. The term "Unrelated Person" shall
mean any Person other than a Related Person. A "Related Person" means (i)
any Plan or trust for any Plan, and (ii) any wholly-owned Subsidiary of
the Company. Any Person who is a party to any stockholders' agreement
shall not be considered to be acting in concert with any other party
thereto merely because such Person is a party thereto.
"Chase" means Chase Bank of Texas, National Association, a
national banking association.
"Code" means the Internal Revenue Code of 1986 and the regulations
promulgated thereunder.
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"Collateral" means all, or substantially all, of the accounts and
inventory of the Company and its domestic Subsidiaries, all as more fully
described in the Security Documents.
"Commitment" and "Commitments"means the obligation of each of the
Banks to enter into and perform this Agreement, to make available the
Loans to the Company in the amounts shown on the signature page of each
Bank hereto and all other duties and obligations of the Banks hereunder.
"Commitment Fee" has the meaning specified in Section 2.19.
"Company" has the meaning specified in the introduction to this
Agreement.
"Consolidated Net Worth" means, as at any date of determination,
all items which in conformity with GAAP would be included in the
calculation of shareholders' equity on a consolidated balance sheet of
the Company as at such date, plus any amounts included on such
consolidated balance sheet in respect of the Company's preferred stock,
provided the terms of such preferred stock have been approved by the
Majority Banks in their sole discretion.
"Conversion" or "Convert" (in each case whether or not
capitalized) means the changing of a Eurodollar Rate Advance to an
Alternate Base Rate Advance or vice versa in accordance with the
provisions hereof.
"Credit Event" means the making of any Advance or the conversion
of any Advance into a Eurodollar Rate Advance.
"Default" means the occurrence of any event which with or without
the giving of notice or the passage of time or both would become an Event
of Default.
"Default Rate" means the lesser of (i) the Highest Lawful Rate and
(ii) the Alternate Base Rate plus two percent (2%).
"Designated Payment Date" means February 28, May 31, August 31 and
November 30 of each year; provided, however, if a Designated Payment Date
shall be a day which is not a Business Day, such Designated Payment Date
shall be the next succeeding Business Day, and such extension of time
shall be included in determining the amount to be paid on such date.
"Domestic Lending Office" means, with respect to any Bank, the
office of such Bank designated from time to time as its "Domestic Lending
Office" hereunder.
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"EBITDA" means, for any period, and determined in accordance with
GAAP, the sum of:
(a) the consolidated pre tax income of the Company, plus the
aggregate amount which was deducted for such period in determining such
consolidated pre tax income for (i) interest expense, (ii) depreciation
expense, (iii) amortization expense, and (iv) compensation expense
relating to the issuance of stock and stock options to employees (to the
extent same do not constitute a use of cash); and
(b) for each acquisition of a Qualified Company acquired by the
Company during the twelve (12) months preceding the date as of which
EBITDA is calculated and with respect to the period beginning twelve (12)
months prior to the calculation of EBITDA through the date of said
acquisition by the Company, the sum of the consolidated pre-tax income of
such Qualified Company, plus: (A) the aggregate amount which was deducted
for such period in determining such consolidated pre-tax income for (i)
interest expense, (ii) depreciation expense, and (iii) amortization
expense, and (B) Add-Back Adjustments of such Qualified Company;
provided, said pre-acquisition EBITDA shall be included in EBITDA only to
the extent any such amount is not included in subparagraph (a) above.
"Effective Date" means the date on which all conditions to make an
Advance set forth in Section 4.01 are first met or waived in accordance
with Section 11.01 hereof.
"Eligible Assignee" means (a) any Bank; (b) a commercial bank
organized under the laws of the United States, or any state thereof, and
having total assets in excess of $1,000,000,000.00; (c) a commercial bank
organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development or any successor
organization, or a political subdivision of any such country, and having
total assets in excess of $1,000,000,000.00; provided that such bank is
acting through a branch or agency located in the country in which it is
organized or another country which is also a member of the Organization
for Economic Cooperation and Development or any successor organization;
(d) the central bank of any country which is a member of the Organization
for Economic Cooperation and Development or any successor organization;
and (e) any other bank or similar financial institution approved by the
Agent.
"Employee Agreements" has the meaning set forth in Section 6.12.
"Environmental Laws" means federal, state or local laws, rules or
regulations, and any judicial, arbitral or administrative interpretations
thereof, including any judicial, arbitral or administrative order,
judgment, permit, approval, decision or determination pertaining to
conservation or protection of the environment as in effect and
enforceable against the Company or any of its Subsidiaries at the time in
question, including the Clean Air Act, the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA"), the Federal Water
Pollution Control Act, the Occupational Safety and Health Act, the
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Resource Conservation and Recovery Act, the Safe Drinking Water Act, the
Toxic Substances Control Act, the Superfund Amendment and Reauthorization
Act of 1986, the Hazardous Materials Transportation Act, and comparable
state and local laws, and other environmental conservation and protection
laws.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated thereunder.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) which is either a member of the same "controlled group" or
under "common control," within the meaning of Section 414 of the Code and
the regulations thereunder, with the Company.
"Eurocurrency Liabilities" has the meaning specified in Regulation
D as in effect from time to time.
"Eurodollar Lending Office" means, with respect to each Bank, the
branches or affiliates of such Bank designated as its "Eurodollar Lending
Office" from time to time hereunder.
"Eurodollar Rate" means, with respect to any Eurodollar Rate
Advance, the rate (rounded to the nearest whole multiple of 1/16 of 1%)
at which dollar deposits approximately equal in principal amount to the
entire portion of such Advance and for a maturity equal to the applicable
Interest Period are offered in immediately available funds to the Agent
by prime banks in whatever Eurodollar interbank market may be selected by
the Agent in its sole and absolute discretion at the time of
determination and in accordance with the then usual practice in such
market at approximately 10:00 a.m. (Houston, Texas time) two Business
Days prior to the commencement of such Interest Period.
"Eurodollar Rate Advance" means any Advance bearing interest at a
rate determined by reference to the Eurodollar Rate in accordance with
the provisions of Article II.
"Events of Default" has the meaning specified in Section 9.01.
"Execution Date" means October 13, 1998.
"Existing Letters of Credit" means all letters of credit issued by
Chase, outstanding on the Effective Date and described in Section
3.01(c).
"Extension Request" means each request by the Company made
pursuant to Section 2.20 for the Banks to extend the Maturity Date.
"Federal Funds Effective Rate" has the meaning specified in the
definition of the term "Alternate Base Rate."
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"Fees" has the meaning specified in Section 2.19.
"Financials" has the meaning specified in Section 5.07.
"Funded Debt" means all indebtedness for borrowed money (including
Capitalized Lease Obligations) evidenced by a written document and
subject to periodic, required payments of interest and/or principal.
"GAAP" means generally accepted accounting principles as in effect
from time to time in the United States as set forth in the opinions,
statements and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, the Financial
Accounting Standards Board and such other Persons who shall be approved
by a significant segment of the accounting profession and concurred in by
the independent certified public accountants certifying any audited
financial statements of the Company.
"Guaranteed Obligations" has the meaning specified in Section
8.01.
"Guarantors" has the meaning provided in the introduction to this
Agreement and, except as otherwise agreed by the Majority Banks and the
Company, shall include all of the Subsidiaries of the Company.
"Guaranty" means the obligations contained in Article VIII hereof.
"Hazardous Materials" means (a) hazardous waste as defined in the
Resource Conservation and Recovery Act of 1976, or in any applicable
federal, state or local law or regulation, (b) hazardous substances, as
defined in CERCLA, or in any applicable state or local law or regulation,
(c) gasoline, or any other petroleum product or by-product, (d) toxic
substances, as defined in the Toxic Substances Control Act of 1976, or in
any applicable federal, state or local law or regulation or (e)
insecticides, fungicides, or rodenticides, as defined in the Federal
Insecticide, Fungicide, and Rodenticide Act of 1975, or in any applicable
federal, state or local law or regulation, as each such Act, statute or
regulation may be amended from time to time.
"Highest Lawful Rate" means, as to any Bank, the maximum
nonusurious rate of interest that, under applicable law, may be
contracted for, taken, reserved, charged or received by such Bank on the
Loans or under the Loan Documents at any time or from time to time. If
the maximum rate of interest which, under applicable law, any of the
Banks are permitted to charge the Company on the Loans shall change after
the date hereof, to the extent permitted by applicable law, the Highest
Lawful Rate shall be automatically increased or decreased, as the case
may be, as of the effective time of such change without notice to the
Company or any other Person.
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"Indebtedness" means, without duplication, (a) all indebtedness
for borrowed money (whether by loan or the issuance and sale of debt
securities) or for the deferred purchase price of property or services,
(b) all indebtedness evidenced by bonds, debentures, notes or other
similar instruments, (c) all Capitalized Lease Obligations, (d) all
obligations to reimburse the issuer of any Letter of Credit for amounts
drawn or drawable, and (e) all other items that would be classified as a
liability on the Company's balance sheet pursuant to GAAP.
"Interest Period" has the meaning specified in Section 2.11.
"Issuing Bank" means Chase, in its capacity as a Bank, or such
other Bank to which the Company and the Majority Banks subsequently
agree.
"Investment" means, as applied to any Person, any direct or
indirect purchase or other acquisition by such Person of the assets,
stock or other securities of any other Person, or any direct or indirect
loan, advance or capital contribution by such Person to any other Person,
and any other item which would be classified as an "investment" on a
balance sheet of such Person, including any direct or indirect
contribution by such Person of property or assets to a joint venture,
partnership or other business entity in which such Person retains an
interest but shall not include demand deposits.
"Letter of Credit Fee" has the meaning specified in Section
2.19(c).
"Letter of Credit Request" has the meaning specified in Section
3.02(a).
"Letters of Credit" has the meaning specified in Section 3.01(a).
"Lien" means, when used with respect to any Person, any mortgage,
lien, charge, pledge, security interest or encumbrance of any kind
(whether voluntary or involuntary and whether imposed or created by
operation of law or otherwise) upon, or pledge of, any of its property or
assets, whether now owned or hereafter acquired, any capital lease in the
nature of the foregoing, any conditional sale agreement or other title
retention agreement, in each case, for the purpose, or having the effect,
of protecting a creditor against loss or securing the payment or
performance of an obligation.
"Loan" and "Loans" has the meaning set forth in Section 2.01.
"Loan Documents" means this Agreement, the Notes, the Security
Documents, the Notice of Advance, and the corporate resolutions
authorizing the Loan Documents.
"Majority Banks" means Banks holding at least 66b % of the
Advances outstanding under the Loans, or, if no Advances are outstanding,
Banks holding such percentage of the Total Commitment.
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16
"Margin" means, (a) at any time of determination prior to a Public
Debt Issuance Event, with respect to Alternate Base Rate Advances,
Eurodollar Rate Advances, or Commitment Fees, as applicable, the
percentage determined in accordance with the following table:
-------------------------------------------------------------------------------------------------
Equal to Equal to Equal to Equal to
or less than or less than or less than or less than
2.75 to 1.00 2.25 to 1.00 2.00 to 1.00 1.50 to 1.00
and and and and Equal to
Funded Debt/ greater than greater than greater than greater than or less than
EBITDA Ratio 2.25 to 1.00 2.00 to 1.00 1.50 to 1.00 1.00 to 1.00 1.00 to 1.00
=================================================================================================
Alternate Base Rate
Margin .50% .25% 0% 0% 0%
-------------------------------------------------------------------------------------------------
Eurodollar Margin 2.00% 1.75% 1.50% 1.25% 1.00%
=================================================================================================
Commitment Fee .375% .375% .375% .25% .25%
-------------------------------------------------------------------------------------------------
and (b) at any time of determination on or after a Public Debt Issuance Event,
with respect to Alternate Base Rate Advances, Eurodollar Rate Advances, or
Commitment Fees, as applicable, the percentage determined in accordance with the
following table:
---------------------------------------------------------------------------------------------------
Equal to Equal to Equal to Equal to Equal to or
or less than or less than or less than or less than Less than
4.00 to 1.00 3.50 to 1.00 2.75 to 1.00 2.00 to 1.00 1.50 to 1.00
and and and and
Funded Debt/ greater than greater than greater than greater than
EBITDA Ratio 3.50 to 1.00 2.75 to 1.00 2.00 to 1.00 1.50 to 1.00
===================================================================================================
Alternate Base Rate
Margin .50% .25% 0% 0% 0%
Eurodollar Margin 2.00% 1.75% 1.50% 1.25% 1.00%
---------------------------------------------------------------------------------------------------
Commitment Fee .375% .375% .375% .25% .25%
===================================================================================================
If sufficient information does not exist to calculate the
applicable Margin, Eurodollar Rate Advances shall not be available to the
Company and the applicable Margin for Alternate Base Rate Advances shall
be deemed to be .50%.
"Margin Period" means a period commencing three (3) days after the
date on which the quarterly or annual financial statements of the Company
are required to be delivered pursuant to Section 6.01(a) or Section
6.01(b), as the case may be, and ending three (3) days after the next
date a financial statement is required to be so delivered.
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Material Adverse Effect" means, relative to any occurrence of
whatever nature (including any adverse determination in any litigation,
arbitration or governmental investigation or proceeding), (a) a material
adverse effect on the financial condition, business or operations of the
Company and its Subsidiaries taken as a whole or (b) a material
impairment of the collective ability of the Company and its Subsidiaries
taken as a whole to make payment hereunder or under any Note or the right
of any Bank to enforce any of its remedies to collect any amounts owing
under the Loan Documents.
"Material Contract" means the Contracts listed on Schedule 6.11,
as amended from time to time.
"Maturity Date" means October 13, 2001, unless accelerated
pursuant to Article IX hereof.
"Maximum Guaranteed Amount" means for each Guarantor the maximum
amount which any Guarantor could pay under the Guaranty without having
such payment set aside as a fraudulent transfer or conveyance or similar
action under the Bankruptcy Code or any applicable state or foreign law.
"Multiemployer Plan" means any plan that is a "multiemployer plan"
(as such term is defined in Section 4001(a)(3) of ERISA).
"Note" and "Notes" have the meanings specified in Section 2.02.
"Notice of Advance" has the meaning provided in Section 2.03(a).
"Notice of Conversion" has the meaning provided in Section 2.05.
"Notice of Default" has the meaning specified in Section 9.02.
"Obligations" means all the obligations of the Company now or
hereafter existing under the Loan Documents, whether for principal,
interest, Fees, expenses, indemnification or otherwise.
"Other Activities" has the meaning specified in Section 10.03.
"Other Financings" has the meaning specified in Section 10.03.
"Payment Office" means the office of the Agent located at 0000
Xxxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000, or such other office as the Agent
may hereafter designate in writing as such to the other parties hereto.
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"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to all or a substantial portion of its functions under
ERISA.
"Permitted Investments" means, as to any Person:
(a) securities issued or directly and fully guaranteed or
insured by the United States or any agency or instrumentality
thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not
more than twelve months from the date of acquisition thereof,
(b) time deposits and certificates of deposit with
maturities of not more than twelve months from the date of
acquisition by such Person which deposits or certificates are
either: (a) fully insured by the Federal Deposit Insurance
Corporation or (b) in any Bank or other commercial bank
incorporated in the United States or any U.S. branch of any other
commercial bank, in each case having capital, surplus and
undivided profits aggregating $100,000,000.00 or more with a
long-term unsecured debt rating of at least A- from Standard &
Poor's Ratings Group or A3 from Xxxxx'x Investors Service,
(c) commercial paper issued by any Person incorporated in
the United States rated at least A2 or the equivalent thereof by
Standard & Poor's Ratings Group or at least P2 or the equivalent
thereof by Xxxxx'x Investors Service and, in each case, maturing
not more than 270 days after the date of issuance,
(d) investments in money market mutual funds having assets
in excess of $2,000,000,000.00 substantially all of whose assets
are comprised of securities of the types described in clauses (a)
through (c) above, and
(e) repurchase or reverse purchase agreements respecting
obligations with a term of not more than seven days for underlying
securities of the types described in clause (a) above entered into
with any bank listed in or meeting the qualifications specified in
clause (b) above.
"Permitted Liens" means, as to any Person:
(a) Liens for taxes, assessments, levies or other
governmental charges not yet due or which are being contested in
good faith by appropriate proceedings and for which adequate
reserves are maintained in accordance with GAAP;
(b) Liens in connection with worker's compensation,
unemployment insurance or other social security, old age pension
or public liability obligations not yet due or which are being
contested in good faith by appropriate proceedings and for which
adequate reserves are maintained in accordance with GAAP;
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(c) operator's, vendors', carriers', warehousemen's,
repairmen's, mechanics', workers', materialmen's or other like
Liens arising by operation of law in the ordinary course of
business (or deposits to obtain the release of any such Lien) and
securing amounts of $100,000.00 or less or amounts not yet due or
which are being contested in good faith by appropriate proceedings
and for which adequate reserves are maintained in accordance with
GAAP;
(d) deposits to secure insurance or adequate self insurance
arrangements in the ordinary course of business;
(e) deposits and other Liens to secure the performance of
bids, tenders, contracts (other than contracts for the payment of
indebtedness for borrowed money or the deferred purchase price of
goods or services), leases, licenses, franchises, trade contracts,
statutory obligations, surety and appeal bonds and performance
bonds and other obligations of a like nature incurred in the
ordinary course of business;
(f) easements, rights of way, covenants, restrictions,
reservations, exceptions, encroachments, zoning and similar
restrictions and other similar encumbrances (other than to secure
the payment of indebtedness for borrowed money or the deferred
purchase price of goods or services) or title defects, in each
case incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any
case singly or in the aggregate materially detract from the value
or usefulness of the Property subject thereto for the business
conducted by the Company and its Subsidiaries or materially
interfere with the ordinary conduct of the business of the Company
and its Subsidiaries;
(g) bankers' liens arising by operation of law;
(h) inchoate Liens arising under ERISA to secure contingent
liabilities of the Company and its Subsidiaries;
(i) landlord's liens that are subordinated to the Liens in
favor of the Agent, unless waived by the Agent;
(j) Liens on assets of Subsidiaries to secure indebtedness
to the Company provided same are collaterally assigned to the
Agent, provided, such Liens may be incurred only to the extent the
underlying Indebtedness is otherwise permitted under the terms of
this Agreement;
(k) Liens on the right to rebates of prepaid insurance
premiums financed by third parties on behalf of the Company or any
of its Subsidiaries to secure up to $1,000,000.00 outstanding at
any time;
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(l) judgment Liens that do not constitute an Event of
Default; and
(m) Liens permitted under Section 7.04 (excluding
subsection (c) thereof).
"Person" means an individual, partnership, corporation (including
a business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a foreign
or domestic state or political subdivision thereof or any agency of such
state or subdivision.
"Plan" means any employee pension benefit plan (as defined in
Section 3(2) of ERISA), subject to Title IV of ERISA or Section 412 of
the Code, other than a Multiemployer Plan, with respect to which the
Company or an ERISA Affiliate contributes or has an obligation or
liability to contribute, including any such plan that may have been
terminated.
"Pledge Agreement" has the meaning specified in Section
4.01(d)(ii).
"Prescribed Forms" shall mean such duly executed form(s) or
statement(s), and in such number of copies, which may, from time to time,
be prescribed by law and which, pursuant to applicable provisions of the
Code or an income tax treaty between the United States and the country of
residence of the party providing the form(s) or statement(s), permit each
of the Company and the Agent to make payments hereunder for the account
of such party free of deduction or withholding of income and other taxes.
"Prior Credit Agreement" has the meaning specified in the
Introduction hereto on page one.
"Property" or "assets" (whether or not capitalized) means any
interest in any kind of property or asset, whether real, personal or
mixed, or tangible or intangible.
"Public Debt Issuance Event" means, the issuance by the Company of
Subordinated Debentures, which event shall be deemed to have occurred on
the date of such issuance.
"Qualified Company" means any Person in the residential or
commercial/industrial service industry whose primary business is to
provide residential or commercial/industrial services, consisting of
heating, ventilation and air conditioning, mechanical, indoor air
quality, plumbing, process piping, appliance, electrical, installation,
reinstallation and maintenance services.
"Regulations A, D, T, U and X" means Regulations A, D, T, U and X
of the Board as the same are from time to time in effect, and all
official rulings and interpretations thereunder or thereof.
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"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or
disposing into the environment (including the abandonment or discarding
of barrels, containers and other closed receptacles).
"Reportable Event" means an event described in Section 4043(b) of
ERISA with respect to a Plan as to which the 30-day notice requirement
has not been waived by the PBGC.
"Requirements of Environmental Laws" means, as to any Person, the
requirements of any applicable Environmental Law relating to or affecting
such Person or the condition or operation of such Person's business or
its properties, both real and personal.
"Reserve Percentage" means, for any Interest Period and for any
Bank, the reserve percentage applicable during such Interest Period under
regulations issued from time to time by the Board (or if more than one
such percentage is so applicable, the daily average for such percentages
for those days in such Interest Period during which any such percentage
shall be so applicable) for determining the maximum reserve requirement
(including any marginal, supplemental or emergency reserves) for such
Bank in respect of liabilities or assets consisting of or including
Eurocurrency Liabilities.
"Responsible Officer" means, with respect to the Company, the
president, chief executive officer, chief operating officer, treasurer or
chief financial officer of the Company.
"Security Agreement" has the meaning specified in Section
4.01(d)(i).
"Security Documents" means the documents described in Section
4.01(d) of this Agreement executed by the Company and its Subsidiaries in
favor of Chase, as Agent, for the benefit of the Banks, pursuant to the
terms hereof.
"Senior Debt" means Funded Debt other than Subordinated Debentures
and Subordinated Shareholder Debt.
"Subordinated Debentures" means subordinated debentures issued by
the Company, with a scheduled final maturity of such principal of no
sooner than the Maturity Date and containing terms and provisions
satisfactory to the Majority Banks in their sole discretion.
"Subordinated Shareholder Debt" means any Indebtedness of the
Company and its Subsidiaries, subordinated in each instance to the
satisfaction of the Agent, owing to any seller of any Qualified Company
and incurred in connection with the acquisition of such Qualified
Company.
"Subsidiary" means, with respect to any Person, (a) any
corporation more than 50% of whose stock of any class or classes having
by the terms thereof ordinary voting power to
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elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such
corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person,
directly or indirectly, and (b) any partnership, association, joint
venture or other entity in which such Person, directly or indirectly, has
greater than 50% of the equity interest. Unless otherwise provided or the
context otherwise requires, the term "Subsidiary" or "Subsidiaries" shall
mean a Subsidiary or Subsidiaries of the Company.
"Total Commitment" means the aggregate Commitments of all Banks
totaling a maximum of $230,000,000.00 for all Banks.
"Unrelated Person" means any Person who is not a Related Person.
"Unutilized Commitment" means the Total Commitment less the sum of
outstanding Advances and all issued and outstanding Letters of Credit.
SECTION 1.02 Types of Advances. Advances and Loans hereunder are
distinguished by "Type". The Type of an Advance refers to the determination
whether such Advance is a Eurodollar Rate Advance or an Alternate Base Rate
Advance.
SECTION 1.03 Accounting Terms. All accounting terms not defined
herein shall be construed in accordance with GAAP, as applicable, and all
calculations required to be made hereunder and all financial information
required to be provided hereunder shall be done or prepared in accordance with
GAAP.
SECTION 1.04 Schedules. Schedules hereto may be updated by the
Company from time to time to reflect transactions and other matters not
prohibited by the Loan Documents.
ARTICLE II
THE LOANS
SECTION 2.01 The Loans. Subject to the terms and conditions
hereof, each Bank severally agrees at any time and from time to time on and
after the Execution Date and prior to the Maturity Date, to make and maintain a
revolving credit loan or loans (each a "Loan" and collectively, the "Loans") to
the Company not to exceed at any time outstanding the maximum amount of its
Commitment, which Loans (i) shall, at the option of the Company, be made and
maintained pursuant to one or more Advances comprised of Alternate Base Rate
Advances or Eurodollar Rate Advances, provided that, except as otherwise
specifically provided herein, all Advances made pursuant to a single Notice of
Advance shall be of the same Type, (ii) in the case of Eurodollar Rate Advances,
shall be made in the minimum amount of $1,000,000.00 and integral multiples of
$100,000.00 and, in the case of Alternate Base Rate Advances, in the minimum
amount of $300,000.00 and integral multiples of $100,000.00, or, in either case,
the amount of the Unutilized
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Commitment, (iii) may be repaid and, so long as no Default or Event of Default
exists hereunder, reborrowed, at the option of the Company in accordance with
the provisions hereof, and (iv) shall, in the aggregate at any time outstanding,
not exceed the maximum total amount of the Commitments. There shall be no
further Advances after the Maturity Date.
SECTION 2.02 The Notes. The Loans shall be evidenced by Notes in
favor of each Bank (individually a "Note" and collectively, the "Notes"),
substantially in the form of: Exhibit 2.02 hereto.
SECTION 2.03 Notice of Advance. Whenever the Company desires an
Advance, it shall give written notice thereof (a "Notice of Advance") (or
telephonic notice promptly confirmed in writing) to the Agent in the case of an
Alternate Base Rate Advance, not later than 10:00 a.m. (Houston, Texas time) on
the date of such Advance and in the case of a Eurodollar Rate Advance, not later
than 11:00 a.m. (Houston, Texas time) three Business Days prior to the date of
such Advance. Each Notice of Advance shall be irrevocable and shall be in the
form of Exhibit 2.03 hereto, specifying (i) the aggregate principal amount of
the Advance to be made, (ii) the date of such Advance (which shall be a Business
Day), (iii) the Type of Advance, and (iv) if the proposed Advance is to be a
Eurodollar Rate Advance, the initial Interest Period to be applicable thereto.
The Agent shall promptly give the Banks written notice or
telephonic notice (promptly confirmed in writing) of each proposed Advance, of
each Bank's proportionate share thereof and of the other matters covered by each
Notice of Advance.
SECTION 2.04 Disbursement of Funds for Loans. No later than 1:00
p.m. (Houston, Texas time) on any Advance Date for Loans, each Bank shall make
available its pro rata portion of the amount of such Advance in U.S. dollars and
in immediately available funds at the Payment Office. At such time, the Agent
shall credit the amounts so received to the general deposit account of the
Company maintained with the Agent in immediately available funds.
Unless the Agent shall have been notified by any Bank prior to
disbursement of the Advance by the Agent that such Bank does not intend to make
available to the Agent such Bank's portion of the Advance to be made on such
date, the Agent may assume that such Bank has made such amount available to the
Agent on such Advance Date and the Agent may, in reliance upon such assumption,
make available to the Company a corresponding amount. If such corresponding
amount is not in fact made available to the Agent by such Bank and the Agent has
made available same to the Company, the Agent shall be entitled to recover such
corresponding amount on demand from such Bank. If such Bank does not pay such
corresponding amount forthwith upon the Agent's demand therefor, the Agent shall
promptly notify the Company, and the Company shall pay such corresponding amount
to the Agent within two (2) Business Days after demand therefor. The Agent shall
also be entitled to recover from such Bank or the Company, as the case may be,
interest on such corresponding amount from the date such corresponding amount
was made available by the Agent to the Company to the date such corresponding
amount is recovered by the Agent, at a rate per annum equal to the Alternate
Base Rate or the Eurodollar Rate plus the applicable Margin, as
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appropriate. Nothing herein shall be deemed to relieve any Bank from its
obligation to fulfill its Commitments hereunder or to prejudice any rights which
the Company may have against any Bank as a result of any default by such Bank
hereunder. No failure of any Bank hereunder shall relieve any other Bank of its
obligations.
SECTION 2.05 Conversions and Continuances. The Company shall have
the option to convert or continue on any Business Day all or a portion of the
outstanding principal amount of one Type of Advance into another Type of
Advance, provided, no Advances may be converted into or continued as Eurodollar
Rate Advances if a Default or Event of Default is in existence on the date of
the conversion. Any continuation of an Advance as the same Type of Advance in
the same amount shall be effected by the Company giving notice to the Agent, in
writing, or by telephone promptly confirmed in writing, of its intention to
continue such Advance as an Advance of the same Type. Each such conversion shall
be effected by the Company giving the Agent written notice (each a "Notice of
Conversion"), substantially in the form of Exhibit 2.05 hereto, prior to 11:00
a.m. (Houston, Texas time) at least (a) three (3) Business Days prior to the
date of such conversion in the case of conversion into or continuance as
Eurodollar Rate Advances and (b) prior to 10:00 a.m. (Houston, Texas time) one
Business Day prior to the date of conversion in the case of a conversion into
Alternate Base Rate Advances, specifying each Advance (or portions thereof) to
be so converted and, if to be converted into or continued as Eurodollar Rate
Advances, the Interest Period to be initially applicable thereto. The Agent
shall thereafter promptly notify each Bank of such Notice of Conversion.
SECTION 2.06 Voluntary Prepayments. The Company shall have the
right to voluntarily prepay the Loans in whole or in part at any time on the
following terms and conditions: no Eurodollar Rate Advance may be prepaid prior
to the last day of its Interest Period unless, simultaneously therewith, the
Company pays to the Agent for the benefit of the Banks all sums necessary to
compensate the Banks for all reasonable costs and expenses actually incurred by
the Banks as a result of such prepayment (excluding loss of anticipated
profits), as reasonably determined by the Banks, including but not limited to
those costs described in Section 2.15 hereof; and each prepayment pursuant to
this section shall be applied first, to the payment of accrued and unpaid
interest, and then, to the outstanding principal, pro-rata.
SECTION 2.07 Mandatory Repayments. The Company shall repay Loans
on any day on which the aggregate outstanding principal amount of the Loans plus
the amount of all outstanding Alternative Facilities Advances exceeds the Total
Commitment in the amount of such excess. The aggregate amount under the Notes
(and all accrued, unpaid interest) shall be due and payable, and the Total
Commitment shall terminate, on the Maturity Date.
SECTION 2.08 Method and Place of Payment. Except as otherwise
specifically provided herein, all payments under this Agreement due from the
Company shall be made to the Agent for the benefit of the Banks not later than
1:00 p.m. (Houston, Texas time) on the date when due and shall be made in lawful
money of the United States in immediately available funds at the Payment Office.
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SECTION 2.09 Pro Rata Advances. All Advances under this Agreement
shall be incurred from the Banks pro rata, on the basis of their respective
Commitments. It is understood that no Bank shall be responsible for any default
by any other Bank in its obligation to make Loans hereunder and that each Bank
shall be obligated to make the Loans provided to be made by it hereunder,
regardless of the failure of any other Bank to fulfill its commitments
hereunder.
SECTION 2.10 Interest. (a) Subject to Section 11.08, the Company
shall pay interest on the total outstanding principal balance of all Alternate
Base Rate Advances from the date of each respective Advance to maturity of said
Loan (whether by acceleration or otherwise) at a rate per annum which shall at
all times be equal to the lesser of (i) the Highest Lawful Rate and (ii) the
Alternate Base Rate in effect from time to time plus the applicable Margin for
Alternate Base Rate Advances, which applicable Margin shall be adjusted on the
first day of each Margin Period. If the Alternate Base Rate is based on the
Prime Rate, interest shall be computed on the basis of the actual number of days
elapsed over a year of 365 or 366 days, as the case may be. If the Alternate
Base Rate is based on the Federal Funds Effective Rate, interest shall be
computed on the basis of the actual number of days elapsed over a year of 360
days.
(b) Subject to Section 11.08, the Company shall pay interest on
the total outstanding principal balance of all Eurodollar Rate Advances under
all of the Loans from the date of each respective Advance to maturity of said
Loan (whether by acceleration or otherwise) at a rate per annum (computed on the
basis of the actual number of days elapsed over a year of 360 days) which shall,
during each Interest Period applicable thereto, be equal to the lesser of (i)
the Highest Lawful Rate and (ii) the applicable Eurodollar Rate for such
Interest Period plus the applicable Margin for Eurodollar Rate Advances. The
applicable Eurodollar Rate shall be fixed for each Interest Period and shall not
change during said Interest Period nor shall the applicable Margin, which is
added to said Eurodollar Rate to determine the total interest payable to the
Banks, be adjusted until the first day of each Interest Period that begins after
the effective date of the new Margin Period.
(c) Subject to Section 11.08, overdue principal and, to the extent
permitted by law, overdue interest in respect of any Advance and all other
overdue amounts owing hereunder shall bear interest for each day that such
amounts are overdue at a rate per annum equal to the Default Rate.
(d) Interest on each Advance shall accrue from and including the
date of such Advance to but excluding the date of any repayment thereof and
shall be payable in arrears (i) in respect of Eurodollar Rate Advances (A) on
the last day of the Interest Period (as defined below) applicable thereto and on
each Designated Payment Date during any Interest Period in excess of three (3)
months and (B) on the date of any voluntary or mandatory repayment or any
conversion or continuance, (ii) in respect of Alternate Base Rate Advances (A)
on each Designated Payment Date commencing November 30, 1997, and (B) on the
date of any voluntary or mandatory repayment of such Advances on the principal
amount repaid and (iii) in respect of each Advance, at maturity (whether by
acceleration or otherwise) and, after maturity, on demand.
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(e) The Agent, upon determining the Eurodollar Rate for any
Interest Period, shall notify the Company thereof. Each such determination
shall, absent manifest error, be final and conclusive and binding on all parties
hereto. In addition, prior to the due date for the payment of interest on any
Advances set forth in the immediately preceding paragraph, the Agent shall
notify the Company of the amount of interest due by the Company on all
outstanding Advances on the applicable due date, but any failure of the Agent to
so notify the Company shall not reduce the Company's liability for the amount
owed.
(f) So long as any Bank shall be required under regulations of the
Board to maintain reserves with respect to liabilities or assets consisting of
or including Eurocurrency Liabilities and, as a result, the cost to such Bank is
increased above the level it would be but for such requirement, then such Bank
may require the Company to pay to the Agent, for the account of such Bank,
additional interest on the unpaid principal amount of each such Eurodollar Rate
Advance, from the date of such Advance until such principal amount is paid in
full, at an interest rate per annum equal at all times during the Interest
Period for such Advance to the lesser of (i) the Highest Lawful Rate and (ii)
the remainder obtained by subtracting (A) the Eurodollar Rate for such Interest
Period from (B) the rate obtained by dividing such Eurodollar Rate referred to
in clause (A) above by that percentage equal to 100% minus the Reserve
Percentage of such Bank for such Interest Period. Such additional interest shall
be determined by such Bank as incurred and shall be payable upon demand therefor
by the Bank to the Company. Each determination by such Bank of additional
interest due under this Section shall be conclusive and binding for all purposes
in the absence of manifest error if such determination is made on a reasonable
basis.
SECTION 2.11 Interest Periods. (a) At the time the Company gives
any Notice of Advance or Notice of Conversion or provides notice of its intent
to continue a loan as the same Type in respect of the making of, or conversion
into, a Eurodollar Rate Advance, the Company shall have the right to elect, by
giving the Agent on the dates and at the times specified in Section 2.03 or
Section 2.05, as the case may be, notice of the interest period (each an
"Interest Period") applicable to such Eurodollar Rate Advance, which Interest
Period shall be either a one, two, three or six month period; provided, that:
(i) the initial Interest Period for any Eurodollar Rate Advance
shall commence on the date of such Eurodollar Rate Advance (including the
date of any conversion thereto or continuance thereof pursuant to Section
2.05); each Interest Period occurring thereafter in respect of such
Eurodollar Rate Advance shall commence on the expiration date of the
immediately preceding Interest Period;
(ii) if any Interest Period relating to a Eurodollar Rate Advance
begins on a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period, such Interest
Period shall end on the last Business Day of such calendar month;
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(iii) if any Interest Period would otherwise expire on a day which
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided, that if there are no more Business
Days in that month, the Interest Period shall expire on the preceding
Business Day;
(iv) no Interest Period for Advances shall extend beyond the
applicable Maturity Date; and
(v) the Company shall be entitled to have a maximum of nine (9)
separate Eurodollar Rate Advances hereunder for all Loans outstanding at
any one time.
(b) If, upon the expiration of any Interest Period applicable to a
Eurodollar Rate Advance, the Company has failed to elect a new Interest Period
to be applicable to such Advance as provided above, the Company shall be deemed
to have elected to convert such Advance into an Alternate Base Rate Advance
effective as of the expiration date of such current Interest Period.
SECTION 2.12 Interest Rate Not Ascertainable. In the event that
the Agent shall determine (which determination shall, absent manifest error, be
final, conclusive and binding upon all parties) that on any date for determining
the Eurodollar Rate for any Interest Period, by reason of any changes arising
after the date of this Agreement affecting the Eurodollar interbank market
adequate and fair means do not exist for ascertaining the applicable interest
rate on the basis provided for in the definition of Eurodollar Rate, then, and
in any such event, the Agent shall forthwith give notice to the Company and to
the Banks of such determination. Until the Agent notifies the Company that the
circumstances giving rise to the suspension described herein no longer exist,
the obligations of the Banks to make Eurodollar Rate Advances shall be
suspended.
SECTION 2.13 Legality. (a) Notwithstanding anything to the
contrary herein contained, if any law or regulation or the interpretation
thereof by any governmental authority charged with the administration or
interpretation thereof makes it unlawful for any Bank or its Eurodollar Lending
Office to make or maintain any Eurodollar Rate Advance or to give effect to its
obligations as contemplated hereby, then, by prompt written notice to the
Company, such Bank may:
(i) declare that Eurodollar Rate Advances will not thereafter be
made by such Bank hereunder, whereupon the right of the Company to
receive Eurodollar Rate Advances from such Bank hereunder shall be
suspended until such declaration is subsequently withdrawn, provided,
such request for a Eurodollar Rate Advance shall be automatically
converted (as to such Bank) into a request for an Alternate Base Rate
Advance and the affected Bank or Banks shall respond thereto as provided
herein; and
(ii) require that all outstanding Eurodollar Rate Advances made by
such Bank be converted to Alternate Base Rate Advances, in which event
(A) all such Eurodollar Rate Advances shall be automatically converted to
Alternate Base Rate Advances as of the effective date of such notice as
provided in paragraph (b) below if required by applicable law
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or regulation, or if not so required, at the end of the current Interest
Period and (B) all payments and prepayments of principal which would
otherwise have been applied to repay the converted Eurodollar Rate
Advances shall instead be applied to repay the Alternate Base Rate
Advances resulting from the conversion of such Eurodollar Rate Advances.
(b) For purposes of this Section, a notice to the Company by the
Agent pursuant to paragraph (a) above shall be effective on the date of receipt
thereof by the Company.
SECTION 2.14 Increased Costs, Taxes or Capital Adequacy
Requirements. (a) If any applicable law or regulation or compliance by any Bank
with any applicable guideline or request by any central bank or governmental
authority having jurisdiction over such Bank (whether or not having the force of
law)
(i) shall change the basis of taxation of payments to such Bank of
the principal of or interest on any Eurodollar Rate Advance made by such
Bank or any other fees or amounts payable hereunder with respect to
Eurodollar Rate Advances (other than taxes imposed on the overall net
income of such Bank or its Applicable Lending Office or franchise taxes
imposed upon it by the jurisdiction in which such Bank or its Applicable
Lending Office has an office),
(ii) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement with respect to Eurodollar Rate Advances
against assets of, deposits with or for the account of, or credit
extended by, such Bank (without duplication of any amounts paid pursuant
to Section 2.10(f)) or
(iii) shall impose on such Bank any other condition affecting this
Agreement with respect to Eurodollar Rate Advances or any Eurodollar Rate
Advance made by such Bank, and the result of any of the foregoing shall
be to increase the cost to such Bank of maintaining its Commitment or of
making or maintaining any Eurodollar Rate Advance or to reduce the amount
of any sum received or receivable by such Bank hereunder (whether of
principal, interest or otherwise) in respect thereof by an amount deemed
in good faith by such Bank to be material,
then the Company shall pay to such Bank such additional amount as will
compensate it for such increase or reduction within ten (10) days after notice
thereof pursuant to Section 2.14(c).
(b) If any Bank shall have determined in good faith that any law,
rule, regulation or guideline regarding capital adequacy, or any interpretation
or administration thereof of any such authority, central bank or comparable
agency has or would have the effect of reducing the rate of return on the
capital of such Bank as a consequence of, or with reference to, such Bank's
obligations to lend hereunder to a level below that which it could have achieved
but for such adoption, change or compliance by an amount deemed by such Bank to
be material, then, from time to time, the Company shall pay to the Agent for the
benefit of such Bank such additional amount as will
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reasonably compensate it for such reduction within ten (10) days after notice
thereof pursuant to Section 2.14(c).
(c) Each Bank will notify the Company through the Agent of any
event occurring after the date of this Agreement which will entitle it to
compensation pursuant to this Section, as promptly as practicable after it
becomes aware thereof and determines to request compensation and in any case,
within 180 days after becoming aware thereof. A certificate setting forth in
reasonable detail the amount necessary to compensate the Bank in question as
specified in paragraph (a) or (b) above, as the case may be, and the calculation
of such amount shall be delivered to the Company and shall be conclusive absent
manifest error if such determination is made on a reasonable basis. The Company
shall pay to the Agent for the account of such Bank the amount shown as due on
any such certificate within ten (10) days after its receipt of the same. The
failure on the part of any Bank to demand increased compensation with respect to
any Interest Period shall not constitute a waiver of the right to demand
compensation thereafter within the 180 day time limit set forth above. Each Bank
agrees, to the extent it may lawfully do so without incurring additional costs,
to use its best efforts to minimize costs arising under this section by
designating another lending office for the Loans affected, provided no Bank
shall be required to do so.
(d) Any notice given pursuant to this Section 2.14 shall be deemed
to contain a representation by the Bank issuing such notice that the increased
costs and charges are common to substantially all of the loan customers of such
Bank and are not unique to the Company.
SECTION 2.15 Eurodollar Advance Prepayment and Default Penalties.
Subject to Section 11.08, the Company shall indemnify each Bank against any loss
or expense (excluding loss of anticipated profits) which it may sustain or incur
as a consequence of (a) an Advance of, or a conversion from or into, Eurodollar
Rate Advances that does not occur on the date specified therefor in a Notice of
Advance or Notice of Conversion, (b) any payment, prepayment or conversion of a
Eurodollar Rate Advance required by any other provision of this Agreement or
otherwise made on a date other than the last day of the applicable Interest
Period or (c) any default in the payment or prepayment of the principal amount
of any Eurodollar Rate Advance or any part thereof or interest accrued thereon,
as and when due and payable (at the due date thereof, by notice of prepayment or
otherwise). Such loss or expense shall include an amount equal to the excess
determined by each Bank of (i) its cost of obtaining the funds for the Advance
being paid, prepaid or converted or not borrowed (based on the Eurodollar Rate)
for the period from the date of such payment, prepayment or conversion or
failure to borrow to the last day of the Interest Period for such Advance (or,
in the case of a failure to borrow, the Interest Period for the Advance which
would have commenced on the date of such failure to borrow) over (ii) the amount
of interest (as determined by each Bank) that would be realized in reemploying
the funds so paid, prepaid or converted or not borrowed for such period or
Interest Period, as the case may be. The Agent, on behalf of the Banks, will
notify the Company of any loss or expense which will entitle the Banks to
compensation pursuant to this Section, as promptly as possible after it becomes
aware thereof, but failure to so notify shall not affect the Company's liability
therefor. A certificate of any Bank setting forth any amount which it is
entitled to receive pursuant to this Section shall be delivered to the Company
and
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shall be conclusive absent manifest error if such determination is made on a
reasonable basis. The Company shall pay to the Agent for the account of the
Banks the amount shown as due on any certificate within ten (10) days after its
receipt of the same. Without prejudice to the survival of any other obligations
of the Company hereunder, the obligations of the Company under this Section
shall survive the termination of this Agreement and the assignment of any of the
Notes.
SECTION 2.16 Additional Costs, Taxes or Similar Requirements.
Subject to the terms of Section 11.08, all payments by the Company to any Bank
shall be payable in full by the Company without any reduction or set off of any
kind for any purpose and all costs and expenses incurred by any Bank in
connection herewith, direct or indirect, shall be reimbursed by the Company. To
the extent that any additional payments of any kind are required, any reductions
to payments made to any Bank occur or may reasonably be expected to occur, any
costs are incurred, any taxes (or the withholding thereof) are due to, or
required by, any governmental or regulatory agency, foreign or domestic, state,
federal, local, regional or national, based on any law, rule, regulation,
guideline or similar provision, (other than taxes payable on the taxable income
of any Bank to the United States of America or any state or local entity), or
any similar items, all such payments and costs or reduced income shall be the
responsibility of the Company. This provision shall be interpreted in the
broadest possible terms to include any increased costs, payments or reduced
income for any reason, including, but specifically not by way of limitation, due
to taxes, capital adequacy provisions, reserve requirements, withholding
obligations, costs due to the payment of any sums on a date other than the
regularly scheduled date or for any other reason and the Company does hereby
indemnify and hold harmless each Bank, for all such costs and does agree to pay
same or cover any Bank's expenses or losses in regard to same. The Company shall
immediately pay such sums to any Bank as are necessary to mitigate all such
items. This obligation is in addition to all other obligations of the Company
contained herein.
SECTION 2.17 Tax Forms. If any Bank or any entity that is or
hereafter becomes a borrower is organized under the laws of a jurisdiction
outside the United States, such Person shall provide the Agent and the other
parties hereto with the Prescribed Forms on the date of the initial Advance
hereunder or on the date it becomes a party hereto, as the case may be, and from
time to time thereafter if requested by the affected party hereto or the Agent.
Unless the party requesting them and the Agent have received such Prescribed
Forms, the Agent, if required by applicable law or regulation, may withhold
taxes from payments under the Loan Documents at the applicable rate in the case
of payments to or for any Bank organized under the laws of a jurisdiction
outside the United States, provided the Company shall, unless otherwise directed
in writing by the Agent, make all payments in full to the Agent without
deducting any withholding or similar taxes.
SECTION 2.18 Voluntary Reduction of Commitment. Upon at least five
(5) Business Days' prior written notice, the Company shall have the right,
without premium or penalty, to reduce ratably in part or terminate in whole the
unused portions of the respective Commitments of the Banks provided that each
partial reduction shall be in the aggregate amount of $5,000,000 or any integral
multiple of $1,000,000 in excess thereof.
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SECTION 2.19 Fees. Subject to Section 11.08 hereof, the Company
agrees to pay the following fees (the "Fees"):
(a) The Company shall pay to the Agent for the ratable account of
the Banks a commitment fee (the "Commitment Fee") for the period from and
including the Execution Date to the Maturity Date calculated on the basis of a
360-day year and computed on the daily average of the Unutilized Commitment of
each Bank at the rate for Commitment Fees set forth in the definition of Margin.
Commitment Fees shall be due and payable in arrears on each Designated Payment
Date commencing on the first such date following the Execution Date and on the
Maturity Date.
(b) The Company shall pay to the Agent for the benefit of the
Banks (and, in the case of clause (z) below, for the benefit of the Issuing
Bank) an annual fee (the "Letter of Credit Fee") in respect of each Letter of
Credit issued hereunder equal to (y) the greater of (i) the then effective
Eurodollar Margin multiplied by the face amount of such Letter of Credit
(computed on the basis of the actual number of days elapsed over a year of 360
days) or (ii) $500.00, plus (z) 0.125% multiplied by the face amount of such
Letter of Credit, to be paid to the Issuing Bank. Such fees shall be payable
quarterly in arrears on each Designated Payment Date commencing on the first
such date following the Execution Date and on the Maturity Date.
SECTION 2.20 Extension of Maturity Date. Not less than 60 days and
no more than 90 days prior to the Maturity Date then in effect, provided that no
Event of Default shall have occurred and be continuing, the Company may request
an extension of such Maturity Date by submitting to the Agent an Extension
Request containing the information in respect of such extension specified in
Exhibit 2.20, which the Agent shall promptly furnish to each Bank. Each Bank
shall, not less than 30 days and not more than 60 days prior to the Maturity
Date then in effect, notify the Company and the Agent of its election (in its
sole and absolute discretion) to extend or not extend the Maturity Date as
requested in such Extension Request. Notwithstanding any provision of this
Agreement to the contrary, any notice by any Bank of its willingness to extend
the Maturity Date shall be revocable by such Bank in its sole and absolute
discretion at any time prior to the date that is 30 days prior to the Maturity
Date then in effect. If all Banks shall approve in writing the extension of the
Maturity Date requested in such Extension Request, the Maturity Date shall
automatically and without any further action by any Person be extended for the
period specified in such Extension Request; provided that (i) each extension
pursuant to this Section 2.20 shall be for a maximum of 364 days and (ii) the
Maturity Date shall not be extended beyond the second anniversary of the
original Maturity Date. If, not less than 30 days and not more than 60 days
prior to the Maturity Date then in effect, all Banks shall not approve in
writing the extension of the Maturity Date requested in an Extension Request,
the Maturity Date shall not be extended pursuant to such Extension Request. The
Agent shall promptly notify the Banks and the Company of any extension of the
Maturity Date pursuant to this Section 2.20.
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SECTION 2.21 Replacement of Banks. If any Bank requests
compensation under Section 2.10(f), 2.14 or 2.16 or if any Bank notifies the
Company that it cannot fund certain Loans or is unable to deliver the Prescribed
Forms, or if any Bank defaults in its obligation to fund Advances hereunder,
then the Company may, at its sole expense and effort, upon notice to such Bank
and the Agent, require such Bank to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in Section 11.10), all
its interests, rights and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Bank, if a Bank
accepts such assignment); provided that (i) the Company shall have received the
prior written consent of the Agent, which consent shall not unreasonably be
withheld, (ii) such Bank shall have received payment of an amount equal to the
outstanding principal of its Advances, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder, from the assignee (to the extent
of such outstanding principal and accrued interest and fees) or the Company (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.10(f), 2.14 or 2.16,
such assignment will result in a reduction in such compensation. A Bank shall
not be required to make any such assignment and delegation if, prior thereto, as
a result of a waiver by such Bank or otherwise, the circumstances entitling the
Company to require such assignment and delegation cease to apply.
ARTICLE III
LETTERS OF CREDIT
SECTION 3.01 Letters of Credit. (a) Subject to and upon the terms
and conditions herein set forth, the Issuing Bank will, at any time and from
time to time on or after the Execution Date and prior to the Maturity Date,
promptly following its receipt of a Letter of Credit Request and application for
Letter of Credit, issue for the account of the Company or any of the Guarantors
and in support of the obligations of the Company or any of its Subsidiaries, one
or more irrevocable letters of credit (all such letters of credit together with
the Existing Letters of Credit collectively, the "Letters of Credit"), up to a
maximum amount outstanding at any one time for all Letters of Credit and
Existing Letters of Credit equal to $20,000,000.00, provided that the Issuing
Bank shall not issue any Letter of Credit if at the time of such issuance: (i)
the stated amount of such Letter of Credit is greater than an amount which, when
added to all other Letters of Credit outstanding and all other Advances under
the Notes then outstanding, would exceed the Total Commitment; or (ii) the
expiry date or, in the case of any Letter of Credit containing an expiry date
that is extendible at the option of the Issuing Bank, the initial expiry date of
such Letter of Credit is a date that is later than the Maturity Date, unless
such Letter of Credit is secured by cash.
(b) The Issuing Bank shall neither renew nor permit the renewal of
any Letter of Credit if any of the conditions precedent to such renewal set
forth in Section 4.02 are not satisfied or, after giving effect to such renewal,
the expiry date of such Letter of Credit would be a date that is later than the
Maturity Date.
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(c) The Company, the Agent and the Banks acknowledge that Chase
has issued, for the account of the Company, the Existing Letters of Credit. Upon
the Execution Date, the Letters of Credit outstanding shall be that amount equal
to the aggregate stated amount of the Existing Letters of Credit, and the amount
available for Loans and Letters of Credit under the Commitments shall be reduced
by such amount so long as said Letters of Credit are outstanding and the amount
available under each Bank's Commitment shall be reduced by such Bank's
percentage participation of such amount. If the Company or any of the Guarantors
desires to extend the existing expiry date of any Existing Letter of Credit, or
request a substitute letter of credit be issued for any reason in respect of any
Existing Letter of Credit, the Company or any of the Guarantors shall submit to
the Issuing Bank a Letter of Credit Request as provided in Section 3.02(a).
SECTION 3.02 Letters of Credit Requests. (a) Whenever the Company
desires that a Letter of Credit be issued for its account or that the existing
expiry date shall be extended, it shall deliver to the Issuing Bank (with copies
to be sent to the Agent) in the case of a Letter of Credit to be issued, at
least three (3) Business Days' prior written request therefor and in the case of
the extension of the existing expiry date of any Letter of Credit, at least five
days prior to the date on which the Issuing Bank must notify the beneficiary
thereof that the Issuing Bank does not intend to extend such existing expiry
date. Each such request shall be executed by the Company and shall be in the
form of Exhibit 3.02 attached hereto (each a "Letter of Credit Request") and
shall be accompanied by an application for Letter of Credit therefor, completed
to the reasonable satisfaction of the Issuing Bank, and such other certificates,
documents and other papers and information as the Issuing Bank or any Bank
(through the Agent) may reasonably request. Each Letter of Credit shall be
denominated in U.S. dollars, shall expire no later than the date specified in
Section 3.01, shall not be in an amount greater than is permitted under clauses
(i) or (ii) of Section 3.01(a) and shall be in such form as may be reasonably
approved from time to time by the Issuing Bank and the Company.
(b) The delivery of each Letter of Credit Request shall be deemed
to be a representation and warranty by the Company that such Letter of Credit
may be issued in accordance with, and will not violate the requirements of, this
Agreement. Unless the Issuing Bank has received notice from any Bank before it
issues the respective Letter of Credit or extends the existing expiry date of a
Letter of Credit that one or more of the conditions specified in Article IV are
not then satisfied, or that the issuance of such Letter of Credit would violate
this Agreement, then the Issuing Bank may issue the requested Letter of Credit
in accordance with the Issuing Bank's usual and customary practices. Upon its
issuance of any Letter of Credit or the extension of the existing expiry date of
any Letter of Credit, as the case may be, the Issuing Bank shall promptly notify
the Company, the Agent and each Bank of such issuance or extension, which notice
shall be accompanied by a copy of the Letter of Credit actually issued or a copy
of any amendment extending the existing expiry date of any Letter of Credit, as
the case may be.
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SECTION 3.03 Letter of Credit Participations. (a) All Obligations
of the Company and the Guarantors with respect to all Existing Letters of Credit
and all Letters of Credit issued subsequent hereto shall be deemed to have been
sold and transferred by the Issuing Bank to each Bank, and each Bank shall be
deemed irrevocably and unconditionally to have purchased and received from the
Issuing Bank, without recourse or warranty, an undivided interest and
participation, (to the extent of such Bank's percentage participation in the
Commitments) in each such Obligation, each substitute letter of credit, each
drawing made thereunder and the obligations of the Company under this Agreement
and the other Loan Documents with respect thereto, and any security therefor or
guaranty pertaining thereto including the Guaranty.
(b) The Issuing Bank shall have no obligation relative to the
Banks other than to confirm that any documents required to be delivered under
such Letter of Credit appear to have been delivered and that they appear to
comply on their face with the requirements of such Letter of Credit.
(c) In the event that the Issuing Bank makes any payment under any
Letter of Credit, the same shall be considered an Alternate Base Rate Advance
without further action by any Person. The Issuing Bank shall promptly notify the
Agent, which shall promptly notify each Bank thereof. Each Bank shall
immediately pay to the Agent for the account of the Issuing Bank the amount of
such Bank's percentage participation of such Advance. If any Bank shall not have
so made its percentage participation available to the Agent, such Bank agrees to
pay interest thereon, for each day from such date until the date such amount is
paid at the lesser of the Federal Funds Effective Rate and the Highest Lawful
Rate.
(d) The Issuing Bank shall not be liable for, and the obligations
of the Company and the Banks to make payments to the Agent for the account of
the Issuing Bank with respect to Letters of Credit shall not be subject to, any
qualification or exception whatsoever, including any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement or
any of the other Loan Documents;
(ii) the existence of any claim, setoff, defense or other right
which the Company may have at any time against a beneficiary named in a
Letter of Credit, any transferee of any Letter of Credit, the Agent, the
Issuing Bank, any Bank, or any other Person, whether in connection with
this Agreement, any Letter of Credit, the transactions contemplated
herein or any unrelated transactions (including any underlying
transaction between the Company and the beneficiary named in any such
Letter of Credit);
(iii) any draft, certificate or any other document presented under
the 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;
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(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan
Documents; or
(v) the occurrence of any Default or Event of Default.
(e) THE ISSUING BANK SHALL NOT BE LIABLE FOR ANY ERROR, OMISSION,
INTERRUPTION OR DELAY IN TRANSMISSION, DISPATCH OR DELIVERY OF ANY MESSAGE OR
ADVICE, HOWEVER TRANSMITTED, IN CONNECTION WITH ANY LETTER OF CREDIT, EXCEPT FOR
ERRORS OR OMISSIONS CAUSED BY THE ISSUING BANK'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT. IT IS THE EXPRESS INTENTION OF THE PARTIES HERETO THAT THE ISSUING
BANK, ITS OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS SHALL BE INDEMNIFIED AND
HELD HARMLESS FROM ANY ACTION TAKEN OR OMITTED BY SUCH PERSON UNDER OR IN
CONNECTION WITH ANY LETTER OF CREDIT OR ANY RELATED DRAFT OR DOCUMENT ARISING
OUT OF OR RESULTING FROM SUCH PERSON'S SOLE OR CONTRIBUTORY NEGLIGENCE. The
Company agrees that any action taken or omitted by the Issuing Bank under or in
connection with any Letter of Credit or the related drafts or documents, if done
in accordance with the standards of care specified in the Uniform Customs and
Practice for Documentary Credits (1993 Revision), International Chamber of
Commerce, Publication No. 500 (and any subsequent revisions thereof approved by
a Congress of the International Chamber of Commerce and adhered to by the
Issuing Bank) and, to the extent not inconsistent therewith, the Uniform
Commercial Code of the State of Texas, shall not result in any liability of the
Issuing Bank to the Company.
SECTION 3.04 Increased Costs. (a) Notwithstanding any other
provision herein, but subject to Section 11.08, if any Bank shall have
determined in good faith that any law, rule, regulation or guideline or the
application or effectiveness of any applicable law or regulation or any change
in applicable law or regulation or any change after the Execution Date in the
interpretation or administration thereof, or compliance by any Bank (or any
lending office of such Bank) with any applicable guideline or request from any
central bank or governmental authority (whether or not having the force of law)
either shall impose, modify or make applicable any reserve, deposit, capital
adequacy or similar requirement against letters of credit issued, or
participated in, by any Bank or shall impose on any Bank any other conditions
affecting this Agreement or any Letter of Credit, and the result of any of the
foregoing is to increase the cost to any Bank of issuing, maintaining or
participating in any Letter of Credit, or reduce the amount received or
receivable by any Bank hereunder with respect to Letters of Credit, by an amount
deemed by such Bank to be material, then, from time to time, the Company shall
pay to the Agent for the account of such Bank such additional amount or amounts
as will reasonably compensate such Bank for such increased cost or reduction by
such Bank.
(b) Each Bank will notify the Company through the Agent of any
event occurring after the date of this Agreement which will entitle such Bank to
compensation pursuant to subsection (a) above, as promptly as practicable. A
certificate of a Bank setting forth in reasonable detail such amount or amounts
as shall be necessary to compensate such Bank as specified in subsection (a)
above may be delivered to the Company (with a copy to the Agent) and shall be
conclusive absent manifest error. The Company shall pay to the Agent for the
account of such Bank the amount shown
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as due on any such certificate within 30 days after its receipt of the same. No
Bank shall be entitled to recover any costs pursuant to this Section 3.04(b)
incurred more than 180 days prior to such Bank's giving notice to the Company
for reimbursement thereof.
SECTION 3.05 Conflict between Applications and Agreement. To the
extent that any provision of any application for Letter of Credit is
inconsistent with the provisions of this Agreement, the provisions of this
Agreement shall control.
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.01 Conditions Precedent to the Initial Advance. The
obligation of each Bank to make its initial Advance hereunder to the Company is
subject to the occurrence of or receipt by the Agent of the following, all in
form and substance satisfactory to the Agent, and, where relevant, executed by
all appropriate parties:
(a) this Agreement (which includes the Guaranty);
(b) one Note for each Bank;
(c) Landlord's lien waivers as required by the Agent in respect of
all leased property;
(d) each of the following Security Documents granting a first and
prior (except for Liens permitted under Section 7.04) Lien or security interest
on the Collateral to the Agent for the benefit of itself and the Banks as
security for the Obligations, substantially in the form of Exhibits 4.01(d)(i)
and (ii) hereto:
(i) the Security Agreement (the "Security Agreement") covering
substantially all of the accounts and inventory of the Company and each
of its domestic Subsidiaries existent as of the date hereof (except as
set forth in such Security Agreement or other Security Documents which
exclusions have been agreed to by the Majority Banks), accompanied by all
documents, instruments and other items necessary to obtain and perfect a
Lien thereon;
(ii) the Pledge Agreement (the "Pledge Agreement") pledging to the
Agent all stock owned by the Company or any Subsidiary in all domestic
Subsidiaries accompanied by original stock certificates evidencing such
shares and executed stock powers for such certificates; and
(iii) UCC-1 and UCC-3 Financing Statements and other documents or
instruments necessary to perfect the Liens granted in the Security
Documents.
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(e) A Notice of Advance with respect to the initial Advance
meeting the requirements of Section 2.03(a);
(f) a certificate of the secretary or an assistant secretary of
the Company and each Guarantor certifying, inter alia, (i) true and complete
copies of each of the articles or certificate of incorporation, as amended and
in effect of the Company, the bylaws, as amended and in effect, of the Company
and the resolutions adopted by the Board of Directors of the Company and each of
the Guarantors (A) authorizing the execution, delivery and performance by the
Company and each of its Subsidiaries of this Agreement and the other Loan
Documents to which it is or will be a party and, in the case of the Company, the
Advances to be made hereunder, (B) approving the forms of the Loan Documents to
which it is or will be a party and which will be delivered at or prior to the
date of the initial Advance hereunder and (C) authorizing officers of the
Company and each of its Subsidiaries to execute and deliver the Loan Documents
to which it is or will be a party and any related documents, including, any
agreement contemplated by this Agreement, and (ii) the incumbency and specimen
signatures of the officers of the Company and each of its Subsidiaries executing
any documents on its behalf;
(g) a certificate of the President, Chief Financial Officer or
Treasurer of the Company certifying that there has been no change in the
businesses or financial condition of the Company which could reasonably be
expected to have a Material Adverse Effect since December 31, 1997;
(h) opinions addressed to the Agent and the Banks from (i)
Xxxxxxxxx & Xxxxxxxxx, L.L.P., counsel to the Company and the Guarantors,
substantially in the form set forth as Exhibit 4.01(h)(i), and (ii) from
Xxxxxxxx X. Xxxxxx, General Counsel to the Company, substantially in the form of
Exhibit 4.01(h)(ii);
(i) the payment to the Agent and the Banks of all reasonable fees
and expenses agreed upon by such parties to be paid on the Execution Date
including, without limitation, any accrued unpaid portions of Commitment Fees
due under the Prior Credit Agreement;
(j) certificates of appropriate public officials as to the
existence, good standing and qualification to do business as a foreign
corporation, as applicable, of the Company and its Subsidiaries in each
jurisdiction in which the ownership of its properties or the conduct of its
business requires such qualifications and where the failure to so qualify would
have a Material Adverse Effect;
(k) certificates of insurance as contemplated by Section 6.03(a);
and
(l) UCC searches and other title information reasonably requested
by the Agent on the Company and each of its Subsidiaries.
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The acceptance of the benefits of the initial Credit Event
hereunder shall constitute a representation and warranty by the Company to the
Agent and each of the Banks that, to the best of its knowledge, all of the
conditions specified in this Section above shall have been satisfied or waived
as of that time.
SECTION 4.02 Conditions Precedent to All Credit Events. The
obligation of the Banks to make any Advance, including, without limitation, the
initial Advance hereunder, is subject to the further conditions precedent that
on the date of such Credit Event:
(a) The representations and warranties set forth in Article V
shall be true and correct in all material respects as of, and as if such
representations and warranties were made on, the date of the proposed Advance
(unless such representation and warranty expressly relates to an earlier date or
is no longer true and correct solely as a result of transactions permitted by
the Loan Documents), and the Company shall be deemed to have certified to the
Agent and the Banks that such representations and warranties are true and
correct in all material respects by submitting a Notice of Advance.
(b) The Company shall have complied with the provisions of Section
2.03 hereof.
(c) No Default or Event of Default shall have occurred and be
continuing or would result from such Credit Event.
(d) No Material Adverse Effect shall have occurred in the
consolidated financial condition of the Company and its consolidated
Subsidiaries since the delivery of the most recent financial statements
delivered pursuant to Section 6.01(b).
(e) the Agent shall have received the most recent unqualified
report and opinion on the Company's financial statements issued by KPMG Peat
Marwick LLP, or other independent certified public accountant of recognized
national standing.
(f) Except for any foreign Subsidiaries, all Persons that have
become Subsidiaries subsequent to the Execution Date shall have executed and
delivered to the Agent an Adoption Agreement to the extent required at the time
of such Credit Event pursuant to Section 6.09.
(g) The Agent shall have received such other approvals, opinions
and documents as the Agent or the Banks may reasonably request.
The acceptance of the benefits of each such Credit Event shall
constitute a representation and warranty by the Company to the Agent and each of
the Banks that all of the conditions specified in this Section above exist as of
that time.
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SECTION 4.03 Delivery of Documents. All of the Notes,
certificates, legal opinions and other documents and papers referred to in this
Article IV, unless otherwise specified, shall be delivered to the Agent for the
account of each of the Banks and, except for the Notes, in sufficient
counterparts for each of the Banks and shall be reasonably satisfactory in form
and substance to the Banks.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
In order to induce the Banks to enter into this Agreement and to
make the Advances provided for herein, the Company, as to itself and each of its
Subsidiaries, makes, on or as of the occurrence of each Credit Event (except to
the extent such representations or warranties relate to an earlier date or are
no longer true and correct in all material respects solely as a result of
transactions not prohibited by the Loan Documents), the following
representations and warranties to the Agent and the Banks:
SECTION 5.01 Organization and Qualification. Each of the Company
and its Subsidiaries (a) is duly formed or organized, validly existing and in
good standing under the laws of the state of its organization, (b) has the power
to own its property and to carry on its business as now conducted, except where
the failure to do so would not have a Material Adverse Effect and (c) is duly
qualified to do business and is in good standing in every jurisdiction in which
the failure to be so qualified would have a Material Adverse Effect.
SECTION 5.02 Authorization and Validity. Each of the Company and
its Subsidiaries has the corporate power and authority to execute, deliver and
perform its obligations hereunder and under the other Loan Documents to which it
is a party and all such action has been duly authorized by all necessary
corporate proceedings on its part. Each Loan Document to which the Company or
any of its Subsidiaries is a party have been duly and validly executed and
delivered by such Person and constitute a valid and legally binding agreement of
such Person enforceable in accordance with the respective terms thereof, except,
in each case, as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws relating
to or affecting the enforcement of creditors' rights generally, and by general
principles of equity regardless of whether such enforceability is sought in a
proceeding in equity or at law.
SECTION 5.03 Governmental Consents. No authorization, consent,
approval, license or exemption of or filing or registration with any court or
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, is necessary for the valid execution or delivery by the
Company or any Subsidiary of any Loan Document.
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SECTION 5.04 Conflicting or Adverse Agreements or Restrictions.
Neither the Company nor any Subsidiary is a party to any contract or agreement
or subject to any restriction which would reasonably be expected to have a
Material Adverse Effect. As of the Execution Date, all agreements of the Company
relating to the lending of money or the issuance of letters of credit by any
party are described hereto on Schedule 5.04. Neither the execution nor delivery
of the Loan Documents nor compliance with the terms and provisions hereof or
thereof will be contrary to the provisions of, or constitute a default under,
(a) the charter or bylaws of the Company or any Subsidiary or (b) any law,
regulation, order, writ, injunction or decree of any court or governmental
instrumentality that is applicable to the Company or any Subsidiary or (c) any
material agreement to which the Company or any of its Subsidiaries is a party or
by which it is bound or to which any of them is subject.
SECTION 5.05 Title to Assets. Each of the Company and its
Subsidiaries has good title to all material personal property and good and
indefeasible title to all material real property as reflected on the books and
records of the Company or any of its Subsidiaries as being owned by them, except
for properties disposed of in the ordinary course of business, subject to no
Liens, except those permitted hereunder, except where the failure to do so could
not reasonably be expected to have a Material Adverse Effect. All of such assets
have been and are being maintained by the appropriate Person in good working
condition in accordance with industry standards, except where the failure to do
so could not reasonably be expected to have a Material Adverse Effect.
SECTION 5.06 Litigation. No proceedings against the Company or any
Subsidiary are pending or, to the knowledge of the Company, threatened before
any court or governmental agency or department which involve a reasonable
material risk of having a Material Adverse Effect except those listed on
Schedule 5.06 hereof.
SECTION 5.07 Financial Statements. Prior to the Execution Date,
the Company has furnished to the Banks its audited consolidated balance sheet as
of December 31, 1997 and audited consolidated income statement and statement of
cash flows for the period ended December 31, 1997, and the unaudited balance
sheet and consolidated income statement and statements of cash flow for the
period from January 1, 1998 through June 30, 1998 (such financials, the
"Financials"). The Financials have been prepared in conformity with GAAP
consistently applied (except as otherwise disclosed in such financial
statements) throughout the periods involved and present fairly, in all material
respects, the consolidated financial condition of the Company and its
consolidated Subsidiaries as of the dates thereof and the consolidated results
of their operations for the periods then ended. As of the Execution Date, no
Material Adverse Effect has occurred in the consolidated financial condition of
the Company and its consolidated Subsidiaries since the date of said Financials.
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SECTION 5.08 Default. Neither the Company nor any Subsidiary is in
default under any material provisions of any instrument evidencing any
Indebtedness or of any agreement relating thereto, or in default in any respect
under any order, writ, injunction or decree of any court, or in default in any
respect under or in violation of any order, injunction or decree of any
governmental instrumentality, in each case in such manner as to cause a Material
Adverse Effect.
SECTION 5.09 Investment Company Act. Neither the Company nor any
Subsidiary is, or is directly or indirectly controlled by or acting on behalf of
any Person which is, an "investment company," as such term is defined in the
Investment Company Act of 1940, as amended.
SECTION 5.10 Public Utility Holding Company Act. Neither the
Company nor any Subsidiary is a non-exempt "holding company," or subject to
regulation as such, or, to the knowledge of the Company's or such Subsidiary's
officers, an "affiliate" of a "holding company" or a "subsidiary company" of a
"holding company," within the meaning of the Public Utility Holding Company Act
of 1935, as amended.
SECTION 5.11 ERISA. No accumulated funding deficiency (as defined
in Section 412 of the Code or Section 302 of ERISA), whether or not waived,
exists or is expected to be incurred with respect to any Plan. No liability to
the PBGC (other than required premium payments) has been or is expected by the
Company to be incurred with respect to any Plan by the Company or any ERISA
Affiliate. Neither the Company nor any ERISA Affiliate has incurred any
withdrawal liability under Title IV of ERISA with respect to any Multi-Employer
Plans.
SECTION 5.12 Tax Returns and Payments. Each of the Company and its
Subsidiaries has filed all federal income tax returns and other tax returns,
statements and reports (or obtained extensions with respect thereto) which are
required to be filed and has paid or deposited or made adequate provision, in
accordance with GAAP for the payment of all taxes (including estimated taxes
shown on such returns, statements and reports) which are shown to be due
pursuant to such returns, except for such taxes as are being contested in good
faith and by appropriate proceedings, except, in each such case, where such
failure could not reasonably be expected to have a Material Adverse Effect.
SECTION 5.13 Environmental Matters. Each of the Company and its
Subsidiaries (a) possesses all environmental, health and safety licenses,
permits, authorizations, registrations, approvals and similar rights necessary
under law or otherwise for the Company or such Subsidiary to conduct its
operations as now being conducted (other than those with respect to which the
failure to possess or maintain would not, individually or in the aggregate for
the Company and such Subsidiaries, reasonably be expected to have a Material
Adverse Effect) and (b) each of such licenses, permits, authorizations,
registrations, approvals and similar rights is valid and subsisting, in full
force and effect and enforceable by the Company or such Subsidiary, and each of
the Company and its Subsidiaries is in compliance with all effective terms,
conditions or other provisions of such permits, authorizations, registrations,
approvals and similar rights except for such
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failure or noncompliance that, individually or in the aggregate for the Company
and such Subsidiaries, would not reasonably be expected to have a Material
Adverse Effect. Except as disclosed on Schedule 5.13, neither the Company nor
any of its Subsidiaries has received any notices of any violation of,
noncompliance with, or remedial obligation under, Requirements of Environmental
Laws (which violation or non-compliance has not been cured), and there are no
writs, injunctions, decrees, orders or judgments outstanding, or lawsuits,
claims, proceedings, investigations or inquiries pending or, to the knowledge of
the Company or any Subsidiary, threatened, relating to the ownership, use,
condition, maintenance or operation of, or conduct of business related to, any
property owned, leased or operated by the Company or such Subsidiary or other
assets of the Company or such Subsidiary, other than those violations, instances
of noncompliance, obligations, writs, injunctions, decrees, orders, judgments,
lawsuits, claims, proceedings, investigations or inquiries that, individually or
in the aggregate for the Company and such Subsidiaries, would not have a
Material Adverse Effect. Except as disclosed on Schedule 5.13, there are no
material obligations, undertakings or liabilities arising out of or relating to
Environmental Laws to which the Company or any of its Subsidiaries has agreed,
assumed or retained, or, to the knowledge of the Company, by which the Company
or any of its Subsidiaries is adversely affected, by contract or otherwise and,
further, except as disclosed on Schedule 5.13, neither the Company nor any of
its Subsidiaries has received a written notice or claim to the effect that the
Company or any of its Subsidiaries is or may be liable to any other Person as
the result of a Release or threatened Release of a Hazardous Material which, in
either case, could reasonably be expected to have a Material Adverse Effect.
SECTION 5.14 Purpose of Loans. (a) The proceeds of the Loan will
be used for general corporate purposes and no proceeds of any Loan will be used
for any purpose which would violate any applicable law, rule or regulation.
(b) None of the proceeds of any Advance will be used directly or
indirectly for the purpose of purchasing or carrying any "margin stock" within
the meaning of Regulation U or for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any margin
stock.
SECTION 5.15 Franchises and Other Rights. The Company and each of
its Subsidiaries has all franchises, permits, licenses, patents, trademarks and
other intangible assets or authority as are necessary to enable them to carry on
their respective businesses as now being conducted and is not in default in
respect thereof where the absence of such or any such default could reasonably
be expected to have a Material Adverse Effect.
SECTION 5.16 Subsidiaries and Assets. The Subsidiaries which are
parties to this Agreement and listed on Schedule 5.16 are all of the
Subsidiaries of the Company as of the Execution Date and the address given for
such Subsidiaries is the correct mailing address as of the Execution Date.
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SECTION 5.17 Solvency. After giving effect to the initial Advance
hereunder and all other Indebtedness of the Company existing at the time of such
Advance, the Company and its Subsidiaries, viewed as a consolidated entity, will
have at such time (a) capital sufficient to carry on their businesses and
transactions and (b) assets, the fair market value of which exceeds their
consolidated liabilities (as reflected on the Financials or on the financial
statements most recently delivered to the Banks).
SECTION 5.18 Year 2000. Any reprogramming required to permit the
proper functioning, in and following the year 2000, of (a) the Company's or any
Subsidiary's computer systems and (b) equipment containing embedded microchips
(including systems and equipment supplied by others or with which the Company's
systems interface) and the testing of all such systems and equipment, as so
reprogrammed, will be completed by September 30, 1999, except where the failure
to do such reprogramming and testing would not reasonably be expected to have a
Material Adverse Effect. The cost to the Company and its Subsidiaries of such
reprogramming and testing and of the reasonably foreseeable consequences of year
2000 to the Company and its Subsidiaries (including, without limitation,
reprogramming errors and the failure of others' systems or equipment) will not
result in a Default or would not reasonably be expected to have a Material
Adverse Effect. Except for such of the reprogramming referred to in the
preceding sentence as may be necessary, the computer and management information
systems of the Company and its Subsidiaries are and, with ordinary course
upgrading and maintenance, will continue for the term of this Agreement to be
sufficient to permit the Company to conduct its business in all material
respects and such upgrading and maintenance would not reasonably be expected to
have a Material Adverse Effect.
ARTICLE VI
AFFIRMATIVE COVENANTS
The Company, as to itself and each of its Subsidiaries, covenants
and agrees that on and after the date hereof until the Notes have been paid in
full and the Commitments have terminated:
SECTION 6.01 Information Covenants. The Company will furnish to
each Bank:
(a) As soon as available, and in any event within fifty (50) days
of the end of each fiscal quarter, the consolidated and, if requested by the
Agent, the consolidating balance sheet of the Company and its Subsidiaries as of
the end of such period and the related consolidated and, if requested by the
Agent, consolidating statements of income for such period and, in each case,
also for the portion of the fiscal year ended at the end of such period, setting
forth comparative consolidated figures for the related periods in the prior
fiscal year, all of which shall be certified by the chief financial officer or
chief executive officer of the Company as fairly presenting in all material
respects, the financial position of the Company and its Subsidiaries as of the
end of such
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period and the results of their operations for the period then ended in
accordance with GAAP, subject to changes resulting from normal year-end audit
adjustments.
(b) As soon as available, and in any event within ninety-five (95)
days after the close of each fiscal year of the Company, the audited
consolidated and, if requested by the Agent, the unaudited consolidating balance
sheets of the Company and its Subsidiaries as at the end of such fiscal year and
the related consolidated and, if requested by the Agent, consolidating
statements of income, stockholders' equity and cash flows for such fiscal year,
setting forth comparative figures for the preceding fiscal year and certified by
KPMG Peat Marwick LLP or other independent certified public accountants of
recognized national standing, whose report shall be without limitation as to the
scope of the audit and reasonably satisfactory in substance to the Banks.
(c) Immediately after any Responsible Officer of the Company
obtains verified knowledge thereof, notice of:
(i) any material violation of, noncompliance with, or remedial
obligations under, Requirements of Environmental Laws;
(ii) any material Release or threatened material Release of
Hazardous Materials affecting any property owned, leased or operated by
the Company or any of its Subsidiaries;
(iii) any event or condition which constitutes a Default or an
Event of Default (including any default under the Subordinated
Debentures);
(iv) any condition or event which, in the opinion of management of
the Company, would reasonably be expected to have a Material Adverse
Effect;
(v) any Person having given any written notice to the Company or
taken any other action with respect to a claimed material default or
event under any material instrument or material agreement;
(vi) the institution of any litigation which could reasonably be
expected in the good faith judgment of the Company either to have a
Material Adverse Effect or result in a final, non-appealable judgment or
award in excess of $5,000,000.00 with respect to any single cause of
action;
(vii) all ERISA notices required by Section 6.08; and
(viii) any sale of assets other than as permitted hereby;
Such notice shall specify the nature and period of existence thereof and the
action taken by such Person and the nature of any such claimed default, event or
condition and, in the case of an Event
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of Default or Default, what action has been taken, is being taken or is proposed
to be taken with respect thereto.
(d) At the time of the delivery of the quarterly and annual
financial statements provided for in Sections 6.01(a) and 6.01(b), a certificate
of a Responsible Officer to the effect that, to his knowledge, no Default or
Event of Default exists or, if any Default or Event of Default does exist,
specifying the nature and extent thereof and the action that is being taken or
that is proposed to be taken with respect thereto, which certificate shall set
forth the calculations required to establish whether the Company was in
compliance with the provisions of Sections 7.10 through 7.17 as at the end of
such fiscal period or year, as the case may be.
(e) Upon request by the Agent, a summary report (by Subsidiary) of
all Accounts of the Company and its Subsidiaries.
(f) Promptly following request by the Agent such environmental
reports, studies and audits of the Company's procedures and policies, assets and
operations in respect of Environmental Laws as the Agent may reasonably request.
(g) Promptly upon receipt thereof, a copy of any report or letter
submitted to the Company by its independent accountants in connection with any
regular or special audit of the Company's records and simultaneously with the
sending or filing thereof, copies of all proxy statements, financial statements
and reports which the Company sends to its stockholders, and copies of all
regular, periodic or special reports, and all registration statements, in each
case, which the Company or any of its Subsidiaries files with the Securities and
Exchange Commission or any other securities exchange or securities market.
(h) Promptly following request by the Agent such financial
projections, budgets and unaudited consolidating financial statements of the
Company and its Subsidiaries as the Agent may reasonably request.
(i) From time to time and with reasonable promptness, such other
information or documents as the Agent or any Bank through the Agent may
reasonably request.
SECTION 6.02 Books, Records and Inspections. The Company will
maintain, and will cause its Subsidiaries to maintain, the corporate books and
financial records of the Company and its Subsidiaries and will permit, or cause
to be permitted, any Person designated by any Bank or the Banks to visit and
inspect any of the properties of the Company and its Subsidiaries, to examine
such books and records and make copies thereof or extracts therefrom, audit its
accounts, inventory and finances of any such corporations with the officers,
employees and agents of the Company and its Subsidiaries and with their
independent public accountants, all at such reasonable times and as often as the
Agent or such Bank may request. Such inspections shall be at the expense of the
Company if made annually and shall be at the expense of the Bank or Banks
requiring same if made more often than annually.
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SECTION 6.03 Insurance and Maintenance of Properties. (a) Each of
the Company and its Subsidiaries will keep reasonably adequately insured by
financially sound and reputable insurers all of its material property, and
against the interruption of its business, which is of a character, and in
amounts and against such risks, usually and reasonably insured by similar
Persons engaged in the same or similar businesses, including, without
limitation, insurance against fire, casualty and any other hazards normally
insured against, which policies shall name the Agent for the benefit of the
Banks, as a loss payee. Each of the Company and its Subsidiaries will at all
times maintain insurance against its liability for injury to Persons or
property, which insurance shall be by financially sound and reputable insurers
and in such amounts and form as are customary for corporations of established
reputation engaged in the same or a similar business and owning and operating
similar properties and which shall name the Agent, for the benefit of the Banks,
as an additional insured. The Company shall provide the Agent a listing of all
such insurance and such other certificates and other evidence thereof, on or
prior to the Execution Date hereof and annually thereafter. A listing of all
policies of the Company and its Subsidiaries as of the Execution Date is
attached hereto as Schedule 6.03.
(b) Each of the Company and its Subsidiaries will cause all of its
material properties used or useful in the conduct of its business to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all reasonably necessary
repairs, renewals and replacements thereof, all as in the reasonable judgment of
such Person may be reasonably necessary so that the business carried on in
connection therewith may be properly conducted at all times, except where such
failure could not reasonably be expected to have a Material Adverse Effect.
SECTION 6.04 Payment of Taxes. Each of the Company and its
Subsidiaries will pay and discharge all taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits, or upon any
properties belonging to it, prior to the date on which penalties attach thereto,
except for such amounts that are being contested in good faith and by
appropriate proceedings, except where such failure could not reasonably be
expected to have a Material Adverse Effect.
SECTION 6.05 Corporate Existence. Each of the Company and its
Subsidiaries will do all things necessary to preserve and keep in full force and
effect (a) the existence of the Company, and (b) unless the failure to do so
would not reasonably be expected to have a Material Adverse Effect, the rights
and franchises of each of the Company and its Subsidiaries.
SECTION 6.06 Compliance with Statutes. Each of the Company and its
Subsidiaries will comply with all applicable statutes, regulations and orders
of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property, except to the extent the failure to do so would not reasonably
be expected to have a Material Adverse Effect.
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SECTION 6.07 Material Privileges, Permits, Licenses and Other
Rights. Each of the Company and its Subsidiaries will do all things necessary to
preserve and keep in full force and effect all material privileges, permits,
licenses and other rights necessary to conduct business as such business is
currently conducted as of the Effective Date, except to the extent the failure
to do so would not reasonably be expected to have a Material Adverse Effect.
SECTION 6.08 ERISA. Immediately after any Responsible Officer of
the Company or any of its Subsidiaries knows or has reason to know any of the
following items are true the Company will deliver or cause to be delivered to
the Banks a certificate of the chief financial officer of the Company setting
forth details as to such occurrence and such action, if any, the Company or its
ERISA Affiliate is required or proposes to take, together with any notices
required or proposed to be given to or filed with or by the Company or its ERISA
Affiliate with respect thereto: (i) that a Reportable Event has occurred or that
an application may be or has been made to the Secretary of the Treasury for a
waiver or modification of the minimum funding standard; (ii) that a
Multiemployer Plan has been or may be terminated, reorganized, partitioned or
declared insolvent under Title IV of ERISA; (iii) that any required contribution
to a Plan or Multiemployer Plan has not been or may not be timely made; (iv)
that proceedings may be or have been instituted under Section 4069(a) of ERISA
to impose liability on the Company or an ERISA Affiliate or under Section 4042
of ERISA to terminate a Plan or appoint a trustee to administer a Plan; (v) that
the Company or any ERISA Affiliate has incurred or may incur any liability
(including any contingent or secondary liability) on account of the termination
of or withdrawal from a Plan or a Multiemployer Plan; and (vi) that the Company
or an ERISA Affiliate may be required to provide security to a Plan under
Section 401(a)(29) of the Code.
SECTION 6.09 Additional Subsidiaries. The Company will cause any
Person that becomes a Subsidiary subsequent to the Execution Date to (i) within
forty-five (45) days after becoming a Subsidiary, execute and deliver to the
Agent an Adoption Agreement and (ii) within forty-five (45) days after becoming
a Subsidiary, deliver to the Agent evidence, satisfactory to the Agent, that all
Indebtedness owing by such Subsidiary to any other Person has been paid in full
and said Indebtedness has been canceled and all Liens securing such Indebtedness
have been released or have terminated, (except for Indebtedness and Liens
permitted hereby) provided, if said Subsidiary is not incorporated under the
laws of the United States or one of its states or territories, no such guaranty
will be required if the Company makes arrangements, satisfactory to the Agent,
in its sole discretion, regarding restrictions on transfer of funds or other
assets by the Company or any Subsidiary to said new foreign Subsidiary. Further,
the Company, or its Subsidiary that owns the stock of said new Subsidiary, as
the case may be, will execute the Adoption Agreement referred to above.
SECTION 6.10 Acquisition Agreements. Upon request of the Agent,
the Company shall provide the Agent with: (a) copies of all acquisition
agreements relating to the acquisitions of Qualified Companies, (b) a specimen
form of such acquisition agreement (the "Acquisition Agreements") and (c)
listing of each then existing Acquisition Agreement.
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SECTION 6.11 Material Contracts. (a) The Company and its
Subsidiaries shall provide the Agent with copies of all material contracts (the
"Material Contracts") as of the Effective Date. A listing of each such Material
Contract is attached hereto as Schedule 6.11.
(b) The Company and its Subsidiaries shall provide the Agent with
an executed copy of each additional Material Contract entered into after the
Effective Date, within ten (10) Business Days after request therefor by the
Agent.
SECTION 6.12 Employee Agreements. The Company and its Subsidiaries
shall provide the Agent with copies of all agreements relating to the employees
of the Company and its Subsidiaries, upon request by the Agent, including, but
not limited to, all collective bargaining agreements, employment contracts,
non-compete agreements, employee savings, employee retirement and employee
benefit plans. Upon request by the Agent, the Company will provide the Agent
with a list of (i) each employment agreement between the Company and each of its
officers, (ii) each employment agreement between a Subsidiary and the key
employees of such Subsidiary (or its predecessor), (iii) each union with which a
Subsidiary of the Company has entered into a collective bargaining agreement,
and (iv) each employee pension benefit plan (as defined in ERISA) sponsored by
the Company or any of its subsidiaries.
ARTICLE VII
NEGATIVE COVENANTS
The Company covenants and agrees, as to itself and, except as
otherwise provided herein, each of its Subsidiaries, that on and after the date
hereof until the Notes have been paid in full and the Commitments have
terminated:
SECTION 7.01 Change in Business. The Company will not, and will
not permit any of its Subsidiaries to, engage in any businesses not of the same
general type as those conducted by the Company on the Execution Date, those
conducted by a Qualified Company when acquired and businesses reasonably related
thereto.
SECTION 7.02 Consolidation, Merger or Sale of Assets. Except as
previously disclosed to the Agent, the Company will not, and will not permit any
of its Subsidiaries to, wind up, liquidate or dissolve their affairs, or agree
to be acquired by any third party in any transaction of merger or consolidation
in which the Company or such Subsidiary is not the sole surviving entity, or
sell or otherwise dispose of all or any substantial part of their property or
assets (including the capital stock of any Subsidiary) other than: (a) sales of
inventory and surplus or obsolete assets in the ordinary course of business that
do not prejudice the Banks in any material way, (b) dispositions of the stock of
Subsidiaries to, or mergers with, other wholly-owned Subsidiaries of the Company
that have complied with Section 6.09, and (c) any sale of assets with a value
equal to or less than five percent (5%) of the Company's Consolidated Net Worth,
provided the proceeds of such sale are used
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to acquire assets for use in the Company's business, or, at the option of the
Company, to reduce the Obligations.
SECTION 7.03 Indebtedness. Neither the Company nor any Subsidiary
of the Company will create, incur, assume or permit to exist any Indebtedness of
the Company or any Subsidiary except:
(a) Indebtedness existing hereunder;
(b) Indebtedness existing on the Execution Date and described in
the Financials or, if not shown, listed on Schedule 7.03(b);
(c) Indebtedness arising as a result of the endorsement in the
ordinary course of business of negotiable instruments in the course of
collection;
(d) accounts payable and unsecured, current and long-term,
liabilities (including accrued insurance related liabilities), not the result of
indebtedness for borrowed money, to vendors, suppliers and other Persons for
goods and services in the ordinary course of business;
(e) agreements (including agreements of intent) to acquire any
Person or assets issued by the Company or any of its Subsidiaries in
anticipation of acquiring such Person or assets if such acquisition is not
prohibited by this Agreement, including any ongoing, contingent payment
obligations contained in such agreements;
(f) Intercompany Indebtedness of any Subsidiary of the Company to
the Company or any other Subsidiary and Indebtedness of the Company to any
Subsidiary of the Company assuming same is subordinate to the Obligations in the
manner provided in Section 8.05 hereof;
(g) guarantees by the Company or any of its Subsidiaries of
Indebtedness of any Subsidiary of the Company permitted to be incurred, created
or existing pursuant to this Agreement, provided, that such guarantees are not
directly secured by any Liens;
(h) current and deferred taxes;
(i) contingent liabilities under surety bonds or otherwise
incurred in the ordinary course of business;
(j) earn-out agreements that are a part of Investments allowed
under Section 7.05(d);
(k) Other Indebtedness not in excess of five percent (5%) of
Consolidated Net Worth in the aggregate at any time outstanding;
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(l) Indebtedness not to exceed two percent (2%) of Consolidated
Net Worth at any time outstanding secured in accordance with clause (j) of the
definition herein of Permitted Liens;
(m) Subordinated Shareholder Debt not to exceed $30,000,000.00;
(n) liabilities incurred in connection with interest rate hedging
and swap agreements, provided, same are entered into in connection with the day
to day business operations of the Company and not for speculative purposes;
(o) Alternative Facilities Advances, provided, the Alternative
Facilities Advances do not exceed at any time the lesser of the Aggregate Unused
Commitment as of such time or $20,000,000.00;
(p) Subordinated Debentures issued and outstanding at any time in
an amount not in excess of $150,000,000.00 in principal amount; and
(q) renewals and extensions with the same lenders (in the same or
lesser principal amount on similar terms and conditions) of any Indebtedness
listed in subparagraphs (a) through (p) above.
SECTION 7.04 Liens. Neither the Company nor any Subsidiary of the
Company will create, incur, assume or suffer to exist any Lien upon or with
respect to any of its property or assets of any kind whether now owned or
hereafter acquired (nor will they covenant with any other Person not to grant
such a Lien to the Agent on Collateral, except property secured or to be secured
by a Lien permitted by this Agreement), except:
(a) Liens existing on the Execution Date and listed on Schedule
7.04(a);
(b) Liens securing currently secured Indebtedness permitted under
Section 7.03(b) or (m) above;
(c) Permitted Liens;
(d) Liens created by the Loan Documents;
(e) Other Liens securing obligations allowed pursuant to Section
7.03(k) or (l) not exceeding $1,500,000.00 in the aggregate at any one time;
(f) deposits under real property leases and deposits with
utilities, provided that such deposits do not exceed amounts customarily
deposited by other Persons similarly situated; and
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(g) any renewal, extension or replacement of any Lien referred to
above with the same lenders; provided, that no Lien arising or existing as a
result of such extension, renewal or replacement shall be extended to cover any
property not theretofore subject to the Lien being extended, renewed or replaced
and provided further that the principal amount of the Indebtedness secured
thereby shall not exceed the principal amount of the Indebtedness so secured at
the time of such extension, renewal or replacement.
SECTION 7.05 Investments. Neither the Company nor any Subsidiary
will, directly or indirectly, make or own any Investment in any Person, except:
(a) Permitted Investments;
(b) Investments owned on the Effective Date as set forth on
Schedule 7.05(b), including Investments in the Subsidiaries, direct and
indirect;
(c) Investments arising out of loans and advances for expenses,
travel per diem and similar items in the ordinary course of business to
officers, directors and employees and intercompany Indebtedness permitted by
Section 7.03(f);
(d) Subject to the limitations contained in Section 7.17,
investments in the stock, warrants, stock appreciation rights, other securities
and/or other assets of Qualified Companies;
(e) other Investments not exceeding two and one-half percent
(2.5%) of Consolidated Net Worth in the aggregate at any one time outstanding;
(f) Investments in the form of stock buy backs allowed under
Section 7.06; and
(g) Investments in the Company or in wholly-owned Subsidiaries of
the Company.
SECTION 7.06 Restricted Payments. The Company will not pay any
dividends or redeem, retire, purchase or guaranty the value of or make any other
acquisition, direct or indirect, of any shares of any class of stock of the
Company, or of any warrants, rights or options to acquire any such shares, now
or hereafter outstanding, except to the extent that the consideration therefor
consists solely of shares of stock (including warrants, rights or options
relating thereto) of the Company or is approved by the Majority Banks; provided,
the Company may (i) purchase its stock in a maximum, aggregate amount not to
exceed $1,000,000.00 in the aggregate; and (ii) purchase its stock in an
additional aggregate amount not to exceed $5,000,000.00 provided the stock is
purchased only from former owners of acquired businesses and provided further,
that the purchased stock is reissued or the same number of shares of the same
class of stock is issued, for value, within one hundred fifty (150) days of
purchase and the Company receives the full net proceeds therefor.
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SECTION 7.07 Change in Accounting. The Company will not and will
not permit any Subsidiary to, change its method of accounting except for (a)
changes permitted by GAAP in which the Company's auditors concur, (b) changes
with respect to any Person or assets acquired by the Company to conform with the
Company's policies and procedures and which are permitted by GAAP or (c) changes
required by GAAP. The Company shall advise the Agent in writing promptly upon
making any material change to the extent same is not disclosed in the financial
statements required under Section 6.01 hereof. In the event of any such change,
the Company, the Banks and the Agent agree to negotiate amendments to Sections
7.10 through 7.18 hereof (and related definitions, if relevant) so as to
equitably reflect such changes thereon with the intended result that the
criteria for evaluating the financial condition of the Company and its
Subsidiaries shall be substantially the same after such changes as before.
SECTION 7.08 Certain Indebtedness. The Company will not make, and
will not permit any of its Subsidiaries to make, after the occurrence and during
the continuance of any Event of Default, any prepayments of principal or
interest on any other of the Company's Indebtedness, except as may be required
thereby.
SECTION 7.09 Transactions with Affiliates. The Company will not,
directly or indirectly, engage in any transaction with any Affiliate, including
the purchase, sale or exchange of assets or the rendering of any service, except
in the ordinary course of business or pursuant to the reasonable requirements of
its business and, in each case, upon terms that are no less favorable than those
which might be obtained in an arm's-length transaction at the time from
non-Affiliates.
SECTION 7.10 Consolidated Net Worth. The Company will not permit
its Consolidated Net Worth to be less than $180,000,000.00, plus, in all cases:
(a) 100% of the net cash proceeds received from the issuance of any capital
stock by the Company or any Subsidiary subsequent to the Execution Date at any
time during the term hereof and (b) 75% of the consolidated after tax income (if
positive) of the Company and its Subsidiaries since July 1, 1998 for each fiscal
year during the term hereof (including any Subsidiaries acquired subsequent
hereto).
SECTION 7.11 Funded Debt to EBITDA Ratio. (a) Prior to the
occurrence of a Public Debt Issuance Event, the Company will not permit the
ratio of its Funded Debt to EBITDA calculated for the preceding four (4)
quarters on a rolling four (4) quarter basis to be greater than 2.75 to 1.0 at
any time during the term hereof.
(b) After the occurrence of a Public Debt Issuance Event, the
Company will not permit the ratio of its Funded Debt to EBITDA calculated for
the preceding four (4) quarters on a rolling four (4) quarter basis to be
greater than 4.00 to 1.0 at any time during the term hereof.
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SECTION 7.12 Senior Debt to EBITDA Ratio. After the occurrence of
a Public Debt Issuance Event, the Company will not permit the ratio of Senior
Debt to EBITDA calculated for the preceding four (4) quarters on a rolling four
(4) quarters basis to be greater than 2.50 to 1.00 at any time during the term
hereof.
SECTION 7.13 Funded Debt to Capitalization Ratio. The Company will
not permit its Capitalization Ratio to be greater than fifty-five percent (55%)
at any time during the term hereof.
SECTION 7.14 Capital Expenditures. During any fiscal year during
the term hereof, the Company will not permit non-acquisition related
consolidated Capital Expenditures (including Capitalized Lease Obligations) to
be greater than eight percent (8%) of Consolidated Net Worth as of the end of
such fiscal year.
SECTION 7.15 Fixed Charge Coverage Ratio. The Company will not
permit the ratio of (a) EBITDA calculated for the preceding four (4) quarters on
a rolling four (4) quarter basis, less cash taxes and Capital Expenditures
actually paid during such four (4) quarters to (b) the sum of (without
duplication): cash interest expense, scheduled amortization of principal and
payments in respect of Capitalized Lease Obligations calculated for the
preceding four (4) quarters on a rolling four quarter basis, plus twenty percent
(20%) of Advances outstanding under this Agreement to be less than 1.20 to 1.0,
as of the end of any fiscal quarter.
SECTION 7.16 Limitations on Acquisitions. The Company will not and
will not permit any Subsidiary to acquire any Qualified Company by funding such
acquisition with consideration other than common stock, without first obtaining
prior approval of such acquisition from the Majority Banks, except for such
funding that is less than $15,000,000.00 in non-equity consideration for each
such acquisition.
SECTION 7.17 Subordinated Debt. (a) The Company will not make any
optional payment, prepayment or redemption of any Indebtedness permitted under
(i) Section 7.03(m) without the consent of the Majority Banks and (ii) Section
7.03(p) without the consent of all of the Banks.
(b) The Company will not amend or obtain or grant a waiver of any
provision of (i) the Subordinated Debentures or the debenture indenture in
respect thereof or (ii) any Subordinated Shareholder Debt or any agreement or
arrangement in respect thereof, except for amendments and waivers that are not
material and are not to the detriment of the Banks.
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ARTICLE VIII
GUARANTY
SECTION 8.01 Guaranty. In consideration of, and in order to induce
the Banks to make the Loans hereunder, the Guarantors hereby absolutely,
unconditionally and irrevocably, jointly and severally guarantee the punctual
payment and performance when due, whether at stated maturity, by acceleration or
otherwise, of the Obligations, and all other obligations and covenants of the
Company now or hereafter existing under this Agreement, the Notes and the other
Loan Documents whether for principal, interest (including interest accruing or
becoming owing both prior to and subsequent to the commencement of any
proceeding against or with respect to the Company under any chapter of the
Bankruptcy Code), Fees, commissions, expenses (including reasonable attorneys'
fees and expenses) or otherwise, and all reasonable costs and expenses, if any,
incurred by the Agent or any Bank in connection with enforcing any rights under
this Guaranty (all such obligations being the "Guaranteed Obligations"), and
agree to pay any and all reasonable expenses incurred by each Bank and the Agent
in enforcing this Guaranty; provided that notwithstanding anything contained
herein or in any of the Loan Documents to the contrary, the maximum liability of
each Guarantor hereunder and under the other Loan Documents shall in no event
exceed such Guarantor's Maximum Guaranteed Amount, and provided further, each
Guarantor shall be unconditionally required to pay all amounts demanded of it
hereunder prior to any determination of such Maximum Guaranteed Amount and the
recipient of such payment, if so required by a final non-appealable order of a
court of competent jurisdiction, shall then be liable for the refund of any
excess amounts. If any such rebate or refund is ever required, all other
Guarantors (and the Company) shall be fully liable for the repayment thereof to
the maximum extent allowed by applicable law. This Guaranty is an absolute,
unconditional, present and continuing guaranty of payment and not of
collectibility and is in no way conditioned upon any attempt to collect from the
Company or any other action, occurrence or circumstance whatsoever. Each
Guarantor agrees that the Guaranteed Obligations may at any time and from time
to time exceed the Maximum Guaranteed Amount of such Guarantor without impairing
this Guaranty or affecting the rights and remedies of the Banks hereunder.
SECTION 8.02 Continuing Guaranty. Each Guarantor guarantees that
the Guaranteed Obligations will be paid strictly in accordance with the terms of
this Agreement, the Notes and the other Loan Documents. Each Guarantor agrees
that the Guaranteed Obligations and Loan Documents may be extended or renewed,
and Loans repaid and reborrowed in whole or in part, without notice to or assent
by such Guarantor, and that it will remain bound upon this Guaranty
notwithstanding any extension, renewal or other alteration of any Guaranteed
Obligations or Loan Documents, or any repayment and reborrowing of Loans. To the
maximum extent permitted by applicable law, the obligations of each Guarantor
under this Guaranty shall be absolute, unconditional and irrevocable, and shall
be performed strictly in accordance with the terms hereof under any
circumstances whatsoever, including:
(a) any extension, renewal, modification, settlement, compromise,
waiver or release in respect of any Guaranteed Obligations;
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(b) any extension, renewal, amendment, modification, rescission,
waiver or release in respect of any Loan Documents;
(c) any release, exchange, substitution, non-perfection or
invalidity of, or failure to exercise rights or remedies with respect to, any
direct or indirect security for any Guaranteed Obligations, including the
release of any Guarantor or other Person liable on any Guaranteed Obligations;
(d) any change in the corporate existence, structure or ownership
of the Company, any Guarantor, or any insolvency, bankruptcy, reorganization or
other similar proceeding affecting the Company, such Guarantor, any other
Guarantor or any of their respective assets;
(e) the existence of any claim, defense, set-off or other rights
or remedies which such Guarantor at any time may have against the Company, or
the Company or such Guarantor may have at any time against the Agent, any Bank,
any other Guarantor or any other Person, whether in connection with this
Guaranty, the Loan Documents, the transactions contemplated thereby or any other
transaction other than by the payment in full by the Company of the Guaranteed
Obligations after the termination of the Commitments of the Banks;
(f) any invalidity or unenforceability for any reason of this
Agreement or other Loan Documents, or any provision of law purporting to
prohibit the payment or performance by the Company, such Guarantor or any other
Guarantor of the Guaranteed Obligations or Loan Documents, or of any other
obligation to the Agent or any Bank; or
(g) any other circumstances or happening whatsoever, whether or
not similar to any of the foregoing.
SECTION 8.03 Effect of Debtor Relief Laws. If after receipt of
any payment of, or proceeds of any security applied (or intended to be applied)
to the payment of all or any part of the Guaranteed Obligations, the Agent or
any Bank is for any reason compelled to surrender or voluntarily surrenders
(under circumstances in which it believes it could reasonably be expected to be
so compelled if it did not voluntarily surrender), such payment or proceeds to
any Person (a) because such payment or application of proceeds is or may be
avoided, invalidated, declared fraudulent, set aside, determined to be void or
voidable as a preference, fraudulent conveyance, fraudulent transfer,
impermissible set-off or a diversion of trust funds or (b) for any other similar
reason, including (i) any judgment, decree or order of any court or
administrative body having jurisdiction over the Agent, any Bank or any of their
respective properties or (ii) any settlement or compromise of any such claim
effected by the Agent or any Bank with any such claimant (including the
Company), then the Guaranteed Obligations or part thereof intended to be
satisfied shall be reinstated and continue, and this Guaranty shall continue in
full force as if such payment or proceeds have not been received,
notwithstanding any revocation thereof or the cancellation of any Note or any
other instrument evidencing any Guaranteed Obligations or otherwise; and the
Guarantors, jointly and severally, shall be liable to pay the Agent and the
Banks, and hereby do indemnify the
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Agent and the Banks and hold them harmless for the amount of such payment or
proceeds so surrendered and all expenses (including reasonable attorneys' fees,
court costs and expenses attributable thereto) incurred by the Agent or any Bank
in the defense of any claim made against it that any payment or proceeds
received by the Agent or any Bank in respect of all or part of the Guaranteed
Obligations must be surrendered. The provisions of this paragraph shall survive
the termination of this Guaranty, and any satisfaction and discharge of the
Company by virtue of any payment, court order or any federal or state law.
SECTION 8.04 Waiver of Subrogation. Notwithstanding any payment or
payments made by any Guarantor hereunder, or any set-off or application by the
Agent or any Bank of any security or of any credits or claims, no Guarantor will
assert or exercise any rights of the Agent or any Bank or of such Guarantor
against the Company to recover the amount of any payment made by such Guarantor
to the Agent or any Bank hereunder by way of any claim, remedy or subrogation,
reimbursement, exoneration, contribution, indemnity, participation or otherwise
arising by contract, by statute, under common law or otherwise, and such
Guarantor shall not have any right of recourse to or any claim against assets or
property of the Company, in each case unless and until the Obligations of the
Company guaranteed hereby have been fully and finally satisfied. Until such
time, each Guarantor hereby expressly waives any right to exercise any claim,
right or remedy which such Guarantor may now have or hereafter acquire against
the Company that arises under this Agreement or any other Loan Document or from
the performance by any Guarantor of the Guaranty hereunder including any claim,
remedy or right of subrogation, reimbursement, exoneration, contribution,
indemnification or participation in any claim, right or remedy of the Agent or
any Bank against the Company or any Guarantor, or any security that the Agent or
any Bank now has or hereafter acquires, whether or not such claim, right or
remedy arises in equity, under contract, by statute, under common law or
otherwise. If any amount shall be paid to a Guarantor by the Company or another
Guarantor after payment in full of the Obligations, and the Obligations shall
thereafter be reinstated in whole or in part and the Agent or any Bank forced to
repay any sums received by any of them in payment of the Obligations, this
Guaranty shall be automatically reinstated and such amount shall be held in
trust for the benefit of the Agent and the Banks and shall forthwith be paid to
the Agent to be credited and applied to the Guaranteed Obligations, whether
matured or unmatured. The provisions of this paragraph shall survive the
termination of this Guaranty, and any satisfaction and discharge of the Company
by virtue of any payment, court order or any federal or state law.
SECTION 8.05 Subordination. If any Guarantor becomes the holder of
any indebtedness payable by the Company or another Guarantor, each Guarantor
hereby subordinates all indebtedness owing to it from the Company or such other
Guarantor to all indebtedness of the Company to the Agent and the Banks, and
agrees that during the continuance of any Event of Default it shall not accept
any payment on the same until payment in full of the Obligations of the Company
under this Agreement and the other Loan Documents after the termination of the
Commitments of the Banks and shall in no circumstance whatsoever attempt to
set-off or reduce any obligations hereunder because of such indebtedness. If any
amount shall nevertheless be paid in violation of the foregoing to a Guarantor
by the Company or another Guarantor prior to payment in
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full of the Guaranteed Obligations, such amount shall be held in trust for the
benefit of the Agent and the Banks and shall forthwith be paid to the Agent to
be credited and applied to the Guaranteed Obligations, whether matured or
unmatured.
SECTION 8.06 Waiver. Each Guarantor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Guaranteed Obligations and this Guaranty and waives presentment, demand of
payment, notice of intent to accelerate, notice of dishonor or nonpayment and
any requirement that the Agent or any Bank institute suit, collection
proceedings or take any other action to collect the Guaranteed Obligations,
including any requirement that the Agent or any Bank protect, secure, perfect or
insure any Lien against any property subject thereto or exhaust any right or
take any action against the Company or any other Person or any collateral (it
being the intention of the Agent, the Banks and each Guarantor that this
Guaranty is to be a guaranty of payment and not of collection). It shall not be
necessary for the Agent or any Bank, in order to enforce any payment by any
Guarantor hereunder, to institute suit or exhaust its rights and remedies
against the Company, any other Guarantor or any other Person, including others
liable to pay any Guaranteed Obligations, or to enforce its rights against any
security ever given to secure payment thereof. Each Guarantor hereby expressly
waives to the maximum extent permitted by applicable law each and every right to
which it may be entitled by virtue of the suretyship laws of the State of Texas,
including any and all rights it may have pursuant to Rule 31, Texas Rules of
Civil Procedure, Section 17.001 of the Texas Civil Practice and Remedies Code
and Chapter 34 of the Texas Business and Commerce Code. Each Guarantor hereby
waives marshaling of assets and liabilities, notice by the Agent or any Bank of
any indebtedness or liability to which such Bank applies or may apply any
amounts received by such Bank, and of the creation, advancement, increase,
existence, extension, renewal, rearrangement or modification of the Guaranteed
Obligations. Each Guarantor expressly waives, to the extent permitted by
applicable law, the benefit of any and all laws providing for exemption of
property from execution or for valuation and appraisal upon foreclosure.
SECTION 8.07 Full Force and Effect. This Guaranty is a continuing
guaranty and shall remain in full force and effect until all of the Obligations
of the Company under this Agreement and the other Loan Documents and all other
amounts payable under this Guaranty have been paid in full (after the
termination of the Commitments of the Banks). All rights, remedies and powers
provided in this Guaranty may be exercised, and all waivers contained in this
Guaranty may be enforced, only to the extent that the exercise or enforcement
thereof does not violate any provisions of applicable law which may not be
waived.
SECTION 8.08 Negative Pledge. No Guarantor will create any lien on
its assets to any other Person during the pendency of this Agreement except for
liens that would be permitted by Section 7.04 nor will any of them enter any
agreement with any Person not to grant liens on or pledge assets to the Agent.
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ARTICLE IX
EVENTS OF DEFAULT AND REMEDIES
SECTION 9.01 Events of Default. The following events shall
constitute Events of Default ("Events of Default") hereunder:
(a) any installment of principal is not paid when due or any
payment of interest or Fees is not paid on the date on which such payment is due
and such failure continues for a period of five (5) days; or
(b) any representation or warranty made or deemed made by the
Company or any Subsidiary herein or in any of the Loan Documents or other
document, certificate or financial statement delivered in connection with this
Agreement or any other Loan Document shall prove to have been incorrect in any
material respect when made or deemed made or reaffirmed, as the case may be; or
(c) the Company or any Subsidiary shall fail to perform or observe
any duty or covenant contained in Article VI of this Agreement or in any of the
Security Documents and such failure continues for a period of fifteen (15) days
or shall fail to perform or observe any other covenant or duty contained in this
Agreement or in any of the Loan Documents; or
(d) (i) the Company shall (A) fail to make any principal payment
of or interest or premium, if any, on the Subordinated Debentures or (B) shall
fail to duly observe, perform or comply with any agreement with any Person or
any term or condition with respect to the Subordinated Debentures, if the effect
of such failure is to cause or to permit the holder or holders of any of the
Subordinated Debentures to cause, such obligations to become due prior to any
stated maturity or (ii) the Company or any Subsidiary shall (A) fail to make
(whether as primary obligor or as guarantor or other surety) any principal
payment of or interest or premium, if any, on any instrument of Indebtedness in
excess of $5,000,000.00 allowed hereunder outstanding beyond any period of grace
provided with respect thereto or (B) shall fail to duly observe, perform or
comply with any agreement with any Person or any term or condition of any
instrument of Indebtedness in excess of $5,000,000.00, if the effect of such
failure is to cause, or to permit the holder or holders to cause, such
obligations to become due prior to any stated maturity; or
(e) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i) relief
in respect of the Company or any Subsidiary, or of a substantial part of the
property or assets of the Company or any Subsidiary, under Title 11 of the
United States Code, as now or hereafter in effect, or any successor thereto (the
"Bankruptcy Code"), or any other federal or state bankruptcy, insolvency,
receivership or similar law, (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Company or any
Subsidiary or for a substantial part of the property or assets of the Company or
any Subsidiary or (iii) the winding-up or liquidation of the Company or any
Subsidiary; and such
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proceeding or petition shall continue undismissed for 60 days or an order or
decree approving or ordering any of the foregoing shall be entered; or
(f) the Company or any Subsidiary shall (i) voluntarily commence
any proceeding or file any petition seeking relief under the Bankruptcy Code or
any other federal or state bankruptcy, insolvency, receivership or similar law,
(ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or the filing of any petition described in
clause (e) above, (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for the
Company or any Subsidiary or for a substantial part of the property or assets of
the Company or any Subsidiary, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors, (vi) become unable, or admit in
writing its inability or fail generally, to pay its debts as they become due or
(vii) take any action for the purpose of effecting any of the foregoing; or
(g) any Loan Document shall become or be deemed to be
unenforceable in any material respect in the sole judgment of the Majority
Banks; or
(h) a judgment or order, which with other outstanding judgments
and orders against the Company and its Subsidiaries equal or exceed
$5,000,000.00 in the aggregate (to the extent not covered by insurance as to
which the respective insurer has acknowledged coverage), shall be entered
against the Company or any Subsidiary and (i) within 30 days after entry thereof
such judgment shall not have been paid or discharged or execution thereof stayed
pending appeal or, within 30 days after the expiration of any such stay, such
judgment shall not have been paid or discharged or (ii) any enforcement
proceeding shall have been commenced (and not stayed) by any creditor or upon
such judgment; or
(i) any Plan shall incur an accumulated funding deficiency (as
defined in Section 412 of the Code or Section 302 of ERISA) which (individually
or collectively) exceeds $5,000,000.00, whether or not waived, or a waiver in
excess of $5,000,000.00 of the minimum funding standard or material extension of
any amortization period is sought or granted under Section 412 of the Code with
respect to a Plan; any proceeding shall have occurred or is reasonably likely to
occur by the PBGC under Section 4069(a) of ERISA to impose liability on the
Company, any Subsidiary or an ERISA Affiliate which (individually or
collectively) exceeds $5,000,000.00; any required contribution to a Plan or
Multiemployer Plan in excess of $5,000,000.00 shall not have been made within 15
days of the date such contribution is due; or the Company, any Subsidiary or any
ERISA Affiliate has incurred or is reasonably likely to incur a liability to or
on account of a Plan or Multiemployer Plan under Section 515, 4062, 4063, 4201
or 4204 of ERISA, and there shall result (individually or collectively) from any
such event or events a material risk of either (i) the imposition of a Lien(s)
upon, or the granting of a security interest(s) in, the assets of the Company,
any Subsidiary and/or an ERISA Affiliate securing an amount(s) equal to or
exceed $5,000,000.00, or (ii) the Company, any Subsidiary and/or an ERISA
Affiliate incurring a liability(ies) or obligation(s) with respect thereto equal
to or exceeding $5,000,000.00; or
(j) a Change of Control shall occur.
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SECTION 9.02 Primary Remedies. In any such event, and at any time
after the occurrence of any of the above described events, the Agent, if
directed by the Majority Banks, shall by written notice to the Company (a
"Notice of Default") take any or all of the following actions (without prejudice
to the rights of any Bank to enforce any other rights it may have against the
Company, provided that, if an Event of Default specified in Section 9.01(e) or
Section 9.01(f) shall occur, the following shall occur automatically without the
giving of any Notice of Default): (a) declare the Commitments terminated,
whereupon the Commitments shall forthwith terminate immediately and any
Commitment Fee and any other owing and unpaid Fee shall forthwith become due and
payable without any other notice of any kind; (b) declare the principal of and
any accrued and unpaid interest in respect of all Advances, and all obligations
owing hereunder, to be, whereupon the same shall become, forthwith due and
payable without presentment, demand, notice of demand or of dishonor and
non-payment, protest, notice of protest, notice of intent to accelerate,
declaration or notice of acceleration or any other notice of any kind (except as
herein provided), all of which are hereby waived by the Company; (c) set off any
assets or money of the Company or any Guarantor in its or any Bank's possession
against the Obligations (and thereafter in accordance with Section 11.06); and
(d) exercise any rights or remedies under any of the Loan Documents or under any
applicable state or federal law.
SECTION 9.03 Other Remedies. Upon the occurrence and during the
continuance of any Event of Default, the Agent may proceed to protect and
enforce its and the Banks' rights, either by suit in equity or by action at law
or both, whether for the specific performance of any covenant or agreement
contained in this Agreement or in any other Loan Document or in aid of the
exercise of any power granted in this Agreement or in any other Loan Document;
or may proceed to enforce the payment of all amounts owing to the Banks under
the Loan Documents and any accrued and unpaid interest thereon in the manner set
forth herein or therein; it being intended that no remedy conferred herein or in
any of the other Loan Documents is to be exclusive of any other remedy, and each
and every remedy contained herein or in any other Loan Document shall be
cumulative and shall be in addition to every other remedy given hereunder and
under the other Loan Documents or now or hereafter existing at law or in equity
or by statute or otherwise.
ARTICLE X
THE AGENT
SECTION 10.01 Authorization and Action. Each Bank hereby
irrevocably appoints and authorizes the Agent to act on its behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
specifically delegated to or required of the Agent by the terms hereof, together
with such powers as are reasonably incidental thereto. The Agent may perform any
of its duties hereunder by or through its agents and employees. The duties of
the Agent shall be mechanical and administrative in nature; the Agent shall not
have by reason of this Agreement or any other Loan Documents a fiduciary
relationship in respect of any Bank; and nothing in this Agreement or any other
Loan Document, expressed or implied, is intended to, or shall be so construed as
to, impose upon the Agent any obligations in respect of this Agreement or
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any other Loan Document except as expressly set forth herein or therein. As to
any matters not expressly provided for by this Agreement, the Notes or the other
Loan Documents (including enforcement or collection of the Notes), the Agent
shall not be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Majority Banks,
and such instructions shall be binding upon the Banks and all holders of Notes
and the Obligations; provided, that the Agent shall not be required to take any
action which exposes the Agent to personal liability and shall not be required
or entitled to take any action which is contrary to any of the Loan Documents or
applicable law.
SECTION 10.02 Agent's Reliance. (a) Neither the Agent nor any of
its directors, officers, agents or employees shall be liable to the Banks for
any action taken or omitted to be taken by it or them under or in connection
with this Agreement, the Notes or any of the other Loan Documents (i) with the
consent or at the request of the Majority Banks or (ii) in the absence of its or
their own gross negligence or willful misconduct, it being the express intention
of the parties hereto that the Agent and its directors, officers, agents and
employees shall have no liability to the Banks for actions and omissions under
this Section resulting from their sole ordinary or contributory negligence.
(b) Without limitation of the generality of the foregoing, the
Agent: (i) may treat the payee of each Note and the Obligations as the holder
thereof until the Agent receives written notice of the assignment or transfer
thereof signed by such payee and in form satisfactory to the Agent; (ii) may
consult with legal counsel (including counsel for the Company), independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance with
the advice of such counsel, accountants or experts; (iii) makes no warranty or
representation to any Bank and shall not be responsible to any Bank for any
statements, warranties or representations made in or in connection with this
Agreement, any Note or any other Loan Document; (iv) except as otherwise
expressly provided herein, shall not have any duty to ascertain or to inquire as
to the performance or observance of any of the terms, covenants or conditions of
this Agreement, any Note or any other Loan Document or to inspect the property
(including the books and records) of the Company; (v) shall not be responsible
to any Bank for the due execution, legality, validity, enforceability,
collectibility, genuineness, sufficiency or value of this Agreement, any Note,
any other Loan Document or any other instrument or document furnished pursuant
hereto or thereto; (vi) shall not be responsible to any Bank for the perfection
or priority of any Lien securing the Obligations; and (vii) shall incur no
liability to the Banks under or in respect of this Agreement, any Note or any
other Loan Document by acting upon any notice, consent, certificate or other
instrument or writing (which may be by telegram, telecopier or cable) reasonably
believed by it to be genuine and signed or sent by the proper party or parties.
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SECTION 10.03 Agent and Affiliates; Chase and Affiliates. Without
limiting the right of any other Bank to engage in any business transactions with
the Company or any of its Affiliates, with respect to their Commitments, the
Loans made by them and the Notes issued to them, Chase and each other Bank who
may become the Agent shall have the same rights and powers under this Agreement
and its Notes as any other Bank and may exercise the same as though it was not
the Agent; and the term "Bank" or "Banks" shall, unless otherwise expressly
indicated, include Chase and any such other Bank, in their individual
capacities. Chase, each other Person who becomes the Agent and their respective
Affiliates may be engaged in, or may hereafter engage in, one or more loan,
letter of credit, leasing or other financing activity not the subject of this
Agreement (collectively, the "Other Financings") with the Company, any
Subsidiary or any of its Affiliates, or may act as trustee on behalf of, or
depositary for, or otherwise engage in other business transactions with the
Company, any Subsidiary or any of its Affiliates (all Other Financings and other
such business transactions being collectively, the "Other Activities") with no
responsibility to account therefor to the Banks. Without limiting the rights and
remedies of the Banks specifically set forth herein, no other Bank by virtue of
being a Bank hereunder shall have any interest in (a) any Other Activities, (b)
any present or future guaranty by or for the account of the Company not
contemplated or included herein, (c) any present or future offset exercised by
the Agent in respect of any such Other Activities, (d) any present or future
property taken as security for any such Other Activities or(e) any property now
or hereafter in the possession or control of the Agent which may be or become
security for the Obligations of the Company hereunder and under the Notes by
reason of the general description of indebtedness secured, or of property
contained in any other agreements, documents or instruments related to such
Other Activities; provided, however, that if any payment in respect of such
guaranties or such property or the proceeds thereof shall be applied to
reduction of the Obligations evidenced hereunder and by the Notes, then each
Bank shall be entitled to share in such application according to its pro rata
portion of such Obligations.
SECTION 10.04 Banks' Credit Decision. Each Bank acknowledges and
agrees that it has, independently and without reliance upon the Agent or any
other Bank and based on the financial statements referred to in Section 6.01 and
such other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges and agrees that it will, independently and without reliance upon
the Agent or any other Bank and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan Documents.
SECTION 10.05 Agent's Indemnity. (a) The Agent shall not be
required to take any action hereunder or to prosecute or defend any suit in
respect of this Agreement, the Notes or any other Loan Document unless
indemnified to the Agent's satisfaction by the Banks against loss, cost,
liability and expense. If any indemnity furnished to the Agent shall become
impaired, it may call for additional indemnity and cease to do the acts
indemnified against until such additional indemnity is given. In addition, the
Banks agree to indemnify the Agent (to the extent not reimbursed by the
Company), ratably according to the respective aggregate principal amounts of the
Notes then held by each of them (or if no Notes are at the time outstanding,
ratably according to the
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respective amounts of the Commitments), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against the Agent in any way relating to or
arising out of this Agreement or any action taken or omitted by the Agent under
this Agreement, the Notes and the other Loan Documents. Without limitation of
the foregoing, each Bank agrees to reimburse the Agent promptly upon demand for
its ratable share of any out-of-pocket expenses (including reasonable counsel
fees) incurred by the Agent in connection with the preparation, execution,
administration, or enforcement of, or legal advice in respect of rights or
responsibilities under, this Agreement, the Notes and the other Loan Documents
to the extent that the Agent is not reimbursed for such expenses by the Company.
The provisions of this Section shall survive the termination of this Agreement,
the payment of the Obligations and/or the assignment of any of the Notes.
(b) Notwithstanding the foregoing, no Bank shall be liable under
this Section to the Agent for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements due to the Agent resulting from the Agent's gross negligence or
willful misconduct. Each Bank agrees, however, that it expressly intends, under
this Section, to indemnify the Agent ratably as aforesaid for all such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses and disbursements arising out of or resulting from the Agent's
sole ordinary or contributory negligence.
SECTION 10.06 Successor Agent. The Agent may resign at any time by
giving written notice thereof to the Banks and the Company and may be removed as
Agent under this Agreement, the Notes and the other Loan Documents at any time
with or without cause by the Majority Banks. Upon any such resignation or
removal, the Majority Banks shall have the right to appoint a successor Agent
with the approval of the Company, which shall not be unreasonably withheld. If
no successor Agent shall have been so appointed by the Majority Banks, and shall
have accepted such appointment, within 30 calendar days after the retiring
Agent's giving of notice of resignation or the Majority Banks' removal of the
retiring Agent, then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent with the approval of the Company, which shall not be
unreasonably withheld, which shall be a commercial bank organized under the laws
of the United States of America or of any state thereof and having a combined
capital and surplus of at least $50,000,000. Upon the acceptance of any
appointment as Agent hereunder and under the Notes and the other Loan Documents
by a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Agreement, the Notes and the other Loan Documents. After any retiring
Agent's resignation or removal as Agent hereunder and under the Notes and the
other Loan Documents, the provisions of this Article X shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement, the Notes and the other Loan Documents.
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SECTION 10.07 Notice of Default. The Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Agent shall have received notice from a Bank or the Company
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default." If the Agent receives such
notice, the Agent shall give notice thereof to the Banks; provided, however, if
such notice is received from a Bank, the Agent also shall give notice thereof to
the Company. The Agent shall be entitled to take action or refrain from taking
action with respect to such Default or Event of Default as provided in Section
10.01 and Section 10.02.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01 Amendments. No amendment or waiver of any provision
of this Agreement, any Note or any other Loan Document, nor consent to any
departure by the Company herefrom or therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Company, as to amendments,
and by the Majority Banks in all cases, and then, in any case, such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, no such amendment, waiver or consent shall be
effective unless signed by all of the Banks if it attempts to: (a) change the
definition of "Commitment", "Designated Payment Date", "Majority Banks",
"Margin" or "Maturity Date"; (b) modify this Section or Sections 2.19 or 11.05
or any definition related to said sections; (c) release any Guarantor or
Collateral; (d) waive any Default under Section 9.01(a), (e) release any Liens
on any of the Collateral, or in any other manner change the repayment terms of
the Loans, including required principal payments or the rate, amount or time of
interest payments or (f) modify Section 7.17(a)(ii). Further, no provisions of
Article III or Article X or other terms affecting the Agent or the Issuing Bank
may be changed without the consent of said Agent or the Issuing Bank as
appropriate.
SECTION 11.02 Notices. Except with respect to telephone
notifications specifically permitted pursuant to Article II, all notices,
consents, requests, approvals, demands and other communications provided for
herein shall be in writing (including telecopy communications) and mailed,
telecopied, sent by overnight courier or delivered:
(a) If to the Company and the Guarantors:
Group Maintenance America Corp.
0 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No: (000) 000-0000
Attention: Chief Financial Officer
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(b) If to the Agent:
Chase Bank of Texas
000 Xxxx 00xx Xxxxxx
Xxxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No: (000) 000-0000
Attention: Xx. Xxxx Xxxxxxx
Senior Vice President
with copies to:
Agency Services
1 Chase Xxxxxxxxx Xxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
and to:
Xxxxxxx & Xxxxx L.L.P.
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attention: Xx. Xxxxxx X. Xxxxxx
or, in the case of any party hereto, such other address or telecopy number as
such party may hereafter specify for such purpose by notice to the other
parties.
(c) If to any Bank, to the address shown on the signature page
hereof or specified by such Bank (or the Agent on behalf of any Bank) to the
Company.
All communications shall, when mailed, telecopied or delivered, be
effective when mailed by certified mail, return receipt requested to any party
at its address specified above, or telecopied to any party to the telecopy
number set forth above, or delivered personally to any party at its address
specified above; provided, that communications to the Agent pursuant to Article
II shall not be effective until actually received by the Agent, and provided
further that communications sent by telecopy after 5:00 p.m., Houston, Texas
time, shall be effective on the next succeeding business day.
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SECTION 11.03 No Waiver; Remedies. No failure on the part of any
Bank or the Agent to exercise, and no delay in exercising, any right hereunder,
under any Note or under any other Loan Document shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right, or any
abandonment or discontinuance of any steps to enforce such right, preclude any
other or further exercise thereof or the exercise of any other right. No notice
to or demand on the Company in any case shall entitle the Company to any other
or further notice or demand in similar or other circumstances. The remedies
herein are cumulative and not exclusive of any other remedies provided by law,
at equity or in any other agreement.
SECTION 11.04 Costs and Expenses. The Company agrees to pay on
demand: (a) all reasonable out-of-pocket costs and expenses of the Agent in
connection with the preparation, delivery, sale and syndication of this
Agreement, the Notes, the other Loan Documents and the other documents to be
delivered hereunder, including the reasonable fees and out-of-pocket expenses of
counsel for the Agent with respect thereto and with respect to advising the
Agent as to its rights and responsibilities under this Agreement, the Notes and
the other Loan Documents, and any modification, supplement or waiver of any of
the terms of this Agreement or any other Loan Document, (b) all reasonable
out-of-pocket costs and expenses of any Bank including reasonable legal fees and
expenses, in connection with the enforcement of this Agreement, the Notes and
the other Loan Documents and (c) reasonable costs and expenses incurred in
connection with third party professional services reasonably required by the
Agent such as appraisers, environmental consultants, accountants or similar
Persons, provided that, prior to any Event of Default hereunder, the Agent will
first obtain the consent of the Company to such expense, which consent shall not
be unreasonably withheld. Without prejudice to the survival of any other
obligations of the Company hereunder and under the Notes, the obligations of the
Company under this Section shall survive the termination of this Agreement or
the replacement of the Agent and each assignment of the Notes.
SECTION 11.05 Release and Indemnity. (a) The Company shall and
hereby does indemnify the Agent and each Bank and each Affiliate thereof and
their respective directors, officers, employees and agents from, and hold each
of them harmless against, any and all losses, liabilities, claims or damages
(including reasonable legal fees and expenses) to which any of them may become
subject, insofar as such losses, liabilities, claims or damages arise out of or
result from any actual or proposed use by the Company of the proceeds of any
extension of credit hereunder or any investigation, litigation or other
proceeding (including any threatened investigation or proceeding) relating to
the foregoing or any of the other Loan Documents, and the Company shall
reimburse each Bank and each Affiliate thereof and their respective directors,
officers, employees and agents, upon demand for any expenses (including legal
fees) reasonably incurred in connection with any such investigation or
proceeding; but excluding any such losses, liabilities, claims, damages or
expenses incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified (the "Indemnified Obligations").
(b) WITHOUT LIMITING ANY PROVISION OF THIS AGREEMENT, IT IS THE
EXPRESS INTENTION OF THE PARTIES HERETO THAT EACH PERSON TO BE INDEMNIFIED
HEREUNDER SHALL BE INDEMNIFIED AND HELD HARMLESS AGAINST ANY AND ALL INDEMNIFIED
OBLIGATIONS ARISING OUT OF OR
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RESULTING FROM THE ORDINARY SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH PERSON OR
IMPOSED UPON SAID PARTY UNDER ANY THEORY OF STRICT LIABILITY. Without prejudice
to the survival of any other obligations of the Company hereunder and under the
other Loan Documents, the obligations of the Company under this Section shall
survive the termination of this Agreement and the other Loan Documents and the
payment of the Obligations or the assignment of the Notes.
SECTION 11.06 Right of Setoff. Without limiting the remedies
provided for in Article IX, each Bank is hereby authorized at any time and from
time to time, after acceleration of the Obligations after the occurrence of an
Event of Default to the fullest extent permitted by law, to set off and apply
any and all deposits held and other indebtedness owing by such Bank, or any
branch, subsidiary or Affiliate, to or for the credit or the account of the
Company against any and all the Obligations of the Company now or hereafter
existing under this Agreement and the other Loan Documents and other obligations
of the Company held by such Bank, irrespective of whether or not such Bank shall
have made any demand under this Agreement, its Note or the Obligations and
although the Obligations may be unmatured. Each Bank agrees promptly to notify
the Company after any such set-off and application made by such Bank, provided,
that failure to give such notice shall not affect the validity of such set-off
and application. The rights of each Bank under this Section are in addition to
other rights and remedies (including other rights of setoff) which such Bank may
have.
SECTION 11.07 GOVERNING LAW. THIS AGREEMENT, ALL NOTES, THE OTHER
LOAN DOCUMENTS AND ALL OTHER DOCUMENTS EXECUTED IN CONNECTION HEREWITH SHALL BE
DEEMED TO BE CONTRACTS AND AGREEMENTS EXECUTED BY THE COMPANY AND EACH BANK
UNDER THE LAWS OF THE STATE OF TEXAS AND OF THE UNITED STATES OF AMERICA AND FOR
ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF
SAID STATE AND OF THE UNITED STATES OF AMERICA. Without limitation of the
foregoing, nothing in this Agreement, or in the Notes or in any other Loan
Document shall be deemed to constitute a waiver of any rights which any Bank may
have under applicable federal legislation relating to the amount of interest
which such Bank may contract for, take, receive or charge in respect of the Loan
and the Loan Documents, including any right to take, receive, reserve and charge
interest at the rate allowed by the law of the state where any Bank is located.
The Agent, each Bank and the Company further agree that insofar as the
provisions of Texas Finance Code, Chapter 303, as amended, are applicable to the
determination of the Highest Lawful Rate with respect to the Notes and the
Obligations hereunder and under the other Loan Documents, the weekly rate
ceiling of such Article, as described in Article 1D.003 of the Texas Credit
Title, shall be applicable; provided, however, that to the extent permitted by
such Article, the Agent may from time to time by notice to the Company revise
the election of such interest rate ceiling as such ceiling affects the then
current or future balances of the Loans. The provisions of the Texas Finance
Code, Chapter 346 do not apply to this Agreement, any Note issued hereunder or
the other Loan Documents.
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SECTION 11.08 Interest. Each provision in this Agreement and each
other Loan Document is expressly limited so that in no event whatsoever shall
the amount paid, or otherwise agreed to be paid, to the Agent or any Bank, or
charged, contracted for, reserved, taken or received by the Agent or any Bank,
for the use, forbearance or detention of the money to be loaned under this
Agreement or any Loan Document or otherwise (including any sums paid as required
by any covenant or obligation contained herein or in any other Loan Document
which is for the use, forbearance or detention of such money), exceed that
amount of money which would cause the effective rate of interest to exceed the
Highest Lawful Rate, and all amounts owed under this Agreement and each other
Loan Document shall be held to be subject to reduction to the effect that such
amounts so paid or agreed to be paid, charged, contracted for, reserved, taken
or received which are for the use, forbearance or detention of money under this
Agreement or such Loan Document shall in no event exceed that amount of money
which would cause the effective rate of interest to exceed the Highest Lawful
Rate. Anything in any Note or any other Loan Document to the contrary
notwithstanding, the Company shall not be required to pay unearned interest on
any Note and the Company shall not be required to pay interest on the
Obligations at a rate in excess of the Highest Lawful Rate, and if the effective
rate of interest which would otherwise be payable under such Note and such Loan
Documents would exceed the Highest Lawful Rate, or if the holder of such Note
shall receive any unearned interest or shall receive monies that are deemed to
constitute interest which would increase the effective rate of interest payable
by the Company under such Note and the other Loan Documents to a rate in excess
of the Highest Lawful Rate, then (a) the amount of interest which would
otherwise be payable by the Company shall be reduced to the amount allowed under
applicable law and (b) any unearned interest paid by the Company or any interest
paid by the Company in excess of the Highest Lawful Rate shall in the first
instance be credited on the principal of the Obligations of the Company (or if
all such Obligations shall have been paid in full, refunded to the Company). It
is further agreed that, without limitation of the foregoing, all calculations of
the rate of interest contracted for, reserved, taken, charged or received by any
Bank under the Notes and the Obligations and under the other Loan Documents are
made for the purpose of determining whether such rate exceeds the Highest Lawful
Rate, and shall be made, to the extent permitted by usury laws applicable to
such Bank, by amortizing, prorating and spreading in equal parts during the
period of the full stated term of the Notes and this Agreement all interest at
any time contracted for, charged or received by such Bank in connection
therewith. Furthermore, in the event that the maturity of any Note or other
obligation is accelerated or in the event of any required or permitted
prepayment, then such consideration that constitutes interest under applicable
law may never include more than the maximum amount allowed by applicable law and
excess interest, if any, provided for in this Agreement, any Note or otherwise
shall be canceled automatically as of the date of such acceleration or
prepayment and, if theretofore paid, shall be refunded to the Company.
SECTION 11.09 Survival of Representations and Warranties. All
representations, warranties and covenants contained herein or made in writing by
the Company in connection herewith and the other Loan Documents shall survive
the execution and delivery of this Agreement, the Notes and the other Loan
Documents and the termination of the Commitments of the Banks and will bind and
inure to the benefit of the respective successors and assigns of the parties
hereto,
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whether so expressed or not, provided, that the Commitments of the Banks shall
not inure to the benefit of any successor or assign of the Company.
SECTION 11.10 Successors and Assigns; Participations. (a) All
covenants, promises and agreements by or on behalf of the Company or the Banks
that are contained in this Agreement shall bind and inure to the benefit of
their respective permitted successors and assigns. The Company may not assign or
transfer any of its rights or obligations hereunder.
(b) Any of the Banks may assign to or sell participations to one
or more banks of all or a portion of its rights and obligations under this
Agreement and the other Loan Documents (including all or a portion of its
Commitment, the Advances and the Obligations of the Company owing to it and the
Notes); provided, that the Company shall continue to deal solely and directly
with the Agent and such assigning or selling Bank in connection with such Bank's
rights and obligations under this Agreement and the other Loan Documents. Except
with respect to cost protections provided to a participant pursuant to this
paragraph and the items listed in Section 11.01 hereof, no participant shall be
a third party beneficiary of this Agreement nor shall it be entitled to enforce
any rights provided to the Banks against the Company under this Agreement. In
the case of participations (but not assignments) (i) the original Bank's
obligations under this Agreement (including without limitation, its Commitment
to the Company hereunder) shall remain unchanged, (ii) such Bank shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) such Bank shall remain the holder of such Loan Documents for
all purposes of this Agreement, (iv) the Company, the Agent and the other Banks
shall continue to deal solely and directly with such Bank in connection with
such Bank's rights and obligations under this Agreement, (v) such Bank shall
continue to be able to agree to any modification or amendment of this Agreement
or any waiver hereunder without the consent, approval or vote of any such
participant or group of participants, other than modifications, amendments and
waivers described in the proviso to Section 11.01, and (vi) except as
contemplated by the immediately preceding clause (v), no participant shall be
deemed to be or to have any of the rights of obligations of a "Bank" hereunder.
(c) A Bank may assign to any other Bank or Banks or to any
Affiliate of a Bank and, with the prior written consent of the Company and the
Agent (which consent shall not be unreasonably withheld), a Bank may assign to
one or more other Eligible Assignees all or a portion of its interests, rights,
and obligations under this Agreement and the other Loan Documents (including all
or a portion of its Commitment and the same portion of the Loans and other
Obligations of the Company at the time owing to it and the Note held by it);
provided, however, that (i) each such assignment shall be in a minimum principal
amount of not less than $5,000,000.00 and shall be of a constant, and not a
varying, percentage of the assigning Bank's Commitment, its rights and
obligations under this Agreement, and its share of the outstanding balance of
each of the Notes, (ii) the parties to each such assignment shall execute and
deliver to the Agent, for its acceptance, an Assignment and Acceptance,
substantially in the form of Exhibit 11.10(c) hereto, in form and substance
satisfactory to the Agent (an "Assignment and Acceptance") and any Note subject
to such assignment, (iii) no assignment shall be effective until receipt by the
Agent of a reasonable service fee from the Assignee Bank in respect of said
assignment equal to $2,000.00, and (iv) the Assigning
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Bank, provided it does not assign all of its rights and obligations under this
Agreement and the other Loan Documents, shall retain a minimum amount of
$5,000,000.00 of the Commitment following the Assignment. Upon such execution,
delivery and acceptance, from and after the effective date specified in each
Assignment and Acceptance, which effective date (unless otherwise agreed to by
the assigning Bank, the Eligible Assignee thereunder and the Agent) shall be at
least five Business Days after the execution thereof, (x) the Eligible Assignee
thereunder shall be a party hereto as a "Bank" and to the other Loan Documents
and, to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Bank hereunder and under the other Loan Documents and (y)
the assignor Bank thereunder shall, to the extent provided in such Assignment
and Acceptance, be released from its obligations under this Agreement and the
other Loan Documents (and, in the case of an Assignment and Acceptance covering
all of the remaining portion of an assigning Bank's rights and obligations under
this Agreement and the other Loan Documents, such Bank shall cease to be a party
hereto).
(d) Any Bank may at any time assign all or any portion of its
rights under this Agreement and its Note to a Federal Reserve Bank. No such
assignment shall release the transferor Bank from its obligations hereunder.
(e) Notwithstanding any other provision herein, any Bank may, in
connection with any assignment or participation or proposed assignment or
participation pursuant to this section, disclose to the assignee or participant
or proposed assignee or participant, any information relating to the Company
furnished to such Bank by or on behalf of the Company; provided, however, that
prior to any such disclosure, the assignee or participant or proposed assignee
or participant shall agree in writing for the benefit of the Company to preserve
the confidentiality of any confidential information relating to the Company or
any of its Subsidiaries received by it from such Bank in a manner consistent
with Section 11.11.
SECTION 11.11 Confidentiality. Each Bank and the Agent agrees to
keep any information delivered or made available to it by the Company or any of
its Subsidiaries, confidential from anyone other than Persons employed or
retained by its who are or are expected to become engaged in evaluating,
approving, structuring or administering the Loans and who are bound hereby;
provided that nothing herein shall prevent any Bank or the Agent from disclosing
such information (a) to any other Bank, (b) pursuant to subpoena or upon the
order of any court or administrative agency, (c) upon the request or demand of
any regulatory agency or authority having jurisdiction over such Bank, (d) which
has been publicly disclosed, (e) to the extent reasonably required in connection
with any litigation to which the Agent, any Bank, the Company or its respective
Affiliates may be a party, (f) to the extent reasonably required in connection
with the exercise of any remedy hereunder, (g) to such Bank's legal counsel and
independent auditors and who are bound hereby and (h) to any actual or proposed
participant or assignee of all or part of its rights hereunder which has agreed
in writing to be bound by the provisions of this Section. Each Bank or the Agent
will promptly notify the Company of any information that it is required or
requested to deliver pursuant to clause (b) or (c) of this Section and, if the
Company is a party to any such litigation, clause (e) of this Section.
-64-
71
SECTION 11.12 Pro Rata Treatment. (a) Except as otherwise
specifically permitted hereunder, each payment or prepayment of principal, if
permitted under this Agreement, and each payment of interest with respect to an
Advance shall be made pro rata among the Banks.
(b) Each Bank agrees that if, through the exercise of a right of
banker's Lien, setoff or claim of any kind against the Company as a result of
which the unpaid principal portion of the Notes and the Obligations held by it
shall be proportionately less than the unpaid principal portion of the Notes and
Obligations held by any other Bank, it shall be deemed to have simultaneously
purchased from such other Bank a participation in the Notes and Obligations held
by such other Bank, in the amount required to render such amounts proportional;
provided, however, that if any such purchase or purchases or adjustments shall
be made pursuant to this Section and the payment giving rise thereto shall
thereafter be recovered, such purchase or purchases or adjustments shall be
rescinded to the extent of such recovery and the purchase price or prices or
adjustments restored without interest.
SECTION 11.13 Separability. Should any clause, sentence, paragraph
or Section of this Agreement be judicially declared to be invalid, unenforceable
or void, such decision will not have the effect of invalidating or voiding the
remainder of this Agreement, and the parties hereto agree that the part or parts
of this Agreement so held to be invalid, unenforceable or void will be deemed to
have been stricken herefrom and the remainder will have the same force and
effectiveness as if such part or parts had never been included herein.
SECTION 11.14 Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Any Subsidiary of the Company that executes an Adoption Agreement
after the date of this Agreement shall, upon such execution, become a party
hereto as a Guarantor.
SECTION 11.15 Interpretation. (a) In this Agreement, unless a
clear contrary intention appears:
(i) the singular number includes the plural number and vice versa;
(ii) reference to any gender includes each other gender;
(iii) the words "herein," "hereof" and "hereunder" and other words
of similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision;
(iv) reference to any Person includes such Person's successors and
assigns but, if applicable, only if such successors and assigns are
permitted by this Agreement, and reference to a Person in a particular
capacity excludes such Person in any other capacity or
-65-
72
individually, provided that nothing in this clause is intended to
authorize any assignment not otherwise permitted by this Agreement;
(v) except as expressly provided to the contrary herein, reference
to any agreement, document or instrument (including this Agreement) means
such agreement, document or instrument as amended, supplemented or
modified and in effect from time to time in accordance with the terms
thereof and, if applicable, the terms hereof, and reference to any Note
or other note includes any Note issued pursuant hereto in extension or
renewal thereof and in substitution or replacement therefor;
(vi) unless the context indicates otherwise, reference to any
Article, Section, Schedule or Exhibit means such Article or Section
hereof or such Schedule or Exhibit hereto;
(vii) the words "including" (and with correlative meaning
"include") means including, without limiting the generality of any
description preceding such term;
(viii) with respect to the determination of any period of time,
except as expressly provided to the contrary, the word "from" means "from
and including" and the word "to" means "to but excluding"; and
(ix) reference to any law, rule or regulation means such as
amended, modified, codified or reenacted, in whole or in part, and in
effect from time to time.
(b) The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
(c) No provision of this Agreement shall be interpreted or
construed against any Person solely because that Person or its legal
representative drafted such provision.
(d) In the event of any conflict between the specific provisions
of this Agreement and the provisions of any application pertaining to any letter
of credit secured by a Loan Document, the terms of this Agreement shall control.
SECTION 11.16 SUBMISSION TO JURISDICTION. (a) ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY BE
BROUGHT IN THE COURTS OF THE STATE OF TEXAS, IN XXXXXX COUNTY OR OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF TEXAS AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH OF THE COMPANY AND EACH GUARANTOR HEREBY IRREVOCABLY ACCEPTS FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS WITH RESPECT TO ANY SUCH ACTION OR PROCEEDING. THE COMPANY AND
EACH GUARANTOR FURTHER IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS OUT OF ANY
OF THE AFOREMENTIONED COURTS IN ANY
-66-
73
SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO IT AT ITS ADDRESS PROVIDED IN SECTION 11.02
AND WITH RESPECT TO ANY GUARANTOR, AT THE ADDRESS PROVIDED ON SCHEDULE 5.16
HERETO, SUCH SERVICE TO BECOME EFFECTIVE THIRTY (30) DAYS AFTER SUCH MAILING.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT OR ANY BANK TO SERVE PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR
OTHERWISE PROCEED AGAINST THE COMPANY IN ANY OTHER JURISDICTION.
(b) EACH OF THE COMPANY AND THE GUARANTORS HEREBY IRREVOCABLY
WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE
OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND
HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH
COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.
SECTION 11.17 WAIVER OF JURY TRIAL. EACH OF THE COMPANY AND EACH
GUARANTOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO
A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS
UNDER THIS AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR
ARISING FROM OR RELATING TO ANY BANKING RELATIONSHIP EXISTING IN CONNECTION WITH
THIS AGREEMENT, AND AGREES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY
SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
SECTION 11.18 FINAL AGREEMENT OF THE PARTIES. THIS AGREEMENT
(INCLUDING THE SCHEDULES AND EXHIBITS HERETO), THE NOTES AND THE OTHER LOAN
DOCUMENTS CONSTITUTE A "LOAN AGREEMENT" AS DEFINED IN SECTION 26.02(a) OF THE
TEXAS BUSINESS AND COMMERCE CODE, AND REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
-67-
74
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective officers thereunto duly authorized as of the
date first above written.
COMPANY:
GROUP MAINTENANCE AMERICA CORP.
By: /s/ XXXXXX X. XXXXXX
--------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
75
GUARANTORS/DOMESTIC SUBSIDIARIES:
AA Advance Air, Inc., a Florida corporation
XX XXXX, Inc. (dba Jarrell Plumbing), a Texas corporation
A-ABC Appliance, Inc., a Texas corporation
A-1 Appliance & Air Conditioning, Inc., a Texas corporation
A-1 Mechanical of Lansing, Inc., a Michigan corporation
Air Conditioning Engineers, Inc., a Michigan corporation
Air Conditioning, Plumbing & Heating Service Co., Inc., a Colorado corporation
Aircon Energy Incorporated, a California corporation
Airtron, Inc., a Delaware corporation
Airtron of Central Florida, Inc., a Florida corporation
All Service Electric, Inc., a Florida corporation
Arkansas Mechanical Services, Inc., an Arkansas corporation
Atlantic Industrial Constructors, Inc., a Virginia corporation
Xxxx Electric Corp., an Illinois corporation
Xxxxxxxx Xxxxx Products & Publications, Inc., a Colorado corporation
Central Air Conditioning Contractors, Inc., a Delaware corporation
Central Carolina Air Conditioning Company, a North Carolina corporation
Xxxxxxx Xxxxxxxx, Inc., a Texas corporation
Xxxxx Xxxxxxxx Electric Service, Inc., an Ohio corporation
Colonial Air Conditioning Company, a Connecticut corporation
Commercial Air Holding Company, a Maryland corporation
Commercial Air, Power & Cable, Inc., a Maryland corporation
Xxxxxxx Brothers, Inc., a South Carolina corporation
Divco, Inc., a Washington corporation
Dynamic Software Corporation, a Maryland corporation
Xxxxx Services, Inc., an Alabama corporation
The Farfield Company, a Delaware corporation
Xxxxxxxx Electric Corporation, a Delaware corporation
Xxxxxxxx Electrical Contractors, Inc., a Texas corporation
Xxxxxxx Mechanical Contractors, Inc., a Minnesota corporation
GroupMAC Holding Corp., a Delaware corporation
HPS Plumbing Services, Inc., a California corporation
Hallmark Air Conditioning, Inc., a Texas corporation
Xxxxxxxxxx Mechanical Corporation, a Virginia corporation
X. X. Xxxxxxx Air Conditioning, Inc., a Colorado corporation
Xxxxx Xxxxxx Air Conditioning, Inc., a Texas corporation
K & N Plumbing, Heating and Air Conditioning, Inc., a Texas corporation
Xxxxx'x Inc., a Delaware corporation
Linford Service Co., a California corporation
XxxXxxxxx-Xxxxxx Co., Inc., a Washington corporation
XxxXxxxxx-Xxxxxx Industries, Inc., a Washington corporation
XxxXxxxxx-Xxxxxx Service, Inc., a Washington corporation
Masters, Inc., a Maryland corporation
76
Mechanical Interiors, Inc., a Texas corporation
Xxxxxxx Island Air & Heat, Inc., a Delaware corporation
New Construction Air Conditioning, Inc., a Michigan corporation
Noron, Inc., an Ohio corporation
Xxxx X. Xxxxx Co., Inc., an Indiana corporation
Phoenix Electric Company, a Delaware corporation
Ray and Xxxxxx Xxxxxxx, Inc., a Florida corporation
Reliable Mechanical, Inc., a Delaware corporation
Xxxxxxxx Electric Corp., an Ohio corporation
Xxxxxx Services, Incorporated, a Tennessee corporation
Southeast Mechanical Service, Inc., a Florida corporation
Sterling Air Conditioning, Inc., a Texas corporation
Sun Plumbing, Inc., a Florida corporation
Team Mechanical, Inc., a Utah corporation
United Acquisition Corp. (dba United Service Alliance), an Iowa corporation
Valley Wide Plumbing and Heating, Inc., a Colorado corporation
Van's Comfortemp Air Conditioning, Inc., a Florida corporation
Vantage Mechanical Contractors, Inc., a Maryland corporation
Xxxx'x Heating and Cooling, Inc., a Florida corporation
Xxxxxxx & Sons, Inc., a Florida corporation
Xxxxxx Refrigeration, Air Conditioning & Heating, Inc., an Ohio corporation
Yale Incorporated, a Minnesota corporation
By: /s/ XXXXXX X. XXXXXX
-------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
GroupMAC Management Co., a Delaware corporation
By: /s/ XXXXXX X. XXXXXX
-------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
77
AGENT/BANK:
Amount of Commitment: CHASE BANK OF TEXAS,
$27,500,000.00 NATIONAL ASSOCIATION,
as Agent and Individually, as a Bank
By: /s/ X. X. XXXXXXX
---------------------------
X. X. Xxxxxxx
Vice President
78
CO-AGENT/BANK:
Amount of Commitment: BANK OF AMERICA TEXAS, N.A.,
$25,000,000.00 as Co-Agent and
Individually, as a Bank
By: /s/ XXXXXX X. XXXXX
------------------------
Name: Xxxxxx X. Xxxxx
------------------------
Title: Vice President
------------------------
Address for Notice:
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attention: Xxxxxx Xxxxx
79
DOCUMENTATION AGENT/BANK:
Amount of Commitment: ABN AMRO BANK, N.V.,
$25,000,000.00 as Documentation Agent and
Individually, as a Bank
By: /s/ XXXXXX X. XXXX
----------------------------
Name: Xxxxxx X. Xxxx
----------------------------
Title: Senior Vice President
----------------------------
By: /s/ XXXX X. XXXXXXXXXXXXX
----------------------------
Name: Xxxx X. Xxxxxxxxxxxxx
----------------------------
Title: Assistant Vice President
----------------------------
Address for Notice:
Xxxxx Xxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxxx Xxxx
80
BANKS:
Amount of Commitment: BANK OF MONTREAL
$20,000,000.00
By: /s/ XXXX X. XXXXXXX
----------------------------
Name: Xxxx X. Xxxxxxx
----------------------------
Title: Portfolio Manager
----------------------------
Address for Notice:
000 Xxxxx XxXxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxx Xxxxxx
81
BANKS:
Amount of Commitment: THE BANK OF NOVA SCOTIA
$20,000,000.00
By: /s/ F.C.H. XXXXX
-------------------------------
Name: F.C.H. Xxxxx
-------------------------------
Title: Senior Manager, Loan Operations
-------------------------------
Address for Notice:
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxxxx, Xxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: F.C.H. Xxxxx
82
BANKS:
Amount of Commitment: BANKBOSTON, N.A.
$15,000,000.00
By: /s/ XXXX XXXXXX
--------------------------------
Name: Xxxx Xxxxxx
--------------------------------
Title: Vice President
--------------------------------
Address for Notice:
000 Xxxxxxx Xxxxxx, Mail Stop 01-10-01
Xxxxxx, Xxxxxxxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxx Xxxxxx
E-mail: xxxxxxx@xxx.xxx
83
BANKS:
Amount of Commitment: CREDIT LYONNAIS NEW YORK BRANCH
$20,000,000.00
By: /s/ PASCAL POUPELLE
--------------------------------
Name: Pascal Poupelle
--------------------------------
Title: Executive Vice President
--------------------------------
Address for Notice:
0000 Xxxx Xxxxxx, Xxxxx 0000X
Xxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxx Xxxxxx
84
BANKS:
Amount of Commitment: KEY CORPORATE CAPITAL INC.
$15,000,000.00
By: /s/ XXXXX XXXX
------------------------------
Name: Xxxxx Xxxx
Title: Vice President
Address for Notice:
000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, Xxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxx Xxxx
85
BANKS:
Amount of Commitment: NATIONAL CITY BANK OF KENTUCKY
$17,500,000.00
By: /s/ XXXXXX X. XXXXXX
----------------------------
Xxxxxx X. Xxxxxx
----------------------------
Vice President
----------------------------
Address for Notice:
000 Xxxxx 0xx Xxxxxx, 00-X00X
Xxxxxxxxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxxx X. Xxxxxx
86
SYNDICATION AGENT/BANK:
Amount of Commitment: PARIBAS,
$25,000,000.00 as Syndication Agent and
Individually, as a Bank
By: /s/ XXXXX XXXXXXX
--------------------------------
Name: Xxxxx Xxxxxxx
--------------------------------
Title: Vice President
--------------------------------
By: /s/ XXXXX XXXXXXXX
--------------------------------
Name: Xxxxx Xxxxxxxx
--------------------------------
Title: Vice President
--------------------------------
Address for Notice:
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxx Xxxxxxx
87
BANKS:
Amount of Commitment: UNION BANK OF CALIFORNIA, N.A.
$20,000,000.00
By: /s/ J. XXXXX XXXXXX
---------------------------
Name: J. Xxxxx Xxxxxx
---------------------------
Title: Vice President
---------------------------
Address for Notice:
000 X. Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxx Xxxxxx
88
EXHIBIT 1.01A
ADMINISTRATIVE QUESTIONNAIRE
PLEASE COMPLETE THE FOLLOWING
INFORMATION AND RETURN VIA FAX
TO THE ATTENTION OF:
Xxxxxxx Xxxxxxx: FAX (000) 000-0000
Agent: Chase Manhattan Bank
One Chase Xxxxxxxxx Xxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Legal Name of Your Institution
To Appear in Documentation:
--------------------------------------------
Number of Signature Lines Required:
--------------------------------------------
GENERAL INFORMATION - DOMESTIC LENDING OFFICE
Institution Name:
Street Address:
City, State, Zip Code:
GENERAL INFORMATION - EURODOLLAR LENDING OFFICE
Institution Name:
--------------------------------------------
Street Address:
--------------------------------------------
City, State, Zip Code:
--------------------------------------------
CONTACTS/NOTIFICATION METHODS
Primary Contact:
--------------------------------------------
Street Address:
--------------------------------------------
City, State, Zip Code:
--------------------------------------------
Phone Number:
--------------------------------------------
FAX Number:
--------------------------------------------
Back-up Contact:
--------------------------------------------
Street Address:
--------------------------------------------
City, State, Zip Code:
--------------------------------------------
Phone Number:
--------------------------------------------
FAX Number:
--------------------------------------------
89
TAX WITHHOLDING [FOR US LOANS ONLY]
Non Resident Alien _____ Y _____ N
*Please attach Form 4224 or 1001
Tax ID Number ______________
ADMINISTRATIVE CONTACTS - BORROWINGS, PAYDOWNS, INTEREST, FEES, ETC.
Contact:
--------------------------------------------
Street Address:
--------------------------------------------
City, State, Zip Code:
--------------------------------------------
Phone Number:
--------------------------------------------
FAX Number:
--------------------------------------------
PAYMENT INSTRUCTIONS:
Name of Bank where funds
are to be transferred:
--------------------------------------------
Name of Account,
if applicable:
--------------------------------------------
Account Number:
--------------------------------------------
Additional Information:
--------------------------------------------
MAILINGS:
Please specify who should receive financial information:
Name:
--------------------------------------------
Street Address:
--------------------------------------------
City, State, Zip Code:
--------------------------------------------
IT IS VERY IMPORTANT THAT ALL OF THE ABOVE INFORMATION IS ACCURATELY FILLED IN
AND RETURNED PROMPTLY. IF THERE IS SOMEONE OTHER THAN YOURSELF WHO SHOULD
RECEIVE THIS QUESTIONNAIRE, PLEASE NOTIFY ME OF THEIR NAME AND FAX NUMBER AND WE
WILL FAX THEM A COPY OF THE QUESTIONNAIRE. IF YOU HAVE ANY QUESTIONS, PLEASE
CALL XXXXXXX XXXXXXX ON 000-000-0000.
90
EXHIBIT 1.01B
FORM
OF
ADOPTION AGREEMENT
[Date]
Chase Bank of Texas, National
Association, as Agent
for the Banks that are parties to the
Credit Agreement referred to below
000 X. 00xx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention:_________________
Dear Sirs:
Reference is made to the Second Amended and Restated Credit
Agreement dated as of October 15, 1998 (the "Credit Agreement"), among Group
Maintenance America Corp., a Texas corporation (the "Company"), the subsidiaries
of the Company party thereto, as guarantors, the banks party thereto, Chase Bank
of Texas, National Association, as agent for the banks, and Bank of America
Texas, N.A., as co-agent, Paribas, as syndication agent, and ABN AMRO Bank,
N.V., as documentation agent. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Credit
Agreement.
This agreement (this "Adoption Agreement") is executed and
delivered pursuant to Section 6.09 of the Credit Agreement which provides that
any Person that becomes a Subsidiary subsequent to the Execution Date will
execute and deliver to the Agent an Adoption Agreement acknowledging such
Person's agreement to be bound by the terms of the Credit Agreement and the
applicable Security Documents. In addition, Section 6.09 provides that the
Company or its Subsidiary that owns or holds the stock of said new Subsidiary,
as the case may be, will execute and deliver to the Agent the Adoption Agreement
acknowledging its agreement to be bound by the terms of the Pledge Agreement
with respect to pledging shares of said new Subsidiary and delivering to the
Agent the certificates evidencing its ownership of said new Subsidiary.
Therefore, for and in consideration of Ten Dollars ($10.00)
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged:
(a) the undersigned party (i) signing as Guarantor hereby
executes this Adoption Agreement to acknowledge it is a Subsidiary and
a Guarantor and agrees to be bound and is hereby bound by all of the
terms and conditions of the Credit Agreement and the Guaranty
91
contained therein applicable to a Subsidiary or a Guarantor, (ii)
signing as Debtor hereby executes this Adoption Agreement to
acknowledge it is a Debtor as such term is defined in the Security
Agreement and, as such, agrees to be bound and hereby is bound by all
of the terms and conditions of the Security Agreement and in connection
therewith does hereby grant to the Agent for the benefit of the Banks a
first and prior lien or security interest in all of Debtor's right,
title and interest in and to the Collateral (as such term is defined in
the Security Agreement) of such Debtor, and (iii) hereby delivers to
the Agent a UCC-1 Financing Statement signed by the Debtor and
describing the Collateral of such Debtor subject to the Security
Agreement, and
(b) the undersigned party (i) signing as Pledgor hereby
executes this Adoption Agreement to acknowledge it is a Pledgor as such
term is defined in the Pledge Agreement and, as such, agrees to be
bound and hereby is bound by all of the terms and conditions of the
Pledge Agreement and in connection therewith does hereby pledge to the
Agent for the benefit of the Banks, and grant to the Agent for the
benefit of the Banks, a Lien and security interest in Pledgor's right,
title and interest in and to, the Pledged Collateral (as such term is
defined in the Pledge Agreement), (ii) hereby delivers to the Agent the
certificate evidencing shares of stock of the new Subsidiary owned by
the Pledgor, together with a stock power [SIGNED IN BLANK] and (iii)
hereby delivers to the Agent a UCC-1 Financing Statement signed by the
Pledgor.
Executed effective this ____ day of _____________, ____.
GUARANTOR/DEBTOR
--------------------------------
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
PLEDGOR
--------------------------------
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
92
EXHIBIT 2.02
FORM OF
NOTE
Dated: _________________, 1998
FOR VALUE RECEIVED, the undersigned, GROUP MAINTENANCE AMERICA
CORP., a Texas corporation (the "Company"), HEREBY PROMISES TO PAY to the order
of _______________________________ (the "Bank") the lesser of (i) the amount of
the Bank's Commitment and (ii) the aggregate unpaid principal amount of the
Loans made by the Bank to the Company pursuant to the Credit Agreement (as
defined below).
The Company promises to pay interest on the unpaid principal
amount of each Loan from the date of such Loan until such principal amount is
paid in full, at such interest rates, and payable at such dates and times, as
are specified in the Second Amended and Restated Credit Agreement dated as of
October 15, 1998 (as the same may from time to time be amended, modified or
supplemented, the "Credit Agreement," the terms defined therein and not
otherwise defined herein being used herein as therein defined), among the
Company, the Subsidiaries of the Company party thereto, the Bank and certain
other banks that are parties thereto, Chase Bank of Texas, National Association,
as Agent for the Bank and such other banks, Bank of America Texas, N.A., as a
co- agent, Paribas, as syndication agent, and ABN AMRO Bank, N.V., as
documentation agent.
Both principal and interest are payable in same day funds in
lawful money of the United States of America to Chase Bank of Texas, National
Association, as Agent, at 0000 Xxxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000, or at such
other place as the Agent shall designate in writing to the Company.
This Note may be held by the Bank for the account of its
Domestic Lending Office or its Eurodollar Lending Office and may be transferred
from one to the other from time to time as the Bank may determine.
This Note is one of the Notes referred to in, and is entitled
to the benefits of, the Credit Agreement. The obligations of the Company
hereunder are guaranteed by the Guarantors pursuant to Article VIII of the
Credit Agreement. The Credit Agreement, among other things, (i) provides for the
making of the Loans by the Bank to the Company from time to time, the
indebtedness of the Company resulting from each such Loan being evidenced by
this Note and (ii) contains provisions for acceleration of the maturity hereof
upon the happening of certain stated events, also for prepayments on account of
principal hereof prior to the maturity hereof upon the terms and conditions
therein specified, and to the effect that no provision of the Credit Agreement
93
or this Note shall require the payment or permit the collection of interest in
excess of the Highest Lawful Rate.
Except as provided in the Credit Agreement, the Company and
any and all endorsers, guarantors and sureties severally waive grace, demand,
presentment for payment, notice of dishonor or default or intent to accelerate,
protest and notice of protest and diligence in collecting and bringing of suit
against any party hereto, and agree to all renewals, extensions or partial
payments hereon and to any release or substitution of security herefor, in whole
or in part, with or without notice, before or after maturity.
This Note shall be governed by, and construed and interpreted
in accordance with, the laws of the State of Texas and any applicable laws of
the United States of America.
GROUP MAINTENANCE AMERICA CORP.
By:
-----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
94
EXHIBIT 2.03
FORM
OF
NOTICE OF ADVANCE
[Date]
Chase Bank of Texas, National Association,
as Agent
for the Banks that are parties to the
Credit Agreement referred to below
000 Xxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention: _____________________________
Dear Sirs:
Reference is made to the Second Amended and Restated Credit
Agreement dated as of October 15, 1998 (the "Credit Agreement"), among the
Company, the Subsidiaries of the Company party thereto, the Banks party thereto
and Chase Bank of Texas, National Association, as Agent for such Banks.
Capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement.
The Company hereby requests an Advance under the Credit
Agreement and in that connection sets forth below the information relating to
such Advance (the "Proposed Advance") as required by Section 2.03 of the Credit
Agreement:
(a) Aggregate Principal Amount of Proposed Advance(1) $
------------
(b) Borrowing Date of Proposed Advance(2)
--------------------------------------------------------------------------------
(c) Type of Advances(3)
------------
--------
(1) Except with respect to any Proposed Eurodollar Rate Advance, not less than
$1,000,000.00 and in integral multiples of $100,000.00, and with respect to
any Proposed Alternate Base Rate Advance, not less than $300,000.00 and
$100,000.00 multiples thereof.
(2) Must be a Business Day.
(3) Alternate Base Rate Advance or Eurodollar Rate Advance.
95
(d) Interest Period and last day thereof(4)
--------------------------------------------------------------------------------
By each of the delivery of this Notice of Advance and the
acceptance of any or all of the Advances made by the Banks in response to this
Notice of Advance, the Company shall be deemed to have represented and warranted
that the conditions to lending specified in Article IV of the Credit Agreement
have been satisfied with respect to the Proposed Advance.
Very truly yours,
GROUP MAINTENANCE AMERICA CORP.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
--------
(4) Applicable only to a Eurodollar Rate Advance, which shall have a duration
of one, two, three or six months, and which shall end not later than the
Maturity Date; subject, however, to the limitations contained in the Credit
Agreement.
96
EXHIBIT 2.05
FORM
OF
NOTICE OF CONVERSION
[Date]
Chase Bank of Texas, National Association,
as Agent
for the Banks that are parties to the
Credit Agreement referred to below
000 Xxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention: __________________________
Dear Sirs:
Reference is made to the Second Amended and Restated Credit
Agreement dated as of October 15, 1998 (the "Credit Agreement"), among the
Company, the Subsidiaries of the Company party thereto, the Banks party thereto
and Chase Bank of Texas, National Association, as Agent for such Banks.
Capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement.
The Company hereby requests that a prior Advance under the
Credit Agreement be converted into another Type of Advance and in that
connection sets forth the following information:
(a) Aggregate Principal Amount of Proposed Conversion(5) $
--------------
(b) Date of Proposed Conversion(6)
(c) Type of Conversion (i.e., from Eurodollar Rate to Alternate Base Rate
or vice versa)
--------
(5) All conversions of the Loan shall be not less than $300,000.00.
(6) Must be a Business Day not less than three (3) Business Days
subsequent in the case of an Eurodollar Rate Advance and one (1) Business Day
subsequent in the case of a Base Rate Advance.
97
(d) Interest Period and last day thereof (if converting to Eurodollar
Rate Advance)
------------------------------
The Company
GROUP MAINTENANCE AMERICA CORP.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
98
EXHIBIT 2.20
FORM
OF
EXTENSION REQUEST
[Date]
Chase Bank of Texas National
Association, as Agent
for the Banks that are parties to the
Credit Agreement referred to below
000 X. 00xx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention:
Dear Sirs:
Reference is made to the Second Amended and Restated Credit
Agreement dated as of October 15, 1998 (the "Credit Agreement"), among Group
Maintenance America Corp., a Texas Corporation (the "Company"), the subsidiaries
of the Company party thereto, as guarantors, the banks party thereto, Chase Bank
of Texas, National Association, as agent for the banks, and Bank of America
Texas, N.A., as co-agent, Paribas, as syndication agent, and ABN AMRO Bank,
N.V., as documentation agent. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Credit
Agreement.
The Company hereby requests an Extension of the Maturity Date
set forth in the Credit Agreement, and in that connection certifies that this
request complies with the terms of the Credit Agreement, the provisions of
Section 2.20, and that no Default or Event of Default is continuing as of the
date of this request.
GROUP MAINTENACE AMERICA CORP.
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
99
EXHIBIT 3.02
FORM OF
LETTER OF CREDIT REQUEST
Chase Bank of Texas, National Association Date: ________________
000 Xxxx Xxxxxx
Xxxxxxx, Xxxxx
Attention: ________________
Reference is made to the Second Amended and Restated Credit
Agreement dated effective as of October 15, 1998 (as amended or modified from
time to time, the "Credit Agreement") among Group Maintenance America Corp.,
certain of its Subsidiaries and Chase Bank of Texas, National Association, as
Agent for itself and the other Banks named therein. Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to such
terms in the Credit Agreement. The undersigned hereby gives you notice pursuant
to Section 3.02 of the Credit Agreement that it requests that the Issuing Bank
issue a Letter of Credit under the Credit Agreement and in that connection sets
forth below the terms of such Letter of Credit:
1. Name of beneficiary: __________________________
2. Name of account party: __________________________
3. Amount: $ __________________________
4. Expiration date of the
Letter of Credit to be
issued: __________________________
5. Description of the goods,
if any: __________________________
6. Advising bank, if any: __________________________
7. Options: partial drawings __________________________
permitted are/are not
8. Terms and required documents, if any: _______________
_____________________________________________________
By delivery of this request for the issuance of a Letter of
Credit, the undersigned represents and warrants that the conditions to the
issuance thereof specified in the Credit
100
Agreement have been satisfied and that, following the issuance requested herein,
the total Letters of Credit outstanding does not exceed $20,000,000.00.
Very truly yours,
GROUP MAINTENANCE AMERICA CORP.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
101
EXHIBIT 4.01(d)(I)
SECOND AMENDED AND RESTATED SECURITY AGREEMENT
This SECOND AMENDED AND RESTATED SECURITY AGREEMENT (as the
same may be amended, amended and restated, modified or supplemented from time to
time, this "Agreement") dated as of October 15, 1998 is executed by GROUP
MAINTENANCE AMERICA CORP., a Texas corporation with an office at 0 Xxxxxxxx
Xxxxx, Xxxxx 0000, Xxxxxxx, XX 00000 (the "Company"), the Subsidiaries (as
defined in the Credit Agreement below) of the Company signatory hereto now or in
the future (collectively with any future Subsidiaries party to the Credit
Agreement and the Company, the "Debtors" and each individually, a "Debtor"), for
the benefit of CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, a national banking
association, as collateral agent for itself and for the banks under the Credit
Agreement, as hereinafter defined (in such capacity, the "Secured Party").
PRELIMINARY STATEMENT
WHEREAS, the Company, the Secured Party, as agent (then known
as Texas Commerce Bank National Association) and the banks party thereto entered
into that one certain Credit Agreement dated December 11, 1997 (as amended, the
"First Credit Agreement" ), relating to the extension of a series of loans with
a commitment totaling $75,000,000.00 by said banks to the Company; and
WHEREAS, the Company and certain of its subsidiaries, as
guarantors, the Secured Party, as agent, the banks and financial institutions
listed on the signature pages thereto, ABN AMRO Bank, N.V. and Paribas, as
co-agents agreed to amend and restate the First Credit Agreement pursuant to the
terms and conditions of the Amended and Restated Credit Agreement dated June 12,
1998 (the "Amended and Restated Credit Agreement" and together with the First
Credit Agreement, the "Prior Credit Agreement"), relating to the extension of a
series of loans with a commitment totaling $125,000,000.00 by said banks to the
Company; and
WHEREAS, the Secured Party, as agent, the banks party thereto
(the "Banks"), Bank of America Texas, N.A. as co-agent, Paribas, as syndication
agent, ABN AMRO Bank, N.V., as documentation agent, and the Debtors desire to
amend and restate the Prior Credit Agreement and have entered into that certain
Second Amended and Restated Credit Agreement dated as of October 15, 1998 (as
amended, amended and restated, modified or supplemented from time to time, the
"Credit Agreement"), under the terms of which the Banks agreed to make available
to the Company, a loan of up to $230,000,000.00; and
WHEREAS, in connection with the Prior Credit Agreement and as
partial security therefor, the Secured Party, the Company and certain of its
subsidiaries entered into that one certain Security Agreement dated December 11,
1997 which was amended and restated pursuant to the Amended and Restated
Security Agreement dated June 12, 1998 among the
102
Secured Party, the Company and certain of its subsidiaries (collectively, the
"Prior Security Agreement"), granting liens on certain property owned by said
parties to the Secured Party; and
WHEREAS, in connection with the Credit Agreement, and because
certain additional Persons have become Subsidiaries under the Credit Agreement
which were not parties to the Prior Credit Agreement, the parties wish to amend
and restate the Prior Security Agreement to include said Persons and their
assets thereunder; and
WHEREAS, it is a condition precedent to the obligation of the
Secured Party to make the Loans to the Company under the Credit Agreement that
the Company and the Debtors shall execute and deliver this Agreement to the
Secured Party; and
WHEREAS, the Debtors will each benefit from the execution of
the Credit Agreement and wish to execute this Agreement in order to help satisfy
such condition precedent and to secure the obligations under the Credit
Agreement and letters of credit from time to time issued;
NOW THEREFORE, in consideration of the premises and in order
to induce the Secured Party to extend the loans and issue letters of credit
pursuant to the terms of the Credit Agreement, the Debtors hereby agree to amend
and restate the Prior Security Agreement as follows:
SECTION 1. Defined Terms.
(a) Each capitalized term used herein and not otherwise
defined shall have the meaning for such term as defined in the Credit Agreement
and/or a Loan Document.
(b) The term "UCC" means the Uniform Commercial Code as in
effect on the date hereof in the State of Texas; provided that if by mandatory
provisions of law, the perfection or the effect of perfection or non-perfection
of the security interests granted pursuant to Section 2 hereof, as well as all
other security interests created or assigned as additional security for the
Secured Obligations pursuant to the provisions of this Agreement, in any
Collateral is governed by the UCC as in effect in a jurisdiction other than
Texas, "UCC" means the UCC as in effect in such other jurisdiction for purposes
of the provisions hereof relating to such perfection or effect of perfection or
non-perfection.
(c) "Secured Obligations" means obligations, contingent or
otherwise, of the Company or any Debtor pursuant to any of the Loan Documents,
including, without limitation, all sums owing by the Company or any Debtor to
the Secured Party under any of the Loan Documents, any obligations outstanding
now or in the future, including, but not limited to, any letters of credit
issued by the Secured Party or any other Bank and any interest rate swaps,
xxxxxx or similar agreements between any Debtor or any of its Subsidiaries and
any of the Banks all on a pari passu basis.
103
(d) All rights and interests granted to the Secured Party
under the Prior Security Agreement are hereby ratified and renewed and brought
forward herein to the extent same are not inconsistent herewith. This Agreement
shall be a restatement of the Prior Security Agreement but shall not invalidate
or adversely affect any rights or interests granted to the Secured Party
thereunder or affect the priority thereof except as expressly set forth herein.
SECTION 2. Grant of Security. Each Debtor hereby grants to the
Secured Party a first and prior lien or security interest in, all of such
Debtor's right, title and interest in and to the following assets of such
Debtor, now owned or hereafter acquired, except as otherwise excluded on
Schedule I hereto (the "Collateral"):
(a) (i) All accounts (as defined in the UCC) and (whether or
not included in such definition), and (ii) all receivables, accounts receivable,
lease receivables, contract rights, chattel paper, drafts, acceptances,
instruments, writings evidencing a monetary obligation or a security interest or
a lease of goods, general intangibles and other obligations of any kind, now or
hereafter existing, whether or not arising out of or in connection with the sale
or lease of goods or the rendering of services, and all rights now or hereafter
existing in and to all agreements, leases, and other contracts securing or
otherwise relating to any such accounts, lease receivables, chattel paper,
drafts, acceptances, instruments, writings evidencing a monetary obligation or a
security interest or a lease of goods, general intangibles or obligations (any
and all of the foregoing in sub-clause (i) and (ii) being the "Receivables");
and
(b) All inventory (as defined in the UCC) in all of its forms,
wherever located, now or hereafter existing and whether acquired by purchase,
merger or otherwise, and all raw materials, stores, tools, and work in process
therefor, all finished goods, spare parts, service parts, and all materials used
or consumed in the manufacture, packing, shipping, advertising, selling, leasing
or production thereof, including (whether or not included in such UCC
definition) goods in which the Debtors have an interest in mass or joint or
other interest or right of any kind and goods which are returned to or
repossessed by the Debtors, and all accessions thereto and products thereof and
documents therefor (any and all of the foregoing being the "Inventory"); and
(c) All instruments, chattel paper or letters of credit (each
as defined in the UCC) and any other items including all promissory notes held
by the Debtors evidencing indebtedness owed to any of them by any Person (any
and all of the foregoing being the "Instruments"); and
(d) All documents (as defined in the UCC) or other receipts
covering, evidencing or presenting goods; and
(e) All products and proceeds of any and all of the foregoing
Collateral and, to the extent not otherwise included, all payments received in
connection with any excluded assets
104
described on Schedule I(B), all payments under insurance or any indemnity,
warranty or guaranty, payable by reason of loss or damage to or otherwise with
respect to any of the foregoing Collateral.
SECTION 3. Security for Obligations. This Agreement secures,
on a first and prior basis except for the Permitted Liens, and other Liens
permitted under the Credit Agreement the prompt and complete payment of the
Secured Obligations.
SECTION 4. Debtors Remains Liable. Anything herein to the
contrary notwithstanding, (a) the Debtors shall remain liable under the
contracts and agreements included in the Collateral to the extent set forth
therein (and subject to any defenses thereto) to perform all of their duties and
obligations thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by the Secured Party of any of the rights hereunder
shall not release the Debtors from any of their duties or obligations under the
contracts and agreements included in the Collateral, and (c) the Secured Party
shall have no obligations or liability under the contracts and agreements
included in the Collateral solely by reason of this Agreement, and the Secured
Party shall not be obligated to perform any of the obligations or duties of the
Debtors thereunder or to take any action to collect or enforce any claim for
payment assigned hereunder in each case, solely by reason of this Agreement.
SECTION 5. Representations and Warranties. The Debtors each
represent and warrant as follows:
(a) Those locations specified on Schedule II-A hereto or such
other locations disclosed to the Secured Party after the date hereof constitute
all of the locations at which there is located any Inventory of any Debtors
(other than rolling stock or Inventory in transit). The principal place of
business and chief executive office of the Company and the office where it keeps
its records concerning the Receivables, are located at the address specified in
the introductory paragraph to this Agreement or at such other locations
disclosed to the Secured Party after the date hereof. Each other Debtor has its
chief executive office at the location shown on Schedule II-B hereto or at such
other locations disclosed to the Secured Party after the date hereof.
(b) Each Debtor owns the Collateral free and clear of any
Lien, except for Permitted Liens and other Liens permitted under the Credit
Agreement. No effective financing statement or other instrument similar in
effect covering all or any part of the Collateral is on file in any recording
office, except for protective filings under true leases, filings made in
connection with Permitted Liens and other Liens permitted under the Credit
Agreement.
(c) This Agreement has been duly executed and delivered by
each Debtor. Upon the filing of financing statements in the locations listed on
Schedule III hereto, the security
105
interests granted herein shall constitute valid and perfected security interests
in substantially all the Collateral, subject only to Permitted Liens and other
Liens permitted under the Credit Agreement, to the extent such security
interests can be perfected by such filings pursuant to the UCC.
(d) No consent of, or notice to, any other Persons and no
authorization, approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body is required either (i) for the grant
by the Debtors of the Liens granted hereby or for the execution, delivery or
performance of this Agreement by the Debtors or (ii) for the perfection of the
rights and remedies hereunder, other than the filing of financing statements as
provided in (c) above.
(e) All information with respect to the Collateral and the
obligors under the Receivables set forth in any schedule hereto, certificate or
other writing at any time heretofore or hereafter furnished by each Debtor to
the Secured Party, taken as a whole, is, to each Debtor's knowledge, true,
correct and complete in all material respects as of the date specified therein.
(f) The Subsidiaries listed on Schedule 5.16 of the Credit
Agreement are all of the Subsidiaries of the Company as of the Execution Date
and the address given for such Subsidiaries is the correct mailing address as of
the Execution Date.
SECTION 6. Further Assurances. (a) Each Debtor agrees that
from time to time, at the expense of the Debtor, each Debtor will promptly
execute and deliver all further instruments and documents, and take all further
action, that the Secured Party may reasonably request as being necessary or
desirable, in order to perfect and protect any security interest granted or
purported to be granted hereby or to enable the Secured Party to exercise and
enforce its rights and remedies hereunder with respect to any Collateral.
Without limiting the generality of the foregoing, each Debtor will: (i) if any
Receivable shall be evidenced by a promissory note or other Instrument, deliver
and pledge to the Secured Party such note or Instrument duly endorsed and
accompanied by duly executed instruments of transfer or assignment, all in form
and substance reasonably satisfactory to the Secured Party; and (ii) execute and
file such financing or continuation statements, or amendments thereto, and such
other instruments or notices as the Secured Party may reasonably request as
being necessary or desirable in order to perfect and preserve the security
interests granted or purported to be granted hereby.
(b) Each Debtor hereby authorizes the Secured Party to file
one or more financing or continuation statements, and amendments thereto,
relative to all or any part of the Collateral without the signature of such
Debtor, in each case where permitted by law. A carbon, photographic or other
reproduction of any financing statement executed by each Debtor covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.
106
(c) Each Debtor will furnish to the Secured Party from time to
time statements and schedules further identifying and describing the Collateral
as the Secured Party may reasonably request, all in reasonable detail.
(d) Each Debtor will promptly notify the Secured Party of any
change of its name, corporate structure, federal employer identification number
or the address of its principal place of business or chief executive office
where its books and records are maintained.
(e) Each Debtor shall keep its principal place of business and
chief executive office and the office where it keeps its records concerning the
Collateral, at the location or locations therefor specified in Section 5(a) or,
upon 20 days' prior written notice (or such other notice acceptable to the
Secured Party) to the Secured Party, at such other locations in a jurisdiction
where all action required by this Section 6(a) shall have been or shall be taken
with respect to the Collateral.
(f) Except as otherwise provided in this subsection (f), each
Debtor shall continue to collect, at its own reasonable expense, all amounts due
or to become due such Debtor under the Receivables. In connection with such
collections, each Debtor may take (and, upon the occurrence and continuance of
an Event of Default and so long as it is continuing and has not been waived at
the Secured Party's direction, shall take) such action as such Debtor or the
Secured Party may deem necessary or advisable to enforce collection of the
Receivables; provided, that the Secured Party shall have the right at any time
during the existence of an Event of Default, upon written notice to each Debtor
of its intention to do so, to notify the account debtors or obligors under any
Receivables of the assignment of such Receivables to the Secured Party and to
direct such account debtors or obligors to make payment of all amounts due or to
become due to such Debtor thereunder directly to the Secured Party and, upon
such notification and at the expense of such Debtor, to enforce collection of
any such Receivables, and to adjust, settle or compromise the amount or payment
thereof, in the same manner and to the same extent as such Debtor might have
done. After receipt by the Debtors of the notice from the Secured Party referred
to in the proviso to the preceding sentence, (i) all amounts and proceeds
(including instruments) received by the Debtors in respect of the Receivables
shall be received in trust by the Secured Party under the Credit Agreement,
shall be segregated from other funds of the Debtors and shall be forthwith paid
over to the Secured Party in the same form as so received (with any necessary
endorsement) to be held as cash collateral and either (A) released to the
Debtors so long as no default shall be continuing or (B) if any default shall be
continuing, applied as provided in Section 12(b), and (ii) the Debtors shall not
adjust, settle or compromise the amount or payment of any Receivable, or release
wholly or partly any account debtor or obligor thereof, or allow any credit or
discount thereon, except with the prior written consent of the Secured Party.
107
(g) The Debtors shall keep substantially all the Inventory
(other than such Inventory sold in the ordinary course of business or Inventory
in transit) at the places therefor specified in Section 5(a) or, upon at least
20 days' prior written notice (or such other notice acceptable to the Secured
Party) to the Secured Party, at such other places in jurisdictions where all
action required by this Section 6(a) shall have been or shall be taken with
respect to such Inventory.
(h) The Debtors shall promptly upon request furnish to the
Secured Party a statement respecting any material loss or damage to any of the
Inventory or any other of the Collateral and will permit the Secured Party or
any other Party to inspect the Collateral upon reasonable notice during normal
business hours.
SECTION 7. Insurance. The Debtors shall, at their own expense,
maintain insurance as required by the Loan Documents.
SECTION 8. Transfers and Other Liens. The Debtors shall not:
(a) sell, assign (by agreement, operation of law or otherwise) or otherwise
dispose of any of the Collateral (other than in the ordinary course of business
or not prohibited by the Credit Agreement) or (b) create or suffer to exist any
Lien upon or with respect to any of the Collateral, except for Permitted Liens
and other Liens permitted by the Credit Agreement.
SECTION 9. Secured Party Appointed Attorney-in-Fact. Each
Debtor hereby irrevocably appoints the Secured Party as the Debtors'
attorney-in-fact, with full authority in the place and stead of the Debtors and
in the name of the Debtors, from time to time in the Secured Party's sole
reasonable discretion after the occurrence of an Event of Default and during the
continuance thereof, to take any action and to execute any instrument which the
Secured Party may deem reasonably necessary or advisable to accomplish the
purposes of this Agreement, including:
(a) to obtain insurance required to be paid pursuant to
Section 7 herein,
(b) to ask, demand, collect, xxx for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become due under
or in respect of any of the Collateral,
(c) to receive, endorse, and collect any drafts or other
instruments, documents and chattel paper, in connection with clause (a) above,
(d) to file any claims or take any action or institute any
proceedings which the Secured Party may deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the rights of the
Secured Party with respect to any of the Collateral, and
108
(e) to sell, transfer, assign, or otherwise deal in or with
the Collateral or the proceeds thereof, as provided herein and subject to
applicable law, as fully and effectually as if the Secured Party were the
absolute owner thereof; provided, that the Secured Party shall give the Debtors
not less than ten (10) days' prior written notice of the time and place of any
sale or other intended disposition of any of the Collateral, except any
Collateral which is perishable or threatens to decline speedily in value or is
of a type customarily sold on a recognized market. The Debtors agree that such
notice constitutes "reasonable notification" within the meaning of ss. 9.504(c)
of the UCC.
SECTION 10. Secured Party May Perform. If any Debtor fails to
perform any agreement contained herein, the Secured Party may itself perform, or
cause performance of, such agreement, and the expenses of the Secured Party
incurred in connection therewith shall be payable upon demand by such Debtor and
if not paid shall bear interest at the Default Rate set forth in the Credit
Agreement.
SECTION 11. The Secured Party's Duties. The powers conferred
on the Secured Party hereunder are solely to protect its interest in the
Collateral and shall not impose any duty upon it or any other Party to exercise
any such powers. In regard to any Debtor, except for reasonable care in the
custody of any Collateral in its possession and the accounting for moneys
actually received by it hereunder, neither the Secured Party nor any other party
shall have any duty as to any Collateral or as to the taking of any necessary
steps to preserve rights against prior parties or any other rights pertaining to
any Collateral. The Secured Party shall be deemed to have exercised reasonable
care in the custody and preservation of any Collateral in its possession if such
Collateral is accorded treatment substantially equal to that which the Secured
Party accords its own property, it being understood that the Secured Party shall
not have any responsibility for taking any necessary steps to preserve rights
against any Secured Party with respect to any Collateral.
SECTION 12. Remedies. If any Event of Default shall have
occurred and be continuing:
(a) The Secured Party may exercise in respect of the
Collateral, in addition to other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party on
default under the UCC (whether or not the UCC applies to the affected
Collateral) and the Secured Party may also (i) require any Debtor to, and each
Debtor hereby agrees that it will at its reasonable expense and upon request of
the Secured Party forthwith, assemble all or part of the Collateral as directed
by the Secured Party and make it available to the Secured Party at a place to be
designated by the Secured Party, and (ii) without notice except as specified
below, sell the Collateral or any part thereof in one or more parcels at public
or private sale, at any of the Secured Party's offices or elsewhere, for cash or
on credit, and upon such other terms as may be commercially reasonable. Each
Debtor agrees that, to the
109
extent notice of sale shall be required by law, at least ten (10) days' prior
notice to the Debtors of the time and place of any public sale or the time after
which any private sale is to be made shall constitute reasonable notification
thereof. The Secured Party shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given. The Secured Party may adjourn
any public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
(b) Any cash received by the Secured Party shall be applied to
repay the Secured Obligations. Any surplus of such cash or cash proceeds held by
the Secured Party and remaining after payment in full of all the Secured
Obligations shall be paid over to the Debtors or to whomsoever may be lawfully
entitled to receive such surplus.
SECTION 13. Amendments. No amendment or waiver of any
provision of this Agreement, nor consent to any departure by the Debtors
herefrom, shall in any event be effective unless the same shall be in writing
and signed by the Secured Party with the requisite consent of the Debtors, and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given.
SECTION 14. Addresses for Notices. All notices and other
communications provided for hereunder shall be given in the manner and at the
addresses and telecopy numbers as set forth in the Credit Agreement, and shall
become effective, as specified in the Credit Agreement and/or the Loan
Documents.
SECTION 15. Termination; Reinstatement. (a) Each Debtor agrees
that this Agreement and the Liens granted hereunder shall terminate when, but
only when, all Secured Obligations have been fully paid and performed and all
Banks' commitments under the Loan Documents have expired or been terminated. At
any time thereafter upon the Debtor's request, the Secured Party shall promptly
reassign and redeliver, including the termination of any financing statements
(or cause to be reassigned and redelivered) to the Debtors, or to such Person or
Persons as the Debtors shall designate in writing, against receipt, such of the
Collateral (if any) as shall not have been sold or otherwise applied by the
Secured Party pursuant to the terms hereof and shall still be held by it
hereunder. Any such reassignment shall be without recourse upon, or
representation or warranty by, the Secured Party (other than that the Secured
Party has not sold, encumbered or otherwise transferred any interest in the
Collateral except as provided in this Agreement) and shall be at the sole
reasonable cost and expense of the Debtors.
(b) This Agreement shall continue to be effective or be
reinstated, as the case may be, if at any time any amount received by the
Secured Party in respect of the Secured Obligations is rescinded or must
otherwise be restored or returned by the Secured Party upon the filing of any
bankruptcy proceeding by or of the Debtors or upon the appointment of any
110
intervenor or conservator of, or trustee or similar official for, the Debtors or
any substantial part of their assets, or otherwise, all as though such payments
had not been made.
SECTION 16. Waiver of Marshaling. All rights of marshaling of
assets of the Debtors, including any such right with respect to the Collateral,
are hereby waived by the Debtors.
SECTION 17. Limitation by Law. All rights, remedies and powers
provided in this Agreement may be exercised only to the extent that the exercise
thereof does not violate any applicable provision of law, and all the provisions
of this Agreement are intended to be subject to all applicable mandatory
provisions of law which may be controlling and to be limited to the extent
necessary so that they will not render this Agreement invalid, unenforceable, in
whole or in part, or not entitled to be recorded, registered or filed under the
provisions of any applicable law.
SECTION 18. Separability. Should any clause, sentence,
paragraph, subsection or Section of this Agreement be judicially declared to be
invalid, unenforceable or void, such declaration will not have the effect of
invalidating or voiding the remainder of this Agreement, and the parties hereto
agree that the part or parts of this Agreement so held to be invalid,
unenforceable or void will be deemed to have been stricken herefrom by the
Secured Party hereto, and the remainder will have the same force and
effectiveness as if such stricken part or parts had never been included herein.
SECTION 19. No Waiver; Remedies. No failure on the part of the
Secured Party to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 20. Partial Release of Security Interest. Upon the
request of the Debtors in connection with any sale, transfer or other
disposition of property or assets permitted hereunder or under any Loan
Document, so long as no Event of Default under any of the Loan Documents has
occurred and is continuing, the Secured Party shall execute and deliver to the
Debtors duly executed releases or partial releases, as applicable, of any
security interest it may have in such property or assets, in form and substance
reasonably satisfactory to the Secured Party and the applicable Debtor;
provided, for any such sale other than Inventory that provides net proceeds to
any Debtor in excess of $100,000.00, such proceeds shall be delivered to the
Secured Party as collateral for all of the Secured Obligations.
SECTION 21. Continuing Security Interest. This Agreement shall
create a continuing security interest in the Collateral and shall (a) remain in
full force and effect until
111
payment in full of the Secured Obligations, (b) be binding upon each Debtor, its
successors and assigns, and (c) inure to the benefit of the Secured Party and
its respective successors, transferees and assigns. Without limiting the
generality of the foregoing clause (c), the Secured Party may assign or
otherwise transfer all or a portion of its interests, rights and obligations
under any Note held by it pursuant to the Credit Agreement or pursuant to any
Loan Document. Upon the payment in full of the Secured Obligations, the Liens
granted hereby shall terminate and all rights to the Collateral shall revert to
the Debtors. Upon any such termination, the Secured Party will, at the Debtors'
reasonable expense, promptly execute and deliver to the Debtors such documents
as the Debtors shall reasonably request to evidence such termination. Any
Material Subsidiary of the Company that executes a counterpart of this Agreement
after the date of this Agreement shall, upon such execution, become a party
hereto as a Debtor.
SECTION 22. Survival of Representations and Warranties. All
representations and warranties contained in this Agreement or made in writing by
or on behalf of the Debtors in connection herewith are true and correct in all
material respects when made or deemed made and shall survive the execution and
delivery of this Agreement until repayment of the Secured Obligations. Any
investigation by the Secured Party shall not diminish in any respect whatsoever
its rights to rely on such representations and warranties.
SECTION 23. Governing Law; Terms. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND
THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA, EXCEPT AS REQUIRED BY
MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY OR
PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT
OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
THAN THE STATE OF TEXAS.
SECTION 24. Inconsistencies. In the event of any
irreconcilable inconsistences between any provision of this Agreement and any
provision of the Credit Agreement and/or the Loan Documents, the provisions of
this Agreement shall control.
SECTION 25. Counterparts. This Agreement may be executed in
any number of counterparts, and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which when taken together shall constitute but one and the same
agreement.
SECTION 26. Interpretation.
(a) In this Agreement, unless a clear contrary intention
appears:
(i) the singular number includes the plural number
and vice versa;
112
(ii) the words "herein," "hereof" and "hereunder" and
other words of similar import refer to this Agreement as a
whole and not to any particular Article, Section or other
subdivision;
(iii) reference to any Person includes such Person's
successors and assigns but, if applicable, only if such
successors and assigns are permitted by this Agreement, and
reference to a Person in a particular capacity excludes such
Person in any other capacity or individually, provided that
nothing in this clause (iii) is intended to authorize any
assignment not otherwise permitted by this Agreement;
(iv) reference to any agreement, document or
instrument means such agreement, document or instrument as
amended, supplemented or modified and in effect from time to
time in accordance with the terms thereof and, if applicable,
the terms hereof, and reference to any Note includes any Note
issued pursuant hereto in extension or renewal thereof and in
substitution or replacement therefor;
(v) unless the context indicates otherwise, reference
to any Section or Schedule means such Section hereof or such
Schedule hereto;
(vi) the words "including" (and with correlative
meaning "include") means including, without limiting the
generality of any description preceding such term;
(vii) with respect to the determination of any period
of time, the word "from" means "from and including" and the
word "to" means "to but excluding;" and
(viii) reference to any law means such as amended,
modified, codified or reenacted, in whole or in part, and in
effect from time to time.
(b) The Section headings herein are for convenience only and
shall not affect the construction hereof.
(c) No provision of this Agreement shall be interpreted or
construed against any Person solely because that Person or its legal
representative drafted such provision.
SECTION 27. Submission to Jurisdiction. (a) ANY LEGAL ACTION
OR PROCEEDING WITH RESPECT TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY BE
BROUGHT IN THE COURTS OF THE STATE OF TEXAS, IN XXXXXX COUNTY OR THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF
113
TEXAS AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH DEBTOR HEREBY
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, UNCONDITIONALLY,
THE JURISDICTION OF THE AFORESAID COURTS WITH RESPECT TO ANY SUCH ACTION OR
PROCEEDING. EACH DEBTOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS
OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE
MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO
IT AT ITS ADDRESS PROVIDED IN SECTION 14, SUCH SERVICE TO BECOME EFFECTIVE
THIRTY (30) DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF
THE SECURED PARTY OR ANY OF THE PARTIES TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST
THE DEBTORS IN ANY OTHER JURISDICTION.
(b) EACH DEBTOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID
ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT
BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (A) ABOVE AND HEREBY FURTHER
IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY
SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
SECTION 28. Waiver of Jury Trial. EACH PARTY HEREBY WAIVES, TO
THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT OR
UNDER ANY AMENDMENT, LOAN DOCUMENTS, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED
OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM
OR RELATING TO ANY BANKING OR FINANCIAL RELATIONSHIP EXISTING IN CONNECTION WITH
THIS AGREEMENT OR ANY LOAN DOCUMENT, AND AGREES, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT
AND NOT BEFORE A JURY.
SECTION 29. Final Agreement of the Parties. THIS AGREEMENT
(INCLUDING THE SCHEDULES HERETO) AND THE OTHER LOAN DOCUMENTS CONSTITUTE A "LOAN
AGREEMENT" AS DEFINED IN SECTION 26.02(A) OF THE TEXAS BUSINESS AND COMMERCE
CODE, AND REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES RELATING TO THE
SUBJECT MATTER
114
HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
115
IN WITNESS WHEREOF, the Debtors have caused this Agreement to
be duly executed and delivered by its officer duly authorized as of the date
first above written.
COMPANY/DEBTOR:
GROUP MAINTENANCE AMERICA
CORP., a Texas corporation
By:
------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
116
SUBSIDIARIES/DEBTORS:
AA ADVANCE AIR, INC.
XX XXXX, INC.
(d/b/a Xxxxxxx Plumbing)
A-ABC APPLIANCE, INC.
A-1 APPLIANCE & AIR CONDITIONING, INC.
A-1 MECHANICAL OF LANSING, INC.
AIR CONDITIONING ENGINEERS, INC.
AIR CONDITIONING, PLUMBING & HEATING SERVICE
CO., INC.
AIRCON ENERGY INCORPORATED
AIRTRON, INC.
AIRTRON OF CENTRAL FLORIDA, INC.
ALL SERVICE ELECTRIC, INC.
ARKANSAS MECHANICAL SERVICES, INC.
(f/k/a AMS Acquisition Corp.)
ATLANTIC INDUSTRIAL CONSTRUCTORS, INC.
XXXX ELECTRIC CORP.
XXXXXXXX XXXXX PRODUCTS & PUBLICATIONS, INC.
CENTRAL AIR CONDITIONING CONTRACTORS, INC.
CENTRAL CAROLINA AIR CONDITIONING COMPANY
(f/k/a Central Carolina Acquisition Corp.)
XXXXXXX XXXXXXXX, INC.
XXXXX XXXXXXXX ELECTRIC SERVICE, INC.
COLONIAL AIR CONDITIONING COMPANY
COMMERCIAL AIR HOLDING COMPANY
COMMERCIAL AIR, POWER & CABLE, INC.
XXXXXXX BROTHERS, INC.
DIVCO, INC.
DYNAMIC SOFTWARE CORPORATION
XXXXX SERVICES, INC.
THE FARFIELD COMPANY
XXXXXXXX ELECTRIC CORPORATION
XXXXXXXX ELECTRICAL CONTRACTORS, INC.
XXXXXXX MECHANICAL CONTRACTORS, INC.
GROUPMAC HOLDING CORP.
HPS PLUMBING SERVICES, INC.
HALLMARK AIR CONDITIONING, INC.
XXXXXXXXXX MECHANICAL CORPORATION
117
X.X. XXXXXXX AIR CONDITIONING, INC.
XXXXX XXXXXX AIR CONDITIONING, INC.
K&N PLUMBING, HEATING AND AIR CONDITIONING, INC.
XXXXX'X, INC.
LINFORD SERVICE CO.
(f/k/a LSC Acquisition Corp.)
XXXXXXXXX-XXXXXX CO., INC.
XXXXXXXXX-XXXXXX INDUSTRIES, INC.
(f/k/a XxxXxxxxx-Xxxxxx Acquisition Corp.)
XXXXXXXXX-XXXXXX SERVICE, INC.
MASTERS, INC.
(f/k/a Masters Acquisition Corp.)
MECHANICAL INTERIORS, INC.
XXXXXXX ISLAND AIR & HEAT, INC.
NEW CONSTRUCTION AIR CONDITIONING, INC.
NORON, INC.
XXXX X. XXXXX CO., INC.
PHOENIX ELECTRIC COMPANY
RAY AND XXXXXX XXXXXXX, INC.
RELIABLE MECHANICAL, INC.
XXXXXXXX ELECTRIC CORP.
XXXXXX SERVICES, INCORPORATED
SOUTHEAST MECHANICAL SERVICE, INC.
(f/k/a SEMS Acquisition Corp.)
STERLING AIR CONDITIONING, INC.
SUN PLUMBING, INC.
TEAM MECHANICAL, INC.
UNITED ACQUISITION CORP.
(d/b/a/ United Service Alliance)
VALLEY WIDE PLUMBING AND HEATING, INC.
VAN'S COMFORTEMP AIR CONDITIONING, INC.
(f/k/a Van's Acquisition Corp.)
VANTAGE MATERIAL CONTRACTORS, INC.
XXXX'X HEATING AND COOLING, INC.
XXXXXXX & SONS, INC.
118
XXXXXX REFRIGERATION, AIR CONDITIONING &
HEATING, INC.,
(f/k/a Xxxxxx Acquisition Corp.)
YALE INCORPORATED
(f/k/a Yale Acquisition Corp.)
By:
---------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
GROUPMAC MANAGEMENT CO.
By:
---------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
119
AGENT/SECURED PARTY:
CHASE BANK OF TEXAS NATIONAL
ASSOCIATION, as Agent for the Banks
By:
---------------------------------------
Name: X. X. Xxxxxxx
Title: Vice President
120
SCHEDULE I
EXCLUDED ASSETS
Excluded Assets means and refers to (A) that portion of the Debtor's personal
property which, if included in the Collateral, would violate, be prohibited by,
or constitute a default under any agreement, contract, document, or law or would
require any consent which has not yet been obtained and (B) Receivables due from
any residential customer of any Debtor incurred in connection with the
installation of any heating, ventilation or air conditioning equipment not in
excess of $2,000,000.00 at any time and including any note receivable in
connection therewith; provided any and all proceeds from such excluded assets
shall not be excluded assets and shall be Collateral and subject to all of the
terms and conditions of this Agreement.
121
SCHEDULE II-A
LOCATIONS OF INVENTORY
LOCATION OF INVENTORY AND
DEBTOR ACCOUNTS RECEIVABLE
------ -------------------------
A-ABC Appliance, Inc. Dallas, Texas
A-1 Appliance & Air Conditioning, Inc. Dallas, Texas
A-1 Mechanical of Lansing, Inc. Lansing, Michigan
AA Advance Air, Inc. Pompano Beach, Florida
XX XXXX, Inc. (dba Jarrell Plumbing) Houston, Texas
Air Conditioning Engineers, Inc. Utica, Michigan
Air Conditioning, Plumbing & Heating Denver, Colorado
Service Co., Inc. Longmont, Colorado
Aircon Energy Incorporated Sacramento, California
Arkansas Mechanical Services, Inc. North Little Rock, Arkansas
Fayetteville, Arkansas
Airtron of Central Florida, Inc. East Oldsmar, Florida
Airtron, Inc. East Oldsmar, Florida
Indianapolis, Indiana
Wichita, Kansas
Louisville, Kentucky
Erlanger, Kentucky
Fairfiled, Ohio
Cleveland, Ohio
Columbus, Ohio
Dayton, Ohio
Austin, Texas
Garland, Texas
Houston, Texas
San Antonio, Texas
All Service Electric, Inc. Jacksonville, Florida
122
LOCATION OF INVENTORY AND
DEBTOR ACCOUNTS RECEIVABLE
------ --------------------------
Atlantic Industrial Constructors, Inc. Richmond, Virginia
Xxxx Electric Corp. Wheeling, Illinois
Xxxxxxxx Xxxxx Products & Publications, Inc. Englewood, Colorado
Central Air Conditioning Contractors, Inc. Columbia, Maryland
Central Carolina Air Conditioning Company Greensboro, North Carolina
Winston Salem, North Carolina
Xxxxxxx Xxxxxxxx, Inc. South Houston, Texas
Xxxxx Xxxxxxxx Electric Service, Inc. Grove City, Ohio
Colonial Air Conditioning Company Bloomfield, Connecticut
Commercial Air, Power & Cable, Inc. Beltsville, Maryland
Commercial Air Holding Company Beltsville, Maryland
Xxxxxxx Brothers, Inc. Rock Hill, South Carolina
Divco, Inc. Spokane, Washington
Dynamic Software Corporation Gaithersburg, Maryland
Xxxxx Services, Inc. Birmingham, Alabama
The Farfield Company Lititz, Pennsylvania
Lancaster County, Pennsylvania
Xxxxxxxx Electric Corporation Colorado Springs, Colorado
Xxxxxxxx Electrical Contractors, Inc. Dallas, Texas
Xxxxxxx Mechanical Contractors, Inc. Minneapolis, Minnesota
GroupMAC Holding Corp. Houston, Texas
GroupMAC Management Co. Houston, Texas
HPS Plumbing Services, Inc. Bakersfield, California
Hallmark Air Conditioning, Inc. Houston, Texas
Xxxxxxxxxx Mechanical Corporation Richmond, Virginia
123
LOCATION OF INVENTORY AND
DEBTOR ACCOUNTS RECEIVABLE
------ -------------------------
X.X. Xxxxxxx Air Conditioning, Inc. Colorado Springs, Colorado
Xxxxx Xxxxxx Air Conditioning, Inc. San Antonio, Texas
K&N Plumbing, Heating and Air Arlington, Texas
Conditioning, Inc. Las Vegas, Nevada
Xxxxx'x, Inc. Fargo, North Dakota
Linford Service Co. Oakland, California
San Jose, California
Ontario, California
San Diego, California
Sacramento, California
XxxXxxxxx-Xxxxxx Industries, Inc. Seattle, Washington
Portland, Oregon
XxxXxxxxx-Xxxxxx Co., Inc. Seattle, Washington
Portland, Oregon
XxxXxxxxx-Xxxxxx Service, Inc. Seattle, Washington
Portland, Oregon
Masters, Inc. Gaithersburg, Maryland
Chantilly, Virginia
Mechanical Interiors, Inc. Dallas, Texas
Austin, Texas
Xxxxxxx Island Air & Heat, Inc. Merritt Island, Florida
New Construction Air Conditioning, Inc. Holt, Michigan
Noron, Inc. Toledo, Ohio
Xxxx X. Xxxxx Co., Inc. Indianapolis, Indiana
Phoenix Electric Company Tigard, Oregon
Ray and Xxxxxx Xxxxxxx, Inc. Jacksonville, Florida
Reliable Mechanical, Inc. Louisville, Kentucky
Xxxxxxxx Electric Corp. Toledo, Ohio
124
LOCATION OF INVENTORY AND
DEBTOR ACCOUNTS RECEIVABLE
------ -------------------------
Xxxxxx Services, Incorporated Memphis, Tennessee
Southeast Mechanical Service, Inc. Hollywood, Florida
Sterling Air Conditioning, Inc. Pearland, Texas
Sun Plumbing, Inc. Melbourne, Florida
Team Mechanical, Inc. Kaysville, Utah
United Acquisition Corp. Englewood, Colorado
Valley Wide Plumbing and Heating, Inc. Avon, Colorado
Van's Comfortemp Air Conditioning, Inc. Delray Beach, Florida
Vantage Material Contractors, Inc. Glen Burnie, Maryland
Xxxx'x Heating and Cooling, Inc. Ft. Xxxxx, Florida
Xxxxxxx & Sons, Inc. Naples, Florida
Xxxxxx Refrigeration, Air Conditioning & Cincinnati, Ohio
Heating, Inc.
Yale Incorporated Minneapolis, Minnesota
125
SCHEDULE II-B
CHIEF EXECUTIVE OFFICE LOCATIONS
OF DEBTORS
DEBTORS LOCATION OF CHIEF EXECUTIVE OFFICE
------- ----------------------------------
AA Advance Air, Inc. 0000 X.X. 00xx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxx 00000
XX XXXX, Inc. (dba Jarrell Plumbing) 0000 Xxxxxx
Xxxxxxx, Xxxxx 00000
A-ABC Appliance, Inc. 00000 Xxxxxxxxxxxx Xxx
Xxxxxx, Xxxxx 00000
A-1 Appliance & Air Conditioning, Inc. 00000 Xxxxxxxxxxxx Xxx
Xxxxxx, Xxxxx 00000
A-1 Mechanical of Lansing, Inc. 000 X. Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxx 00000
Air Conditioning Engineers, Inc. 0000 Xxxxxx Xxxx
Xxxxx, Xxxxxxxx 00000
Air Conditioning, Plumbing & Heating 0000 Xxxx Xxxxxx
Xxxxxxx, Xx. Xxxxxx, Xxxxxxxx 00000
Aircon Energy Incorporated 0000 X. Xxxxxxx Xxxx., Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxx 00000
Airtron, Inc. 0000 Xxxxx Xxxxx Xxxxx
Xxxxxx, Xxxx 00000
Airtron of Central Florida, Inc. 0000 Xxxxx Xxxxx Xxxxx
Xxxxxx, Xxxx 00000
All Service Electric, Inc. 0000 Xxxxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Arkansas Mechanical Services, Inc. 0000 Xxxxxxx Xxxx
X. Xxxxxx Xxxx, Xxxxxxxx 00000
Atlantic Industrial Constructors, Inc. 0000 Xxxxxx'x Xxxx
Xxxxxxxx, Xxxxxxxx 00000
126
DEBTORS LOCATION OF CHIEF EXECUTIVE OFFICE
------- ----------------------------------
Xxxx Electric Corp. 000 Xxxx Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Xxxxxxxx Xxxxx Products & Publications, Inc. 0000 X. Xxxxxxx Xxx. #000
Xxxxxxxxx, Xxxxxxxx 00000
Central Air Conditioning Contractors, Inc. 0000 Xxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000-0000
Central Carolina Air Conditioning Company 0000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Xxxxxxx Xxxxxxxx, Inc. 0000 Xxxxxxxxxxxx
Xxxxx Xxxxxxx, Xxxxx 00000
Xxxxx Xxxxxxxx Electric Service, Inc. 0000 Xxxxx Xxxx
Xxxxx Xxxx, Xxxx 00000
Colonial Air Conditioning Company 0 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Commercial Air Holding Company 00000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Commercial Air, Power & Cable, Inc. 00000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Xxxxxxx Brothers, Inc. 0000 Xxxxxxx Xxx.
Xxxx Xxxx, Xxxxx Xxxxxxxx 00000
Divco, Inc. 000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Dynamic Software Corporation 0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxx 00000-0000
Xxxxx Services, Inc. 0000 Xxxxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
The Farfield Company 000 Xxxxxx Xxxxxx Xxxx
Xxxxxx, Xxxxxxxxxxxx 00000
Xxxxxxxx Electric Corporation 0000 Xxxx Xxxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
127
DEBTORS LOCATION OF CHIEF EXECUTIVE OFFICE
------- ----------------------------------
Xxxxxxxx Electrical Contractors, Inc. 00000 Xxxxxxxx
Xxxxxx, Xxxxx 00000
Xxxxxxx Mechanical Contractors, Inc. 0000 Xxxx 00xx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
GroupMAC Holding Corp. 0 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
GroupMAC Management Co. 0 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
HPS Plumbing Services, Inc. 000 00xx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxxx 00000
Hallmark Air Conditioning, Inc. 0000 Xxxxxxxxxxx Xxxx
Xxxxxxx, Xxxxx 00000
Xxxxxxxxxx Mechanical Corporation 0000 Xxxxxxxxx Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
X. X. Xxxxxxx Air Conditioning, Inc. 000 Xxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Xxxxx Xxxxxx Air Conditioning, Inc. 00000 Xxxxxxx Xxxx
Xxx Xxxxxxx, Xxxxx 00000
K & N Plumbing, Heating and Air 0000 X. Xxxxxxx Xxxxxxx
Conditioning, Inc. Xxxxxxxxx, Xxxxx 00000
Xxxxx'x, Inc. 00 X. 00xx Xxxxxx
Xxxxx, Xxxxx Xxxxxx 00000
Linford Service Co. 0000 Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
XxxXxxxxx-Xxxxxx Industries, Inc. 0000 Xxxxxxx X.X.
Xxxxxxx, Xxxxxxxxxx 00000-0000
XxxXxxxxx-Xxxxxx Co., Inc. 0000 Xxxxxxx X.X.
Xxxxxxx, Xxxxxxxxxx 00000-0000
XxxXxxxxx-Xxxxxx Service, Inc. 0000 Xxxxxxx X.X.
Xxxxxxx, Xxxxxxxxxx 00000-0000
128
DEBTORS LOCATION OF CHIEF EXECUTIVE OFFICE
------- ----------------------------------
Masters, Inc. 7891 Beechcraft
Xxxxxxxxxxxx, Xxxxxxxx 00000
Mechanical Interiors, Inc. 000 Xxxxx Xxx
Xxxxxx, Xxxxx 00000-0000
Xxxxxxx Island Air & Heat, Inc. 000 Xxxxxxx Xxxxxx
Xxxxxxx Xxxxxx, Xxxxxxx 00000
New Construction Air Conditioning, Inc. 0000 Xxxxx Xxxxxx
Xxxx, Xxxxxxxx 00000
Noron, Inc. 5465 Enterprise
Xxxxxx, Xxxx 00000
Xxxx X. Xxxxx Co., Inc. 0000 Xxxx 00xx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Phoenix Electric Company 0000 X.X. Xxxx Xxxxxx Xxxxx
Xxxxxx, Xxxxxx 00000
Ray and Xxxxxx Xxxxxxx, Inc. 0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Reliable Mechanical, Inc. 00000 Xxxxxxxxxx Xxxxxxxxxx Xxxx.
Xxxxxxxxxx, Xxxxxxxx 00000
Xxxxxxxx Electric Corp. 0000 Xxxxxxxxxx Xxxx.
Xxxxxx, Xxxx 00000
Xxxxxx Services, Incorporated 0000 Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxx 00000
Southeast Mechanical Service, Inc. 0000 XX 00xx Xxxxxxx
Xxxxxxxxx, Xxxxxxx 00000
Sterling Air Conditioning, Inc. 0000 Xxxx Xxxxxxxx
Xxxxxxxx, Xxxxx 00000
Sun Plumbing, Inc. 0000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx 00000
Team Mechanical, Inc. 000 X. 000 Xxxx
Xxxxxxxxx, Xxxx 00000
129
DEBTORS LOCATION OF CHIEF EXECUTIVE OFFICE
------- ----------------------------------
United Acquisition Corp. (dba United Service 0000 X. Xxxxxxx Xxx., #000
Xxxxxxxx) Xxxxxxxxx, Xxxxxxxx 00000
Valley Wide Plumbing and Heating, Inc. 000 Xxxxxxx Xxxx
Xxxx, Xxxxxxxx 00000
Van's Comfortemp Air Conditioning, Inc. 000 X. Xxxxxxxx
Xxxxxx Xxxxx, Xxxxxxx 00000
Vantage Mechanical Contractors, Inc. 000 Xxxxx Xxxxxxx Xxxx
Xxxx Xxxxxx, Xxxxxxxx 00000
Xxxx'x Heating and Cooling, Inc. 00000-0 Xxxxx Xxxxxxx
Xx. Xxxxx, Xxxxxxx 00000
Wiegold & Sons, Inc. 2255 J&C Blvd.; Xxxx Xxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxx 00000
Xxxxxx Refrigeration, Air Conditioning & 000 Xxxx Xxxx
Xxxxxxx, Xxx. Xxxxxxxxxx, Xxxx 00000
Yale Incorporated 0000 Xxxxxx Xxxxxx
Xxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000
130
SCHEDULE III
UCC FILINGS
LOCATION OF UCC-1 FILINGS
(SECRETARY OF STATE, UNLESS
DEBTORS OTHERWISE INDICATED)
------- --------------------------
Group Maintenance America Corp. Florida; Indiana; Xxxxxx County, Indiana; Kansas;
Kentucky; Ohio; and Texas
A-ABC Appliance, Inc. Texas
A-1 Appliance & Air Conditioning, Inc. Texas
A-1 Mechanical of Lansing, Inc. Michigan
AA Advance Air, Inc. Florida
XX XXXX, Inc. Texas
Air Conditioning Engineers, Inc. Michigan
Air Conditioning, Plumbing & Heating Service Co., Colorado
Inc.
Aircon Energy Incorporated California
Airtron, Inc. Delaware; Florida; Indiana; Xxxxxx County, Indiana;
Kansas; Kentucky; Ohio; and Texas
Airtron of Central Florida, Inc. Florida and Ohio
All Service Electric, Inc. Florida
Arkansas Mechanical Services, Inc. Arkansas
Atlantic Industrial Constructors, Inc. Xxxxxxxx
Xxxx Electric Corp. Illinois
Xxxxxxxx Xxxxx Products & Publications, Inc. Colorado
Central Air Conditioning Contractors, Inc. Maryland
Central Carolina Air Conditioning Company North Carolina
Xxxxxxx Xxxxxxxx, Inc. Texas
Xxxxx Xxxxxxxx Electric Service, Inc. Ohio
Colonial Air Conditioning Company Connecticut
Commercial Air, Power & Cable, Inc. Maryland
Commercial Air Holding Company Maryland
131
LOCATION OF UCC-1 FILINGS
(SECRETARY OF STATE, UNLESS
DEBTORS OTHERWISE INDICATED)
------- --------------------------
Xxxxxxx Brothers, Inc. South Carolina
Divco, Inc. Washington
Dynamic Software Corporation Maryland
Xxxxx Services, Inc. Alabama
The Farfield Company Pennsylvania
Xxxxxxxx Electric Corporation Colorado
Xxxxxxxx Electrical Contractors, Inc. Texas
Xxxxxxx Mechanical Contractors, Inc. Minnesota
GroupMAC Holding Corp. Texas
GroupMAC Management Co. Texas
HPS Plumbing Services, Inc. California
Hallmark Air Conditioning, Inc. Texas
Xxxxxxxxxx Mechanical Corporation Virginia
X.X. Xxxxxxx Air Conditioning, Inc. Colorado
Xxxxx Xxxxxx Air Conditioning, Inc. Texas
K&N Plumbing, Heating and Air Conditioning, Inc. Texas and Nevada
Xxxxx'x, Inc. North Dakota
Linford Service Co. California
XxxXxxxxx-Xxxxxx Industries, Inc. Oregon and Washington
XxxXxxxxx-Xxxxxx Co., Inc. Oregon and Washington
XxxXxxxxx-Xxxxxx Service, Inc. Oregon and Washington
Masters, Inc. Maryland and Virginia
Mechanical Interiors, Inc. Texas
Xxxxxxx Island Air & Heat, Inc. Florida
New Construction Air Conditioning, Inc. Michigan
Noron, Inc. Ohio
132
LOCATION OF UCC-1 FILINGS
(SECRETARY OF STATE, UNLESS
DEBTORS OTHERWISE INDICATED)
------- ---------------------------
Xxxx X. Xxxxx Co., Inc. Indiana and Xxxxxx County, Indiana
Phoenix Electric Company Oregon
Ray and Xxxxxx Xxxxxxx, Inc. Florida
Reliable Mechanical, Inc. Kentucky
Xxxxxxxx Electric Corp. Ohio
Xxxxxx Services, Incorporated Tennessee
Southeast Mechanical Service, Inc. Florida
Sterling Air Conditioning, Inc. Texas
Sun Plumbing, Inc. Florida
Team Mechanical, Inc. Utah
United Acquisition Corp. Colorado
Valley Wide Plumbing and Heating, Inc. Colorado
Van's Comfortemp Air Conditioning, Inc. Florida
Vantage Material Contractors, Inc. Maryland
Xxxx'x Heating and Cooling, Inc. Florida
Xxxxxxx & Sons, Inc. Florida
Xxxxxx Refrigeration, Air Conditioning & Heating, Inc. Ohio
Yale Incorporated Minnesota
133
EXHIBIT 4.01(d)(ii)
SECOND AMENDED AND RESTATED PLEDGE AGREEMENT
This SECOND AMENDED AND RESTATED PLEDGE AGREEMENT (as the same
may be amended, amended and restated, modified, or supplemented from time to
time, this "Agreement") dated as of October 15, 1998 is executed by GROUP
MAINTENANCE AMERICA CORP., a Texas corporation with an office at 0 Xxxxxxxx
Xxxxx, Xxxxx 0000, Xxxxxxx, XX 00000 (the "Company"), the subsidiaries of the
Company signatory hereto now or in the future (such subsidiaries with the
Company, collectively the "Pledgors" and individually, a "Pledgor") in favor of
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, a national banking association with
its principal offices in Houston, Xxxxxx County, Texas, as agent for itself and
for the banks under the Second Amended and Restated Credit Agreement, as
hereinafter defined (in such capacity, the "Secured Party").
PRELIMINARY STATEMENTS
WHEREAS, the Pledgors own the shares (the "Pledged
Shares") of stock described in Schedule I attached hereto and issued by the
corporations named therein; and
WHEREAS, the Company, the Secured Party, as agent
(then known as Texas Commerce Bank National Association) and the banks party
thereto entered into that one certain Credit Agreement dated December 11, 1997
(as amended, the "First Credit Agreement" ), relating to the extension of a
series of loans with a commitment totaling $75,000,000.00 by said banks to the
Company; and
WHEREAS, the Company and certain of its subsidiaries,
as guarantors, the Secured Party, as agent, the banks and financial institutions
listed on the signature pages thereto, ABN Amro Bank, N.V. and Paribas, as
co-agents agreed to amend and restate the First Credit Agreement pursuant to the
terms and conditions of the Amended and Restated Credit Agreement dated June 12,
1998 (the "Amended and Restated Credit Agreement" and together with the First
Credit Agreement, the "Prior Credit Agreement"), relating to the extension of a
series of loans with a commitment totaling $125,000,000.00 by said banks to the
Company; and
WHEREAS, the Secured Party, as agent, the banks party
thereto (the "Banks"), Bank of America Texas, N.A., as co-agent, Paribas, as
syndication agent, ABN AMRO Bank, N.V., as documentation agent, and the Pledgors
desire to amend and restate the Prior Credit Agreement and have entered into
that certain Second Amended and Restated Credit Agreement dated as of October
15, 1998 (as amended, amended and restated, modified or supplemented from time
to time, the "Credit Agreement"), under the terms of which the Banks agreed to
make available to the Company, a loan of up to $230,000,000.00; and
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WHEREAS, in connection with the Prior Credit
Agreement and as partial security thereof, the Secured Party, the Company and
certain of its subsidiaries entered into that one certain Pledge Agreement dated
December 11, 1997, which was amended and restated pursuant to the Amended and
Restated Pledge Agreement dated June 12, 1998 among the Secured Party, the
Company and certain of its subsidiaries (collectively, the "Prior Pledge
Agreement") pledging certain shares of stock held by each of them to the Secured
Party; and
WHEREAS, each of the Pledgors will benefit, directly
or indirectly, from the execution of this Pledge Agreement and the granting of a
security interest in the "Pledged Collateral" (hereinafter defined) in which
each Pledgor, respectively, has any right, title, or interest as security for
all of the "Secured Obligations" (hereinafter defined); and
WHEREAS, it is a condition precedent to the
obligation of the Banks to make Loans to the Company under the Credit Agreement
that the Pledgors shall execute and deliver this Agreement to the Secured Party;
and
WHEREAS, the Pledgors desire to execute this
Agreement in order to satisfy such condition precedent and to secure the
obligations under the Credit Agreement and letters of credit from time to time
issued.
NOW THEREFORE, in consideration of the foregoing
premises and in order to induce the Banks to extend the loans and issue letters
of credit pursuant to the terms of the Credit Agreement, the Pledgors hereby
agree to amend and restate the Prior Pledge Agreement as follows:
SECTION 1. Defined Terms and Related Matters.
(a) Each capitalized term used herein (including,
without limitation, in the introductory paragraph and recitals hereof) and not
defined herein shall have the meaning assigned to such term in the Credit
Agreement and/or a Loan Document.
(b) "Pledged Shares" means one hundred percent (100%)
of the shares of all stock of any Pledgor in any domestic Subsidiaries whether
certificated or uncertificated, as set forth on Schedule I hereto.
(c) "UCC" means the Uniform Commercial Code as in
effect on the date hereof in the State of Texas; provided that if by mandatory
provisions of law, the perfection or the effect of perfection or non-perfection
of the security interests granted pursuant to Section 2 hereof, as well as all
other security interests created or assigned as additional security for the
Secured Obligations pursuant to the provisions of this Agreement, in any
Collateral is governed by the UCC as in effect in a jurisdiction other than
Texas, "UCC" means the UCC as in effect in such other jurisdiction for purposes
of the provisions hereof relating to such perfection or effect of perfection or
non-perfection.
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(d) "Secured Obligations" means all obligations,
contingent or otherwise, of the Company or any Pledgor pursuant to any of the
Loan Documents, including, without limitation, all sums owing by the Company or
any Pledgor to the Secured Party under any of the Loan Documents, and any
obligations outstanding now or in the future, including, but not limited to, any
letters of credit issued by the Agent or any other Bank and any interest rate
swaps, xxxxxx or similar agreements between any Pledgor or any of its
Subsidiaries and any of the Banks all on a pari passu basis.
(e) All rights and interests granted to the Secured
Party under the Prior Pledge Agreement are hereby ratified and renewed and
brought forward herein to the extent same are not inconsistent herewith. This
Agreement shall be a restatement of the Prior Pledge Agreement but shall not
invalidate or adversely affect any rights or interests granted to the Secured
Party thereunder or affect the priority thereof except as expressly set forth
herein.
SECTION 2. Pledges. The Pledgors hereby pledge to the
Secured Party and grant to the Secured Party, a Lien and security interest in
the following collateral (collectively, the "Pledged Collateral") as set forth
below:
(i) The Pledged Shares and the certificates,
if any, representing the Pledged Shares, and all
dividends, cash, instruments and other property from
time to time received, receivable or otherwise
distributed in respect of, or in exchange for, any or
all of the Pledged Shares;
(ii) All additional shares of stock of any
issuer of any Pledged Shares of such stock from time
to time acquired by any Pledgor, and the certificates
representing such additional shares, and all
dividends, cash, instruments and other property from
time to time received, receivable or otherwise
distributed in respect of or in exchange for any or
all of such shares; and
(iii) All proceeds of any of the foregoing.
The inclusion of proceeds in this Agreement does not
authorize the Pledgors to sell, dispose of or otherwise use the Pledged
Collateral in any manner not specifically authorized hereby.
SECTION 3. Security for Obligations. This Agreement
secures on a first and prior basis, except for the Permitted Liens and other
Liens permitted under the Credit Agreement, the prompt and complete payment and
performance of the Secured Obligations.
SECTION 4. Delivery of Pledged Collateral. All
certificates, if any, representing or evidencing the Pledged Collateral shall be
delivered to and held by the Secured Party and shall be in suitable form for
transfer by delivery, or shall be accompanied by duly executed
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instruments of transfer or assignment in blank, all in form and substance
satisfactory to the Secured Party.
SECTION 5. Representations and Warranties. Each of
the Pledgors represents and warrants as follows:
(a) The principal place of business and chief
executive office of the Company and the office where it keeps its records
concerning the Pledged Collateral are located at the address specified in the
introductory paragraph to this Agreement or at such other locations disclosed to
the Secured Party after the date hereof. Each other Pledgor has its chief
executive office at the location shown on Schedule II hereto or at such other
locations as disclosed to the Secured Party after the date hereof.
(b) The Pledged Shares have been duly authorized and
validly issued and are fully paid and non-assessable.
(c) The Pledgors are the legal and beneficial owners
of the Pledged Shares free and clear of any Lien, security interest, option or
other charge or encumbrance except for the Permitted Liens and other Liens
permitted under the Credit Agreement.
(d) The delivery of the Pledged Shares to the Secured
Party pursuant to this Agreement and the filing of financing statements, if
applicable, creates a valid and perfected first priority security interest in
the Pledged Shares (subject only to Permitted Liens and other Liens permitted
under the Credit Agreement), securing the payment of the Secured Obligations.
(e) No authorization, approval, or other action by,
and no notice to or filing with, any governmental authority is required either
(i) for the pledge by the Pledgors of the Pledged Shares pursuant to this
Agreement or for the execution, delivery or performance of this Agreement by the
Pledgors or (ii) for the exercise by the Secured Party of the voting or other
rights provided for in this Agreement (except as may be required in connection
with such disposition by laws affecting the offering and sale of securities
generally).
(f) All shares of stock in any domestic Subsidiary
are pledged to the Secured Party hereunder.
(g) The Subsidiaries listed on Schedule 5.16 of the
Credit Agreement are all of the Subsidiaries of the Company as of the Execution
Date and the address given for such Subsidiaries is the correct mailing address
as of the Execution Date.
SECTION 6. Further Assurances. (a) Each Pledgor
agrees that from time to time, at the reasonable expense of the Pledgor, each
Pledgor will promptly execute and deliver all further instruments and documents,
and take all further action, that the Secured Party may reasonably request as
being necessary or desirable, in order to perfect and protect any security
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interest granted or purported to be granted hereby or to enable the Secured
Party to exercise and enforce its rights and remedies hereunder with respect to
any Pledged Collateral. Without limiting the generality of the foregoing, each
Pledgor will execute and file such financing or continuation statements, or
amendments thereto, and such other instruments or notices as the Secured Party
may reasonably request as being necessary or desirable in order to perfect and
preserve the security interests granted or purported to be granted hereby.
(b) Each Pledgor hereby authorizes the Secured Party
for the benefit of itself and the Banks to file one or more financing or
continuation statements, and amendments thereto, relative to all or any part of
the Pledged Collateral without the signature of such Pledgor, in each case where
permitted by law. A carbon, photographic or other reproduction of any financing
statement executed by each Pledgor covering the Pledged Collateral or any part
thereof shall be sufficient as a financing statement where permitted by law.
(c) Each Pledgor will furnish to the Secured Party
from time to time statements and schedules further identifying and describing
the Pledged Collateral as the Secured Party may reasonably request, all in
reasonable detail.
(d) Each Pledgor will promptly notify the Secured
Party of any change of its name, corporate structure, federal employer
identification number or the address of its principal place of business or chief
executive office where its books and records are maintained.
(e) Each Pledgor shall keep its principal place of
business and chief executive office and the office where it keeps its records
concerning the Pledged Collateral at the location or locations therefor
specified in Section 5(a) or, upon 30 days' prior written notice to the Secured
Party, at such other locations in a jurisdiction where all action required by
this Section 6(a) shall have been taken with respect to the Pledged Collateral.
Each Pledgor will hold and preserve such records and will upon reasonable notice
permit representatives of the Secured Party at any time during normal business
hours to inspect and make abstracts from such records.
SECTION 7. Voting Rights. (a) So long as no Event of
Default shall have occurred and be continuing, the Pledgors shall be entitled to
exercise any and all voting and other rights pertaining to the Pledged
Collateral or any part thereof for any purpose not inconsistent with the terms
of this Agreement, the Credit Agreement, or any Loan Documents.
(b) Upon the occurrence and during the continuance of
an Event of Default, all rights of the Pledgors to exercise the voting rights
which they would otherwise be entitled to exercise pursuant to Section 7(a)
hereof shall cease for so long as such Event of Default shall continue, and the
Secured Party shall thereupon have the sole right to exercise such voting
rights.
SECTION 8. Dividends. If dividends with respect to
the Pledged Collateral are received by the Pledgors in violation of the terms of
the Loan Documents, such dividends shall
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be received in trust for the benefit of the Secured Party for itself and for the
benefit of the Banks, shall be segregated from other funds of the Pledgors and
shall be forthwith paid over to the Secured Party as Pledged Collateral in the
same form as so received.
SECTION 9. Transfers and Other Liens; Additional
Shares. (a) The Pledgors shall not: (i) sell, assign (by agreement, operation of
law or otherwise) or otherwise dispose of, or grant any option with respect to,
any of the Pledged Collateral except for transfers to other Pledgors or other
wholly owned Subsidiaries of Pledgors which agree to be bound by the terms
hereof or (ii) create or permit to exist any Lien upon or with respect to any of
the Pledged Collateral, except for the Permitted Liens and other liens permitted
under the Credit Agreement.
(b) The Pledgors agree that they will (i) cause the
companies that issued the shares that constitute the Pledged Collateral not to
issue any stock or other securities in addition to, or in substitution for, the
Pledged Collateral, except to the Pledgor and (ii) pledge to the Secured Party
hereunder, immediately upon such acquisition (directly or indirectly) thereof,
any and all additional shares of stock or other securities of such companies.
(c) Notwithstanding the foregoing or any other
provision hereof, any Subsidiary may be merged with any other Subsidiary whose
shares have been pledged pursuant hereto or pursuant to any Adoption Agreement
or other Security Document or with the Company.
SECTION 10. Secured Party Appointed Attorney-in-Fact.
The Pledgors hereby irrevocably appoint the Secured Party for the benefit of
itself and for the benefit of the Banks as the Pledgors' attorney-in-fact, with
full authority in the place and stead of the Pledgors and in the name of the
Pledgors, from time to time in the Secured Party's sole reasonable discretion
after the occurrence of an Event of Default and during the continuance thereof,
to take any action and to execute any instrument which the Secured Party may
reasonably deem necessary or advisable to accomplish the purposes of this
Agreement, including, without limitation, to receive, endorse and collect all
certificates made payable to the Pledgors representing any dividend or other
distribution in respect of the Pledged Collateral or any part thereof. Upon the
occurrence and during the continuance of an Event of Default, the Secured Party
shall have the right, in its sole discretion and without notice to the Pledgors,
to transfer to or to register in the name of the Secured Party or any of its
nominees, for the benefit of itself and the Banks, any or all of the Pledged
Collateral.
SECTION 11. Secured Party May Perform. If any Pledgor
fails to perform any agreement contained herein, the Secured Party may itself
perform, or cause performance of, such agreement, and the reasonable expenses of
the Secured Party incurred in connection therewith shall be payable upon demand
by such Pledgor and if not paid shall bear interest at the Default Rate set
forth in the Credit Agreement.
SECTION 12. The Secured Party's Duties. The powers
conferred on the Secured Party hereunder are solely to protect its interest and
the interests of Banks in the Pledged Collateral and shall not impose any duty
upon it to exercise any such powers. In regard to any
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Pledgor, except for reasonable care in the custody of any Pledged Collateral in
its possession and the accounting for moneys actually received by it hereunder,
neither the Secured Party nor any other party shall have any duty as to any
Pledged Collateral or as to the taking of any reasonably necessary steps to
preserve rights against prior parties or any other rights pertaining to any
Pledged Collateral. The Secured Party shall be deemed to have exercised
reasonable care in the custody and preservation of the Pledged Collateral in its
possession if the Pledged Collateral is accorded treatment substantially equal
to that which the Secured Party accords its own property, it being understood
that the Secured Party shall not have any responsibility for (a) ascertaining or
taking action with respect to calls, conversions, exchanges, maturities, tenders
or other matters relative to any Pledged Collateral, whether or not the Secured
Party has or is deemed to have knowledge of such matters or (b) taking any
necessary steps to preserve rights against any parties with respect to any
Pledged Collateral.
SECTION 13. Remedies upon Default. If any Event of
Default shall have occurred and be continuing:
(a) The Secured Party for itself and for the benefit
of the Banks may exercise in respect of the Pledged Collateral, in addition to
other rights and remedies provided for herein or otherwise available to it, all
the rights and remedies of a secured party under the UCC (whether or not the UCC
applies to the affected Collateral), and the Secured Party may also, without
notice except as specified below, sell the Pledged Collateral or any part
thereof in one or more parcels at public or private sale, at any exchange,
broker's board or at any of the Secured Party's offices or elsewhere, for cash,
or for future delivery, and upon such other terms as are commercially
reasonable. Each Pledgor agrees that, to the extent notice of sale shall be
required by applicable law, at least ten (10) days' notice to the Pledgors of
the time and place of any public sale or of the time after which any private
sale is to be made shall constitute reasonable notification thereof. The Secured
Party shall not be obligated to make any sale of Pledged Collateral regardless
of notice of sale having been given. The Secured Party may adjourn any public or
private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned.
(b) Any cash received by the Secured Party shall be
applied to repay the Secured Obligations. Any surplus of such cash or cash
proceeds held by the Secured Party and remaining after payment in full of all
the Secured Obligations shall be paid over to the Pledgors or to whomsoever may
be lawfully entitled to receive such surplus.
(c) In connection with the sale of any Pledged
Collateral, the Secured Party is authorized, but not obligated, to limit
prospective purchasers to the extent deemed necessary or desirable by the
Secured Party to render such sale exempt from the registration requirements of
the Securities Act of 1933, as amended (the "Securities Act"), and any
applicable state laws and regulations, and no sale so made in good faith by the
Secured Party shall be deemed not to be "commercially reasonable" because so
made.
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(d) All rights and remedies of the Secured Party
expressed herein are in addition to all other rights and remedies possessed by
the Secured Party under the Credit Agreement and any other agreement or
instrument relating to the Obligations.
SECTION 14. Additional Provisions Concerning Sales of
Pledged Collateral. (a) The Pledgors recognize that the Secured Party may be
unable to effect a public sale of any or all of the Pledged Collateral by reason
of certain prohibitions contained in the laws of any jurisdiction outside the
United States or in the Securities Act and applicable state securities laws, but
may instead be compelled to resort to one or more private sales thereof to a
restricted group of purchasers who shall be obligated to agree, among other
things, to acquire such Pledged Collateral for their own account for investment
and not with a view to the distribution or resale thereof. The Pledgors
acknowledge and agree that any such private sale may result in prices and other
terms less favorable to the seller than if such sale were a public sale and,
notwithstanding such circumstances, agree that any such private sale shall, to
the extent permitted by law, be deemed to have been made in a commercially
reasonable manner. The Secured Party shall not be under any obligation to delay
a sale of any of the Pledged Collateral for the period of time necessary to
permit the Pledgors to register such securities under the laws of any
jurisdiction outside the United States, under the Securities Act or under any
applicable state securities laws, even if the Pledgors would agree to do so.
(b) The Pledgors further agree to do or cause or be
done, to the extent that the Pledgors may legally do so, all such other acts and
things as may be necessary to make such sales or resales of any portion or all
of the Pledged Collateral valid and binding and in compliance with any and all
applicable laws, regulations, orders, writs, injunctions, decrees or awards of
any and all courts, arbitrators or governmental authorities, domestic or
foreign, having jurisdiction over any such sale or sales, all at the Pledgors'
expense; provided, however, that the Pledgors shall not be obligated to register
such securities under the laws of any jurisdiction including, without
limitation, under the Securities Act. The Pledgors further agree that a breach
of any of the covenants contained in this Section shall cause irreparable injury
to the Secured Party, and that the Secured Party has no adequate remedy at law
in respect of such breach and, as a consequence, agrees that each and every
covenant contained in this Section shall be specifically enforceable against the
Pledgors, and, to the fullest extent permitted by law, the Pledgors hereby waive
and agree not to assert as a defense against an action for specific performance
of such covenants that (i) the Pledgors' failure to perform such covenants shall
not cause irreparable injury to the Secured Party or the Banks or (ii) the
Secured Party for itself and on behalf of the Banks has an adequate remedy at
law in respect of such breach.
SECTION 15. Indemnity and Expenses. (a) The Pledgors
hereby agree to indemnify the Secured Party from and against any and all claims,
losses and liabilities growing out of or resulting from enforcement of this
Agreement, except claims, losses or liabilities, if any, resulting from the
Secured Party's gross negligence or willful misconduct. SUBJECT TO THE
FOREGOING, IT IS THE EXPRESS INTENTION OF THE PLEDGORS THAT THE SECURED PARTY
SHALL BE INDEMNIFIED AND HELD HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES,
CLAIMS, DEFICIENCIES, JUDGMENTS OR
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EXPENSES ARISING OUT OF OR RESULTING FROM THE ORDINARY CONTRIBUTORY OR ORDINARY
CONCURRENT NEGLIGENCE OF ANY SUCH PERSON.
(b) The Pledgors shall, upon demand, but subject to
the terms of the Credit Agreement, pay to the Secured Party the amount of any
and all reasonable expenses, including the reasonable fees and expenses of the
such party's counsel and of its experts, that the Secured Party may incur in
connection with (i) administration of this Agreement, (ii) the evaluation,
appraisal, custody or preservation of, or sale of, collection from, or other
realization upon any of the Pledged Collateral, (iii) the exercise or
enforcement of any of the rights of the Secured Party for itself and for the
benefit of the Banks hereunder or (iv) the failure by the Pledgors to perform or
observe any of the provisions of this Agreement. Each Pledgor agrees to pay
interest on any sums payable to the Secured Party hereunder that are not paid
when due at a rate per annum equal to the Default Rate set forth in the Credit
Agreement.
SECTION 16. Amendments, Etc. No amendment or waiver
of any provision of this Agreement, nor consent to any departure by the Pledgors
herefrom, shall in any event be effective unless the same shall be in writing
and signed by the Secured Party with the requisite consent of all other Banks,
if applicable, and the Pledgors, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose of which
given.
SECTION 17. Addresses for Notices. All notices and
other communications to any Pledgor provided for hereunder shall be given in the
manner and at the addresses and telecopy numbers as set forth for the Company in
the Credit Agreement, and shall become effective as specified in the Credit
Agreement and/or Loan Documents.
SECTION 18. Waiver of Marshaling. All rights of
marshaling of assets of the Pledgors, including any such right with respect to
the Pledged Collateral, are hereby waived by the Pledgors.
SECTION 19. Limitation by Law. All rights, remedies
and powers provided in this Agreement may be exercised only to the extent that
the exercise thereof does not violate any applicable provision of law, and all
the provisions of this Agreement are intended to be subject to all applicable
mandatory provisions of law which may be controlling and to be limited to the
extent necessary so that they shall not render this Agreement invalid,
unenforceable, in whole or in part, or not entitled to be recorded, registered
or filed under the provisions of any applicable law.
SECTION 20. Severability. Should any clause,
sentence, paragraph, subsection or Section of this Agreement be judicially
declared to be invalid, unenforceable or void, such decision shall not have the
effect of invalidating or voiding the remainder of this Agreement, and the
parties hereto agree that the part or parts of this Agreement so held to be
invalid or unenforceable shall be deemed to have been stricken herefrom by the
parties hereto, and the
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remainder of this Agreement shall have the same force and effectiveness as if
such stricken part or parts had never been included herein.
SECTION 21. Termination; Reinstatement. (a) Each
Pledgor agrees that this Agreement and the Liens granted hereunder shall
terminate when, but only when, all Secured Obligations have been fully and
finally paid and performed and all Banks' Commitments under the Credit Agreement
and/or Loan Documents have expired or been terminated. At any time thereafter
upon the Pledgor's request, the Secured Party shall promptly reassign and
redeliver, including the termination of any financing statements (or cause to be
reassigned and redelivered) to the Pledgors, or to such Person or Persons as the
Pledgors shall designate in writing, against receipt, such of the Pledged
Collateral (if any) as shall not have been sold or otherwise applied by the
Secured Party for the benefit of itself or the Banks pursuant to the terms
hereof and shall still be held by it hereunder. Any such reassignment shall be
without recourse upon, or representation or warranty by, the Secured Party
(other than that the Secured Party for the benefit of itself and the Banks has
not sold, encumbered or otherwise transferred any interest in the Collateral
except as provided in this Agreement) and shall be at the sole reasonable cost
and expense of the Pledgors.
(b) This Agreement shall continue to be effective or
be reinstated, as the case may be, if at any time any amount received by the
Secured Party or any other of the Banks in respect of the Secured Obligations is
rescinded or must otherwise be restored or returned by the Secured Party or such
other Banks upon the filing of any bankruptcy proceeding by or of the Pledgors
or upon the appointment of any intervenor or conservator of, or trustee or
similar official for, the Pledgors or any substantial part of their assets, or
otherwise, all as though such payments had not been made.
SECTION 22. No Waiver; Remedies. No failure on the
part of the Secured Party to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by applicable law.
SECTION 23. Continuing Security Interest; Transfer of
the Notes. This Agreement creates a continuing security interest in the Pledged
Collateral and shall (a) remain in full force and effect until the full and
final payment and performance of the Secured Obligations after the Pledgors
shall have no further obligation under the Loan Documents, (b) be binding upon
each Pledgor, its successors and assigns and (c) inure to the benefit of the
Secured Party for the benefit of itself and the Banks and their respective
permitted successors, transferees and assigns. Without limiting the generality
of the foregoing clause (c), any of the Banks may assign or otherwise transfer
all or a portion of its interests, rights and obligations in the Pledged
Collateral held by it pursuant to the Credit Agreement, or pursuant to any Loan
Document, to any other Person in accordance with the terms of the Credit
Agreement, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to the Secured Party for itself and for the
benefit of the Banks herein or otherwise. Upon the termination of the Secured
Obligations, the Liens granted hereby in
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accordance with the foregoing shall revert to Pledgors, and the Secured Party
will, at the Pledgors' sole cost and expense, promptly execute and deliver to
the Pledgor such documents as the Pledgor shall reasonably request to evidence
such termination. Any Subsidiary of the Company that executes a counterpart of
this Agreement after the date of this Agreement shall, upon such execution,
become a party hereto as a Pledgor.
SECTION 24. Security Interest Absolute. All rights of
the Secured Party for itself and for the benefit of Banks and security interests
hereunder, and all obligations of the Pledgors hereunder, shall be absolute and
unconditional irrespective of:
(a) any lack of validity or enforceability of the
Credit Agreement, any of the Notes, or any other Loan Document;
(b) any change in the time, manner or place or
payment of, or in any other term of, all or any of the Secured Obligations, or
any other amendment or waiver of or any consent to any departure from the Credit
Agreement, any of the Notes, or any other Loan Documents;
(c) any exchange, release or non-perfection of any
other collateral, or any release or amendment or waiver of or consent to
departure from any guaranty for all or any of the Secured Obligations; or
(d) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, the Pledgors or any other
third party.
SECTION 25. Governing Law. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND
THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA, EXCEPT AS REQUIRED BY
MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY OR
PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT
OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
THAN THE STATE OF TEXAS.
SECTION 26. Inconsistencies. In the event of any
irreconcilable inconsistences between any provision of this Security Agreement
and any provision of the Credit Agreement and/or the Loan Documents, the
provisions of this Agreement shall control.
SECTION 27. Counterparts. This Agreement may be
executed in any number of counterparts, and by different parties hereto in
separate counterparts either in original form or by telecopy, each of which when
so executed shall be deemed to be an original and all of which when taken
together shall constitute but one and the same agreement.
SECTION 28. Interpretation.
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(a) In this Security Agreement, unless a clear
contrary intention appears:
(i) the singular number includes the plural
number and vice versa;
(ii) the words "herein," "hereof" and
"hereunder" and other words of similar import refer
to this Security Agreement as a whole and not to any
particular Article, Section or other subdivision;
(iii) reference to any Person includes such
Person's successors and assigns but, if applicable,
only if such successors and assigns are permitted by
this Security Agreement, and reference to a Person in
a particular capacity excludes such Person in any
other capacity or individually, provided that nothing
in this clause (iii) is intended to authorize any
assignment not otherwise permitted by this Security
Agreement;
(iv) reference to any agreement, document or
instrument means such agreement, document or
instrument as amended, supplemented or modified and
in effect from time to time in accordance with the
terms thereof and, if applicable, the terms hereof,
and reference to any Note includes any Note issued
pursuant hereto in extension or renewal thereof and
in substitution or replacement therefor;
(v) unless the context indicates otherwise,
reference to any Article, Section, Schedule or
Exhibit means such Article or Section hereof or such
Schedule or Exhibit hereto;
(vi) the words "including" (and with
correlative meaning "include") means including,
without limiting the generality of any description
preceding such term;
(vii) with respect to the determination of
any period of time, the word "from" means "from and
including" and the word "to" means "to but
excluding"; and
(viii) reference to any law means such as
amended, modified, codified or reenacted, in whole or
in part, and in effect from time to time.
(b) The Section headings herein are for convenience
only and shall not affect the construction hereof.
(c) No provision of this Security Agreement shall be
interpreted or construed against any Person solely because that Person or its
legal representative drafted such provision.
145
SECTION 29. Submission to Jurisdiction. (a) ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT AND THE OTHER TRANSACTION
DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE STATE OF TEXAS, IN XXXXXX COUNTY
OR THE UNITED STATES FOR THE SOUTHERN DISTRICT OF TEXAS AND, BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH PLEDGOR HEREBY IRREVOCABLY ACCEPTS FOR ITSELF
AND IN RESPECT OF ITS PROPERTY, UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS WITH RESPECT TO ANY SUCH ACTION OR PROCEEDING. EACH PLEDGOR
FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO IT AT ITS ADDRESS
PROVIDED IN TRANSACTION DOCUMENTS, SUCH SERVICE TO BECOME EFFECTIVE THIRTY (30)
DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE SECURED
PARTY OR ANY OF THE PARTIES TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE PLEDGORS
IN ANY OTHER JURISDICTION.
(b) EACH PLEDGOR HEREBY IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF
THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (A) ABOVE AND HEREBY
FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM.
SECTION 30. Waiver of Jury Trial. EACH PARTY HEREBY
WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO A TRIAL BY JURY
IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT
OR UNDER ANY AMENDMENT, LOAN DOCUMENTS, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR
ARISING FROM OR RELATING TO ANY BANKING OR FINANCIAL RELATIONSHIP EXISTING IN
CONNECTION WITH THIS AGREEMENT OR ANY LOAN DOCUMENT, AND AGREES, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED
BEFORE A COURT AND NOT BEFORE A JURY.
SECTION 31. Final Agreement of the Parties. THIS
AGREEMENT (INCLUDING THE SCHEDULES HERETO), AND THE OTHER LOAN DOCUMENTS,
CONSTITUTE A "LOAN AGREEMENT" AS DEFINED IN SECTION 26.02(a) OF THE
146
TEXAS BUSINESS AND COMMERCE CODE, AND REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
147
IN WITNESS WHEREOF, the Pledgors have caused this
Agreement to be duly executed and delivered as of the date first above written.
COMPANY/PLEDGOR:
GROUP MAINTENANCE AMERICA
CORP., a Texas corporation
By:
------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
148
SUBSIDIARIES/PLEDGORS:
AIRTRON, INC.
COMMERCIAL AIR HOLDING COMPANY
GROUPMAC HOLDING CORP.
HALLMARK AIR CONDITIONING, INC.
XXXXXXXXX-XXXXXX INDUSTRIES, INC.
By:
----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
149
AGENT/SECURED PARTY:
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION, Agent for the Banks
By:
-----------------------------------------
Name: X. X. Xxxxxxx
Title: Vice President
150
SCHEDULE I
PLEDGED SHARES
PERCENTAGE OF STOCK NUMBER
ISSUING COMPANY AND SHARES CERTIFICATE OF
OWNER/PLEDGOR OF STOCK STATE OF INCORPORATION PLEDGED NO. SHARES
----------------------- ---------------------- ------------- ----------- ------
Group Maintenance America Corp., GroupMAC Holding Corp. 100% 1 1,000
a Texas corporation (Delaware)
Group Maintenance America Corp., GroupMAC Management Co. 100% 1 1,000
a Texas corporation (Delaware)
GroupMAC Holding Corp., a A-ABC Appliance, Inc. 100% 8 and 50 and 50
Delaware corporation (Texas) NV 8
GroupMAC Holding Corp., a A-1 Appliance & Air Conditioning, 100% 6 300,000
Delaware corporation Inc. (Texas)
Group Maintenance America Corp., XX XXXX, Inc. 100% 2 1,000
a Texas corporation (Texas)
Group Maintenance America Corp., Air Conditioning Engineers, Inc. 100% A001 1,000
a Texas corporation (Michigan)
Group Maintenance America Corp., Air Conditioning, Plumbing & 100% A001 1,000
a Texas corporation Heating Service Co., Inc. (Colorado)
Group Maintenance America Corp., Aircon Energy Incorporated 100% A001 1,000
a Texas corporation (California)
Group Maintenance America Corp., Airtron, Inc. 100% 235 329,513.104
a Texas corporation (Delaware)
Airtron, Inc., a Delaware corporation Airtron of Central Florida, Inc. 100% 1 100
(Florida)
Hallmark Air Conditioning, Inc., a Xxxxx Xxxxxx Air Conditioning, Inc. 100% 8 8,875
Texas corporation (Texas)
Group Maintenance America Corp., All Service Electric, Inc. 100% A001 1,000
a Texas corporation (Florida)
Group Maintenance America Corp., Arkansas Mechanical Services, Inc. 100% A001 1,000
a Texas corporation (Arkansas)
Group Maintenance America Corp., Xxxx Electric Corp 100% A001 1,000
a Texas corporation (Illinois)
Group Maintenance America Corp., Callahan Xxxxx Products & 100% A001 1,000
a Texas corporation Publications, Inc.
(Colorado)
151
PERCENTAGE OF STOCK NUMBER
ISSUING COMPANY AND SHARES CERTIFICATE OF
OWNER/PLEDGOR OF STOCK STATE OF INCORPORATION PLEDGED NO. SHARES
----------------------- ---------------------- ------------- ------------ ------
Group Maintenance America Corp., Central Carolina Air Conditioning 100% A001 1,000
a Texas corporation Company (North Carolina)
GroupMAC Holding Corp., a Xxxxxxx Xxxxxxxx, Inc. 100% 4 1,000
Delaware corporation (Texas)
Group Maintenance America Corp., Commercial Air Holding Company 100% A001 1,000
a Texas corporation (Maryland)
Commercial Air Holding Company, Commercial Air, Power & Cable, 100% A001 100,000
a Maryland corporation Inc. (Maryland)
Group Maintenance America Corp., Xxxxxxx Brothers, Inc. 100% 3 2,000
a Texas corporation (South Carolina)
Group Maintenance America Corp., Xxxxx Services, Inc. 100% A001 1,000
a Texas corporation (Alabama)
Group Maintenance America Corp., Xxxxxxx Mechanical Contractors, Inc. 100% A001 1,000
a Texas corporation (Minnesota)
Group Maintenance America Corp., HPS Plumbing Services, Inc., 100% A001 1,000
a Texas corporation (California)
GroupMAC Holding Corp., a Texas Hallmark Air Conditioning, Inc. 100% 30 180
corporation (Texas)
Group Maintenance America Corp., Xxxxxxxxxx Mechanical Corporation 100% A001 1,000
a Texas corporation (Virginia)
Group Maintenance America Corp., X. X. Xxxxxxx Air Conditioning, Inc. 100% A001 1,000
a Texas corporation (Colorado)
GroupMAC Holding Corp., a Texas K & N Plumbing, Heating and Air 100% 8 5,000
corporation Conditioning, Inc. (Texas)
Group Maintenance America Corp., Linford Service Co. 100% A001 1,000
a Texas corporation (California)
Group Maintenance America Corp., XxxXxxxxx-Xxxxxx Industries, Inc. 100% A001 1,000
a Texas corporation (Washington)
XxxXxxxxx-Xxxxxx Industries, Inc., XxxXxxxxx-Xxxxxx Co., Inc. 100% 1 30,070
a Washington corporation (Washington)
XxxXxxxxx-Xxxxxx Industries, Inc., XxxXxxxxx-Xxxxxx Co., Inc. 100% 2 36,764
a Washington corporation (Washington)
XxxXxxxxx-Xxxxxx Industries, Inc., XxxXxxxxx-Xxxxxx Co., Inc. 100% 3 36,764
a Washington corporation (Washington)
152
PERCENTAGE OF STOCK NUMBER
ISSUING COMPANY AND SHARES CERTIFICATE OF
OWNER/PLEDGOR OF STOCK STATE OF INCORPORATION PLEDGED NO. SHARES
----------------------- --------------------- ------------- ----------- ------
XxxXxxxxx-Xxxxxx Industries, Inc., XxxXxxxxx-Xxxxxx Service, Inc. 100% 1 500
a Washington corporation (Washington)
Group Maintenance America Corp., Masters, Inc. 100% A001 1,000
a Texas corporation (Maryland)
Group Maintenance America Corp., Mechanical Interiors, Inc. (Texas) 100% A001 1,000
a Texas corporation
Group Maintenance America Corp., Xxxx X. Xxxxx Co. Inc. 100% 6 550
a Texas corporation (Indiana)
Group Maintenance America Corp., Ray and Xxxxxx Xxxxxxx, Inc. 100% A001 1,000
a Texas corporation (Florida)
Group Maintenance America Corp., Xxxxxx Services, Incorporated 100% 49 396
a Texas corporation (Tennessee)
Group Maintenance America Corp., Southeast Mechanical Service, Inc. 100% A001 1,000
a Texas corporation (Florida)
Group Maintenance America Corp., Sterling Air Conditioning, Inc. 100% A001 1,000
a Texas corporation (Texas)
Group Maintenance America Corp., United Acquisition Corp. 100% 1 1,000
a Texas corporation (Iowa)
Group Maintenance America Corp., Valley Wide Plumbing and Heating, 100% A001 1,000
a Texas corporation Inc. (Colorado)
Group Maintenance America Corp., Van's Comfortemp Air Conditioning, 100% A001 1,000
a Texas corporation Inc.
(Florida)
Group Maintenance America Corp., Vantage Mechanical Contractors, 100% A001 1,000
a Texas corporation Inc. (Maryland)
Group Maintenance America Corp., Xxxx'x Heating and Cooling, Inc. 100% A001 1,000
a Texas corporation (Florida)
Group Maintenance America Corp., Willis Refrigeration, Air 100% 1 1,000
a Texas corporation Conditioning & Heating, Inc.
(Ohio)
Group Maintenance America Corp., Yale Incorporated 100% A001 1,000
a Texas corporation (Minnesota)
Group Maintenance America Corp., A-1 Mechanical of Lansing, Inc. 100% A001 1,000
a Texas corporation (Michigan)
153
PERCENTAGE OF STOCK NUMBER
ISSUING COMPANY AND SHARES CERTIFICATE OF
OWNER/PLEDGOR OF STOCK STATE OF INCORPORATION PLEDGED NO. SHARES
----------------------- ---------------------- ------------- ----------- ------
Group Maintenance America Corp., AA Advance Air, Inc. 100% A001 1,000
a Texas corporation (Florida)
Group Maintenance America Corp., Atlantic Industrial Constructors, Inc. 100% A001 1,000
a Texas corporation (Virginia)
Group Maintenance America Corp., Central Air Conditioning 100% A001 1,000
a Texas corporation Contractors, Inc.
(Delaware)
Group Maintenance America Corp., Xxxxx Xxxxxxxx Electric Service, Inc. 100% A001 100
a Texas corporation (Ohio)
Group Maintenance America Corp., Colonial Air Conditioning Company 100% A001 1,000
a Texas corporation (Delaware)
Group Maintenance America Corp., Divco, Inc. 100% A-001 1,000
a Texas corporation (Washington)
Group Maintenance America Corp., Dynamic Software Corporation 100% 7 30
a Texas corporation (Maryland)
Group Maintenance America Corp., The Farfield Company 100% A001 1,000
a Texas corporation (Delaware)
Group Maintenance America Corp., Xxxxxxxx Electric Corporation 100% A001 1,000
a Texas corporation (Delaware)
Group Maintenance America Corp, Xxxxxxxx Electrical Contractors, Inc. 100% A001 1,000
a Texas corporation (Texas)
Group Maintenance America Corp., Xxxxx'x, Inc. 100% A001 1,000
a Texas corporation (Delaware)
Group Maintenance America Corp., Xxxxxxx Island Air & Heat, Inc. 100% A001 1,000
a Texas corporation (Delaware)
Group Maintenance America Corp., New Construction Air Conditioning, 100% A001 1,000
a Texas corporation Inc.
(Michigan)
Group Maintenance America Corp., Noron, Inc. 100% A001 850
a Texas corporation (Ohio)
Group Maintenance America Corp., Phoenix Electric Company 100% A001 1,000
a Texas corporation (Delaware)
Group Maintenance America Corp., Reliable Mechanical, Inc. 100% A001 1,000
a Texas corporation (Delaware)
154
PERCENTAGE OF STOCK NUMBER
ISSUING COMPANY AND SHARES CERTIFICATE OF
OWNER/PLEDGOR OF STOCK STATE OF INCORPORATION PLEDGED NO. SHARES
----------------------- ---------------------- ------------- ----------- ------
Group Maintenance America Corp., Xxxxxxxx Electric Corp. 100% A001 100
a Texas corporation (Ohio)
Group Maintenance America Corp., Sun Plumbing, Inc. 100% A001 1,000
a Texas corporation (Florida)
Group Maintenance America Corp., Team Mechanical, Inc. 100% A001 1,000
a Texas corporation (Utah)
Group Maintenance America Corp., Xxxxxxx & Sons, Inc. 100% A001 1,000
a Texas corporation (Florida)
155
SCHEDULE II
CHIEF EXECUTIVE OFFICE LOCATIONS OF OTHER PLEDGORS
Airtron, Inc.
0000 Xxxxx Xxxxx Xxxxx
Xxxxxx, Xxxx 00000
Commercial Air Holding Company
00000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx
Hallmark Air Conditioning, Inc.
0000 Xxxxxxxxxxx Xxxx
Xxxxxxx, Xxxxx 00000
XxxXxxxxx-Xxxxxx Industries, Inc.
0000 Xxxxxxx XX
Xxxxxxx, Xxxxxxxxxx 00000
Group MAC Holding Corp.
0 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
156
EXHIBIT 4.01(h)(i)
[XXXXXXXXX & XXXXXXXXX, L.L.P. LETTERHEAD]
October 15, 1998
To each of the Banks party to the Second
Amended and Restated Credit Agreement
dated as of October 15, 1998 among
Group Maintenance America Corp.,
its Subsidiaries listed on the signature
pages thereto as guarantors ("Guarantors"),
such Banks and Chase Bank of Texas,
National Association, as Agent
("Credit Agreement") and to such Agent
Ladies and Gentlemen:
We have acted as counsel to Group Maintenance America Corp., a Texas corporation
("Borrower") and each of the Guarantors in connection with the Credit Agreement.
As used herein, the term "Texas Collateral Subsidiary" refers to each of A-ABC
Appliance, Inc., a Texas corporation, Group Maintenance America Corp., a Texas
corporation, Hallmark Air Conditioning, Inc., a Texas corporation, K&N Plumbing,
Heating, and Air Conditioning, Inc., a Texas corporation, XX XXXX, Inc., a Texas
corporation, Xxxxxxx Xxxxxxxx, Inc., a Texas corporation, Mechanical Interiors,
Inc., a Texas corporation, and Sterling Air Conditioning, Inc., a Texas
corporation.
This opinion is the opinion referred to in Section 4.01(h)(i) of the Credit
Agreement. Capitalized terms used herein and defined in the Credit Agreement but
not defined herein are used herein as therein defined.
In connection with this opinion, we have examined copies of the following
documents (the "Documents"):
(i) a counterpart of the Credit Agreement executed by the
Borrower;
157
[XXXXXXXXX & XXXXXXXXX, L.L.P. LETTERHEAD]
To the Banks and the Agent
October 15, 1998
Page 2
(ii) the 11 Notes dated October 15, 1998, one executed by the
Borrower for each Bank (the "Notes");
(iii) the Second Amended and Restated Security Agreement dated as of
October 15, 1998, executed by the Borrower and each Guarantor
in favor of the Agent (the "Security Agreement"); and
(iv) the Second Amended and Restated Pledge Agreement dated as of
October 15, 1998, executed by the Borrower and those
Guarantors signatory thereto ("Pledgors") favor of the Agent
(the "Pledge").
We have also examined originals or copies of such records and documents as we
have deemed necessary and relevant for purposes of this opinion. In addition, we
have relied on certificates or comparable documents of an officer of the
Borrower and each Guarantor as to certain matters of fact relating to this
opinion and have made such investigations of law as we have deemed necessary and
relevant as a basis for this opinion. We have assumed (a) the genuineness of all
signatures (including, without limitation, those of the Borrower, each Pledgor
and each Guarantor), (b) the authenticity of all documents and records submitted
to us as originals, (c) the conformity to original documents and records of all
documents and records submitted to us as copies and (d) the truthfulness of all
statements of fact contained therein.
The Credit Agreement, the Notes, and the Security Agreement are collectively
referred to as the "Borrower Loan Documents". The Credit Agreement and the
Security Agreement are collectively referred to as the "Guarantor Loan
Documents".
Based on the foregoing and subject to the limitations and assumptions set forth
in this opinion, and having due regard for such legal considerations as we deem
relevant, we are of the opinion that:
1. Each of the Borrower Loan Documents constitutes the legal, valid and
binding obligation of the Borrower enforceable against the Borrower in
accordance with its terms.
2. Each of the Guarantor Loan Documents constitutes the legal, valid
and binding obligation of each Guarantor enforceable against each Guarantor in
accordance with its terms.
3. The Pledge constitutes the legal, valid and binding obligation of
each of the Pledgors enforceable against each of the Pledgors in accordance with
its terms.
158
[XXXXXXXXX & XXXXXXXXX, L.L.P. LETTERHEAD]
To the Banks and the Agent
October 15, 1998
Page 3
4. The Security Agreement creates a security interest in the Borrower's
and each Texas Collateral Subsidiary's respective right, title and interest in
the Collateral (as defined in the Security Agreement) to the extent that a
security interest in such Collateral can be created under the Texas Business and
Commerce Code ("UCC"). The forms of the financing statements attached as Exhibit
A hereto ("Financing Statements") are in proper form, for filing with the Office
of the Secretary of State of Texas. To the extent the UCC is applicable to the
creation and perfection of a security interest in such Collateral and except for
any such Collateral the perfection of a security interest in which cannot be
obtained by the filing pursuant to the UCC of a financing statement with the
Office of the Secretary of State of Texas, upon the filing of the Financing
Statements in such forms pursuant to the provisions of the UCC, the security
interests referred to in the first sentence of this paragraph 4 in the
Borrower's and each Texas Collateral Subsidiary's respective right, title and
interest in such Collateral will be perfected. To the extent the UCC is
applicable to the perfection of a security interest created by the Pledge in
certificated securities in registered form described in the Pledge, perfection
of such security interest in such securities may be accomplished by delivery to
the secured party, and the secured party taking possession, in the State of
Texas of the security certificates representing such securities pursuant to the
Pledge.
The foregoing opinion is, with your concurrence, predicated on and
qualified in its entirety by the following:
(a) We are members of the Bar of the State of Texas. The foregoing
opinion is based on and is limited to the law of the State of Texas. We render
no opinion with respect to the law of any other jurisdiction.
(b) No opinion is expressed as to the creation, existence, perfection
or priority of any Lien except as expressly stated in paragraph 4 above.
Furthermore, we express no opinion as to (i) goods not located in Texas, (ii)
goods which are installed in or affixed to, or become a part of a product or
mass with, goods which are not items of collateral; (iii) any collateral which
consists of fixtures, crops, timber, minerals and the like or accounts or
general intangibles resulting from the sale thereof or letters of credit; (iv)
any collateral that is not reasonably identified in the description of
collateral set forth in the relevant Documents; or (v) any collateral in which
the Person purporting to grant a security interest does not have "rights" within
the meaning of Section 9.203(a)(3) of the UCC.
(c) Our opinion is subject to the effect of applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance, preference,
liquidation, conservatorship or other similar laws affecting creditor's rights
generally.
159
[XXXXXXXXX & XXXXXXXXX, L.L.P. LETTERHEAD]
To the Banks and the Agent
October 15, 1998
Page 4
(d) The enforceability of the Documents is subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law), and we express no opinion as to the
availability of specific performance or any other equitable remedy.
(e) We express no opinion as to the legality, validity, binding effect
or enforceability of any provision in the Documents (i) purporting to restrict
access to courts or to legal or equitable remedies; (ii) purporting to establish
evidentiary standards; (iii) purporting to grant a right of set-off of moneys,
securities and other properties of Persons other than the Person granting such
right; (iv) providing for enforceability of any assignment of leases or rents
prior to the time that the lienholder obtains possession of the property covered
by any real property security document through foreclosure or appointment of a
receiver for the property covered thereby, or takes some action which is
judicially deemed to be the equivalent thereof; (v) purporting to irrevocably
appoint any Person as attorney-in-fact; (vi) purporting to permit the Agent or
any other Person to sell or otherwise dispose of any collateral except in
compliance with applicable law, (vii) purporting to establish standards for the
care of collateral in a secured party's possession other than as provided in
Section 9.207 of the UCC; (viii) purporting to indemnify, defend or hold
harmless any Person; (ix) purporting to affect any right to trial by jury, venue
or jurisdiction; or (x) pertaining to subrogation rights, delay or omission of
enforcement of rights or remedies, severability or marshaling of assets.
(f) We express no opinion as to any provision of the Documents insofar
as it provides that any Person purchasing a participation from a Bank pursuant
thereto may exercise set-off or similar rights with respect to such
participation.
(g) We express no opinion as to the adequacy or accuracy of any
description of real or personal property, and we have assumed that such
descriptions are adequate and accurate. We express no opinion as to title or
ownership of any property.
(h) We express no opinion as to the legality, validity, binding effect
or enforceability of any waiver under the Documents, or any consent thereunder,
relating to the rights of any party, or duties owing to them, which exist as a
matter of law except to the extent such party may legally so waive or consent
and has so waived and consented.
(i) We have assumed, as to each Person (including, without limitation,
the Borrower, each Pledgor and each Guarantor) shown as being a party to any of
the Documents, (i) that such Person is duly organized, validly existing and in
good standing under the laws of the jurisdiction in which it is organized, (ii)
that each of the Documents to which such Person is shown as a party has been
duly authorized, executed and delivered by such Person, (iii) that such Person
has the requisite
160
[XXXXXXXXX & XXXXXXXXX, L.L.P. LETTERHEAD]
To the Banks and the Agent
October 15, 1998
Page 5
power and authority to execute, deliver and perform its obligations under the
Documents and will perform such obligations in compliance with all laws and
regulations applicable to it, (iv) that there are neither suits, actions or
proceedings pending against such Person nor judicial or administrative orders,
judgments, or decrees binding on such Person that affect the legality, validity,
binding effect or enforceability of the Documents to which such Person is a
party, (v) that no consent, license, approval or authorization of, or filing or
registration with, any governmental authority is required for the valid
execution, delivery and performance of the Documents, and (vi) that the
execution, delivery and performance of the Documents by such Person do not
violate (1) any provision of any law or regulation, (2) any order, judgment,
writ, injunction, award or decree of any court, arbitrator, or governmental
authority, (3) the charter of bylaws of such Person, or (4) any indenture, lease
or other agreement to which such Person is a party or by which such Person or
any of its assets is bound. Furthermore, we have assumed, as to each Person
(other than the Borrower, each Pledgor and each Guarantor) that each of the
Documents to which such Person is shown as a party constitutes the legal, valid
and binding obligation of such Person enforceable against such Person in
accordance with its terms, subject to the type of qualifications regarding
enforceability as are set forth in this opinion. We have also assumed that each
Bank will make each Loan for its own account in the ordinary course of its
commercial lending business and not with a view to, or for sale in connection
with, any distribution of the Notes and that no Bank is participating in any
such distribution.
(j) We have assumed that the Agent and the Banks will comply with each
usury savings clause in the Documents and that neither the Agent nor any of the
Banks has taken, reserved, charged or received interest, or will take, reserve,
charge or receive interest, except as provided in the Loan Documents. We express
no opinion as to the effect of the law of any jurisdiction other than the State
of Texas wherein any Bank may be located or wherein enforcement of the
Documents may be sought which limits the rates of interest legally chargeable
or collectible.
(k) Our opinion is subject to the qualification that certain remedial
provisions of the Documents are or may be unenforceable in whole or in part, but
such possible unenforceability of such remedial provisions will not render any
Document inadequate for enforcing payment of the indebtedness that is evidenced
by such Document and for the practical realization of the principal rights and
benefits afforded by such Document.
(l) In the case of property which becomes collateral after the date
hereof, Section 552 of the Bankruptcy Code limits the extent to which property
acquired by a debtor after the commencement of a case under the Bankruptcy Code
may be subject to a security interest arising from a security agreement entered
into by the debtor before the commencement of such case.
161
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To the Banks and the Agent
October 15, 1998
Page 6
(m) We express no opinion as to any choice of law provision insofar as
it may relate to any matter referred to in Section 8.110 or Section 9.103 of
the UCC or any financing statement. Furthermore, our opinion is subject to the
effect of 12 U.S.C. Section 85.
(n) Insofar as any Document covers personal property, we call your
attention to Section 9.311 of the UCC which states that a debtor's rights in
collateral may be voluntarily or involuntarily transferred (by way of sale,
creation of a security interest, attachment, levy, garnishment or other judicial
process) notwithstanding a provision in the security agreement prohibiting any
transfer or making the transfer constitute a default. Our opinion is subject to
the operation of Section 9.311 of the UCC.
(o) This opinion is given only as of the date hereof, and we have no
obligation to report to you or any other Person any fact or circumstance that
may hereafter come to our attention or any change in law. Without limiting the
generality of the foregoing, you are advised that filing of continuation
statements may be required to maintain perfection of security interests, and
perfection of security interests may terminate if the debtor changes its name,
identity, corporate structure or the jurisdiction of its chief executive office
or the collateral is moved to a new jurisdiction. As to any collateral as to
which possession is required for the perfection of a security interest, a
perfected security interest will not continue (with certain exceptions) if
possession is not maintained. Continuation of perfection of a security interest
in proceeds is limited to the extent set forth in the UCC.
(p) We have assumed that (i) value has been given within the meaning of
Section 9.203(a)(2) of the UCC and (ii) financing statements have been or will
be properly filed in the proper offices in the relevant jurisdictions for
perfection of the security interests in all collateral pursuant to the
provisions of local law in effect in the relevant jurisdictions.
This opinion is to be delivered only to you and your assignees permitted under
the Documents and only in connection with the transactions described above and
may not be quoted, circulated, or published, in whole or in part, or furnished
to any other Person (other than to independent auditors
162
[XXXXXXXXX & XXXXXXXXX, L.L.P. LETTERHEAD]
To the Banks and the Agent
October 15, 1998
Page 7
and attorneys, participants or transferees, regulators or government agencies,
or pursuant to a court order, subpoena or other legal process) without our prior
written consent.
Very truly yours,
Xxxxxxxxx & Xxxxxxxxx, L.L.P.
163
[XXXXXXXX X. XXXXXX LETTERHEAD]
October 15, 1998
To the Banks and the Agent
referred to below:
c/o Chase Bank of Texas,
National Association
000 Xxxx 00xx Xxxxxx
Xxxxxxx, Xxxxx 00000
Ladies and Gentlemen:
As Senior Vice President and General Counsel of Group Maintenance
America Corp., a Texas corporation (the "Company"), I have acted as counsel for
the Company and its subsidiaries (the "Subsidiaries") in connection with the
Second Amended and Restated Credit Agreement (the "Credit Agreement") dated as
of October 15, 1998, among the Company, the Subsidiaries, Chase Bank of Texas,
National Association, as Agent (the "Agent"), and the Banks party thereto (the
"Banks"). This opinion is being delivered to you pursuant to Section 4.01(h)(ii)
of the Credit Agreement. Unless otherwise defined herein, capitalized terms used
herein have the definitions set forth In the Credit Agreement.
I am familiar with the corporate proceedings of the Company and the
Subsidiaries (the Company and such subsidiaries are herein collectively referred
to as the "GroupMAC Entities") relating to the authorization of the Credit
Agreement. In connection with the Credit Agreement, I have examined such
statutes, corporate records and other instruments and documents as I have deemed
it necessary to examine for the purposes of this opinion.
Based upon the foregoing and having regard to the legal considerations
that I deem relevant, I am of the opinion that:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its incorporation and has
all requisite corporate power and authority to execute and deliver each of the
Loan Documents to which it is a party and to perform its obligations thereunder.
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October 15, 1998
Page 2
2. Each Subsidiary is a corporation duly incorporated, validly existing
and in good standing under the laws of the jurisdiction of its incorporation and
has all requisite corporate power and authority to execute and deliver each of
the Loan Documents to which it is a party and to perform its obligations
thereunder.
3. Each of the Company, GroupMAC Management Co. and GroupMAC Holding
Corp. is duly licensed or qualified in each jurisdiction in which the character
of its business or its ownership of property requires such licensing or
qualification except where the failure to be so licensed or qualified would not
have a material adverse effect on the business or financial condition of the
Company and its Subsidiaries, taken as a whole.
4. Each of the GroupMAC Entities has duly authorized, by all necessary
corporate action on its part, its execution, delivery and performance of the
Loan Documents to which it is a party and the consummation of the transactions
contemplated therein,
5. Each of the GroupMAC Entities has executed and delivered the Loan
Documents to which it is a party.
6. The execution and delivery by each GroupMAC Entity of the Loan
Documents to which it is a party, and the performance of its obligations
thereunder, (i) do not violate (A) any provision of any existing law or
regulation applicable to the GroupMAC Entities, (B) any order, judgment, writ,
injunction, award or decree, known to me after due inquiry, of any court,
arbitrator, or government authority applicable to GroupMAC Entities, (C) the
charter or by-laws of any GroupMAC Entity, or (D) any material indenture,
material lease or other material agreement, known to me after due inquiry, to
which any GroupMAC Entity is a party or by which any GroupMAC Entity or any of
its assets is bound, and (ii) do not result in, or require, the creation or
imposition of any lien on any property, assets or revenues of any GroupMAC
Entity pursuant to the provisions of any such Indenture, lease or other
agreement, except for liens created by, or required to be created by, any of the
Loan Documents.
7. No consent, license, approval or authorization of, or filing or
registration with, any governmental authority, which has not been obtained or
made, is required for the valid execution and delivery by each GroupMAC Entity
of the Loan Documents to which it is a party.
8. To the best of my knowledge, there is no litigation, investigation
or administrative proceeding of or before any court arbitrator or governmental
authority pending or threatened against any GroupMAC Entity (1) with respect to
the Loan Documents or (ii) that, in my reasonable judgment, would have a
material adverse effect on the business or financial condition of the Company
and its Subsidiaries, taken as a whole.
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October 15, 1998
Page 3
I am a member of the State Bar of Texas, and the opinions expressed
herein am based upon and are limited exclusively to the laws of the State of
Texas, the General Corporation Law of the State of Delaware and the federal laws
of the United States of America. For purposes of this opinion I have assumed
with your permission, that the laws of any state other than Texas and the
corporate laws of Delaware applicable to the matters addressed herein are
identical to the laws of the State of Texas.
This opinion is provided solely for your benefit and the respective
successors and assigns of each of you and may not be relied upon by, or
disclosed to, any other persons.
Very truly yours,
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EXHIBIT 11.10(c)
FORM
OF
ASSIGNMENT AND ACCEPTANCE
DATED ________________, 199___
Reference is made to the Second Amended and Restated Credit Agreement
dated as of October 15, 1998 (the "Credit Agreement"), among Group Maintenance
America Corp., a Texas corporation (the "Company"), certain Subsidiaries of the
Company, as Guarantors, the Banks party thereto, Chase Bank of Texas, National
Association, as Agent for such Banks, Bank of America Texas, N.A., as co-agent,
Paribas, as syndication agent, and ABN AMRO Bank, N.V., as documentation Agent.
Capitalized terms used herein and not otherwise defined shall have the meanings
assigned to such terms in the Credit Agreement.
_________________________ (the "Assignor') and _________________ (the
"Asignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee (without
recourse to the Assignor), and the Assignee hereby purchases and assumes from
the Assignor, a ___% interest (the "Percentage Interest") in and to all the
Assignor's rights and obligations under the Credit Agreement as of the
Assignment Date (as defined below), including, without limitation, (i) the
Percentage Interest in the Commitment of the Assignor on the Assignment Date,
(ii) the Percentage Interest in each of the Loans owing to the Assignor
outstanding on the Assignment Date, (iii) the Percentage Interest in all unpaid
interest with respect to such Loans and all commitment fees due to Assignor in
its capacity as a Bank accrued to the Assignment Date and (iv) the Percentage
Interest in any Notes held by the Assignor.
2. The Assignor (a) represents that as of the date hereof its
Commitment for all Loans (without giving effect to assignments thereof which
have not yet become effective) is $ _____________, and the outstanding balance
of its Loans (unreduced by any assignments thereof which have not yet become
effective) is $ ______________, broken down as follows: _______________________
________________________________________________________________________________
_______________________________________________________________________________;
(b) makes no representation or warranty and assumes no responsibility with
respect to any statements, covenants, warranties or representations made in or
in connection with the Credit Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement, any
other Loan Document or any instrument or document furnished pursuant thereto,
other than that it is the legal and beneficial owner of the interest being
assigned by it
167
hereunder and that such interest is free and clear of any adverse claim; (c)
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of any party to the Credit Agreement or the
performance or observance by any party to the Credit Agreement of any of its
obligations under the Loan Documents or any other instrument or document
furnished pursuant thereto; (and) (d) attaches the Note issued to Assignor and
requests that the Agent exchange such Note for a new Note executed by the
Company and payable to the Assignee in a principal amount equal to
$ ____________ and a new Note executed by the Company and payable to the
Assignor in a principal amount equal to $ _____________.
3. The Assignee (i) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (ii) confirms that it
has received a copy of the Credit Agreement, together with copies of the most
recent financial statements delivered pursuant to Section ______ thereof and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment and Acceptance;
(iii) agrees that it will, independently and without reliance upon the Agent,
the Assignor or any other Bank and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement; (iv) confirms that it is
an Eligible Assignee; (v) appoints and authorizes the Agent to take such action
as agent on its behalf and to exercise such powers under the Credit Agreement as
are delegated to the Agent by the terms thereof, together with such powers as
are reasonably incidental thereto; (vi) agrees that it will perform in
accordance with their terms all the obligations which by the terms of the Credit
Agreement are required to be performed by it as a Bank; (vii) agrees that it
will comply with Section ____ of the Credit Agreement with respect to
information furnished to it by the Company, the Agent or the Assignor; (viii)
confirms that it has delivered a completed Administrative Questionnaire to the
Agent; and (ix) attaches to this Assignment and Acceptance the Prescribed Forms.
4. The effective date for this Assignment and Acceptance shall be
______________ (the "Assignment Date"). Following the execution of this
Assignment and Acceptance, it will be delivered to the Agent for acceptance and
recording by the Agent pursuant to Section ____________ of the Credit Agreement.
5. Upon such acceptance and recording, from and after the Assignment
Date, (i) the Assignee shall be a party to the Credit Agreement and, to the
extent provided in this Assignment and Acceptance, have the rights and
obligations of a Bank thereunder and (ii) the Assignor shall, to the extent
provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.
6. Notwithstanding anything to the contrary contained in the Credit
Agreement, the Company shall be required to reimburse the Agent, the Assignor or
& Assignee for any costs and
168
expenses (including attorneys' fees) incurred by such Person in connection with
this Assignment and Acceptance.
7. Upon such acceptance and recording, from and after the Assignment
Date, the Agent shall make all payments in respect of the interest assigned
hereby (including payments of principal, interest, fees and other amounts) to
the Assignee. The Assignor and Assignee shall make all appropriate adjustments
in payments for periods prior to the Assignment Date by the Agent or with
respect to the making of this assignment directly between themselves.
8. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of Texas.
[NAME OF ASSIGNOR),
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
[NAME OF ASSIGNEE),
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
169
Consented and Agreed to as
of the date first above written.
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
as Agent
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
GROUP MAINTENANCE AMERICA CORP.
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
