Exhibit 99.1
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
among
HILB, XXXXX AND XXXXXXXX COMPANY,
as Borrower,
THE LENDERS NAMED HEREIN,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent,
PNC BANK, NATIONAL ASSOCIATION,
as Documentation Agent,
and
BANK OF AMERICA SECURITIES, LLC,
as Syndication Agent,
Senior Credit Facilities
Sole Arranger and Lead Book-Runner:
WACHOVIA SECURITIES, INC.
Dated as of July 1, 2002
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
1.1 Defined Terms........................................................1
1.2 Accounting Terms....................................................22
1.3 Other Terms; Construction...........................................22
ARTICLE II
AMOUNT AND TERMS OF THE LOANS
2.1 Loans; Commitments..................................................23
2.2 Borrowings..........................................................26
2.3 Disbursements; Funding Reliance; Domicile of Loans..................29
2.4 Notes...............................................................29
2.5 Termination and Reduction of Commitments and Swingline Commitment...31
2.6 Mandatory Payments and Prepayments..................................32
2.7 Voluntary Prepayments...............................................35
2.8 Interest............................................................35
2.9 Fees................................................................37
2.10 Interest Periods....................................................37
2.11 Conversions and Continuations.......................................38
2.12 Method of Payments; Computations....................................39
2.13 Recovery of Payments................................................40
2.14 Use of Proceeds.....................................................41
2.15 Pro Rata Treatment..................................................41
2.16 Increased Costs; Change in Circumstances; Illegality; etc...........42
2.17 Taxes...............................................................44
2.18 Compensation........................................................46
2.19 Replacement of Lenders..............................................46
2.20 Increases of Revolving Credit Commitments...........................47
ARTICLE III
CONDITIONS OF BORROWING
3.1 Conditions of Closing...............................................48
3.2 Conditions of All Borrowings........................................51
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 Corporate Organization and Power....................................52
4.2 Authorization; Enforceability.......................................52
4.3 No Violation........................................................53
4.4 Governmental and Third-Party Authorization; Permits.................53
4.5 Litigation..........................................................53
4.6 Taxes...............................................................54
4.7 Subsidiaries........................................................54
4.8 Full Disclosure.....................................................54
4.9 Margin Regulations..................................................54
4.10 No Material Adverse Change..........................................54
4.11 Financial Matters...................................................55
4.12 Ownership of Properties.............................................56
4.13 ERISA...............................................................56
4.14 Environmental Matters...............................................57
4.15 Compliance With Laws................................................57
4.16 Regulated Industries................................................58
4.17 Insurance...........................................................58
4.18 Material Contracts..................................................58
4.19 Labor Relations.....................................................58
4.20 Transaction Documents...............................................58
4.21 Xxxxx Acquisition...................................................59
ARTICLE V
AFFIRMATIVE COVENANTS
5.1 Financial Statements................................................59
5.2 Other Business and Financial Information............................60
5.3 Corporate Existence; Franchises; Maintenance of Properties..........62
5.4 Compliance with Laws................................................62
5.5 Payment of Obligations..............................................63
5.6 Insurance...........................................................63
5.7 Maintenance of Books and Records; Inspection........................63
5.8 Permitted Acquisitions..............................................63
5.9 Creation or Acquisition of Subsidiaries.............................65
5.10 Subsidiary Guarantors; Pledge of Capital Stock......................66
5.11 Further Assurances..................................................66
ARTICLE VI
FINANCIAL COVENANTS
6.1 Leverage Ratio......................................................67
6.2 Fixed Charge Coverage Ratio.........................................67
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6.3 Cash Flow Coverage Ratio............................................67
ARTICLE VII
NEGATIVE COVENANTS
7.1 Merger; Consolidation...............................................68
7.2 Indebtedness........................................................68
7.3 Liens...............................................................69
7.4 Disposition of Assets...............................................71
7.5 Investments.........................................................71
7.6 Restricted Payments.................................................72
7.7 Transactions with Affiliates........................................73
7.8 Lines of Business...................................................74
7.9 Certain Amendments..................................................74
7.10 Limitation on Certain Restrictions..................................74
7.11 No Other Negative Pledges...........................................74
7.12 Fiscal Year.........................................................74
7.13 Accounting Changes..................................................74
ARTICLE VIII
EVENTS OF DEFAULT
8.1 Events of Default...................................................75
8.2 Remedies: Termination of Commitments, Acceleration, etc.............77
8.3 Remedies: Set-Off...................................................77
ARTICLE IX
THE ADMINISTRATIVE AGENT
9.1 Appointment.........................................................78
9.2 Nature of Duties....................................................78
9.3 Exculpatory Provisions..............................................78
9.4 Reliance by Administrative Agent....................................79
9.5 Non-Reliance on Administrative Agent and Other Lenders..............79
9.6 Notice of Default...................................................80
9.7 Indemnification.....................................................80
9.8 The Administrative Agent in its Individual Capacity.................81
9.9 Successor Administrative Agent......................................81
9.10 Swingline Lender....................................................82
9.11 Syndication Agent, Documentation Agent..............................82
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ARTICLE X
MISCELLANEOUS
10.1 Fees and Expenses...................................................82
10.2 Indemnification.....................................................82
10.3 Governing Law; Consent to Jurisdiction..............................83
10.4 Waiver of Jury Trial................................................83
10.5 Notices.............................................................84
10.6 Amendments, Waivers, etc............................................85
10.7 Assignments, Participations.........................................86
10.8 No Waiver...........................................................88
10.9 Successors and Assigns..............................................89
10.10 Survival............................................................89
10.11 Severability........................................................89
10.12 Construction........................................................89
10.13 Confidentiality.....................................................89
10.14 Counterparts; Effectiveness.........................................90
10.15 Disclosure of Information...........................................90
10.16 Entire Agreement....................................................90
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EXHIBITS [OMITTED*]
Exhibit A-1 Form of Tranche A Term Note
Exhibit A-2 Form of Tranche B Term Note
Exhibit A-3 Form of Revolving Note
Exhibit A-4 Form of Swingline Note
Exhibit B-1 Form of Notice of Borrowing
Exhibit B-2 Form of Notice of Swingline Borrowing
Exhibit B-3 Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Assignment and Acceptance
Exhibit E Form of Subsidiary Guaranty
Exhibit F Form of Opinion of Xxxxxxxx Xxxxxx Xxxxx & Xxxxxxx, P.C.
Exhibit G Form of Financial Condition Certificate
Exhibit H Form of Pledge Agreement
SCHEDULES [OMITTED*]
Schedule 4.7 Subsidiaries
Schedule 4.16 Regulated Entities
Schedule 4.18 Material Contracts
Schedule 5.10 Excluded Subsidiaries
Schedule 7.2.1 Indebtedness
Schedule 7.2.2 Acquisition Indebtedness
Schedule 7.2.3 Contingent Acquisition Indebtedness
Schedule 7.3 Liens
Schedule 7.5 Investments
Schedule 7.7 Transactions with Affiliates
[* The Company will provide the omitted exhibits and schedules to the Commission
upon request]
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CREDIT AGREEMENT
THIS SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of the 1st
day of July, 2002 (this "Agreement"), is made among HILB, XXXXX AND XXXXXXXX
COMPANY, a Virginia corporation with its principal offices in Xxxx Xxxxx,
Henrico County, Virginia (the "Borrower"), the banks and financial institutions
listed on the signature pages hereto or that become parties hereto after the
date hereof (collectively, the "Lenders"), WACHOVIA BANK, NATIONAL ASSOCIATION,
formerly known as First Union National Bank, ("Wachovia"), as administrative
agent for the Lenders (in such capacity, the "Administrative Agent"), PNC BANK,
NATIONAL ASSOCIATION, as documentation agent (in such capacity, the
"Documentation Agent"), and BANK OF AMERICA SECURITIES, LLC, as syndication
agent (in such capacity, the "Syndication Agent").
RECITALS
A. The Borrower, the Existing Lenders and the Administrative
Agent are parties to an Amended and Restated Credit Agreement dated as of April
6, 2001 (as amended prior to the date hereof, the "Existing Credit Agreement"),
providing for the availability to the Borrower of a term loan facility in the
aggregate principal amount of $60,000,000 and a revolving credit facility in the
aggregate principal amount of $100,000,000.
B. The Borrower has requested certain amendments to the Existing
Credit Agreement, including that the Tranche B Lenders make available to the
Borrower, in addition to the credit facilities made available under the Existing
Credit Agreement, a term loan facility in the aggregate principal amount of
$160,000,000. The Lenders have agreed to such amendments and to make such
facilities available to the Borrower by amending and restating the Existing
Credit Agreement in its entirety on the terms and subject to the conditions
hereinafter set forth.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual provisions, covenants
and agreements herein contained, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Defined Terms. For purposes of this Agreement, in addition to the
terms defined elsewhere herein, the following terms shall have the meanings set
forth below (such meanings to be equally applicable to the singular and plural
forms thereof):
"2001 Fee Letter" shall mean the letter from Wachovia to the Borrower,
dated February 9, 2001, relating to certain fees payable by the Borrower in
respect of the transactions contemplated by the Existing Credit Agreement, as
amended, modified or supplemented from time to time.
"2002 Fee Letter" shall mean the letter from Wachovia to the Borrower,
dated May 3, 2002, relating to certain fees payable by the Borrower in respect
of the transactions contemplated by this Agreement, as amended, modified or
supplemented from time to time.
"Account Designation Letter" shall mean a letter from the Borrower to
the Administrative Agent, duly completed and signed by an Authorized Officer and
in form and substance satisfactory to the Administrative Agent, listing any one
or more accounts to which the Borrower may from time to time request the
Administrative Agent to forward the proceeds of any Loans made hereunder.
"Acquisition" shall mean any transaction or series of related
transactions, consummated on or after the date hereof, by which the Borrower
directly, or indirectly through one or more Subsidiaries, (i) acquires any going
business, or all or substantially all of the assets, of any Person (including,
without limitation, a book of business), whether through purchase of assets,
merger or otherwise, or (ii) acquires securities or other ownership interests of
any Person having at least a majority of combined voting power of the then
outstanding securities or other ownership interests of such Person.
"Acquisition Amount" shall mean, with respect to any Acquisition, (a)
the sum (without duplication) of (i) the amount of cash paid by the Borrower and
its Subsidiaries in connection with such Acquisition, (ii) the Fair Market Value
of all Capital Stock of the Borrower issued or given in connection with such
Acquisition, (iii) the amount (determined in accordance with GAAP) of all
Indebtedness incurred, assumed or acquired by the Borrower and its Subsidiaries
in connection with such Acquisition, (iv) all additional purchase price amounts
in connection with such Acquisition in the form of earnouts and other contingent
obligations that should be recorded as a liability on the balance sheet of the
Borrower and its Subsidiaries or expensed, in either event in accordance with
GAAP, Regulation S-X under the Securities Act of 1933, as amended, or any other
rule or regulation of the Securities and Exchange Commission, (v) all amounts
paid in respect of covenants not to compete, consulting agreements and other
affiliated contracts in connection with such Acquisition, (vi) the amount of all
transaction fees and expenses (including, without limitation, legal, accounting
and finders' fees and expenses) incurred by the Borrower and its Subsidiaries in
connection with such Acquisition and (vii) the aggregate fair market value of
all other consideration given by the Borrower and its Subsidiaries in connection
with such Acquisition, minus (b)(i) in the case of an Acquisition of Capital
Stock of a Target, cash of such Target immediately after or concurrent with the
consummation of such Acquisition, and (ii) in the case of an Acquisition of
assets, cash received by the Borrower and its Subsidiaries in connection with
such Acquisition.
"Acquisition Indebtedness" shall have the meaning given to such term in
Section 7.2.
"Adjusted Base Rate" shall mean, at any time with respect to any Base
Rate Loan, a rate per annum equal to the Base Rate as in effect at such time
plus the Applicable Margin Percentage for Base Rate Loans as in effect at such
time.
"Adjusted LIBOR Rate" shall mean, at any time with respect to any LIBOR
Loan, a rate per annum equal to the LIBOR Rate as in effect at such time plus
the Applicable Margin Percentage for LIBOR Loans as in effect at such time.
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"Administrative Agent" shall mean Wachovia, in its capacity as
Administrative Agent appointed under Article IX, and its successors and
permitted assigns in such capacity.
"Affiliate" shall mean, as to any Person, each other Person that
directly, or indirectly through one or more intermediaries, owns or controls, is
controlled by or under common control with, such Person or is a director or
officer of such Person. For purposes of this definition, with respect to any
Person "control" shall mean (i) the possession, direct or indirect, of the power
to direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities, by contract or otherwise, or
(ii) the beneficial ownership of securities or other ownership interests of such
Person having 10% or more of the combined voting power of the then outstanding
securities or other ownership interests of such Person ordinarily (and apart
from rights accruing under special circumstances) having the right to vote in
the election of directors or other governing body of such Person.
"Agreement" shall mean this Second Amended and Restated Credit
Agreement, as an amendment and restatement of the Existing Credit Agreement, as
amended, modified or supplemented from time to time.
"American Phoenix Acquisition Indebtedness" shall mean all Indebtedness
of the Borrower outstanding under the Borrower's 5.25% Convertible Subordinated
Debentures, dated May 3, 1999, due 2014 in the original aggregate principal
amount of $32,000,000.
"Applicable Margin Percentage" shall mean, at any time from and after
the Closing Date, the applicable percentage (a) to be added to the Base Rate
pursuant to Section 2.8 for purposes of determining the Adjusted Base Rate, (b)
to be added to the LIBOR Rate pursuant to Section 2.8 for purposes of
determining the Adjusted LIBOR Rate, and (c) to be used in calculating the
Commitment Fee, in each case as determined under the following matrix with
reference to the Leverage Ratio:
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Applicable
Margin Applicable Applicable
Percentage for Margin Margin Applicable
Base Rate Percentage for Percentage for Margin
Revolving/ LIBOR Base Rate Percentage for Applicable Margin
Tranche A Term Revolving/ Tranche B Term LIBOR Tranche B Percentage for
Leverage Ratio Loans Tranche A Loans Loans Term Loans Commitment Fee
Greater than or
equal to 2.0 to 1.000% 2.000% 2.000% 2.750% 0.400%
1.0
Greater than or
equal to 1.5 to 0.750% 1.750% 2.000% 2.750% 0.375%
1.0 but less
than 2.0 to 1.0
Greater than or
equal to 1.0 to 0.625% 1.625% 2.000% 2.750% 0.350%
1.0 but less
than 1.5 to 1.0
Less than 1.0 0.500% 1.500% 2.000% 2.750% 0.325%
to 1.0
On each Adjustment Date (as hereinafter defined), the Applicable Margin
Percentage for all Loans and the Commitment Fee payable pursuant to Section
2.9(b) shall be adjusted effective as of such date (based upon the calculation
of the Leverage Ratio as of the last day of the fiscal period to which such
Adjustment Date relates) in accordance with the above matrix; provided, however,
that, notwithstanding the foregoing or anything else herein to the contrary, if
at any time the Borrower shall have failed to deliver the financial statements
as required by Section 5.1(a) or Section 5.1(b), as the case may be, or the
Compliance Certificate as required by Section 5.2(a), or if at any time an Event
of Default shall have occurred and be continuing, then at the election of the
Required Lenders, at all times from and including the date on which such
statements or Compliance Certificate are required to have been delivered (or the
date of occurrence of such Event of Default, as the case may be) to the date on
which the same shall have been delivered (or such Event of Default cured or
waived, as the case may be), each Applicable Margin Percentage shall be
determined in accordance with the above matrix as if the
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Leverage Ratio were greater than or equal to 2.0 to 1.0 (notwithstanding the
actual Leverage Ratio). For purposes of this definition, "Adjustment Date" shall
mean, with respect to any fiscal period of the Borrower beginning with the
fiscal quarter ending September 30, 2002, the fifth (5th) day (or, if such day
is not a Business Day, on the next succeeding Business Day) after delivery by
the Borrower in accordance with Section 5.1(a) or Section 5.1(b), as the case
may be, of (i) financial statements as of the end of and for such fiscal period
and (ii) a duly completed Compliance Certificate with respect to such fiscal
period. Until the first Adjustment Date, each Applicable Margin Percentage shall
be determined in accordance with the above matrix as if the Leverage Ratio were
greater than or equal to 2.0 to 1.0 (notwithstanding the actual Leverage Ratio).
"Approved Fund" shall mean, with respect to any Lender, any trust,
limited or general partnership, limited liability company, corporation or other
limited purpose entity that invests in loans (a "fund") and is formed by such
Lender and its Affiliates or, if such Lender is a fund, that is managed or
advised by the same investment advisor of such Lender or by an Affiliate of such
investment advisor.
"Asset Disposition" shall mean any sale, assignment, transfer or other
disposition by the Borrower or any of its Subsidiaries to any other Person
(other than to the Borrower or to a Wholly Owned Subsidiary), whether in one
transaction or in a series of related transactions, of any of its assets,
business units or other properties (including any interests in property, whether
tangible or intangible, and including Capital Stock of Subsidiaries), excluding
the sale or exchange of used or obsolete equipment to the extent the proceeds of
such sale are applied towards, or such equipment is exchanged for, similar or
substitute replacement equipment.
"Assignee" shall have the meaning given to such term in Section
10.7(a).
"Assignment and Acceptance" shall mean an Assignment and Acceptance
entered into between a Lender and an Assignee and accepted by the Administrative
Agent and the Borrower, in substantially the form of Exhibit D.
"Authorized Officer" shall mean, with respect to any action specified
herein, any officer of the Borrower duly authorized by resolution of the board
of directors of the Borrower to take such action on its behalf, and whose
signature and incumbency shall have been certified to the Administrative Agent
by the secretary or an assistant secretary of the Borrower.
"Bankruptcy Code" shall mean 11 X.X.X.xx.xx. 101 et seq., as amended
from time to time, and any successor statute.
"Base Rate" shall mean the higher of (i) the per annum interest rate
publicly announced from time to time by Wachovia in Charlotte, North Carolina,
to be its prime rate (which may not necessarily be its best lending rate), as
adjusted to conform to changes as of the opening of business on the date of any
such change in such prime rate, and (ii) the Federal Funds Rate plus 0.5% per
annum, as adjusted to conform to changes as of the opening of business on the
date of any such change in the Federal Funds Rate.
"Base Rate Loan" shall mean, at any time, any Loan that bears interest
at such time at the Adjusted Base Rate.
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"Borrower" shall have the meaning given to such term in the
introductory paragraph hereof.
"Borrower Margin Stock" shall mean shares of Capital Stock of the
Borrower that are held by the Borrower or any of its Subsidiaries and that
constitute Margin Stock.
"Borrowing" shall mean the incurrence by the Borrower (including as a
result of conversions and continuations of outstanding Loans pursuant to Section
2.11) on a single date of a group of Loans of a single Class and Type (or a
Swingline Loan made by the Swingline Lender) and, in the case of LIBOR Loans, as
to which a single Interest Period is in effect.
"Borrowing Date" shall mean, with respect to any Borrowing, the date
upon which such Borrowing is made.
"Business Day" shall mean (i) any day other than a Saturday or Sunday,
a legal holiday or a day on which commercial banks in Charlotte, North Carolina
are required by law to be closed and (ii) in respect of any determination
relevant to a LIBOR Loan, any such day that is also a day on which tradings are
conducted in the London interbank Eurodollar market.
"Capital Expenditures" shall mean, for any period, the aggregate amount
(whether paid in cash or accrued as a liability) that would, in accordance with
GAAP, be included on the consolidated statement of cash flows of the Borrower
and its Subsidiaries for such period as additions to equipment, fixed assets,
real property or improvements or other capital assets (including, without
limitation but without duplication, (i) capital lease obligations and (ii) for
purposes of calculating the Fixed Charge Coverage Ratio, Capital Expenditures of
Xxxxx for the applicable period); provided, however, that Capital Expenditures
shall not include any such expenditures (i) for replacements and substitutions
for capital assets, to the extent made with the proceeds of insurance, or (ii)
made in connection with Permitted Acquisitions.
"Capital Stock" shall mean (i) with respect to any Person that is a
corporation, any and all shares, interests or equivalents in capital stock
(whether voting or nonvoting, and whether common or preferred) of such
corporation, and (ii) with respect to any Person that is not a corporation, any
and all partnership, membership, limited liability company or other equity
interests of such Person; and in each case, any and all warrants, rights or
options to purchase any of the foregoing.
"Cash Equivalents" shall mean (i) securities issued or unconditionally
guaranteed by the United States of America or any state thereof or any agency or
instrumentality thereof, backed by the full faith and credit of the United
States of America and maturing within 180 days from the date of acquisition,
(ii) commercial paper issued by any Person organized under the laws of the
United States of America, maturing within 180 days from the date of acquisition
and, at the time of acquisition, having a rating of at least A-1 or the
equivalent thereof by Standard & Poor's Ratings Services or at least P-1 or the
equivalent thereof by Xxxxx'x Investors Service, Inc., (iii) time deposits and
certificates of deposit maturing within 180 days from the date of issuance and
issued by a bank or trust company organized under the laws of the United States
of America or any state thereof that has combined capital and surplus of at
least $500,000,000 and that has (or is a subsidiary of a bank holding company
that has) a long-term unsecured debt rating of at
6
least A or the equivalent thereof by Standard & Poor's Ratings Services or at
least A2 or the equivalent thereof by Xxxxx'x Investors Service, Inc., (iv)
repurchase obligations with a term not exceeding seven (7) days with respect to
underlying securities of the types described in clause (i) above entered into
with any bank or trust company meeting the qualifications specified in clause
(iii) above, (v) municipal bonds with maturities of 180 days or less, with
ratings of at least MIG 4 or the equivalent thereof by Xxxxx'x Investors
Service, Inc. or at least SP-2 or the equivalent thereof by Standard & Poor's
Ratings Services and (vi) money market funds at least 95% of the assets of which
are continuously invested in securities of the type described in clauses (i),
(ii) and (v) above. Cash Equivalents shall include time and demand deposits
issued by a bank organized under the laws of the United Kingdom and other
similar investments approved from time to time by the Administrative Agent.
"Cash Flow Coverage Ratio" shall mean, as of the last day of any fiscal
quarter, the ratio of (i) the sum of Consolidated EBITDA of the Borrower for the
period of four consecutive fiscal quarters then ending plus Consolidated
Operating Lease Expense for such period to (ii) the sum of Consolidated Interest
Expense of the Borrower for such period plus Consolidated Operating Lease
Expense for such period.
"Class" shall have the meaning given to such term in Section 2.2(a).
"Closing Date" shall mean the date on which all conditions precedent
set forth in Section 3.1 have been satisfied or waived in accordance with the
terms of this Agreement.
"CNA" shall mean Continental Casualty Company and its subsidiaries.
"Collateral" shall mean the assets, property, and interests in property
that shall from time to time be pledged or purported to be pledged as direct or
indirect security for the Obligations pursuant to any one or more of the
Security Documents.
"Commitment" shall mean, with respect to any Tranche B Lender or
Revolving Lender, such Lender's Tranche B Commitment and/or Revolving Credit
Commitment, individually or collectively, as applicable.
"Commitment Fee" shall have the meaning given to such term in Section
2.9(b).
"Compliance Certificate" shall mean a fully completed and duly executed
certificate in the form of Exhibit C, together with a Covenant Compliance
Worksheet.
"Consolidated EBITDA" shall mean, for any Person for any period, the
aggregate, without duplication, of (i) Consolidated Net Income for such Person
for such period (including, without limitation, in the case of the Borrower,
historical net income of Xxxxx on a pro forma basis for such period), plus (ii)
the Consolidated Interest Expense for such Person, (iii) the sum of federal,
state, local and other income taxes, depreciation, amortization of intangible
assets, and other noncash expenses or charges reducing income for such period
(including, without limitation, in the case of the Borrower, all such items
reducing historical net income of Xxxxx during such period and nonrecurring cash
and noncash integration and restructuring charges reducing income and associated
with the Xxxxx Acquisition, and excluding noncash expenses associated with stock
repurchases in connection with the Deferred Compensation Plans), plus
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(iv) the amount of all reasonable, nonrecurring transaction costs incurred by
Xxxxx in connection with the closing of the Xxxxx Acquisition, all to the extent
taken into account in the calculation of Consolidated Net Income for such Person
for such period, minus (v) the sum of extraordinary or nonrecurring gains
incurred in connection with the sale of all of the Capital Stock or
substantially all of the assets of an insurance agency, including without
limitation a book of business (collectively, "Agency Dispositions"), but only to
the extent such sum exceeds the sum of (A) extraordinary or nonrecurring losses
incurred in connection with Agency Dispositions and (B) $3,250,000, all to the
extent taken into account in the calculation of Consolidated Net Income for such
Person for such period, minus (vi) the sum of extraordinary or nonrecurring
gains and other noncash credits increasing income for such period that are not
incurred in connection with Agency Dispositions, all to the extent taken into
account in the calculation of Consolidated Net Income for such Person for such
period.
"Consolidated Fixed Charges" shall mean, for any period, the aggregate
(without duplication) of the following, all determined on a consolidated basis
for the Borrower and its Subsidiaries in accordance with GAAP for such period:
(a) Consolidated Interest Expense for the Borrower for such period, (b) the
aggregate (without duplication) of all scheduled payments of principal on
Indebtedness required to be made by the Borrower and its Subsidiaries during the
period of four consecutive fiscal quarters immediately following the end of such
period, including, without limitation, the aggregate principal amount of the
Term Loans due under Section 2.6(a) and 2.6(b) (as such amounts may have been
previously adjusted in accordance with the terms of this Agreement as a result
of prior prepayments on the Term Loans, including adjustments made pursuant to
Section 2.6(g) or Section 2.7(b), but excluding the scheduled repayment in full
of the Revolving Loans on the Revolving Credit Termination Date), (c) dividends
paid by the Borrower during such period (including, without limitation, with
respect to shares of Capital Stock of the Borrower issued (at the closing of
such acquisition) as consideration in connection with the Xxxxx Acquisition, pro
forma dividends that would have been paid on such shares during such period,
assuming such shares had been outstanding for the twelve consecutive calendar
months preceding the date of issuance of such shares, and assuming the payment
of dividends at the rate that would have been applicable on the date of payment
thereof, had such shares been outstanding), (d) repurchases by the Borrower of
its Capital Stock occurring during such period (excluding repurchases by the
Borrower of its Capital Stock in connection with the Deferred Compensation
Plans), and (e) the aggregate (without duplication) of all cash payments made by
the Borrower and its Subsidiaries during such period with respect to earnout or
contingent obligations incurred in connection with any Acquisition (excluding,
however, cash payments with respect to earnout or contingent obligations that
were accrued as Indebtedness at the beginning of such period and for which the
principal payments with respect thereto were previously accounted for as part of
Consolidated Fixed Charges under subsection (b) of such definition).
"Consolidated Indebtedness" shall mean, as of any date of
determination, the aggregate (without duplication) of all Indebtedness of the
Borrower and its Subsidiaries as of such date, determined on a consolidated
basis in accordance with GAAP. For purposes of determining Consolidated
Indebtedness as of any date, (i) each Contingent Obligation of the Borrower and
its Subsidiaries required to be included in such determination shall be valued
at the maximum aggregate principal amount (whether or not drawn or outstanding)
of the Indebtedness that is the corresponding "primary obligation" (as such term
is defined in the definition of Contingent
8
Obligation) as of such date, and (ii) each earnout and other contingent
obligation incurred in connection with an Acquisition (whether consummated
before or after the date hereof) shall be valued at the amount that should be
recorded as a liability on the balance sheet of the Borrower and its
Subsidiaries as of such date, in accordance with GAAP, Regulation S-X of the
Securities Act of 1933, as amended, or any other rule or regulation of the
Securities and Exchange Commission.
"Consolidated Interest Expense" shall mean, for any Person for any
period, the sum (without duplication) of (i) total interest expense of such
Person and its Subsidiaries for such period in respect of Indebtedness of such
Person and its Subsidiaries (including, without limitation, all (x) such
interest expense accrued or capitalized during such period and (y) all
commitment fees and other ongoing fees in respect of Indebtedness accrued or
capitalized during such period, in each case whether or not actually paid during
such period), determined on a consolidated basis in accordance with GAAP, and
(ii) all net amounts payable under or in respect of Hedge Agreements, to the
extent paid or accrued by such Person and its Subsidiaries during such period;
provided, however, that, for purposes of calculating the financial covenants set
forth in Article VI as of the last day of each of the fiscal quarters ending
September 30, 2002, December 31, 2002, and March 31, 2003, Consolidated Interest
Expense shall be determined by multiplying (i) Consolidated Interest Expense
(calculated as provided above) for the period commencing July 1, 2002 and ending
on the last day of such fiscal quarter by (ii)(A) 4, in the case of the fiscal
quarter ending September 30, 2002, (B) 2, in the case of the fiscal quarter
ending December 31, 2002, and (C) 4/3, in the case of the fiscal quarter ending
March 31, 2003.
"Consolidated Net Income" shall mean, for any Person for any period,
net income (or loss) for such Person and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.
"Consolidated Operating Lease Expense" shall mean, for any period, the
operating lease expense, net of any sublease income, for the Borrower and its
Subsidiaries for such period (including (but without duplication), with respect
to the calculation of the Cash Flow Coverage Ratio, pro forma operating lease
expense, net of any sublease income, for Xxxxx, for such period), each as
determined on a consolidated basis in accordance with GAAP.
"Consolidated Pro Forma EBITDA" shall mean for the Borrower for any
period, without duplication, (i) Consolidated EBITDA of the Borrower for such
period plus (ii) to the extent not taken into account in Consolidated EBITDA of
the Borrower, historical Consolidated EBITDA on a pro forma basis for such
period of Xxxxx, plus (iii) to the extent not taken into account in Consolidated
EBITDA of the Borrower, historical Consolidated EBITDA for such period of any
Target acquired in a Permitted Acquisition after the commencement of such period
(provided that the Consolidated EBITDA of such Target is supported by the
financial statements or tax returns of the Target or other financial data
reasonably acceptable to the Administrative Agent), minus (iv) to the extent
taken into account in Consolidated EBITDA of the Borrower, Consolidated EBITDA
for such period of any Subsidiary or other business unit disposed of by the
Borrower at any time after the commencement of such period.
"Contingent Obligation" shall mean, with respect to any Person, any
direct or indirect liability of such Person with respect to any Indebtedness,
liability or other obligation (the
9
"primary obligation") of another Person (the "primary obligor"), whether or not
contingent, (a) to purchase, repurchase or otherwise acquire such primary
obligation or any property constituting direct or indirect security therefor,
(b) to advance or provide funds (i) for the payment or discharge of any such
primary obligation or (ii) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (c) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor in respect thereof to make payment of such primary
obligation or (d) otherwise to assure or hold harmless the owner of any such
primary obligation against loss or failure or inability to perform in respect
thereof; provided, however, that, with respect to the Borrower and its
Subsidiaries, the term Contingent Obligation shall not include endorsements for
collection or deposit in the ordinary course of business.
"Covenant Compliance Worksheet" shall mean a fully completed worksheet
in the form of Attachment A to Exhibit C.
"Credit Documents" shall mean this Agreement, the Notes, the 2001 Fee
Letter, the 2002 Fee Letter, the Subsidiary Guaranty, the Security Documents and
all other agreements, instruments, documents and certificates now or hereafter
executed and delivered to the Administrative Agent or any Lender by or on behalf
of the Borrower or any of its Subsidiaries with respect to this Agreement and
the transactions contemplated hereby, in each case as amended, modified,
supplemented or restated from time to time.
"Debt Issuance" shall mean the issuance or sale by the Borrower or any
of its Subsidiaries of any debt securities, whether in a public offering of such
securities or otherwise other than any such securities issued to a Target (or
its securityholders at the time of the Acquisition thereof by the Borrower and a
Subsidiary) in connection with any Permitted Acquisition and constituting all or
a portion of the applicable purchase price.
"Default" shall mean any event or condition that, with the passage of
time or giving of notice, or both, would constitute an Event of Default.
"Deferred Compensation Plan" shall mean the Hilb, Xxxxx and Xxxxxxxx
Company Executive Voluntary Deferral Plan and the Hilb, Xxxxx and Xxxxxxxx
Company Outside Directors Deferral Plan or any replacement plan thereof or
successor plan thereto, each as amended, modified or supplemented from time to
time.
"Disqualified Capital Stock" shall mean, with respect to any Person,
any Capital Stock of such Person that, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or upon
the happening of any event or otherwise, (i) matures or is mandatorily
redeemable or subject to any mandatory repurchase requirement, pursuant to a
sinking fund obligation or otherwise, (ii) is redeemable or subject to any
mandatory repurchase requirement at the sole option of the holder thereof, or
(iii) is convertible into or exchangeable for (whether at the option of the
issuer or the holder thereof) (a) debt securities or (b) any Capital Stock
referred to in (i) or (ii) above, in each case under (i), (ii) or (iii) above at
any time on or prior to the first anniversary of the later of the Revolving
Credit Maturity Date and the Tranche B Maturity Date; provided, however, that
only the portion of Capital Stock that so matures or is
10
mandatorily redeemable, is so redeemable at the option of the holder thereof, or
is so convertible or exchangeable on or prior to such date shall be deemed to be
Disqualified Capital Stock.
"Dollars" or "$" shall mean dollars of the United States of America.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and any successor statute, and all rules and
regulations from time to time promulgated thereunder.
"ERISA Affiliate" shall mean any Person (including any trade or
business, whether or not incorporated) that would be deemed to be under "common
control" with, or a member of the same "controlled group" as, the Borrower or
any of its Subsidiaries, within the meaning of Sections 414(b), (c), (m) or (o)
of the Internal Revenue Code or Section 4001 of ERISA.
"ERISA Event" shall mean any of the following with respect to a Plan or
Multiemployer Plan, as applicable: (i) a Reportable Event with respect to a Plan
or a Multiemployer Plan, (ii) a complete or partial withdrawal by the Borrower
or any ERISA Affiliate from a Multiemployer Plan that results in liability under
Section 4201 or 4204 of ERISA, or the receipt by the Borrower or any ERISA
Affiliate of notice from a Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends to
terminate or has terminated under Section 4041A of ERISA, (iii) the distribution
by the Borrower or any ERISA Affiliate under Section 4041 or 4041A of ERISA of a
notice of intent to terminate any Plan or the taking of any action to terminate
any Plan, (iv) the commencement of proceedings by the PBGC under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer, any
Plan, or the receipt by the Borrower or any ERISA Affiliate of a notice from any
Multiemployer Plan that such action has been taken by the PBGC with respect to
such Multiemployer Plan, (v) the institution of a proceeding by any fiduciary of
any Multiemployer Plan against the Borrower or any ERISA Affiliate to enforce
Section 515 of ERISA, which is not dismissed within thirty (30) days, (vi) the
imposition upon the Borrower or any ERISA Affiliate of any liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, or the imposition or threatened imposition of any Lien upon any
assets of the Borrower or any ERISA Affiliate as a result of any alleged failure
to comply with the Internal Revenue Code or ERISA in respect of any Plan, (vii)
the engaging in or otherwise becoming liable for a nonexempt Prohibited
Transaction by the Borrower or any ERISA Affiliate, (viii) a violation of the
applicable requirements of Section 404 or 405 of ERISA or the exclusive benefit
rule under Section 401(a) of the Internal Revenue Code by any fiduciary of any
Plan for which the Borrower or any of its ERISA Affiliates may be directly or
indirectly liable or (ix) the adoption of an amendment to any Plan that,
pursuant to Section 401(a)(29) of the Internal Revenue Code or Section 307 of
ERISA, would result in the loss of tax-exempt status of the trust of which such
Plan is a part if the Borrower or an ERISA Affiliate fails to timely provide
security to such Plan in accordance with the provisions of such sections.
"Eligible Assignee" shall mean (i) a commercial bank organized under
the laws of the United States or any state thereof and having total assets in
excess of $500,000,000, (ii) a commercial bank organized under the laws of any
other country that is a member of the Organization for Economic Cooperation and
Development or any successor thereto (the "OECD") or a political subdivision of
any such country and having total assets in excess of
11
$500,000,000, provided that such bank or other financial institution is acting
through a branch or agency located in the United States, in the country under
the laws of which it is organized or in another country that is also a member of
the OECD, (iii) the central bank of any country that is a member of the OECD,
(iv) a finance company, insurance company or other financial institution or fund
that is engaged in making, purchasing or otherwise investing in loans in the
ordinary course of its business and having total assets in excess of
$250,000,000, (v) any Affiliate of an existing Lender, (vi) a special purpose
investment fund that is organized for the specific purpose of making, acquiring
participations in or investing in loans of the type made pursuant to this
Agreement, (vii) funds that typically invest in bank loans or (viii) any other
Person approved by the Required Lenders, which approval shall not be
unreasonably withheld. With respect to any Lender that is an Approved Fund, any
other Approved Fund of such Lender shall be treated as an Eligible Assignee.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
accusations, allegations, notices of noncompliance or violation, investigations
(other than internal reports prepared by any Person in the ordinary course of
its business and not in response to any third party action or request of any
kind) or proceedings relating in any way to any actual or alleged violation of
or liability under any Environmental Law or relating to any permit issued, or
any approval given, under any such Environmental Law (collectively, "Claims"),
including, without limitation, (i) any and all Claims by Governmental
Authorities for enforcement, cleanup, removal, response, remedial or other
actions or damages pursuant to any applicable Environmental Law and (ii) any and
all Claims by any third party seeking damages, contribution, indemnification,
cost recovery, compensation or injunctive relief resulting from Hazardous
Substances or arising from alleged injury or threat of injury to human health or
the environment.
"Environmental Laws" shall mean any and all federal, state and local
laws, statutes, ordinances, rules, regulations, permits, licenses, approvals,
rules of common law and orders of courts or Governmental Authorities, relating
to the protection of human health or occupational safety or the environment, now
or hereafter in effect and in each case as amended from time to time, including,
without limitation, requirements pertaining to the manufacture, processing,
distribution, use, treatment, storage, disposal, transportation, handling,
reporting, licensing, permitting, investigation or remediation of Hazardous
Substances.
"Equity Issuance" shall mean the issuance, sale or other disposition,
whether in a public offering or otherwise, by the Borrower or any of its
Subsidiaries of its Capital Stock, any rights, warrants or options to purchase
or acquire any shares of its Capital Stock, or any other security or instrument
representing, convertible into or exchangeable for an equity interest in the
Borrower or any of its Subsidiaries; provided, however, that the term Equity
Issuance shall not include (i) the issuance or sale of Capital Stock by any of
the Subsidiaries of the Borrower to the Borrower or any other Subsidiary, (ii)
any Capital Stock of the Borrower issued to a Target (or its securityholders at
the time of the Acquisition thereof by the Borrower or a Subsidiary) in
connection with any Permitted Acquisition and constituting all or a portion of
the applicable purchase price, or (iii) the issuance or granting of the
Borrower's Capital Stock and stock options for the Borrower's Capital Stock, and
the underlying Capital Stock issued upon the exercise of such options, to
employees, managers and directors of the Borrower pursuant to the Borrower's
12
stock option, stock purchase or other benefit or compensation plans as
established from time to time.
"Event of Default" shall have the meaning given to such term in Section
8.1.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute, and all rules and
regulations from time to time promulgated thereunder.
"Existing Credit Agreement" shall have the meaning given to such term
in the Recitals hereof.
"Existing Lender" shall mean the banks and financial institutions that
are parties to the Existing Credit Agreement.
"Existing Revolving Loan" shall have the meaning given to such term in
Section 2.1(c).
"Existing Revolving Notes" shall have the meaning given to such term in
Section 2.4(a).
"Existing Term Loan" shall have the meaning given to such term in
Section 2.1(a).
"Existing Term Notes" shall have the meaning given to such term in
Section 2.4(a).
"Fair Market Value" shall mean, with respect to any Capital Stock of
the Borrower given in connection with an Acquisition, the value given to such
Capital Stock for purposes of such Acquisition by the parties thereto, as
determined in good faith pursuant to the relevant acquisition agreement or
otherwise in connection with such Acquisition.
"Federal Funds Rate" shall mean, for any period, a fluctuating per
annum interest rate (rounded upwards, if necessary, to the nearest 1/100 of one
percentage point) equal for each day during such period to the weighted average
of the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by the Administrative Agent.
"Federal Reserve Board" shall mean the Board of Governors of the
Federal Reserve System or any successor thereto.
"Financial Condition Certificate" shall mean a fully completed and duly
executed certificate, substantially in the form of Exhibit G, together with the
attachments thereto.
"Financial Officer" shall mean, with respect to the Borrower, the chief
financial officer, vice president - finance, principal accounting officer or
treasurer of the Borrower.
13
"Fixed Charge Coverage Ratio" shall mean, as of the last day of any
fiscal quarter for the period of four consecutive fiscal quarters then ending,
the ratio of (i) Consolidated EBITDA for the Borrower for such period minus
Capital Expenditures for such period to (ii) Consolidated Fixed Charges for such
period.
"Foreign Subsidiary" shall mean, with respect to any Person, a
Subsidiary of such Person that is a "controlled foreign corporation", as such
term is defined in Section 957 of the Internal Revenue Code.
"GAAP" shall mean generally accepted accounting principles, as set
forth in the statements, opinions and pronouncements of the Accounting
Principles Board, the American Institute of Certified Public Accountants and the
Financial Accounting Standards Board, consistently applied and maintained, as in
effect from time to time (subject to the provisions of Section 1.2).
"Governmental Authority" shall mean any nation or government, any state
or other political subdivision thereof and any central bank thereof, any
municipal, local, city or county government, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
"Hazardous Substances" shall mean any substances or materials (i) that
are or become defined as hazardous wastes, hazardous substances, pollutants,
contaminants or toxic substances under any Environmental Law, (ii) that are
defined by any Environmental Law as toxic, explosive, corrosive, ignitable,
infectious, radioactive, mutagenic or otherwise hazardous, (iii) the presence of
which require investigation or response under any Environmental Law, (iv) that
constitute a nuisance, trespass or health or safety hazard to Persons or
neighboring properties, (v) that consist of underground or aboveground storage
tanks, whether empty, filled or partially filled with any substance, or (vi)
that contain, without limitation, asbestos, polychlorinated biphenyls, urea
formaldehyde foam insulation, petroleum hydrocarbons, petroleum derived
substances or wastes, crude oil, nuclear fuel, natural gas or synthetic gas.
"Hedge Agreement" shall mean any interest or foreign currency rate
swap, cap, collar, option, hedge, forward rate or other similar agreement or
arrangement designed to protect against fluctuations in interest rates or
currency exchange rates.
"Xxxxx" shall mean Xxxxx Group, LLC, a Delaware limited liability
company.
"Xxxxx Acquisition" shall mean the direct and indirect Acquisition of
the Capital Stock of Xxxxx by the Borrower.
"Xxxxx Acquisition Documentation" shall mean the Purchase Agreement,
dated as of May 10, 2002, by and among the Borrower, Xxxxx, the Members of Xxxxx
and the Shareholders of Xxxxx XXX Corp., and each other agreement, instrument or
certificate required to be delivered in connection therewith or otherwise in
connection with the Xxxxx Acquisition.
"HRH Captive" shall mean Essenale, Ltd., a Bermuda insurance company.
-----------
14
"HRH Charitable Foundation" shall mean HRH Charitable Foundation, a
non-stock, not-for-profit Virginia corporation.
"Indebtedness" shall mean, with respect to any Person (without
duplication), (i) all indebtedness and obligations of such Person for borrowed
money or in respect of loans or advances of any kind, (ii) all obligations of
such Person evidenced by notes, bonds, debentures or similar instruments, (iii)
all reimbursement obligations of such Person with respect to surety bonds,
letters of credit and bankers' acceptances (in each case, whether or not drawn
or matured and in the stated amount thereof), (iv) all obligations of such
Person to pay the deferred purchase price of property or services (other than
the portion of Acquisition Amounts payable in the Capital Stock of the
Borrower), (v) all indebtedness created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such
Person, (vi) all obligations of such Person as lessee under leases that are or
are required to be, in accordance with GAAP, recorded as capital leases, to the
extent such obligations are required to be so recorded, (vii) all Disqualified
Capital Stock issued by such Person, with the amount of Indebtedness represented
by such Disqualified Capital Stock being equal to the greater of its voluntary
or involuntary liquidation preference and its maximum fixed repurchase price,
but excluding accrued dividends, if any (for purposes hereof, the "maximum fixed
repurchase price" of any Disqualified Capital Stock that does not have a fixed
repurchase price shall be calculated in accordance with the terms of such
Disqualified Capital Stock as if such Disqualified Capital Stock were purchased
on any date on which Indebtedness shall be required to be determined pursuant to
this Agreement, and if such price is based upon, or measured by, the fair market
value of such Disqualified Capital Stock, such fair market value shall be
determined reasonably and in good faith by the board of directors or other
governing body of the issuer of such Disqualified Capital Stock), (viii) the net
termination obligations of such Person under any Hedge Agreements, calculated as
of any date as if such agreement or arrangement were terminated as of such date,
(ix) all Contingent Obligations of such Person and (x) all indebtedness referred
to in clauses (i) through (ix) above secured by any Lien on any property or
asset owned or held by such Person regardless of whether the indebtedness
secured thereby shall have been assumed by such Person or is nonrecourse to the
credit of such Person.
"Interest Period" shall have the meaning given to such term in Section
2.10.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time, and any successor statute, and all rules and
regulations from time to time promulgated thereunder.
"LIBOR Loan" shall mean, at any time, any Loan that bears interest at
such time at the Adjusted LIBOR Rate.
"LIBOR Rate" shall mean, with respect to each LIBOR Loan comprising
part of the same Borrowing for any Interest Period, an interest rate per annum
obtained by dividing (i) (y) the rate of interest (rounded upward, if necessary,
to the nearest 1/16 of one percentage point) appearing on Telerate Page 3750 (or
any successor page) or (z) if no such rate is available, the rate of interest
determined by the Administrative Agent to be the rate or the arithmetic mean of
rates (rounded upward, if necessary, to the nearest 1/16 of one percentage
point) at which Dollar deposits in immediately available funds are offered by
Wachovia to first-tier banks in the
15
London interbank Eurodollar market, in each case under (y) and (z) above at
approximately 11:00 a.m., London time, two (2) Business Days prior to the first
day of such Interest Period for a period substantially equal to such Interest
Period and in an amount substantially equal to the amount of Wachovia's LIBOR
Loan comprising part of such Borrowing, by (ii) the amount equal to 1.00 minus
the Reserve Requirement (expressed as a decimal) for such Interest Period.
"Lender" shall mean each financial institution signatory hereto and
each other financial institution that becomes a "Lender" hereunder pursuant to
Section 10.7, and their respective successors and assigns.
"Lending Office" shall mean, with respect to any Lender, the office of
such Lender the office of such Lender maintaining such Commitments and/or Loans.
A Lender may designate separate Lending Offices for the purposes of making or
maintaining different Types of Loans, and, with respect to LIBOR Loans, such
office may be a domestic or foreign branch or Affiliate of such Lender.
"Leverage Ratio" shall mean, as of the last day of any fiscal quarter,
the ratio of (i) Consolidated Indebtedness as of such date to (ii) Consolidated
Pro Forma EBITDA for the Borrower for the period of four consecutive fiscal
quarters then ending.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
security interest, lien (statutory or otherwise), preference, priority, charge
or other encumbrance of any nature, whether voluntary or involuntary, including,
without limitation, the interest of any vendor or lessor under any conditional
sale agreement, title retention agreement, capital lease or any other lease or
arrangement having substantially the same effect as any of the foregoing.
"Loans" shall mean any or all of the Tranche A Term Loans, the Tranche
B Term Loans, the Revolving Loans and the Swingline Loans.
"Margin Stock" shall have the meaning given to such term in Regulation
U.
"Material Adverse Change" shall mean a material adverse change in the
condition (financial or otherwise), operations, prospects, business, properties
or assets of the Borrower and its Subsidiaries, taken as a whole.
"Material Adverse Effect" shall mean a material adverse effect upon (i)
the condition (financial or otherwise), operations, prospects, business,
properties or assets of the Borrower and its Subsidiaries, taken as a whole,
(ii) the ability of the Borrower and its Subsidiaries to perform their
obligations, as a whole, under this Agreement or any of the other Credit
Documents, or (iii) the legality, validity or enforceability of this Agreement
or any of the other Credit Documents or the rights and remedies of the
Administrative Agent and the Lenders hereunder and thereunder.
"Material Contract" shall have the meaning given to such term in
Section 4.18.
"Multiemployer Plan" shall mean any "multiemployer plan" within the
meaning of Section 4001(a)(3) of ERISA to which the Borrower or any ERISA
Affiliate makes, is making or is obligated to make contributions or has made or
been obligated to make contributions.
16
"Net Cash Proceeds" shall mean (i) in the case of any Equity Issuance
or Debt Issuance, the aggregate cash payments received by the Borrower and its
Subsidiaries less reasonable and customary fees and expenses (including
underwriting discounts and commissions) incurred by the Borrower and its
Subsidiaries in connection therewith and (ii) in the case of any Asset
Disposition, the aggregate amount of all cash payments received by the Borrower
and its Subsidiaries in connection with such Asset Disposition less (x)
reasonable fees and expenses incurred by the Borrower and its Subsidiaries in
connection therewith, (y) Indebtedness to the extent the amount thereof is
secured by a Lien on the property that is the subject of such Asset Disposition
and the transferee of (or holder of the Lien on) such Property requires that
such Indebtedness be repaid as a condition to such Asset Disposition, and (z)
any income or transfer taxes paid or reasonably estimated by the Borrower to be
payable by the Borrower and its Subsidiaries as a result of such Asset
Disposition.
"Notes" shall mean any or all of the Tranche A Term Notes, the Tranche
B Term Notes, the Revolving Notes and the Swingline Note.
"Notice of Borrowing" shall have the meaning given to such term in
Section 2.2(b).
"Notice of Conversion/Continuation" shall have the meaning given to
such term in Section 2.11(b).
"Notice of Swingline Borrowing" shall have the meaning given to such
term in Section 2.2(d).
"Obligations" shall mean all principal of and interest (including, to
the greatest extent permitted by law, post-petition interest) on the Loans and
all fees, expenses, indemnities and other obligations owing, due or payable at
any time by the Borrower to the Administrative Agent, any Lender, or any other
Person entitled thereto, under this Agreement or any of the other Credit
Documents.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
successor thereto.
"Participant" shall have the meaning given to such term in Section
10.7(d).
"Permitted Acquisition" shall mean (a) any Acquisition with respect to
which all of the following conditions are satisfied: (i) each business acquired
shall be within the permitted lines of business described in Section 7.8, (ii)
any Capital Stock given as consideration in connection therewith shall be
Capital Stock of the Borrower, (iii) the Acquisition, at no time, shall have
been contested by the board of directors of the Target, (iv) in the case of an
Acquisition involving the acquisition of control of Capital Stock of any Person,
immediately after giving effect to such Acquisition such Person (or the
surviving Person, if the Acquisition is effected through a merger or
consolidation) shall be the Borrower or a Wholly Owned Subsidiary, and (v) all
of the conditions and requirements of Sections 5.8 and 5.9 applicable to such
Acquisition are satisfied; or (b) any other Acquisition to which the Required
Lenders (or the Administrative Agent on their behalf) shall have given their
prior written consent (which consent may be in their sole discretion and may be
given subject to such additional terms and conditions as the Required Lenders
shall establish) and with respect to which all of the conditions and
requirements set forth in this
17
definition and in Section 5.8, and in or pursuant to any such consent, have been
satisfied or waived in writing by the Required Lenders (or the Administrative
Agent on their behalf).
"Permitted Liens" shall have the meaning given to such term in Section
7.3.
"Person" shall mean any corporation, association, joint venture,
partnership, limited liability company, organization, business, individual,
trust, government or agency or political subdivision thereof or any other legal
entity.
"Plan" shall mean any "employee pension benefit plan" within the
meaning of Section 3(2) of ERISA that is subject to the provisions of Title IV
of ERISA (other than a Multiemployer Plan) and to which the Borrower or any
ERISA Affiliate may have any liability.
"Pledge Agreement" shall mean the Pledge Agreement made by the Borrower
and the Subsidiaries party thereto in favor of the Administrative Agent,
substantially in the form of Exhibit H, as amended, modified or supplemented
from time to time.
"Premium Funding Associates" shall mean Premium Funding Associates,
Inc., a Connecticut corporation.
"Prepayment Account" shall have the meaning given to such term in
Section 2.6(g).
"Pro Forma Balance Sheet" shall have the meaning given to such term in
Section 4.11(c).
"Prohibited Transaction" shall mean any transaction described in (i)
Section 406 of ERISA that is not exempt by reason of Section 408 of ERISA or by
reason of a Department of Labor prohibited transaction individual or class
exemption or (ii) Section 4975(c) of the Internal Revenue Code that is not
exempt by reason of Section 4975(c)(2) or 4975(d) of the Internal Revenue Code.
"Projections" shall have the meaning given to such term in Section
4.11(d).
"Refunded Swingline Loans" shall have the meaning given to such term in
Section 2.2(e).
"Register" shall have the meaning given to such term in Section
10.7(b).
"Regulations D, T, U and X" shall mean Regulations D, T, U and X,
respectively, of the Federal Reserve Board, and any successor regulations.
"Reportable Event" shall mean (i) any "reportable event" within the
meaning of Section 4043(c) of ERISA for which the 30-day notice under Section
4043(a) of ERISA has not been waived by the PBGC (including any failure to meet
the minimum funding standard of, or timely make any required installment under,
Section 412 of the Internal Revenue Code or Section 302 of ERISA, regardless of
the issuance of any waivers in accordance with Section 412(d) of the Internal
Revenue Code), (ii) any such "reportable event" subject to advance notice to the
PBGC under Section 4043(b)(3) of ERISA, (iii) any application for a funding
waiver or an
18
extension of any amortization period pursuant to Section 412 of the Internal
Revenue Code, and (iv) a cessation of operations described in Section 4062(e) of
ERISA.
"Required Lenders" shall mean the Lenders holding outstanding Loans and
unutilized Commitments (or, after the termination of the Revolving Credit
Commitments, outstanding Loans) representing more than fifty-one percent (51%)
of the aggregate at such time of all outstanding Loans and unutilized
Commitments (or, after the termination of the Revolving Credit Commitments, the
aggregate at such time of all outstanding Loans).
"Requirement of Law" shall mean, with respect to any Person, the
charter, articles or certificate of organization or incorporation and bylaws or
other organizational or governing documents of such Person, and any statute,
law, treaty, rule, regulation, order, decree, writ, injunction or determination
of any arbitrator or court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject or otherwise pertaining to any or
all of the transactions contemplated by this Agreement and the other Credit
Documents.
"Reserve Requirement" shall mean, with respect to any Interest Period,
the reserve percentage (expressed as a decimal) in effect from time to time
during such Interest Period, as provided by the Federal Reserve Board, applied
for determining the maximum reserve requirements (including, without limitation,
basic, supplemental, marginal and emergency reserves) applicable to Wachovia
under Regulation D with respect to "Eurocurrency liabilities" within the meaning
of Regulation D, or under any similar or successor regulation with respect to
Eurocurrency liabilities or Eurocurrency funding.
"Responsible Officer" shall mean, with respect to the Borrower, the
president, the chief executive officer, the chief financial officer, any
executive officer, or any other Financial Officer of the Borrower, and any other
officer or similar official thereof responsible for the administration of the
obligations of the Borrower in respect of this Agreement.
"Revolving Credit Commitment" shall mean, with respect to any Lender at
any time, the amount set forth for such Lender at such time in the Register
maintained by the Administrative Agent pursuant to Section 10.7(b) as such
Lender's "Revolving Credit Commitment," as such amount may be reduced at or
prior to such time pursuant to the terms hereof. The aggregate amount of the
Revolving Credit Commitments as of the date hereof shall be $100,000,000.
"Revolving Credit Maturity Date" shall mean June 30, 2004, as such date
may be extended pursuant to Section 2.1(c).
"Revolving Credit Termination Date" shall mean the Revolving Credit
Maturity Date or such earlier date of termination of the Revolving Credit
Commitments pursuant to Section 2.5 or Section 8.2.
"Revolving Lender" shall mean any Lender having a Revolving Credit
Commitment (or, after the Revolving Credit Commitments have terminated, any
Lender holding outstanding Revolving Loans).
"Revolving Loans" shall have the meaning given to such term in Section
2.1(c).
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"Revolving Notes" shall mean the Existing Revolving Notes and those
promissory notes of the Borrower in substantially the form of Exhibit A-3,
together with any amendments, modifications and supplements thereto,
substitutions therefor and restatements thereof.
"Security Documents" shall mean the Pledge Agreement and all other
pledge or security agreements, mortgages, deeds of trust, assignments or other
similar agreements or instruments executed and delivered by the Borrower or any
of its Subsidiaries pursuant to Section 5.9 or otherwise in connection with the
attachment and perfection of the Administrative Agent's security interests, and
liens thereunder, including without limitation, UCC financing statements,
related to the transactions contemplated hereby, in each case as amended,
modified or supplemented from time to time.
"Subsidiary" shall mean, with respect to any Person, any corporation or
other Person of which more than fifty percent (50%) of the outstanding Capital
Stock having ordinary voting power to elect a majority of the board of
directors, board of managers or other governing body of such Person, is at the
time, directly or indirectly, owned or controlled by such Person and one or more
of its other Subsidiaries or a combination thereof (irrespective of whether, at
the time, securities of any other class or classes of any such corporation or
other Person shall or might have voting power by reason of the happening of any
contingency). When used without reference to a parent entity, the term
"Subsidiary" shall be deemed to refer to a Subsidiary of the Borrower.
"Subsidiary Guarantor" shall mean any Subsidiary of the Borrower that
is a guarantor under the Subsidiary Guaranty.
"Subsidiary Guaranty" shall mean a guaranty agreement made by the
Subsidiary Guarantors in favor of the Administrative Agent and the Lenders, in
substantially the form of Exhibit E, as amended, modified or supplemented from
time to time.
"Swingline Commitment" shall mean $5,000,000 or, if less, the aggregate
Revolving Credit Commitments at the time of determination, as such amount may be
reduced at or prior to such time pursuant to the terms hereof.
"Swingline Lender" shall mean Wachovia in its capacity as maker of
Swingline Loans, and its successors in such capacity.
"Swingline Loans" shall have the meaning given to such term in Section
2.1(d).
"Swingline Maturity Date" shall mean the date that is five (5) Business
Days prior to the Revolving Credit Maturity Date.
"Swingline Note" shall mean the promissory note of the Borrower in
substantially the form of Exhibit A-4, together with any amendments,
modifications and supplements thereto, substitutions therefor and restatements
thereof.
"Target" shall have the meaning given to such term in Section 5.8.
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"Term Loans" shall mean, collectively, the Tranche A Term Loans and the
Tranche B Term Loans.
"Tranche A Lender" shall mean any Lender holding outstanding Tranche A
Term Loans.
"Tranche A Maturity Date" shall mean June 30, 2004.
"Tranche A Term Loans" shall have the meaning given to such term in
Section 2.1(a).
"Tranche A Term Notes" shall mean the Existing Term Notes and those
promissory notes of the Borrower in substantially the form of Exhibit A-1,
together with any amendments, modifications and supplements thereto,
substitutions therefor and restatements thereof.
"Tranche B Commitment" shall mean, with respect to any Tranche B Lender
at any time, the amount set forth for such Tranche B Lender at such time in the
Register maintained by the Administrative Agent pursuant to Section 10.7(b) as
such Tranche B Lender's "Tranche B Commitment," as such amount may be reduced at
or prior to such time pursuant to the terms hereof. The aggregate amount of the
Tranche B Commitments as of the date hereof shall be $160,000,000.
"Tranche B Lender" shall mean any Lender having a Tranche B Commitment
(or, after the Tranche B Commitments have terminated, any Lender holding
outstanding Tranche B Term Loans).
"Tranche B Maturity Date" shall mean June 30, 2007.
"Tranche B Term Loans" shall have the meaning given to such term in
Section 2.1(b).
"Tranche B Term Notes" shall mean the promissory notes of the Borrower
in favor of each Tranche B Lender evidencing the Tranche B Term Loans made by
such Tranche B Lender pursuant to Section 2.1(b), in substantially the form of
Exhibit A-2, together with any amendments, modifications and supplements
thereto, substitutions therefor and restatements thereof.
"Transaction Documents" shall mean, collectively, the Credit Documents
and any and all other agreements, certificates, instruments and documents
heretofore, now or hereafter executed by or in behalf of the Borrower or any of
its Subsidiaries with respect to any of the foregoing or with respect to the
Transactions, in each case without regard to any amendments, modifications or
supplements thereto or restatements thereof other than those approved by the
Required Lenders pursuant to the terms hereof.
"Transactions" shall mean, collectively, the transactions contemplated
by the Transaction Documents, including (i) the consummation of the Xxxxx
Acquisition, (ii) the making of the Tranche B Term Loans as contemplated by this
Agreement and the application of the proceeds thereof, (iii) the amendment and
restatement of the Existing Credit Agreement as contemplated by this Agreement,
and (iv) the payment of permitted fees and expenses in connection with the
foregoing.
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"Type" shall have the meaning given to such term in Section 2.2(a).
"Unfunded Pension Liability" shall mean, with respect to any Plan or
Multiemployer Plan, the excess of its benefit liabilities under Section
4001(a)(16) of ERISA over the current value of its assets, determined in
accordance with the applicable assumptions used for funding under Section 412 of
the Internal Revenue Code for the applicable plan year.
"Unutilized Revolving Credit Commitment" shall mean, with respect to
any Lender at any time, such Lender's Revolving Credit Commitment at such time
less the aggregate principal amount of all Revolving Loans made by such Lender
that are outstanding at such time.
"Unutilized Swingline Commitment" shall mean, with respect to the
Swingline Lender at any time, the Swingline Commitment at such time less the
aggregate principal amount of all Swingline Loans that are outstanding at such
time.
"Wachovia" shall have the meaning given to such term in the
introductory paragraph hereof.
"Wholly Owned" shall mean, with respect to any Subsidiary of any
Person, that 100% of the outstanding Capital Stock of such Subsidiary is owned,
directly or indirectly, by such Person.
1.2 Accounting Terms. Except as specifically provided otherwise in
this Agreement, a ll accounting terms used herein that are not specifically
defined shall have the meanings customarily given them in accordance with GAAP.
Notwithstanding anything to the contrary in this Agreement, for purposes of
calculation of the financial covenants set forth in Article VI, all accounting
determinations and computations hereunder shall be made in accordance with GAAP
as in effect as of the date of this Agreement applied on a basis consistent with
the application used in preparing the most recent financial statements of the
Borrower referred to in Section 4.11(a). In the event that any changes in GAAP
after such date are required to be applied to the Borrower and would affect the
computation of the financial covenants contained in Article VI, such changes
shall be followed only from and after the date this Agreement shall have been
amended to take into account any such changes.
1.3 Other Terms; Construction.
Unless otherwise specified or unless the context otherwise requires,
all references herein to sections, annexes, schedules and exhibits are
references to sections, annexes, schedules and exhibits in and to this
Agreement, and all terms defined in this Agreement shall have the defined
meanings when used in any other Credit Document or any certificate or other
document made or delivered pursuant hereto. All references herein to the Lenders
or any of them shall be deemed to include the Swingline Lender unless
specifically provided otherwise or unless the context otherwise requires.
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ARTICLE II
AMOUNT AND TERMS OF THE LOANS
2.1 Loans; Commitments.
(a) Pursuant to the Existing Credit Agreement, each Existing Lender,
subject to and on the terms and conditions of the Existing Credit Agreement,
made term loans (each, an "Existing Term Loan," and collectively, the "Existing
Term Loans") to the Borrower. The aggregate principal amount of the Existing
Term Loans made pursuant to the Existing Credit Agreement and outstanding
immediately prior to the Closing Date is $39,975,000. On the Closing Date, the
following shall occur: (i) pursuant to the terms of Section 2.7(a) of the
Existing Credit Agreement, Borrower shall make a partial prepayment of the
Existing Term Loans in the aggregate principal amount of $10,000,000 (and each
Existing Lender severally agrees, subject to and on the terms and conditions of
the Existing Credit Agreement, to consent to such prepayment and waive any
applicable notice period required by Section 2.7(a) of the Existing Credit
Agreement (but not any amounts due under Section 2.18 of the Existing Credit
Agreement on account of such prepayment)), and (ii) the Existing Term Loans
(after giving effect to the foregoing prepayment) shall automatically be
continued as an equivalent principal amount of Loans hereunder (each such loan,
a "Tranche A Term Loan," and collectively, the "Tranche A Term Loans") and shall
be of the same Type, and shall have the same Interest Period, as the
corresponding Existing Term Loans. To the extent repaid, Tranche A Term Loans
may not be reborrowed.
(b) Each Tranche B Lender severally agrees, subject to and on
the terms and conditions of this Agreement, to make a single loan (each being a
"Tranche B Term Loan" and, collectively, the "Tranche B Term Loans") to the
Borrower on the Closing Date, in an aggregate principal amount not to exceed its
Tranche B Commitment. No Tranche B Term Loans shall be made at any time after
the Closing Date. To the extent repaid, Tranche B Term Loans may not be
reborrowed.
(c) (i) Pursuant to the Existing Credit Agreement, each Existing
Lender, subject to and on the terms and conditions of the Existing Credit
Agreement, made revolving loans (each, an "Existing Revolving Loan," and
collectively, the "Existing Revolving Loans") to the Borrower. On the Closing
Date, the following shall occur: (A) pursuant to the terms of Section 2.7(a) of
the Existing Credit Agreement, Borrower shall make a partial prepayment of the
Existing Revolving Loans in the aggregate principal amount of $30,000,000 (and
each Existing Lender severally agrees, subject to and on the terms and
conditions of the Existing Credit Agreement, to consent to such prepayment and
waive any applicable notice period required by Section 2.7(a) of the Existing
Credit Agreement (but not any amounts due under Section 2.18 of the Existing
Credit Agreement on account of such prepayment)), and (B) the Existing Revolving
Loans (after giving effect to the foregoing prepayment) shall automatically be
continued as an equivalent principal amount of Loans hereunder (each such loan,
together with the additional revolving loans described hereinbelow, a "Revolving
Loan," and collectively, the "Revolving Loans") and shall be of the same Type,
and shall have the same Interest Period, as the corresponding Existing Revolving
Loans. Additionally, each Existing Lender severally agrees, subject to and on
the terms and conditions of this Agreement, to make revolving loans to the
23
Borrower, from time to time on any Business Day during the period from and
including the Closing Date to but not including the Revolving Credit Termination
Date, in an aggregate principal amount at any time outstanding not greater than
its Revolving Credit Commitment, provided that no Borrowing of Revolving Loans
shall be made if, immediately after giving effect thereto, the sum of (x) the
aggregate principal amount of Revolving Loans outstanding at such time, and (y)
the aggregate principal amount of Swingline Loans outstanding at such time
(excluding the aggregate amount of any Swingline Loans to be repaid with
proceeds of Revolving Loans made pursuant to such Borrowing) would exceed the
aggregate Revolving Credit Commitments at such time. Subject to and on the terms
and conditions of this Agreement, the Borrower may borrow, repay and reborrow
Revolving Loans.
(ii) The Revolving Credit Maturity Date may be extended as
follows:
(A) The Borrower may, by notice (an "Extension Notice") to the
Administrative Agent (which shall promptly notify the Revolving Lenders) not
less than 90 days prior to the Revolving Credit Maturity Date then in effect
hereunder (the "Existing Revolving Credit Maturity Date"), request that each
Revolving Lender party hereto prior to any extension (an "Existing Revolving
Lender") agree to the extend the Existing Revolving Credit Maturity Date to a
new proposed maturity date that is no later than the Tranche B Maturity Date
(the "Proposed Revolving Credit Maturity Date").
(B) Each Existing Revolving Lender, acting in its sole and
individual discretion, shall, by notice to the Administrative Agent promptly
given (but in no event later than that date (the "Notice Date") which is 15 days
following the date of the Extension Notice, advise the Administrative Agent
whether or not such Existing Revolving Lender agrees to such extension (and each
Existing Revolving Lender that determines not to agree to extend the Revolving
Credit Maturity Date (a "Non-Extending Lender") shall notify the Administrative
Agent (which shall notify the other Existing Revolving Lenders) of such fact
promptly after such determination (but in any event no later than the Notice
Date), and any Existing Revolving Lender that does not so advise the
Administrative Agent on or before the Notice Date shall be deemed to be a
Non-Extending Lender). The election of any Existing Revolving Lender to agree to
such extension shall not obligate any other Lender to so agree.
(C) The Administrative Agent shall notify the Borrower of each
Existing Revolving Lender's determination under this Section 2.1(c)(ii) no later
than that date which is 30 days after the Notice Date (or, if such date is not a
Business Day, on the next succeeding Business Day).
(D) The Borrower shall have the right on or before the
Existing Revolving Credit Maturity Date to replace each Non-Extending Lender
with, and add as "Lenders" under this Agreement in place thereof, one or more
Eligible Assignees (each, an "Additional Commitment Lender") with the approval
of the Administrative Agent (which approval shall not be unreasonably withheld),
each of which Additional Commitment Lenders shall have entered into an agreement
in form and substance satisfactory to the Borrower and the Administrative Agent
pursuant to which such Additional Commitment Lender shall, effective as of the
Existing Revolving Credit Maturity Date, undertake a Revolving Credit Commitment
(and, if any such Additional Commitment Lender is already a Lender, its
Revolving Credit Commitment shall be
24
in addition to such Lender's Revolving Credit Commitment hereunder on such
date); provided that prior to replacing any Non-Extending Lender with any
Additional Commitment Lender, the Borrower shall have given each Revolving
Lender which has agreed to extend the Revolving Credit Maturity Date an
opportunity to increase its Revolving Credit Commitment by an amount equal to
all or a portion of the Non-Extending Lender's Revolving Credit Commitments.
(E) If (and only if) the total of the Revolving Credit
Commitments of the Existing Revolving Lenders that have agreed to so extend the
Revolving Credit Maturity Date shall be more than 50% of the aggregate amount of
the Revolving Credit Commitments in effect immediately prior to the Existing
Revolving Credit Maturity Date, the Revolving Credit Maturity Date shall be
extended to the Proposed Revolving Credit Maturity Date, which shall become the
new Revolving Credit Maturity Date, and each Additional Commitment Lender shall
thereupon become a "Lender" for all purposes of this Agreement.
(F) Notwithstanding the foregoing, the extension of the
Revolving Credit Maturity Date pursuant to this Section 2.1(c)(ii) shall be
effective with respect to any Lender only if:
(x) no Default or Event of Default shall have
occurred and be continuing on the date of notice requesting
such extension or on the Existing Revolving Credit Maturity
Date, and the representations and warranties set forth in
Article IV shall be true and correct on and as of each of said
dates if made on and as of said dates; and
(y) the Borrower shall have paid in full all amounts
owing to each Non-Extending Lender hereunder on or before the
Existing Revolving Credit Maturity Date.
(d) The Swingline Lender agrees, subject to and on the terms and
conditions of this Agreement, to make loans (each, a "Swingline Loan," and
collectively, the "Swingline Loans") to the Borrower, from time to time on any
Business Day during the period from the Closing Date to but not including the
Swingline Maturity Date (or, if earlier, the Revolving Credit Termination Date),
in an aggregate principal amount at any time outstanding not exceeding the
Swingline Commitment, notwithstanding that the aggregate principal amount of
Swingline Loans outstanding at any time, when added to the aggregate principal
amount of the Revolving Loans made by the Swingline Lender in its capacity as a
Lender outstanding at such time, may exceed its Revolving Credit Commitment at
such time, but provided that no Borrowing of Swingline Loans shall be made if,
immediately after giving effect thereto, the sum of (x) the aggregate principal
amount of Revolving Loans outstanding at such time, and (y) the aggregate
principal amount of Swingline Loans outstanding at such time would exceed the
aggregate Revolving Credit Commitments at such time. Subject to and on the terms
and conditions of this Agreement, the Borrower may borrow, repay (including by
means of a Borrowing of Revolving Loans pursuant to Section 2.2(e)) and reborrow
Swingline Loans.
25
2.2 Borrowings.
(a) The Term Loans and Revolving Loans (each, together with the
Swingline Loans, a "Class" of Loan) shall, at the option of the Borrower and
subject to the terms and conditions of this Agreement, be either Base Rate Loans
or LIBOR Loans (each, a "Type" of Loan), provided that all Loans comprising the
same Borrowing shall, unless otherwise specifically provided herein, be of the
same Type. The Swingline Loans shall be made and maintained as Base Rate Loans
at all times.
(b) In order to make a Borrowing (other than (x) Borrowings of
Swingline Loans, which shall be made pursuant to Section 2.2(d), (y) Borrowings
for the purpose of repaying Refunded Swingline Loans, which shall be made
pursuant to Section 2.2(e), and (z) Borrowings involving continuations or
conversions of outstanding Loans, which shall be made pursuant to Section 2.11),
the Borrower will give the Administrative Agent written notice not later than
11:00 a.m., Charlotte time, three (3) Business Days prior to each Borrowing to
be comprised of LIBOR Loans and one (1) Business Day prior to each Borrowing to
be comprised of Base Rate Loans; provided, however, that requests for the
Borrowing of the Tranche B Term Loans and any Revolving Loans to be made on the
Closing Date may, at the discretion of the Administrative Agent, be given later
than the times specified hereinabove. Each such notice (each, a "Notice of
Borrowing") shall be irrevocable, shall be given in the form of Exhibit B-1 and
shall specify (1) the aggregate principal amount, Class and initial Type of the
Loans to be made pursuant to such Borrowing, (2) in the case of a Borrowing of
LIBOR Loans, the initial Interest Period to be applicable thereto, and (3) the
requested date of such Borrowing (the "Borrowing Date"), which shall be a
Business Day. Upon its receipt of a Notice of Borrowing, the Administrative
Agent will promptly notify each Lender of the proposed Borrowing.
Notwithstanding anything to the contrary contained herein:
(i) the aggregate principal amount of the Borrowing of
Tranche B Term Loans shall be in the amount of the aggregate Tranche B
Commitments;
(ii) the aggregate principal amount of each Borrowing
comprised of Base Rate Loans shall not be less than $1,000,000 or, if
greater, an integral multiple of $500,000 in excess thereof (or, in the
case of a Borrowing of Revolving Loans, if less, in the amount of the
aggregate Unutilized Revolving Credit Commitments), and the aggregate
principal amount of each Borrowing comprised of LIBOR Loans shall not
be less than $3,000,000 or, if greater, an integral multiple of
$1,000,000 in excess thereof;
(iii) if the Borrower shall have failed to designate the Type
of Loans comprising a Borrowing, the Borrower shall be deemed to have
requested a Borrowing comprised of Base Rate Loans; and
(iv) if the Borrower shall have failed to select the duration
of the Interest Period to be applicable to any Borrowing of LIBOR
Loans, then the Borrower shall be deemed to have selected an Interest
Period with a duration of one month.
(c) Not later than 1:00 p.m., Charlotte time, on the requested
Borrowing Date, each Lender will make available to the Administrative Agent at
its office referred to in Section 10.5
26
(or at such other location as the Administrative Agent may designate) an amount,
in Dollars and in immediately available funds, equal to the amount of the Loan
or Loans to be made by such Lender. To the extent the Lenders have made such
amounts available to the Administrative Agent as provided hereinabove, the
Administrative Agent will make the aggregate of such amounts available to the
Borrower in accordance with Section 2.3(a) and in like funds as received by the
Administrative Agent.
(d) In order to make a Borrowing of a Swingline Loan, the Borrower
will give the Administrative Agent and the Swingline Lender written notice not
later than 11:00 a.m., Charlotte time, on the Business Day of such Borrowing.
Each such notice (each, a "Notice of Swingline Borrowing") shall be irrevocable,
shall be given in the form of Exhibit B-2 and shall specify (i) the principal
amount of the Swingline Loan to be made pursuant to such Borrowing (which shall
be in an integral multiple of $100,000 (or, if less, in the amount of the
Unutilized Swingline Commitment)) and (ii) the requested Borrowing Date, which
shall be a Business Day. Not later than 1:00 p.m., Charlotte time, on the
requested Borrowing Date, the Swingline Lender will make available to the
Administrative Agent at its office referred to in Section 10.5 (or at such other
location as the Administrative Agent may designate) an amount, in Dollars and in
immediately available funds, equal to the amount of the requested Swingline
Loan. To the extent the Swingline Lender has made such amount available to the
Administrative Agent as provided hereinabove, the Administrative Agent will make
such amount available to the Borrower in accordance with Section 2.3(a) and in
like funds as received by the Administrative Agent.
(e) With respect to any outstanding Swingline Loans, the Swingline
Lender may at any time (whether or not an Event of Default has occurred and is
continuing) in its sole and absolute discretion, and is hereby authorized and
empowered by the Borrower to, cause a Borrowing of Revolving Loans to be made
for the purpose of repaying such Swingline Loans by delivering to the
Administrative Agent (if the Administrative Agent is different from the
Swingline Lender) and each other Lender (on behalf of, and with a copy to, the
Borrower), not later than 11:00 a.m., Charlotte time, one (1) Business Day prior
to the proposed Borrowing Date therefor, a notice (which shall be deemed to be a
Notice of Borrowing given by the Borrower) requesting the Lenders to make
Revolving Loans (which shall be made initially as Base Rate Loans) on such
Borrowing Date in an aggregate amount equal to the amount of such Swingline
Loans (the "Refunded Swingline Loans") outstanding on the date such notice is
given that the Swingline Lender requests to be repaid. Not later than 1:00 p.m.,
Charlotte time, on the requested Borrowing Date, each Lender (other than the
Swingline Lender) will make available to the Administrative Agent at its office
referred to in Section 10.5 (or at such other location as the Administrative
Agent may designate) an amount, in Dollars and in immediately available funds,
equal to the amount of the Revolving Loan to be made by such Lender. To the
extent the Lenders have made such amounts available to the Administrative Agent
as provided hereinabove, the Administrative Agent will make the aggregate of
such amounts available to the Swingline Lender in like funds as received by the
Administrative Agent, which shall apply such amounts in repayment of the
Refunded Swingline Loans. Notwithstanding any provision of this Agreement to the
contrary, on the relevant Borrowing Date, the Refunded Swingline Loans
(including the Swingline Lender's ratable share thereof, in its capacity as a
Lender) shall be deemed to be repaid with the proceeds of the Revolving Loans
made as provided above (including a Revolving Loan deemed to have been made by
the Swingline Lender), and such
27
Refunded Swingline Loans deemed to be so repaid shall no longer be outstanding
as Swingline Loans but shall be outstanding as Revolving Loans. If any portion
of any such amount repaid (or deemed to be repaid) to the Swingline Lender shall
be recovered by or on behalf of the Borrower from the Swingline Lender in any
bankruptcy, insolvency or similar proceeding or otherwise, the loss of the
amount so recovered shall be shared ratably among all the Lenders in the manner
contemplated by Section 2.15(b).
(f) If, as a result of any bankruptcy, insolvency or similar
proceeding with respect to the Borrower, Revolving Loans are not made pursuant
to subsection (e) above in an amount sufficient to repay any amounts owed to the
Swingline Lender in respect of any outstanding Swingline Loans, or if the
Swingline Lender is otherwise precluded for any reason from giving a notice on
behalf of the Borrower as provided for hereinabove, the Swingline Lender shall
be deemed to have sold without recourse, representation or warranty, and each
Lender shall be deemed to have purchased and hereby agrees to purchase, a
participation in such outstanding Swingline Loans in an amount equal to its
ratable share (based on the proportion that its Revolving Credit Commitment
bears to the aggregate Revolving Credit Commitments at such time) of the unpaid
amount thereof together with accrued interest thereon. Upon one (1) Business
Day's prior notice from the Swingline Lender, each Lender (other than the
Swingline Lender) will make available to the Administrative Agent at its office
referred to in Section 10.5 (or at such other location as the Administrative
Agent may designate) an amount, in Dollars and in immediately available funds,
equal to its respective participation. To the extent the Lenders have made such
amounts available to the Administrative Agent as provided hereinabove, the
Administrative Agent will make the aggregate of such amounts available to the
Swingline Lender in like funds as received by the Administrative Agent. In the
event any such Lender fails to make available to the Administrative Agent the
amount of such Lender's participation as provided in this subsection (f), the
Swingline Lender shall be entitled to recover such amount on demand from such
Lender, together with interest thereon for each day from the date such amount is
required to be made available for the account of the Swingline Lender until the
date such amount is made available to the Swingline Lender at the Federal Funds
Rate for the first three (3) Business Days and thereafter at the Adjusted Base
Rate applicable to Revolving Loans. Promptly following its receipt of any
payment by or on behalf of the Borrower in respect of a Swingline Loan, the
Swingline Lender will pay to each Lender that has acquired a participation
therein such Lender's ratable share of such payment.
(g) Notwithstanding any provision of this Agreement to the contrary,
the obligation of each Lender (other than the Swingline Lender) to make
Revolving Loans for the purpose of repaying any Refunded Swingline Loans
pursuant to subsection (e) above and each such Lender's obligation to purchase a
participation in any unpaid Swingline Loans pursuant to subsection (f) above
shall be absolute and unconditional and shall not be affected by any
circumstance or event whatsoever, including, without limitation, (i) any
set-off, counterclaim, recoupment, defense or other right that such Lender may
have against the Swingline Lender, the Administrative Agent, the Borrower or any
other Person for any reason whatsoever, (ii) the occurrence or continuance of
any Default or Event of Default, (iii) any adverse change in the business,
operations, properties, assets, condition (financial or otherwise) or prospects
of the Borrower or any of its Subsidiaries, or (iv) any breach of this Agreement
by any party hereto.
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2.3 Disbursements; Funding Reliance; Domicile of Loans.
(a) The Borrower hereby authorizes the Administrative Agent to
disburse the proceeds of each Borrowing in accordance with the terms of any
written instructions from any of the Authorized Officers, provided that the
Administrative Agent shall not be obligated under any circumstances to forward
amounts to any account not listed in an Account Designation Letter. The Borrower
may at any time deliver to the Administrative Agent an Account Designation
Letter listing any additional accounts or deleting any accounts listed in a
previous Account Designation Letter.
(b) Unless the Administrative Agent has received, prior to 1:00
p.m., Charlotte time, on the relevant Borrowing Date, written notice from a
Lender that such Lender will not make available to the Administrative Agent such
Lender's ratable portion, if any, of the relevant Borrowing, the Administrative
Agent may assume that such Lender has made such portion available to the
Administrative Agent in immediately available funds on such Borrowing Date in
accordance with the applicable provisions of Section 2.2, and the Administrative
Agent may, in reliance upon such assumption, but shall not be obligated to, make
a corresponding amount available to the Borrower on such Borrowing Date. If and
to the extent that such Lender shall not have made such portion available to the
Administrative Agent, and the Administrative Agent shall have made such
corresponding amount available to the Borrower, such Lender, on the one hand,
and the Borrower, on the other, severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount, together with interest
thereon for each day from the date such amount is made available to the Borrower
until the date such amount is repaid to the Administrative Agent, (i) in the
case of such Lender, at the Federal Funds Rate, and (ii) in the case of the
Borrower, at the rate of interest applicable at such time to the Type and Class
of Loans comprising such Borrowing, as determined under the provisions of
Section 2.8. If such Lender shall repay to the Administrative Agent such
corresponding amount, such amount shall constitute such Lender's Loan as part of
such Borrowing for purposes of this Agreement. The failure of any Lender to make
any Loan required to be made by it as part of any Borrowing shall not relieve
any other Lender of its obligation, if any, hereunder to make its Loan as part
of such Borrowing, but no Lender shall be responsible for the failure of any
other Lender to make the Loan to be made by such other Lender as part of any
Borrowing. The Administrative Agent shall promptly give notice to the Borrower
after it obtains knowledge that a Lender will not make funds available
hereunder.
(c) Each Lender may, at its option, make and maintain any Loan at,
to or for the account of any of its Lending Offices, provided that any exercise
of such option shall not affect the obligation of the Borrower to repay such
Loan to or for the account of such Lender in accordance with the terms of this
Agreement.
2.4 Notes.
(a) The Loans made by each Lender shall be evidenced (i) in the case
of Tranche A Term Loans, by the Term Note (as defined by the Existing Credit
Agreement) issued to such Lender under the Existing Credit Agreement
(collectively, the "Existing Term Notes"), provided that upon the request of any
holder of an Existing Term Note, the Borrower shall issue to such holder, in
exchange for such Existing Term Note, a Tranche A Term Note appropriately
29
completed in substantially the form of Exhibit A-1, (ii) in the case of Tranche
B Term Loans, by a Tranche B Term Note appropriately completed in substantially
the form of Exhibit A-2, (iii) in the case of Revolving Loans, by the Revolving
Note (as defined by the Existing Credit Agreement) issued to such Lender under
the Existing Credit Agreement (collectively, the "Existing Revolving Notes"),
provided that upon the request of any holder of an Existing Revolving Note, the
Borrower shall issue to such holder, in exchange for such Existing Revolving
Note, a Revolving Note appropriately completed in substantially the form of
Exhibit A-3, and (iv) in the case of the Swingline Loans, by a Swingline Note
appropriately completed in substantially the form of Exhibit A-4.
(b) The Borrower and each holder of an Existing Term Note hereby
agree that (w) each reference therein to "Amended and Restated Credit Agreement"
shall refer to this Agreement, (x) each reference therein to "Credit Documents"
shall refer to the Credit Documents as defined by this Agreement, (y) each
reference therein to "Term Loans" shall refer to the Tranche A Term Loans as
defined by this Agreement, (z) each reference therein to "First Union National
Bank" shall refer to Wachovia. Each Tranche A Term Note issued to a Tranche A
Lender shall (i) be executed by the Borrower, (ii) be payable to the order of
such Tranche A Lender, (iii) be dated as of the Closing Date (or, in the case of
a Tranche A Term Note issued after the Closing Date, dated the effective date of
the applicable Assignment and Acceptance), (iv) be in a stated principal amount
equal the unpaid principal amount of such Lender's Tranche A Term Loan), (v)
bear interest in accordance with the provisions of Section 2.8, as the same may
be applicable from time to time to the Tranche A Term Loan made by such Lender,
and (vi) be entitled to all of the benefits of this Agreement and the other
Credit Documents and subject to the provisions hereof and thereof.
(c) Each Tranche B Term Note issued to a Tranche B Lender shall (i)
be executed by the Borrower, (ii) be payable to the order of such Tranche B
Lender, (iii) be dated as of the Closing Date (or, in the case of a Tranche B
Term Note issued after the Closing Date, dated the effective date of the
applicable Assignment and Acceptance), (iv) be in a stated principal amount
equal to such Lender's Tranche B Commitment (or, in the case of a Tranche B Term
Note issued after the Closing Date, in an amount equal to the unpaid principal
amount of such Lender's Tranche B Term Loan), (v) bear interest in accordance
with the provisions of Section 2.8, as the same may be applicable from time to
time to the Tranche B Term Loan made by such Lender, and (vi) be entitled to all
of the benefits of this Agreement and the other Credit Documents and subject to
the provisions hereof and thereof.
(d) The Borrower and each holder of an Existing Revolving Note
hereby agree that (w) each reference therein to "Amended and Restated Credit
Agreement" shall refer to this Agreement, (x) each reference therein to "Credit
Documents" shall refer to the Credit Documents as defined by this Agreement, (y)
each reference therein to "Revolving Loans" shall refer to the Revolving Loans
as defined by this Agreement, (z) each reference therein to "First Union
National Bank" shall refer to Wachovia. Each Revolving Note issued to a
Revolving Lender shall (i) be executed by the Borrower, (ii) be payable to the
order of such Revolving Lender, (iii) be dated as of the Closing Date (or, in
the case of a Revolving Note issued after the Closing Date, dated the effective
date of the applicable Assignment and Acceptance), (iv) be in a stated principal
amount equal to such Lender's Revolving Credit Commitment, (v) bear interest in
accordance with the provisions of Section 2.8, as the same may be applicable
from time to time
30
to the Revolving Loans made by such Lender, and (vi) be entitled to all of the
benefits of this Agreement and the other Credit Documents and subject to the
provisions hereof and thereof.
(e) The Swingline Note shall (i) be executed by the Borrower, (ii)
be payable to the order of the Swingline Lender, (iii) be dated as of the
Closing Date, (iv) be in a stated principal amount equal to the Swingline
Commitment, (v) bear interest in accordance with the provisions of Section 2.8,
as the same may be applicable from time to time to the Swingline Loans, and (vi)
be entitled to all of the benefits of this Agreement and the other Credit
Documents and subject to the provisions hereof and thereof.
(f) Each Lender will record on its internal records the amount and
Type of each Loan made by it and each payment received by it in respect thereof
and will, in the event of any transfer of any of its Notes, either endorse on
the reverse side thereof or on a schedule attached thereto (or any continuation
thereof) the outstanding principal amount and Type of the Loans evidenced
thereby as of the date of transfer or provide such information on a schedule to
the Assignment and Acceptance relating to such transfer; provided, however, that
the failure of any Lender to make any such recordation or provide any such
information, or any error therein, shall not affect the Borrower's obligations
under this Agreement or the Notes.
2.5 Termination and Reduction of Commitments and Swingline
Commitment.
(a) The Tranche B Commitments shall be automatically and permanently
terminated on the Closing Date (or, if earlier, on July 31, 2002), unless the
Tranche B Term Loans have been made in full on or prior to such date. The
Revolving Credit Commitments shall be automatically and permanently terminated
on the Revolving Credit Termination Date. The Swingline Commitment shall be
automatically and permanently terminated on the Swingline Maturity Date, unless
sooner terminated pursuant to any other provision of this Section or Section
8.2.
(b) The Revolving Credit Commitments shall, on each date upon which
a prepayment of the Loans is required under any of subsections (d) and (e) of
Section 2.6 (and exceeds in amount the aggregate principal amount of Term Loans
then outstanding) or would be required if Term Loans were then outstanding, be
automatically and permanently reduced by the amount, if any, by which the amount
of such required prepayment (determined as if an unlimited amount of Term Loans
were then outstanding) exceeds the aggregate principal amount of Term Loans then
actually outstanding, as more particularly set forth in Section 2.6(g).
(c) At any time and from time to time after the date hereof, upon
not less than five (5) Business Days' prior written notice to the Administrative
Agent (and, in the case of a termination or reduction of the Unutilized
Swingline Commitment, the Swingline Lender), the Borrower may terminate in whole
or reduce in part the aggregate Unutilized Revolving Credit Commitments or the
Unutilized Swingline Commitment, provided that any such partial reduction shall
be in an aggregate amount of not less than $5,000,000 ($1,000,000 in the case of
the Unutilized Swingline Commitment) or, if greater, an integral multiple of
$1,000,000 in excess thereof. The amount of any termination or reduction made
under this subsection (c) may not thereafter be reinstated.
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(d) Each reduction of the Revolving Credit Commitments pursuant to
this Section shall be applied ratably among the Lenders according to their
respective Revolving Credit Commitments. Notwithstanding any provision of this
Agreement to the contrary, any reduction of the Revolving Credit Commitments
pursuant to this Section that has the effect of reducing the aggregate Revolving
Credit Commitments to an amount less than the amount of the Swingline Commitment
at such time shall result in an automatic corresponding reduction of the
Swingline Commitment to the amount of the aggregate Revolving Credit Commitments
(as so reduced), without any further action on the part of the Borrower or the
Swingline Lender.
2.6 Mandatory Payments and Prepayments.
(a) Except to the extent due or paid sooner pursuant to the
provisions of this Agreement, the Borrower will repay the aggregate outstanding
principal of the Tranche A Term Loans on the last Business Day of each March,
June, September and December during the periods, and in the corresponding
amounts, set forth below:
Date Payment Amount
---- --------------
September 30, 2002 through $3,128,254
June 30, 2003
September 30, 2003 through $3,753,905
March 31, 2004
June 30, 2004 $6,200,270
(b) Except to the extent due or paid sooner pursuant to the
provisions of this Agreement, the Borrower will repay the aggregate outstanding
principal of the Tranche B Term Loans on the last Business Day of each March,
June, September and December during the periods, and in the corresponding
amounts, set forth below:
Date Payment Amount
---- --------------
September 30, 2002 through
March 31, 2007 $400,000
June 30, 2007 $152,400,000
(c) Except to the extent due or paid sooner pursuant to the
provisions of this Agreement, (i) the aggregate outstanding principal of the
Tranche A Term Loans shall be due and payable in full on the Tranche A Maturity
Date, (ii) the aggregate outstanding principal of the Tranche B Term Loans shall
be due and payable in full on the Tranche B Maturity Date, (iii) the aggregate
outstanding principal of the Revolving Loans shall be due and payable in full on
the Revolving Credit Maturity Date, and (iv) the aggregate outstanding principal
of the Swingline Loans shall be due and payable in full on the Swingline
Maturity Date.
(d) In the event that, at any time, the sum of (x) the aggregate
principal amount of Revolving Loans outstanding at such time, and (y) the
aggregate principal amount of Swingline
32
Loans outstanding at such time (excluding the aggregate amount of any Swingline
Loans to be repaid with proceeds of Revolving Loans made on the date of
determination) shall exceed the aggregate Revolving Credit Commitments at such
time (after giving effect to any concurrent termination or reduction thereof),
the Borrower will immediately prepay the outstanding principal amount of the
Swingline Loans and, to the extent of any excess remaining after prepayment in
full of outstanding Swingline Loans, the Borrower will immediately prepay the
outstanding principal amount of the Revolving Loans in the amount of such
excess.
(e) Promptly upon (and in any event not later than two (2) Business
Days after) its receipt thereof, the Borrower will prepay the outstanding
principal amount of the Loans in an amount equal to 25% of the Net Cash Proceeds
from any Equity Issuance and 100% of the Net Cash Proceeds from any Debt
Issuance, and will deliver to the Administrative Agent, concurrently with such
prepayment, a certificate signed by a Financial Officer of the Borrower in form
and substance satisfactory to the Administrative Agent and setting forth the
calculation of such Net Cash Proceeds.
(f) The Borrower will (i) promptly upon (and in any event not later
than two (2) Business Days after) its receipt thereof, prepay the outstanding
principal amount of the Loans in an amount equal to 100% of the excess of the
Net Cash Proceeds from any Asset Disposition over $15,000,000, and (ii) within
five (5) Business Days after the end of any month in which the Net Cash Proceeds
from Asset Dispositions exceeds the amounts set forth below, prepay the
outstanding principal amount of the Loans in an amount equal to 100% of the
excess of the Net Cash Proceeds from any Asset Disposition over (x) together
with the aggregate of the Net Cash Proceeds from all Asset Dispositions
occurring within the 365-day period immediately preceding such Asset Disposition
(but specifically excluding, if applicable, any Asset Dispositions occurring
prior to the Closing Date), $25,000,000, or (y) together with the aggregate of
the Net Cash Proceeds from all Asset Dispositions occurring after the Closing
Date, $50,000,000, whichever is greater. The Borrower will deliver to the
Administrative Agent, concurrently with such prepayment, a certificate signed by
a Financial Officer of the Borrower in form and substance satisfactory to the
Administrative Agent and setting forth the calculation of such Net Cash
Proceeds. Notwithstanding the foregoing, nothing in this subsection shall be
deemed to permit any Asset Disposition not expressly permitted under Section
7.4.
(g) Each prepayment of the Loans made pursuant to subsections (d)
and (e) above shall be applied (i) first, to reduce the outstanding principal
amount of the Tranche A Term Loans and Tranche B Term Loans on a pro rata basis,
with such reduction to be applied to the remaining scheduled principal payments
on the Tranche A Term Loans and the Tranche B Term Loans (as set forth in
subsections (a) and (b) above) on a pro rata basis (provided, however, that
promptly upon notification thereof, one or more Tranche B Lenders may decline to
accept any such prepayment to the extent there are sufficient amounts of Tranche
A Term Loans outstanding to be paid with such declined prepayments, in which
case, such declined payments shall be allocated pro rata among the Tranche A
Term Loans and the Tranche B Term Loans held by Lenders accepting such
prepayments (it being understood that the Tranche B Lenders will have no such
right to decline prepayments if there are insufficient amounts of Tranche A Term
Loans outstanding to be repaid)), (ii) second, to the extent of any excess
remaining after application as provided in clause (i) above, to reduce the
outstanding principal amount of the Swingline Loans, with a corresponding
reduction to the Revolving Credit Commitments as provided in
33
Section 2.5(b), and (iii) third, to the extent of any excess remaining after
application as provided in clauses (i) and (ii) above, to reduce the outstanding
principal amount of the Revolving Loans, with a corresponding reduction to the
Revolving Credit Commitments as provided in Section 2.5(b). Within each Class of
Loans, each payment or prepayment shall be applied first to prepay all Base Rate
Loans, and any excess shall, at the option of the Borrower, be applied to prepay
any LIBOR Loans of such Class immediately and/or deposited in a separate
Prepayment Account (as defined below) for the Loans of such Class. The
Administrative Agent shall apply any cash deposited in the Prepayment Account
for any Class of Loans to prepay LIBOR Loans of such Class on the last day of
their respective Interest Periods (or, at the direction of the Borrower, on any
earlier date), in ascending order of length of the remaining portion of their
then current Interest Periods, until all outstanding Loans of such Class have
been prepaid or until the allocable cash on deposit in the Prepayment Account
for such Class has been exhausted. For purposes of this Agreement, "Prepayment
Account" for any Class of Loans shall mean an account established by the
Borrower with the Administrative Agent and over which the Administrative Agent
shall have exclusive dominion and control, including the exclusive right of
withdrawal for application in accordance with this Section 2.6(g). The
Administrative Agent will, at the request of the Borrower, invest amounts on
deposit in the Prepayment Account for any Class of Loans in Cash Equivalents
that mature prior to the last day of the applicable Interest Periods of the
LIBOR Loans of such Class to be prepaid; provided, however, that (i) the
Administrative Agent shall not be required to make any investment that, in its
sole business judgment, would require or cause the Administrative Agent to be
in, or would result in any, violation of law, statute, rule or regulation, and
(ii) if an Event of Default shall have occurred and be continuing, the selection
of such investments shall be in the sole discretion of the Administrative Agent.
Other than interest earned on such investments, the Prepayment Accounts shall
not bear interest. Interest or profits, if any, on such investments shall be
deposited in the applicable Prepayment Account and reinvested and disbursed as
set forth above. If the maturity of the Loans has been accelerated pursuant to
Article VIII, the Administrative Agent may, in its sole discretion, apply all
amounts on deposit in the Prepayment Account for any Class of Loans to satisfy
any of the Obligations related to such Class of Loans (provided that such
amounts shall be applied first to prepay all outstanding Base Rate Loans). The
Borrower hereby pledges and assigns to the Administrative Agent, for its benefit
and the benefit of the Lenders, each Prepayment Account established hereunder to
secure the Obligations related to such Class of Loans. Each payment or
prepayment of a LIBOR Loan made pursuant to the provisions of this Section on a
day other than the last day of the Interest Period applicable thereto shall be
made together with all amounts required under Section 2.18 to be paid as a
consequence thereof.
(h) Each payment or prepayment of a LIBOR Loan made pursuant to the
provisions of this Section on a day other than the last day of the Interest
Period applicable thereto shall be made together with all amounts required under
Section 2.18 to be paid as a consequence thereof.
(i) Each payment or prepayment pursuant to the provisions of this
Section shall be applied ratably among the Lenders holding the Loans being
prepaid, in proportion to the principal amount held by each.
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2.7 Voluntary Prepayments.
(a) At any time and from time to time, the Borrower shall have
the right to prepay the Loans, in whole or in part, without premium or penalty
(except as provided in clause (iii) below), upon written notice given to the
Administrative Agent not later than 11:00 a.m., Charlotte time, five (5)
Business Days prior to each intended prepayment of LIBOR Loans and one (1)
Business Day prior to each intended prepayment of Base Rate Loans, provided that
(i) each partial prepayment shall be in an aggregate principal amount of not
less than $1,000,000 or, if greater, an integral multiple of $500,000 in excess
thereof (an integral multiple of $100,000 in the case of Swingline Loans), (ii)
no partial prepayment of LIBOR Loans made pursuant to any single Borrowing shall
reduce the aggregate outstanding principal amount of the remaining LIBOR Loans
under such Borrowing to less than $3,000,000 or to any greater amount not an
integral multiple of $1,000,000 in excess thereof, and (iii) unless made
together with all amounts required under Section 2.18 to be paid as a
consequence of such prepayment, a prepayment of a LIBOR Loan may be made only on
the last day of the Interest Period applicable thereto. Each such notice shall
specify the proposed date of such prepayment and the aggregate principal amount,
Class and Type of the Loans to be prepaid (and, in the case of LIBOR Loans, the
Interest Period of the Borrowing pursuant to which made), and shall be
irrevocable and shall bind the Borrower to make such prepayment on the terms
specified therein. Revolving Loans and Swingline Loans (but not Term Loans)
prepaid pursuant to this subsection (a) may be reborrowed, subject to the terms
and conditions of this Agreement.
(b) Each prepayment of the Term Loans made pursuant to subsection
(a) above shall be applied to reduce the outstanding principal amount of the
Tranche A Term Loans and Tranche B Term Loans on a pro rata basis, with such
reduction to be applied to the remaining scheduled principal payments on the
applicable Tranche A Term Loans and the Tranche B Term Loans (as set forth in
Sections 2.6(a) and 2.6(b)) on a pro rata basis (provided, however, that
promptly upon notification thereof, one or more Tranche B Lenders may decline to
accept any such prepayment to the extent there are sufficient amounts of Tranche
A Term Loans outstanding to be paid with such declined prepayments, in which
case, such declined payments shall be allocated pro rata among the Tranche A
Term Loans and the Tranche B Term Loans held by Lenders accepting such
prepayments (it being understood that the Tranche B Lenders will have no such
right to decline prepayments if there are insufficient amounts of Tranche A Term
Loans outstanding to be repaid)). Each prepayment of the Loans made pursuant to
subsection (a) above shall be applied ratably among the Lenders holding the
Loans being prepaid, in proportion to the principal amount held by each.
2.8 Interest.
(a) The Borrower will pay interest in respect of the unpaid principal
amount of each Loan, from the date of Borrowing thereof until such principal
amount shall be paid in full, (i) at the Adjusted Base Rate applicable to the
Class of such Loan, as in effect from time to time during such periods as such
Loan is a Base Rate Loan, and (ii) at the Adjusted LIBOR Rate applicable to the
Class of such Loan, as in effect from time to time during such periods as such
Loan is a LIBOR Loan.
35
(b) Upon the occurrence and during the continuance of any default
by the Borrower in the payment of any principal of or interest on any Loan, any
fees or other amount hereunder when due (whether at maturity, pursuant to
acceleration or otherwise), and (at the election of the Required Lenders) upon
the occurrence and during the continuance of any Event of Default, all
outstanding principal amounts of the Loans and, to the greatest extent permitted
by law, all interest accrued on the Loans and all other accrued and outstanding
fees and other amounts hereunder, shall bear interest at a rate per annum equal
to the interest rate applicable from time to time thereafter to such Loans
(whether the Adjusted Base Rate or the Adjusted LIBOR Rate) plus 2% (or, in the
case of fees and other amounts, at the Adjusted Base Rate applicable to the
Loans plus 2%), and, in each case, such default interest shall be payable on
demand. To the greatest extent permitted by law, interest shall continue to
accrue after the filing by or against the Borrower of any petition seeking any
relief in bankruptcy or under any law pertaining to insolvency or debtor relief.
(c) Accrued (and theretofore unpaid) interest shall be payable as
follows:
(i) in respect of each Base Rate Loan (including any Base Rate
Loan or portion thereof paid or prepaid pursuant to the provisions of
Section 2.6, except as provided hereinbelow), in arrears on the last
Business Day of each calendar quarter, beginning with the first such
day to occur after the Closing Date; provided, that in the event the
Loans are repaid or prepaid in full and the Commitments have been
terminated, then accrued interest in respect of all Base Rate Loans
shall be payable together with such repayment or prepayment on the date
thereof;
(ii) in respect of each LIBOR Loan (including any LIBOR Loan
or portion thereof paid or prepaid pursuant to the provisions of
Section 2.6, except as provided hereinbelow), in arrears (y) on the
last Business Day of the Interest Period applicable thereto (subject to
the provisions of clause (iv) in Section 2.10) and (z) in addition, in
the case of a LIBOR Loan with an Interest Period having a duration of
six months or longer, on each date on which interest would have been
payable under clause (y) above had successive Interest Periods of three
months' duration been applicable to such LIBOR Loan; provided, that in
the event all LIBOR Loans made pursuant to a single Borrowing are
repaid or prepaid in full, then accrued interest in respect of such
LIBOR Loans shall be payable together with such repayment or prepayment
on the date thereof; and
(iii) in respect of any Loan, at maturity (whether pursuant to
acceleration or otherwise) and, after maturity, on demand.
(d) Nothing contained in this Agreement or in any other Credit
Document shall be deemed to establish or require the payment of interest to any
Lender at a rate in excess of the maximum rate permitted by applicable law. If
the amount of interest payable for the account of any Lender on any interest
payment date would exceed the maximum amount permitted by applicable law to be
charged by such Lender, the amount of interest payable for its account on such
interest payment date shall be automatically reduced to such maximum permissible
amount. In the event of any such reduction affecting any Lender, if from time to
time thereafter the amount of interest payable for the account of such Lender on
any interest payment date would be less than the maximum amount permitted by
applicable law to be charged by such Lender, then
36
the amount of interest payable for its account on such subsequent interest
payment date shall be automatically increased to such maximum permissible
amount, provided that at no time shall the aggregate amount by which interest
paid for the account of any Lender has been increased pursuant to this sentence
exceed the aggregate amount by which interest paid for its account has
theretofore been reduced pursuant to the previous sentence.
(e) The Administrative Agent shall promptly notify the Borrower and
the Lenders upon determining the interest rate for each Borrowing of LIBOR Loans
after its receipt of the relevant Notice of Borrowing or Notice of
Conversion/Continuation, and upon each change in the Base Rate; provided,
however, that the failure of the Administrative Agent to provide the Borrower or
the Lenders with any such notice shall neither affect any obligations of the
Borrower or the Lenders hereunder nor result in any liability on the part of the
Administrative Agent to the Borrower or any Lender. Each such determination
(including each determination of the Reserve Requirement) shall, absent manifest
error, be conclusive and binding on all parties hereto.
2.9 Fees. The Borrower agrees to pay:
(a) To Wachovia Securities, Inc., for its own account, on the date
of execution of this Agreement, the fees described in paragraph (1) of the 2002
Fee Letter, in the amounts set forth therein as due and payable on such date and
to the extent not theretofore paid to it;
(b) To the Administrative Agent, for the account of each Lender with
a Revolving Credit Commitment, a commitment fee (the "Commitment Fee") for each
calendar quarter (or portion thereof) for the period from the date of this
Agreement to the Revolving Credit Termination Date, at a per annum rate equal to
the Applicable Margin Percentage in effect for such fee from time to time during
such quarter, on such Lender's ratable share (based on the proportion that its
Revolving Credit Commitment bears to the aggregate Revolving Credit Commitments)
of the average daily aggregate Unutilized Revolving Credit Commitments, payable
in arrears (i) on the last Business Day of each calendar quarter, beginning with
the first such day to occur after the Closing Date, and (ii) on the Revolving
Credit Termination Date; and
(c) To the Administrative Agent, for its own account, the annual
administrative fee described in paragraph (3) of the 2001 Fee Letter, as amended
by the 2002 Fee Letter, on the terms, in the amount and at the times set forth
therein.
2.10 Interest Periods. Concurrently with the giving of a Notice of
Borrowing or Notice of Conversion/Continuation in respect of any Borrowing
(whether in respect of Term Loans or Revolving Loans) comprised of Base Rate
Loans to be converted into, or LIBOR Loans to be continued as, LIBOR Loans, the
Borrower shall have the right to elect, pursuant to such notice, the interest
period (each, an "Interest Period") to be applicable to such LIBOR Loans, which
Interest Period shall, at the option of the Borrower, be a one, two, three or
six-month period; provided, however, that:
(i) all LIBOR Loans comprising a single Borrowing shall at
all times have the same Interest Period;
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(ii) the initial Interest Period for any LIBOR Loan shall
commence on the date of the Borrowing of such LIBOR Loan (including the
date of any continuation of, or conversion into, such LIBOR Loan), and
each successive Interest Period applicable to such LIBOR Loan shall
commence on the day on which the next preceding Interest Period
applicable thereto expires;
(iii) LIBOR Loans may not be outstanding under more than six
(6) separate Interest Periods at any one time (for which purpose
Interest Periods shall be deemed to be separate even if they are
coterminous);
(iv) if any Interest Period otherwise would expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day unless such next succeeding Business Day
falls in another calendar month, in which case such Interest Period
shall expire on the next preceding Business Day;
(v) no Interest Period may be selected with respect to the
Term Loans that would end after a scheduled date for repayment of
principal of the Term Loans occurring on or after the first day of such
Interest Period unless, immediately after giving effect to such
selection, the aggregate principal amount of Term Loans that are Base
Rate Loans or that have Interest Periods expiring on or before such
principal repayment date equals or exceeds the principal amount
required to be paid on such principal repayment date;
(vi) the Borrower may not select any Interest Period that
begins prior to the third (3rd) Business Day after the Closing Date or
that expires (x) after the Tranche A Maturity Date, with respect to
Tranche A Term Loans that are to be maintained as LIBOR Loans, (y)
after the Tranche B Maturity Date, with respect to Tranche B Term Loans
that are to be maintained as LIBOR Loans, or (z) after the Revolving
Credit Maturity Date, with respect to Revolving Loans that are to be
maintained as LIBOR Loans;
(vii) if any Interest Period begins on a day for which there
is no numerically corresponding day in the calendar month during which
such Interest Period would otherwise expire, such Interest Period shall
expire on the last Business Day of such calendar month; and
(viii) no Interest Period shall commence for any LIBOR Loan
(including a conversion of, or continuation into, a LIBOR Loan) on any
day on which there are Swingline Loans outstanding.
2.11 Conversions and Continuations.
(a) The Borrower shall have the right, on any Business Day occurring
on or after the Closing Date, to elect (i) to convert all or a portion of the
outstanding principal amount of any Base Rate Loans of any Class into LIBOR
Loans of the same Class, or to convert any LIBOR Loans of any Class the Interest
Periods for which end on the same day into Base Rate Loans of the same Class, or
(ii) upon the expiration of any Interest Period, to continue all or a portion of
the outstanding principal amount of any LIBOR Loans of any Class the Interest
Periods for which end on the same day for an additional Interest Period,
provided that (w) any such
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conversion of LIBOR Loans into Base Rate Loans shall involve an aggregate
principal amount of not less than $1,000,000 or, if greater, an integral
multiple of $500,000 in excess thereof; any such conversion of Base Rate Loans
into, or continuation of, LIBOR Loans shall involve an aggregate principal
amount of not less than $3,000,000 or, if greater, an integral multiple of
$1,000,000 in excess thereof; and no partial conversion of LIBOR Loans made
pursuant to a single Borrowing shall reduce the outstanding principal amount of
such LIBOR Loans to less than $3,000,000 or to any greater amount not an
integral multiple of $1,000,000 in excess thereof, (x) except as otherwise
provided in Section 2.16(d), LIBOR Loans may be converted into Base Rate Loans
only on the last day of the Interest Period applicable thereto (and, in any
event, if a LIBOR Loan is converted into a Base Rate Loan on any day other than
the last day of the Interest Period applicable thereto, the Borrower will pay,
upon such conversion, all amounts required under Section 2.18 to be paid as a
consequence thereof), (y) no such conversion or continuation shall be permitted
with regard to any Base Rate Loans that are Swingline Loans, and (z) no
conversion of Base Rate Loans into LIBOR Loans or continuation of LIBOR Loans
shall be permitted during the continuance of a Default or Event of Default.
(b) The Borrower shall make each such election by giving the
Administrative Agent written notice not later than 11:00 a.m., Charlotte time,
three (3) Business Days prior to the intended effective date of any conversion
of Base Rate Loans into, or continuation of, LIBOR Loans and one (1) Business
Day prior to the intended effective date of any conversion of LIBOR Loans into
Base Rate Loans. Each such notice (each, a "Notice of Conversion/Continuation")
shall be irrevocable, shall be given in the form of Exhibit B-3 and shall
specify (x) the date of such conversion or continuation (which shall be a
Business Day), (y) in the case of a conversion into, or a continuation of, LIBOR
Loans, the Interest Period to be applicable thereto, and (z) the aggregate
amount, Class and Type of the Loans being converted or continued. Upon the
receipt of a Notice of Conversion/Continuation, the Administrative Agent will
promptly notify each Lender of the proposed conversion or continuation. In the
event that the Borrower shall fail to deliver a Notice of
Conversion/Continuation as provided herein with respect to any outstanding LIBOR
Loans, such LIBOR Loans shall automatically be converted to Base Rate Loans upon
the expiration of the then current Interest Period applicable thereto (unless
repaid pursuant to the terms hereof). In the event the Borrower shall have
failed to select in a Notice of Conversion/Continuation the duration of the
Interest Period to be applicable to any conversion into, or continuation of,
LIBOR Loans, then the Borrower shall be deemed to have selected an Interest
Period with a duration of one month.
2.12 Method of Payments; Computations.
(a) All payments by the Borrower hereunder shall be made without
setoff, counterclaim or other defense, in Dollars and in immediately available
funds to the Administrative Agent, for the account of the Lenders entitled to
such payment or the Swingline Lender, as the case may be (except as otherwise
expressly provided herein as to payments required to be made directly to the
Lenders) at its office referred to in Section 10.5, prior to 12:00 noon,
Charlotte time, on the date payment is due. Any payment made as required
hereinabove, but after 12:00 noon, Charlotte time, shall be deemed to have been
made on the next succeeding Business Day. If any payment falls due on a day that
is not a Business Day, then such due date shall be extended to the next
succeeding Business Day (except that in the case of LIBOR Loans to which the
provisions of clause (iv) in Section 2.10 are applicable, such due
39
date shall be the next preceding Business Day), and such extension of time shall
then be included in the computation of payment of interest, fees or other
applicable amounts.
(b) The Administrative Agent will distribute to the Lenders like
amounts relating to payments made to the Administrative Agent for the account of
the Lenders as follows: (i) if the payment is received by 12:00 noon, Charlotte
time, in immediately available funds, the Administrative Agent will make
available to each relevant Lender on the same date, by wire transfer of
immediately available funds, such Lender's ratable share of such payment (based
on the percentage that the amount of the relevant payment owing to such Lender
bears to the total amount of such payment owing to all of the relevant Lenders),
and (ii) if such payment is received after 12:00 noon, Charlotte time, or in
other than immediately available funds, the Administrative Agent will make
available to each such Lender its ratable share of such payment by wire transfer
of immediately available funds on the next succeeding Business Day (or in the
case of uncollected funds, as soon as practicable after collected). If the
Administrative Agent shall not have made a required distribution to the
appropriate Lenders as required hereinabove after receiving a payment for the
account of such Lenders, the Administrative Agent will pay to each such Lender,
on demand, its ratable share of such payment with interest thereon at the
Federal Funds Rate for each day from the date such amount was required to be
disbursed by the Administrative Agent until the date repaid to such Lender.
(c) Unless the Administrative Agent shall have received written
notice from the Borrower prior to the date on which any payment is due to any
Lender hereunder that such payment will not be made in full, the Administrative
Agent may assume that the Borrower has made such payment in full to the
Administrative Agent on such date, and the Administrative Agent may, in reliance
on such assumption, but shall not be obligated to, cause to be distributed to
such Lender on such due date an amount equal to the amount then due to such
Lender. If and to the extent the Borrower shall not have so made such payment in
full to the Administrative Agent, and without limiting the obligation of the
Borrower to make such payment in accordance with the terms hereof, such Lender
shall repay to the Administrative Agent forthwith on demand such amount so
distributed to such Lender, together with interest thereon for each day from the
date such amount is so distributed to such Lender until the date repaid to the
Administrative Agent, at the Federal Funds Rate.
(d) All computations of interest and fees hereunder (including
computations of the Reserve Requirement) shall be made on the basis of a year
consisting of 365 or 366 days, as the case may be (in the case of Base Rate
Loans), or 360 days (in all other instances), and the actual number of days
(including the first day, but excluding the last day) elapsed.
2.13 Recovery of Payments.
(a) The Borrower agrees that to the extent the Borrower makes
a payment or payments to or for the account of the Administrative Agent or any
Lender, which payment or payments or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside or required to
be repaid to a trustee, receiver or any other party under any bankruptcy,
insolvency or similar state or federal law, common law or equitable cause, then,
to the extent of such payment or repayment, the Obligation intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been received.
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(b) If any amounts distributed by the Administrative Agent to any
Lender are subsequently returned or repaid by the Administrative Agent to the
Borrower or its representative or successor in interest, whether by court order
or by settlement approved by the Lender in question, such Lender will, promptly
upon receipt of notice thereof from the Administrative Agent, pay the
Administrative Agent such amount. If any such amounts are recovered by the
Administrative Agent from the Borrower or its representative or successor in
interest, the Administrative Agent will redistribute such amounts to the Lenders
on the same basis as such amounts were originally distributed.
2.14 Use of Proceeds. The proceeds of the Tranche B Term Loans and
Revolving Loans shall be used (i) first, to effect a partial prepayment of the
Existing Term Loans as set forth in Section 2.1(a), (ii) second, to effect a
partial prepayment of the Existing Revolving Loans as set forth in Section
2.1(c), (iii) third, to finance, in part, the Xxxxx Acquisition, including all
reasonable transaction fees and expenses incurred therewith, (iv) fourth, to pay
or reimburse reasonable transaction fees and expenses in connection with the
closing of the transactions contemplated hereby, and (v) thereafter, for working
capital and general corporate purposes and in accordance with the terms and
provisions of this Agreement (including to finance Permitted Acquisitions in
accordance with the terms and provisions of this Agreement, including, without
limitation, the provisions set forth in Section 5.8).
2.15 Pro Rata Treatment.
(a) Except in the case of Swingline Loans, all fundings,
continuations and conversions of Loans of any Class shall be made by the Lenders
pro rata on the basis of their respective Commitments to provide Loans of such
Class (in the case of the initial funding of Loans of such Class pursuant to
Section 2.2) or on the basis of their respective outstanding Loans of such Class
(in the case of continuations and conversions of Loans of such Class pursuant to
Section 2.11, and additionally in all cases in the event the Commitments have
expired or have been terminated), as the case may be from time to time. All
payments on account of principal of or interest on any Loans, fees or any other
Obligations owing to or for the account of any one or more Lenders shall be
apportioned ratably among such Lenders in proportion to the amounts of such
principal, interest, fees or other Obligations owed to them respectively.
(b) Each Lender agrees that if it shall receive any amount hereunder
(whether by voluntary payment, realization upon security, exercise of the right
of setoff or banker's lien, counterclaim or cross action, or otherwise, other
than pursuant to Section 10.7) applicable to the payment of any of the
Obligations that exceeds its ratable share (according to the proportion of (i)
the amount of such Obligations due and payable to such Lender at such time to
(ii) the aggregate amount of such Obligations due and payable to all Lenders at
such time) of payments on account of such Obligations then or therewith obtained
by all the Lenders to which such payments are required to have been made, such
Lender shall forthwith purchase from the other Lenders such participations in
such Obligations as shall be necessary to cause such purchasing Lender to share
the excess payment or other recovery ratably with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender, such purchase from each such other Lender
shall be rescinded and each such other Lender shall repay to the purchasing
Lender the purchase price to the extent of such
41
recovery, together with an amount equal to such other Lender's ratable share
(according to the proportion of (i) the amount of such other Lender's required
repayment to (ii) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to the provisions of
this subsection may, to the fullest extent permitted by law, exercise any and
all rights of payment (including, without limitation, setoff, banker's lien or
counterclaim) with respect to such participation as fully as if such participant
were a direct creditor of the Borrower in the amount of such participation. If
under any applicable bankruptcy, insolvency or similar law, any Lender receives
a secured claim in lieu of a setoff to which this subsection applies, such
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders entitled
under this subsection to share in the benefits of any recovery on such secured
claim.
2.16 Increased Costs; Change in Circumstances; Illegality; etc.
(a) If, at any time after the date hereof and from time to time,
the introduction of or any change in any applicable law, rule or regulation or
in the interpretation or administration thereof by any Governmental Authority
charged with the interpretation or administration thereof, or compliance by any
Lender with any guideline or request from any such Governmental Authority
(whether or not having the force of law), shall (i) subject such Lender to any
tax or other charge, or change the basis of taxation of payments to such Lender,
in respect of any of its LIBOR Loans or any other amounts payable hereunder or
its obligation to make, fund or maintain any LIBOR Loans (other than any change
in the rate or basis of tax on the overall net income of such Lender or its
applicable Lending Office), (ii) impose, modify or deem applicable any reserve,
special deposit or similar requirement (but excluding any reserves to the extent
actually included within the Reserve Requirement in the calculation of the LIBOR
Rate) against assets of, deposits with or for the account of, or credit extended
by, such Lender or its applicable Lending Office, or (iii) impose on such Lender
or its applicable Lending Office any other condition, and the result of any of
the foregoing shall be to increase the cost to such Lender of making or
maintaining any LIBOR Loans or to reduce the amount of any sum received or
receivable by such Lender hereunder, the Borrower will, promptly upon demand
therefor by such Lender, pay to such Lender such additional amounts as shall
compensate such Lender for such increase in costs or reduction in return.
(b) If, at any time after the date hereof and from time to time,
any Lender shall have reasonably determined that the introduction of or any
change in any applicable law, rule or regulation regarding capital adequacy or
in the interpretation or administration thereof by any Governmental Authority
charged with the interpretation or administration thereof, or compliance by such
Lender with any guideline or request from any such Governmental Authority
(whether or not having the force of law), has or would have the effect, as a
consequence of such Lender's Commitment or Loans hereunder, of reducing the rate
of return on the capital of such Lender or any Person controlling such Lender to
a level below that which such Lender or controlling Person could have achieved
but for such introduction, change or compliance (taking into account such
Lender's or controlling Person's policies with respect to capital adequacy), the
Borrower will, promptly upon demand therefor by such Lender therefor, pay to
such Lender such
42
additional amounts as will compensate such Lender or controlling Person for such
reduction in return.
(c) If, on or prior to the first day of any Interest Period,
(y) the Administrative Agent shall have determined that adequate and reasonable
means do not exist for ascertaining the applicable LIBOR Rate for such Interest
Period or (z) the Administrative Agent shall have received written notice from
the Required Lenders of their determination that the rate of interest referred
to in the definition of "LIBOR Rate" upon the basis of which the Adjusted LIBOR
Rate for LIBOR Loans for such Interest Period is to be determined will not
adequately and fairly reflect the cost to such Lenders of making or maintaining
LIBOR Loans during such Interest Period, the Administrative Agent will forthwith
so notify the Borrower and the Lenders. Upon such notice, (i) all then
outstanding LIBOR Loans shall automatically, on the expiration date of the
respective Interest Periods applicable thereto (unless then repaid in full), be
converted into Base Rate Loans, (ii) the obligation of the Lenders to make, to
convert Base Rate Loans into, or to continue, LIBOR Loans shall be suspended
(including pursuant to the Borrowing to which such Interest Period applies), and
(iii) any Notice of Borrowing or Notice of Conversion/Continuation given at any
time thereafter with respect to LIBOR Loans shall be deemed to be a request for
Base Rate Loans, in each case until the Administrative Agent or the Required
Lenders, as the case may be, shall have determined that the circumstances giving
rise to such suspension no longer exist (and the Required Lenders, if making
such determination, shall have so notified the Administrative Agent), and the
Administrative Agent shall have so notified the Borrower and the Lenders.
(d) Notwithstanding any other provision in this Agreement, if, at
any time after the date hereof and from time to time, any Lender shall have
determined in good faith that the introduction of or any change in any
applicable law, rule or regulation or in the interpretation or administration
thereof by any Governmental Authority charged with the interpretation or
administration thereof, or compliance with any guideline or request from any
such Governmental Authority (whether or not having the force of law), has or
would have the effect of making it unlawful for such Lender to make or to
continue to make or maintain LIBOR Loans, such Lender will forthwith so notify
the Administrative Agent and the Borrower. Upon such notice, (i) each of such
Lender's then outstanding LIBOR Loans shall automatically, on the expiration
date of the respective Interest Period applicable thereto (or, to the extent any
such LIBOR Loan may not lawfully be maintained as a LIBOR Loan until such
expiration date, upon such notice), be converted into a Base Rate Loan, (ii) the
obligation of such Lender to make, to convert Base Rate Loans into, or to
continue, LIBOR Loans shall be suspended (including pursuant to any Borrowing
for which the Administrative Agent has received a Notice of Borrowing but for
which the Borrowing Date has not arrived), and (iii) any Notice of Borrowing or
Notice of Conversion/Continuation given at any time thereafter with respect to
LIBOR Loans shall, as to such Lender, be deemed to be a request for a Base Rate
Loan, in each case until such Lender shall have determined that the
circumstances giving rise to such suspension no longer exist and shall have so
notified the Administrative Agent, and the Administrative Agent shall have so
notified the Borrower.
(e) Determinations by the Administrative Agent or any Lender for
purposes of this Section of any increased costs, reduction in return, market
contingencies, illegality or any other matter shall, absent manifest error, be
conclusive, provided that such determinations are made in
43
good faith. No failure by the Administrative Agent or any Lender at any time to
demand payment of any amounts payable under this Section shall constitute a
waiver of its right to demand payment of any additional amounts arising at any
subsequent time. Nothing in this Section shall require or be construed to
require the Borrower to pay any interest, fees, costs or other amounts in excess
of that permitted by applicable law. If any Lender becomes entitled to claim any
increased costs or reduction in return pursuant to subsections (a) or (b) above,
it shall provide notice thereof to the Borrower certifying (i) that one of the
events described in such subsections has occurred and describing in reasonable
detail the nature of such event, (ii) as to the increased costs or reduction in
return resulting from such event, and (iii) as to the additional amount demanded
by such Lender and a reasonably detailed explanation of the calculation thereof.
2.17 Taxes.
(a) Any and all payments by the Borrower hereunder or under any
Note shall be made, in accordance with the terms hereof and thereof, free and
clear of and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, other than net income and franchise taxes imposed on the Administrative
Agent or any Lender by the United States or by the jurisdiction under the laws
of which the Administrative Agent or such Lender, as the case may be, is
organized or in which its principal office or (in the case of a Lender) its
applicable Lending Office is located, or any political subdivision or taxing
authority thereof (all such nonexcluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as "Taxes").
If the Borrower shall be required by law to deduct any Taxes from or in respect
of any sum payable hereunder or under any Note to the Administrative Agent or
any Lender, (i) the sum payable shall be increased as may be necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section), the Administrative Agent or such
Lender, as the case may be, receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower will make such
deductions, (iii) the Borrower will pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law and (iv)
the Borrower will deliver to the Administrative Agent or such Lender, as the
case may be, evidence of such payment.
(b) The Borrower will indemnify the Administrative Agent and each
Lender for the full amount of Taxes (including, without limitation, any Taxes
imposed by any jurisdiction on amounts payable under this Section) paid by the
Administrative Agent or such Lender, as the case may be, and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes were correctly or legally asserted. This
indemnification shall be made within 30 days from the date the Administrative
Agent or such Lender, as the case may be, makes written demand therefor.
(c) Each of the Administrative Agent and the Lenders agrees that if
it subsequently recovers, or receives a permanent net tax benefit with respect
to, any amount of Taxes (i) previously paid by it and as to which it has been
indemnified by or on behalf of the Borrower or (ii) previously deducted by the
Borrower (including, without limitation, any Taxes deducted from any additional
sums payable under clause (i) of subsection (a) above), the Administrative Agent
or such Lender, as the case may be, shall reimburse the Borrower to the extent
of the
44
amount of any such recovery or permanent net tax benefit (but only to the extent
of indemnity payments made, or additional amounts paid, by or on behalf of the
Borrower under this Section with respect to the Taxes giving rise to such
recovery or tax benefit); provided, however, that the Borrower, upon the request
of the Administrative Agent or such Lender, agrees to repay to the
Administrative Agent or such Lender, as the case may be, the amount paid over to
the Borrower (together with any penalties, interest or other charges), in the
event the Administrative Agent or such Lender is required to repay such amount
to the relevant taxing authority or other Governmental Authority. The
determination by the Administrative Agent or any Lender of the amount of any
such recovery or permanent net tax benefit shall, in the absence of manifest
error, be conclusive and binding.
(d) If any Lender is incorporated or organized under the laws of a
jurisdiction other than the United States of America or any state thereof (a
"Non-U.S. Lender") and claims exemption from United States withholding tax
pursuant to the Internal Revenue Code, such Non-U.S. Lender will deliver to each
of the Administrative Agent and the Borrower, on or prior to the Closing Date
(or, in the case of a Non-U.S. Lender that becomes a party to this Agreement as
a result of an assignment after the Closing Date, on the effective date of such
assignment), (i) in the case of a Non-U.S. Lender that is a "bank" for purposes
of Section 881(c)(3)(A) of the Internal Revenue Code, a properly completed
Internal Revenue Service Forms W-8ECI or W-8BEN, as applicable (or successor
forms), certifying that such Non-U.S. Lender is entitled to an exemption from or
a reduction of withholding or deduction for or on account of United States
federal income taxes in connection with payments under this Agreement or any of
the Notes, together with a properly completed Internal Revenue Service Form W-8
or W-9, as applicable (or successor forms), and (ii) in the case of a Non-U.S.
Lender that is not a "bank" for purposes of Section 881(c)(3)(A) of the Internal
Revenue Code, a certificate in form and substance reasonably satisfactory to the
Administrative Agent and the Borrower and to the effect that (x) such Non-U.S.
Lender is not a "bank" for purposes of Section 881(c)(3)(A) of the Internal
Revenue Code, is not subject to regulatory or other legal requirements as a bank
in any jurisdiction, and has not been treated as a bank for purposes of any tax,
securities law or other filing or submission made to any governmental authority,
any application made to a rating agency or qualification for any exemption from
any tax, securities law or other legal requirements, (y) is not a 10-percent
shareholder for purposes of Section 881(c)(3)(B) of the Internal Revenue Code
and (z) is not a controlled foreign corporation receiving interest from a
related person for purposes of Section 881(c)(3)(C) of the Internal Revenue
Code, together with a properly completed Internal Revenue Service Form W-8 or
W-9, as applicable (or successor forms). Each such Non-U.S. Lender further
agrees to deliver to each of the Administrative Agent and the Borrower an
additional copy of each such relevant form on or before the date that such form
expires or becomes obsolete or after the occurrence of any event (including a
change in its applicable Lending Office) requiring a change in the most recent
forms so delivered by it, in each case certifying that such Non-U.S. Lender is
entitled to an exemption from or a reduction of withholding or deduction for or
on account of United States federal income taxes in connection with payments
under this Agreement or any of the Notes, unless an event (including, without
limitation, any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required, which event renders
all such forms inapplicable or the exemption to which such forms relate
unavailable and such Non-U.S. Lender notifies the Administrative Agent and the
Borrower that it is not entitled to receive payments without deduction or
withholding of United States federal income taxes. Each such Non-U.S.
45
Lender will promptly notify the Administrative Agent and the Borrower of any
changes in circumstances that would modify or render invalid any claimed
exemption or reduction.
(e) If any Lender is entitled to a reduction in (and not a complete
exemption from) the applicable withholding tax, the Borrower and the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable withholding tax after taking into account
such reduction. If any of the forms or other documentation required under
subsection (d) above are not delivered to the Administrative Agent as therein
required, then the Borrower and the Administrative Agent may withhold from any
interest payment to such Lender not providing such forms or other documentation
an amount equivalent to the applicable withholding tax.
2.18 Compensation. The Borrower will compensate each Lender upon
demand for all losses, expenses and liabilities (including, without limitation,
any loss, expense or liability incurred by reason of the liquidation or
reemployment of deposits or other funds required by such Lender to fund or
maintain LIBOR Loans) that such Lender may incur or sustain (i) if for any
reason (other than a failure on the part of such Lender) a Borrowing or
continuation of, or conversion into, a LIBOR Loan does not occur on a date
specified therefor in a Notice of Borrowing or Notice of
Conversion/Continuation, (ii) if any repayment, prepayment or conversion of any
LIBOR Loan occurs on a date other than the last day of an Interest Period
applicable thereto (including as a consequence of acceleration of the maturity
of the Loans pursuant to Section 8.2), (iii) if any prepayment of any LIBOR Loan
is not made on any date specified in a notice of prepayment given by the
Borrower or (iv) as a consequence of any other failure by the Borrower to make
any payments with respect to any LIBOR Loan when due hereunder. Calculation of
all amounts payable to a Lender under this Section shall be made as though such
Lender had actually funded its relevant LIBOR Loan through the purchase of a
Eurodollar deposit bearing interest at the LIBOR Rate in an amount equal to the
amount of such LIBOR Loan, having a maturity comparable to the relevant Interest
Period; provided, however, that each Lender may fund its LIBOR Loans in any
manner it sees fit and the foregoing assumption shall be utilized only for the
calculation of amounts payable under this Section. Determinations by any Lender
for purposes of this Section of any such losses, expenses or liabilities shall,
absent manifest error, be conclusive, provided that such determinations are made
in good faith.
2.19 Replacement of Lenders.
(a) The Borrower may, at any time and so long as no Default or Event
of Default has then occurred and is continuing, replace any Lender (i) that has
requested compensation from the Borrower under Section 2.16(a) or 2.16(b), (ii)
the obligation of which to make or maintain LIBOR Loans has been suspended under
Section 2.16(d), or (iii) that shall refuse to fund, or otherwise default in the
funding, of its ratable share of any Borrowing requested and permitted to be
made hereunder and such refusal has not been withdrawn or such default has not
been cured within three (3) Business Days after the Borrower has given such
Lender written notice thereof, in any case under clauses (i) through (iii) above
by written notice to such Lender and the Administrative Agent given not more
than thirty (30) days after any such event and identifying one or more Persons
each of which shall be an Eligible Assignee and reasonably acceptable to the
Administrative Agent (each, a "Replacement Lender," and collectively, the
"Replacement
46
Lenders") to replace such Lender (the "Replaced Lender"), provided that (i) the
notice from the Borrower to the Replaced Lender and the Administrative Agent
provided for hereinabove shall specify an effective date for such replacement
(the "Replacement Effective Date"), which shall be at least five (5) Business
Days after such notice is given, (ii) as of the relevant Replacement Effective
Date, each Replacement Lender shall enter into an Assignment and Acceptance with
the Replaced Lender pursuant to Section 10.7(a) (but shall not be required to
pay the processing fee otherwise payable to the Administrative Agent pursuant to
Section 10.7(a), which fee, for purposes hereunder, shall be waived), pursuant
to which such Replacement Lenders collectively shall acquire, in such proportion
among them as they may agree with the Borrower and the Administrative Agent, all
(but not less than all) of the Commitment and outstanding Loans of the Replaced
Lender, and, in connection therewith, shall pay (x) to the Replaced Lender, as
the purchase price in respect thereof, an amount equal to the sum as of the
Replacement Effective Date (without duplication) of (1) the unpaid principal
amount of, and all accrued but unpaid interest on, all outstanding Loans of the
Replaced Lender and (2) the Replaced Lender's ratable share of all accrued but
unpaid fees owing to the Replaced Lender under Section 2.9(b), (y) to the
Administrative Agent, for its own account, any amounts owing to the
Administrative Agent by the Replaced Lender under Section 2.3(b), and (z) to the
Administrative Agent, for the account of the Swingline Lender, any amounts owing
the Swingline Lender under Section 2.2(f), and (iii) all other obligations of
the Borrower owing to the Replaced Lender (other than those specifically
described in clause (ii) above in respect of which the assignment purchase price
has been, or is concurrently being, paid), including, without limitation,
amounts payable under Section 2.16(a) and 2.16(b) which give rise to the
replacement of such Replaced Lender and amounts payable under Section 2.18 as a
result of the actions required to be taken under this Section 2.19, shall be
paid in full by the Borrower to the Replaced Lender on or prior to the
Replacement Effective Date.
2.20 Increases of Revolving Credit Commitments.
(a) The parties may effect an increase in the aggregate of the
Revolving Credit Commitments (a "Revolver Increase") as follows. Upon (i) the
execution of a signature page to this Agreement by an Eligible Assignee (or, in
the case of an existing Lender, the execution of a new signature page evidencing
an increase in such Lender's Revolving Credit Commitment(s)) (in each case and
in such capacity, an "Increasing Lender") and acceptance thereof by the
Administrative Agent and the Borrower, (ii) the execution and delivery by the
Borrower of a Revolving Note or Revolving Notes in favor of the Increasing
Lender for such Increasing Lender's Revolving Credit Commitment(s) and Revolving
Loans (and, in the case of an Increasing Lender that is an existing Lender, the
return of its existing Revolving Note or Revolving Notes ), and (iii) delivery
of notice to the other Lenders by the Administrative Agent setting forth the
effective date of the addition of the Increasing Lender hereunder and the amount
of such Increasing Lender's Revolving Credit Commitment(s), such Increasing
Lender shall, without the necessity of any further action by any other Lender or
Agent, be for all purposes a Lender party to this Agreement to the same extent
as if it were an original party hereto with Revolving Credit Commitment(s) as
set forth on the signature page executed by the Increasing Lender (or, in the
case of Increasing Lender that is an existing Lender, such new signature page
executed by such Increasing Lender); provided, however, (x) no Lender may
increase its total Commitments and Loans hereunder to the extent that such
Lender (without any other Lender) would have sufficient Commitments and Loans to
take action hereunder as, or direct that action
47
be taken hereunder on behalf of, the Required Lenders, (y) the total unutilized
Revolving Credit Commitments and Revolving Loans of all Lenders shall not exceed
in the aggregate $150,000,000 and (z) the sum of (i) the amount of all
unutilized Commitments hereunder and (ii) the amount of all Loans outstanding
hereunder shall not exceed in the aggregate $310,000,000.
(b) In the event that on the effective date of a Revolver Increase
(x) an Increasing Lender is assuming a Revolving Credit Commitment (or, in the
case of an Increasing Lender that is an existing Lender, there is an increase in
such Lender's Revolving Credit Commitment) and (y) any Revolving Loans are then
outstanding, the Increasing Lender shall purchase a pro rata participating
interest in the Revolving Loans of each of the other Lenders of such Class. If
breakage costs for LIBOR Loans would result from such purchases, to the extent
Revovling Loans are outstanding as Base Rate Loans, such Increasing Lender shall
first purchase its participating interest in Base Rate Loans, but to the extent
a Increasing Lender purchases a participation in LIBOR Loans pursuant to this
Section 2.20(b), any breakage costs incurred as a result of such purchases shall
be reimbursed by the Borrower in accordance with Section 2.18
(c) The amount of the Commitments and obligations of all Lenders
party hereto prior to the addition of the Revolving Credit Commitment of any
Increasing Lender shall not be affected by the addition of such Increasing
Lender, other than the resulting adjustment to the pro rata share which each
Lender has of the aggregate Commitments and Loans of the Increasing Lender's
Class(es), it being intended that the Increasing Lender's Commitment(s) and
Loans shall be pari passu with those of the other Lenders of the same Class.
(d) Notwithstanding the foregoing, no Revolver Increase pursuant
to this Section 2.20 shall be effective unless (i) no Default of Event of
Default shall have occurred and be continuing on the date of notice requesting
such Revolver Increase or on the effective date of such increase, and (ii) the
representations and warranties set forth in Article IV shall be true and correct
on and as of each of said dates if made on and as of said dates.
ARTICLE III
CONDITIONS OF BORROWING
3.1 Conditions of Closing. The effectiveness of this Agreement and
the amendment and restatement of the Existing Credit Agreement effected hereby
is subject to the following conditions precedent:
(a) The Administrative Agent shall have received the following, each
dated as of the Closing Date (unless otherwise specified) and, except for the
Notes, in sufficient copies for each Lender:
(i) a Tranche B Term Note for each Lender that is a party
hereto as of the Closing Date, in the amount of such Lender's Tranche B
Commitment;
(ii) the Subsidiary Guaranty, duly completed and executed by
each Subsidiary of the Borrower necessary to comply with Section 5.10;
48
(iii) the Pledge Agreement, duly completed and executed by the
Borrower and each Subsidiary of the Borrower necessary to comply with
Section 5.10, together with any certificates evidencing the Capital
Stock being pledged thereunder as of the Closing Date (including
undated assignments separate from certificate for any such certificate,
duly executed in blank) and all other filings, recordings,
registrations and other actions (including without limitation the
filing of duly completed UCC-1 financing staements) necessary or, in
the reasonable opinion of the Adminsitrative Agent, desirable to
perfect the Liens created by the Pledge Agreement; and
(iv) the favorable opinions of Xxxxxxxx Xxxxxx Xxxxx &
Xxxxxxx, P.C., special counsel to the Borrower, in substantially the
form of Exhibit F, in each case addressed to the Administrative Agent
and the Lenders and addressing such other matters as the Administrative
Agent or any Lender may reasonably request, and copies of each opinion
required to be delivered by counsel to the Borrower pursuant to the
Xxxxx Acquisition Documentation, accompanied in each case by a reliance
letter, unless such opinion is addressed to the Administrative Agent
and Lenders or expressly includes a reliance provision, from the
counsel rendering such opinion, stating that the Administrative Agent
(on behalf of the Lenders) is entitled to rely on such opinion as if it
were addressed to the Administrative Agent and the Lenders and
addressing such other matters as the Administrative Agent may
reasonably request.
(b) The Administrative Agent shall have received a certificate,
signed by the president, the chief executive officer or the chief financial
officer of the Borrower, in form and substance satisfactory to the
Administrative Agent, certifying that (i) all representations and warranties of
the Borrower contained in this Agreement and the other Credit Documents are true
and correct as of the Closing Date, both immediately before and after giving
effect to the consummation of the Transactions, (ii) no Default or Event of
Default has occurred and is continuing, both immediately before and after giving
effect to the consummation of the Transactions, (iii) both immediately before
and after giving effect to the consummation of the Transactions, no Material
Adverse Change has occurred since December 31, 2001, and there exists no event,
condition or state of facts that could reasonably be expected to result in a
Material Adverse Change, and (iv) all conditions to the initial extensions of
credit hereunder set forth in this Section and in Section 3.2 have been
satisfied or waived as required hereunder.
(c) The Administrative Agent shall have received a certificate of
the secretary or an assistant secretary of each of the Borrower and the
Subsidiary Guarantors, in form and substance satisfactory to the Administrative
Agent, certifying (i) that attached thereto is a true and complete copy of the
articles or certificate of incorporation and all amendments thereto of the
Borrower or such Subsidiary Guarantor, as the case may be, certified as of a
recent date by the Secretary of State (or comparable Governmental Authority) of
its jurisdiction of organization, and that the same has not been amended since
the date of such certification, (ii) that attached thereto is a true and
complete copy of the bylaws of the Borrower or such Subsidiary Guarantor, as the
case may be, as then in effect and as in effect at all times from the date on
which the resolutions referred to in clause (iii) below were adopted to and
including the date of such certificate, and (iii) that attached thereto is a
true and complete copy of resolutions adopted by the board of directors of the
Borrower or such Subsidiary Guarantor, as the case may be, authorizing the
execution, delivery and performance of this Agreement and the other Credit
49
Documents to which it is a party, and as to the incumbency and genuineness of
the signature of each officer of the Borrower or such Subsidiary Guarantor, as
the case may be, executing this Agreement or any of such other Credit Documents,
and attaching all such copies of the documents described above.
(d) The Administrative Agent shall have received a certificate as
of a recent date of the good standing of each of the Borrower and the Subsidiary
Guarantors under the laws of its jurisdiction of organization, from the
Secretary of State (or comparable Governmental Authority) of such jurisdiction.
(e) All legal matters, documentation, and corporate or other
proceedings incident to the Transactions shall be satisfactory in form and
substance to the Administrative Agent; all approvals, permits and consents of
any Governmental Authorities or other Persons required in connection with the
execution and delivery of this Agreement and the other Transaction Documents and
the consummation of the Transactions shall have been obtained, without the
imposition of conditions that are not acceptable to the Administrative Agent,
and all related filings, if any, shall have been made, and all such approvals,
permits, consents and filings shall be in full force and effect and the
Administrative Agent shall have received such copies thereof as it shall have
requested; all applicable waiting periods shall have expired without any adverse
action being taken by any Governmental Authority having jurisdiction; and no
action, proceeding, investigation, regulation or legislation shall have been
instituted, threatened or proposed before, and no order, injunction or decree
shall have been entered by, any court or other Governmental Authority, in each
case to enjoin, restrain or prohibit, to obtain substantial damages in respect
of, or that is otherwise related to or arises out of, this Agreement, any of the
other Transaction Documents or the consummation of the Transactions, or that, in
the opinion of the Administrative Agent, could reasonably be expected to have a
Material Adverse Effect.
(f) The corporate and capital structure of the Borrower and its
Subsidiaries, after giving effect to the Xxxxx Acquisition and the Transactions,
including without limitation the terms and conditions of any preferred and
common stock or other equity securities issued by the Borrower, shall be
satisfactory to the Required Lenders.
(g) The Administrative Agent shall have received the following at
least five (5) days prior to the Closing Date, each of which shall be made no
earlier than thirty (30) days prior to the Closing Date and be in form and
substance satisfactory to the Administrative Agent, certified search reports
from an independent search service satisfactory to the Administrative Agent
listing any tax lien, judgment or pending suit or Uniform Commercial Code
financing statement that names the Borrower or any of the Subsidiary Guarantors
as debtor or defendant, as appropriate.
(h) Since December 31, 2001, both immediately before and after
giving effect to the Xxxxx Acquisition and the other Transactions, there shall
not have occurred any Material Adverse Change or any event, condition or state
of facts that could reasonably be expected to result in a Material Adverse
Change.
(i) The Borrower shall have paid (i) to Wachovia Securities, Inc.,
the unpaid balance of the fees described in paragraph (1) of the 2002 Fee
Letter, (ii) to the Administrative Agent, the
50
initial payment of the annual administrative fee described in paragraph (3) of
the 2001 Fee Letter, as amended by the 2002 Fee Letter, and (iii) all other fees
and expenses of the Administrative Agent and the Lenders required hereunder or
under any other Credit Document to be paid on or prior to the Closing Date
(including fees and expenses of counsel) in connection with this Agreement and
the transactions contemplated hereby.
(j) The Administrative Agent shall have received a Financial
Condition Certificate, together with the Pro Forma Balance Sheet and the
Projections as described in Sections 4.11(c) and 4.11(d), all of which shall be
in form and substance satisfactory to the Administrative Agent.
(k) The Administrative Agent shall have received an Account
Designation Letter, together with written instructions from an Authorized
Officer, including wire transfer information, directing the payment of the
proceeds of the initial Loans to be made hereunder.
(l) The Borrower shall have obtained a senior secured debt rating
from Standard & Poor's Ratings Services and Xxxxx'x Investors Service, Inc.
(m) Prior to or substantially concurrently with making the Tranche
B Term Loans hereunder, the Xxxxx Acquisition shall have been consummated in
accordance with the terms of the Xxxxx Acquisition Documents and the other
Transaction Documents, and such terms shall be in compliance with the Consent,
dated May 10, 2002, between the Borrower, the Administrative Agent and the
Required Lenders.
(n) The Administrative Agent shall have received a Covenant
Compliance Worksheet, duly completed and certified by the chief financial
officer of the Borrower and in form and substance satisfactory to the
Administrative Agent, demonstrating the Borrower's compliance with the financial
covenants set forth in Sections 6.1 through 6.3, determined on a pro forma basis
as of March 31, 2002, and assuming that the making of the initial Loans
hereunder and consummation of the Xxxxx Acquisition and the other Transactions
had occurred on such date.
(o) The Administrative Agent shall have received all documents,
certificates and opinions required under Section 4.11.
(p) There shall not be any bankruptcy or insolvency proceeding
pending or threatened with respect to the Borrower or any Subsidiary, nor any
pending or threatened litigation, proceeding injunction, order or claim against
or affecting the Borrower or any Subsidiary or any of their respective
properties (i) that would, if adversely determined, be reasonably likely to have
a Material Adverse Effect, or (ii) with respect to this Agreement, any of the
other Credit Documents, the Xxxxx Acquisition or any of the other Transaction
Documents.
(q) The Administrative Agent and each Lender shall have received
such other documents, certificates, opinions and instruments in connection with
the transactions contemplated hereby as it shall have reasonably requested,
including the Xxxxx Acquisition Documents and other Transaction Documents.
3.2 Conditions of All Borrowings. The obligation of each Lender
to make any Loans hereunder, including any Loans made on the Closing Date (but
excluding Revolving Loans made
51
for the purpose of repaying Refunded Swingline Loans pursuant to Section 2.2(e))
is subject to the satisfaction of the following conditions precedent on the
relevant Borrowing Date or date of issuance:
(a) The Administrative Agent shall have received a Notice of
Borrowing in accordance with Section 2.2(b), or (together with the Swingline
Lender) a Notice of Swingline Borrowing in accordance with Section 2.2(d), as
applicable;
(b) Each of the representations and warranties contained in Article
IV and in the other Credit Documents shall be true and correct on and as of such
Borrowing Date (including the Closing Date, in the case of the initial Loans
made hereunder) or date of issuance with the same effect as if made on and as of
such date, both immediately before and after giving effect to the Loans to be
made (except to the extent any such representation or warranty is expressly
stated to have been made as of a specific date, in which case such
representation or warranty shall be true and correct in all material respects as
of such date); and
(c) No Default or Event of Default shall have occurred and be
continuing on such date, both immediately before and after giving effect to the
Loans to be made on such date.
Each giving of a Notice of Borrowing or a Notice of Swingline Borrowing, and the
consummation of each Borrowing, shall be deemed to constitute a representation
by the Borrower that the statements contained in subsections (b) and (c) above
are true, both as of the date of such notice or request and as of the relevant
Borrowing Date.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this
Agreement and to induce the Lenders to extend the credit contemplated hereby,
the Borrower represents and warrants to the Administrative Agent and the
Lenders, both before and after giving effect to the Transactions, as follows:
4.1 Corporate Organization and Power. Each of the Borrower and the
Subsidiary Guarantors (i) is a corporation or limited liability company duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (ii) has the full corporate or other power and
authority to execute, deliver and perform the Credit Documents to which it is or
will be a party, to own and hold its property and to engage in its business as
presently conducted, and (iii) is duly qualified to do business as a foreign
entity and is in good standing in each jurisdiction where the nature of its
business or the ownership of its properties requires it to be so qualified,
except where the failure to be so qualified would not, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect.
4.2 Authorization; Enforceability. Each of the Borrower and the
Subsidiary Guarantors has taken, or on the Closing Date will have taken, all
necessary corporate or other action to execute, deliver and perform each of the
Credit Documents to which it is or will be a party, and has, or on the Closing
Date (or any later date of execution and delivery) will have,
52
validly executed and delivered each of the Credit Documents to which it is or
will be a party. This Agreement constitutes, and each of the other Credit
Documents upon execution and delivery will constitute, the legal, valid and
binding obligation of each of the Borrower and the Subsidiary Guarantors that is
a party hereto or thereto, enforceable against it in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally, by general equitable principles or by principles of good faith and
fair dealing.
4.3 No Violation. The execution, delivery and performance by
each of the Borrower and the Subsidiary Guarantors of this Agreement and each of
the other Transaction Documents to which it is or will be a party, and
compliance by it with the terms hereof and thereof, do not and will not (i)
violate any provision of its articles or certificate of incorporation (or, if
applicable, articles or certificate of organization) or bylaws (or, if
applicable, operating agreement) or contravene any other Requirement of Law
applicable to it, (ii) conflict with, result in a breach of or constitute (with
notice, lapse of time or both) a default under any indenture, agreement or other
instrument to which it is a party, by which it or any of its properties is bound
or to which it is subject, or (iii) result in or require the creation or
imposition of any Lien upon any of its properties or assets. No Subsidiary is a
party to any agreement or instrument or otherwise subject to any restriction or
encumbrance that restricts or limits its ability to make dividend payments or
other distributions in respect of its Capital Stock, to repay Indebtedness owed
to the Borrower or any other Subsidiary, to make loans or advances to the
Borrower or any other Subsidiary, or to transfer any of its assets or properties
to the Borrower or any other Subsidiary, in each case other than such
restrictions or encumbrances existing under or by reason of the Credit Documents
or applicable Requirements of Law.
4.4 Governmental and Third-Party Authorization; Permits.
(a) No consent, approval, authorization or other action by, notice
to, or registration or filing with, any Governmental Authority or other Person
is or will be required as a condition to or otherwise in connection with the due
execution, delivery and performance by each of the Borrower and its Subsidiaries
of this Agreement or any of the other Credit Documents to which it is or will be
a party or the legality, validity or enforceability hereof or thereof, other
than consents and filings the failure to obtain or make which would not,
individually or in the aggregate, have a Material Adverse Effect.
(b) Each of the Borrower and the Subsidiary Guarantors has, and is
in good standing with respect to, all governmental approvals, licenses, permits
and authorizations necessary to conduct its business as presently conducted and
to own or lease and operate its properties, except for those the failure to
obtain which would not be reasonably likely, individually or in the aggregate,
to have a Material Adverse Effect.
4.5 Litigation. There are no actions, investigations, suits or
proceedings pending or, to the knowledge of the Borrower, threatened, at law, in
equity or in arbitration, before any court, other Governmental Authority or
other Person, (i) against or affecting the Borrower, any of its Subsidiaries or
any of their respective properties that would, if adversely determined, be
reasonably likely to have a Material Adverse Effect, or (ii) with respect to
this Agreement or any of the other Credit Documents.
53
4.6 Taxes. Each of the Borrower and the Subsidiary Guarantors has
timely filed all federal, state and local tax returns and reports required to be
filed by it and has paid all taxes, assessments, fees and other charges levied
upon it or upon its properties that are shown thereon as due and payable, other
than those that are being contested in good faith and by proper proceedings and
for which adequate reserves have been established in accordance with GAAP. Such
returns accurately reflect in all material respects all liability for taxes of
the Borrower and the Subsidiary Guarantors for the periods covered thereby.
There is no ongoing audit or examination or, to the knowledge of the Borrower,
other investigation by any Governmental Authority of the tax liability of the
Borrower or any of the Subsidiary Guarantors, and there is no unresolved claim
by any Governmental Authority concerning the tax liability of the Borrower or
any of the Subsidiary Guarantors for any period for which tax returns have been
or were required to have been filed, other than claims for which adequate
reserves have been established in accordance with GAAP. Neither the Borrower nor
any of the Subsidiary Guarantors has waived or extended or has been requested to
waive or extend the statute of limitations relating to the payment of any taxes.
4.7 Subsidiaries. Schedule 4.7 sets forth a list, as of the Closing
Date, of all of the Subsidiaries of the Borrower and, as to each such
Subsidiary, whether such Subsidiary has assets or existing operations. Except
for the shares of capital stock expressly indicated on Schedule 4.7, there are
no shares of capital stock, warrants, rights, options or other equity
securities, or other Capital Stock of any Subsidiary of the Borrower outstanding
or reserved for any purpose. All outstanding shares of capital stock of each
Subsidiary of the Borrower are duly and validly issued, fully paid and
nonassessable.
4.8 Full Disclosure. All factual information heretofore or
contemporaneously furnished to the Administrative Agent or any Lender in writing
by or on behalf of the Borrower or any of the Subsidiary Guarantors for purposes
of or in connection with this Agreement and the Transactions is, and all other
such factual information hereafter furnished to the Administrative Agent or any
Lender in writing by or on behalf of the Borrower or any of the Subsidiary
Guarantors will be, true and accurate in all material respects on the date as of
which such information is dated or certified (or, if such information has been
amended or supplemented, on the date as of which any such amendment or
supplement is dated or certified) and not made incomplete by omitting to state a
material fact necessary to make the statements contained therein, in light of
the circumstances under which such information was provided, not misleading.
4.9 Margin Regulations. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying
Margin Stock. No proceeds of the Loans will be used, directly or indirectly, to
purchase or carry any Margin Stock (other than Borrower Margin Stock purchased
in accordance with Section 7.6), to extend credit for such purpose or for any
other purpose that would violate or be inconsistent with Regulations T, U or X
or any provision of the Exchange Act.
4.10 No Material Adverse Change. There has been no Material Adverse
Change since December 31, 2001, and there exists no event, condition or state of
facts that could reasonably be expected to result in a Material Adverse Change.
54
4.11 Financial Matters.
(a) The Borrower has heretofore furnished to the Administrative
Agent copies of the (i) audited consolidated balance sheets of the Borrower and
its Subsidiaries as of December 31, 2001, 2000, and 1999, and the related
statements of income, cash flows and stockholders' equity for the fiscal years
then ended, together with the opinion of Ernst & Young, LLP thereon, and (ii)
the unaudited consolidated balance sheet of the Borrower and its Subsidiaries as
of March 31, 2002 and the related statements of income, cash flows and
stockholders' equity for the three-month period then ended. Such financial
statements have been prepared in accordance with GAAP (subject, with respect to
the unaudited financial statements, to the absence of notes required by GAAP and
to normal year-end adjustments) and present fairly the financial condition of
the Borrower and its Subsidiaries on a consolidated basis as of the respective
dates thereof and the consolidated results of operations of the Borrower and its
Subsidiaries for the respective periods then ended. Except as fully reflected in
the most recent financial statements referred to above and the notes thereto,
there are no material liabilities or obligations with respect to the Borrower or
any of its Subsidiaries of any nature whatsoever (whether absolute, contingent
or otherwise and whether or not due).
(b) The Borrower has heretofore furnished to the Administrative
Agent copies of the (i) audited consolidated balance sheets of Xxxxx and its
Subsidiaries as of December 31, 2001, 2000, and 1999, and the related statements
of income, cash flows and members' equity for the fiscal years then ended, and
(ii) the unaudited consolidated balance sheet of Xxxxx and its Subsidiaries as
of March 31, 2002 and the related statements of income, cash flows and members
equity for the three-month period then ended. Such financial statements have
been prepared in accordance with GAAP (subject, with respect to the unaudited
financial statements, to the absence of notes required by GAAP and to normal
year-end adjustments) and present fairly the financial condition of Xxxxx and
its Subsidiaries on a consolidated basis as of the respective dates thereof and
the consolidated results of operations of Xxxxx and its Subsidiaries for the
respective periods then ended. Except as fully reflected in the most recent
financial statements referred to above and the notes thereto, there are no
material liabilities or obligations with respect to Xxxxx or any of its
Subsidiaries of any nature whatsoever (whether absolute, contingent or otherwise
and whether or not due).
(c) The unaudited pro forma balance sheet and income statement of
the Borrower as of March 31, 2002, copies of which have heretofore been
delivered to the Administrative Agent, give pro forma effect to the consummation
of the Transactions, all as if such events had occurred on such date (the "Pro
Forma Balance Sheet"). The Pro Forma Balance Sheet has been prepared in
accordance with GAAP (subject to the absence of footnotes required by GAAP and
subject to normal year-end adjustments) and, subject to stated assumptions made
in good faith and having a reasonable basis set forth therein, presents fairly
the financial condition of the Borrower on an unaudited pro forma basis as of
the date set forth therein after giving effect to the consummation of the
transactions described above.
(d) The Borrower has prepared, and has heretofore furnished to the
Administrative Agent a copy of, annual projected balance sheets and statements
of income and cash flows of the Borrower for the six-year period beginning with
the year ending December 31, 2002 and ending with the year ending December 31,
2007, giving effect to the Transactions (the "Projections").
55
In the opinion of management of the Borrower, the assumptions used in the
preparation of the Projections were fair, complete and reasonable when made and
continue to be fair, complete and reasonable as of the date hereof. The
Projections have been prepared in good faith by the executive and financial
personnel of the Borrower, are complete and represent a reasonable estimate of
the future performance and financial condition of the Borrower, subject to the
uncertainties and approximations inherent in any projections.
(e) Each of the Borrower and the Subsidiary Guarantors, after giving
effect to the consummation of the transactions contemplated hereby, (i) has
capital sufficient to carry on its businesses as conducted and as proposed to be
conducted, (ii) has assets with a fair saleable value, determined on a going
concern basis, (y) not less than the amount required to pay the probable
liability on its existing debts as they become absolute and matured and (z)
greater than the total amount of its liabilities (including identified
contingent liabilities, valued at the amount that can reasonably be expected to
become absolute and matured), and (iii) does not intend to, and does not believe
that it will, incur debts or liabilities beyond its ability to pay such debts
and liabilities as they mature.
4.12 Ownership of Properties. Except for minor defects and
irregularities which, individually or in the aggregate, do not materially impair
the practical use thereof for its intended purposes, each of the Borrower and
its Subsidiaries (i) has good and marketable title to all real property owned by
it, (ii) holds interests as lessee under valid leases in full force and effect
with respect to all material leased real and personal property used in
connection with its business, (iii) possesses or has rights to use licenses,
patents, copyrights, trademarks, service marks, trade names and other assets
sufficient to enable it to continue to conduct its business substantially as
heretofore conducted and without any material conflict with the rights of
others, and (iv) has good title to all of its other properties and assets
reflected in the most recent financial statements referred to in Section 4.11(a)
(except as sold or otherwise disposed of since the date thereof in the ordinary
course of business), in each case under (i), (ii), (iii) and (iv) above free and
clear of all Liens other than Permitted Liens.
4.13 ERISA.
(a) Each of the Borrower and its ERISA Affiliates is in compliance
in all material respects with the applicable provisions of ERISA, and each Plan
is and has been administered in compliance in all material respects with all
applicable Requirements of Law, including, without limitation, the applicable
provisions of ERISA and the Internal Revenue Code, except where the failure to
do so, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect. No ERISA Event (i) has occurred within the
five-year period prior to the Closing Date, (ii) has occurred and is continuing,
or (iii) to the knowledge of the Borrower, is reasonably expected to occur with
respect to any Plan. No Plan has any Unfunded Pension Liability as of the most
recent annual valuation date applicable thereto, and neither the Borrower nor
any ERISA Affiliate has engaged in a transaction that could be subject to
Section 4069 or 4212(c) of ERISA.
(b) Neither the Borrower nor any ERISA Affiliate has had a complete
or partial withdrawal from any Multiemployer Plan, and neither the Borrower nor
any ERISA Affiliate would become subject to any liability under ERISA if the
Borrower or any ERISA Affiliate were
56
to withdraw completely from all Multiemployer Plans as of the most recent
valuation date. No Multiemployer Plan is in "reorganization" or is "insolvent"
within the meaning of such terms under ERISA.
4.14 Environmental Matters.
(a) To the knowledge of the Borrower, no Hazardous Substances are or
have been generated, used, located, released, treated, disposed of or stored by
the Borrower or any of its Subsidiaries or by any other Person (including any
predecessor in interest) or otherwise, in, on or under any portion of any real
property, leased or owned, of the Borrower or any of its Subsidiaries, except in
material compliance with all applicable Environmental Laws, and no portion of
any such real property or, to the knowledge of the Borrower, any other real
property at any time leased, owned or operated by the Borrower or any of its
Subsidiaries, has been contaminated by any Hazardous Substance; and no portion
of any real property, leased or owned, of the Borrower or any of its
Subsidiaries has been or is presently the subject of an environmental audit,
assessment or remedial action.
(b) No portion of any real property, leased or owned, of the
Borrower or any of its Subsidiaries has been used by the Borrower or any of its
Subsidiaries or, to the knowledge of the Borrower, by any other Person, as or
for a mine, a landfill, a dump or other disposal facility, a gasoline service
station, or (other than for petroleum substances stored in the ordinary course
of business) a petroleum products storage facility; no portion of such real
property or any other real property at any time leased, owned or operated by the
Borrower or any of its Subsidiaries has, pursuant to any Environmental Law, been
placed on the "National Priorities List" or "CERCLIS List" (or any similar
federal, state or local list) of sites subject to possible environmental
problems; and there are not and have never been any underground storage tanks
situated on any real property, leased or owned, of the Borrower or any of its
Subsidiaries.
(c) To the knowledge of the Borrower, all activities and operations
of the Borrower and its Subsidiaries are in compliance with all material
requirements of all applicable Environmental Laws, except to the extent the
failure so to comply, individually or in the aggregate, would not be reasonably
likely to have a Material Adverse Effect. Each of the Borrower and its
Subsidiaries has obtained all licenses and permits under Environmental Laws
necessary to its respective operations; all such licenses and permits are being
maintained in good standing; and each of the Borrower and its Subsidiaries is in
substantial compliance with all terms and conditions of such licenses and
permits, except for such licenses and permits the failure to obtain, maintain or
comply with which would not be reasonably likely, individually or in the
aggregate, to have a Material Adverse Effect. Neither the Borrower nor any of
its Subsidiaries is involved in any suit, action or proceeding, or has received
any notice, complaint or other request for information from any Governmental
Authority or other Person, with respect to any actual or alleged Environmental
Claims that, if adversely determined, would be reasonably likely, individually
or in the aggregate, to have a Material Adverse Effect; and, to the knowledge of
the Borrower, there are no threatened actions, suits, proceedings or
investigations with respect to any such Environmental Claims, nor any basis
therefor.
4.15 Compliance With Laws. Each of the Borrower and its Subsidiaries
has timely filed all material reports, documents and other materials required to
be filed by it under all
57
applicable Requirements of Law with any Governmental Authority, has retained all
material records and documents required to be retained by it under all
applicable Requirements of Law, and is otherwise in compliance with all
applicable Requirements of Law in respect of the conduct of its business and the
ownership and operation of its properties, except for such Requirements of Law
the failure to comply with which, individually or in the aggregate, would not be
reasonably likely to have a Material Adverse Effect.
4.16 Regulated Industries. Except as set forth on Schedule 4.16,
neither the Borrower nor any of its Subsidiaries is (i) an "investment company,"
a company "controlled" by an "investment company," or an "investment advisor,"
within the meaning of the Investment Company Act of 1940, as amended, or (ii) a
"holding company," a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
4.17 Insurance. The assets, properties and business of the Borrower
and its Subsidiaries are insured against such hazards and liabilities, under
such coverages and in such amounts, as are customarily maintained by prudent
companies similarly situated and under policies issued by insurers of recognized
responsibility.
4.18 Material Contracts. Schedule 4.18 lists, as of the Closing Date,
each "material contract" (within the meaning of Item 601(b)(10) of Regulation
S-K under the Exchange Act) to which the Borrower or any of its Subsidiaries is
a party, by which any of them or their respective properties is bound or to
which any of them is subject (collectively, "Material Contracts"). As of the
Closing Date, (i) each Material Contract is in full force and effect and is
enforceable by the Borrower or the Subsidiary that is a party thereto in
accordance with its terms, and (ii) neither the Borrower nor any of its
Subsidiaries (nor, to the knowledge of the Borrower, any other party thereto) is
in breach of or default under any Material Contract in any material respect or
has given notice of termination or cancellation of any Material Contract.
4.19 Labor Relations. To the knowledge of the Borrower, neither the
Borrower nor any of its Subsidiaries is engaged in any unfair labor practice
within the meaning of the National Labor Relations Act of 1947, as amended.
There is (i) no unfair labor practice complaint before the National Labor
Relations Board, or grievance or arbitration proceeding arising out of or under
any collective bargaining agreement, pending or, to the knowledge of the
Borrower, threatened, against the Borrower or any of its Subsidiaries, (ii) no
strike, lock-out, slowdown, stoppage, walkout or other labor dispute pending or,
to the knowledge of the Borrower, threatened, against the Borrower or any of its
Subsidiaries, and (iii) to the knowledge of the Borrower, no petition for
certification or union election or union organizing activities taking place with
respect to the Borrower or any of its Subsidiaries.
4.20 Transaction Documents. The Borrower has heretofore delivered, or
will on or prior to the Closing Date deliver, to the Administrative Agent a
true, complete and correct copy of each of the Xxxxx Acquisition Documents, in
each case together with all schedules and exhibits referred to therein or
delivered pursuant thereto and all amendments and modifications thereto. Each
such Xxxxx Acquisition Document (together with all schedules and exhibits
thereto) comprises, or upon execution and delivery on or prior to the Closing
Date will comprise,
58
a full and complete copy of all agreements between the parties thereto with
respect to the subject matter thereof, and there are no, and will not then be
any other agreements or understandings or side agreements not contained therein
that relate to or modify the substance thereof. Each such Xxxxx Acquisition
Document is, or upon execution and delivery on or prior to the Closing Date will
be, in full force and effect.
4.21 Xxxxx Acquisition. As of the Closing Date, the Xxxxx Acquisition
will have been consummated in accordance with the terms of the Xxxxx Acquisition
Documents and all applicable Requirements of Law, and the Borrower will be the
direct or indirect legal owner of all of the outstanding Capital Stock of Xxxxx,
free and clear of any Liens other than Liens granted under the Security
Documents.
ARTICLE V
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that, until the termination of the
Commitments and the payment in full of all principal and interest with respect
to the Loans together with all other amounts then due and owing hereunder:
5.1 Financial Statements. The Borrower will deliver to each Lender:
(a) As soon as available and in any event within fifty (50) days
after the end of each of the first three fiscal quarters of each fiscal year,
beginning with the fiscal quarter ending June 30, 2002, unaudited consolidated
and consolidating balance sheets of the Borrower and its Subsidiaries as of the
end of such fiscal quarter and unaudited consolidated statements of income, cash
flows and stockholders' equity and unaudited consolidating statements of income
for the Borrower and its Subsidiaries for the fiscal quarter then ended and for
that portion of the fiscal year then ended, in each case setting forth
comparative consolidated (or consolidating) figures as of the end of and for the
corresponding period in the preceding fiscal year, all in reasonable detail and
prepared in accordance with GAAP (subject to the absence of notes required by
GAAP and subject to normal year-end adjustments) applied on a basis consistent
with that of the preceding quarter or containing disclosure of the effect on the
financial condition or results of operations of any change in the application of
accounting principles and practices during such quarter; and
(b) As soon as available and in any event within ninety-five (95)
days after the end of each fiscal year, beginning with the fiscal year ending
December 31, 2002 (i) an audited consolidated balance sheet of the Borrower and
its Subsidiaries as of the end of such fiscal year and audited consolidated
statements of income, cash flows and stockholders' equity for the Borrower and
its Subsidiaries for the fiscal year then ended, including the notes thereto, in
each case setting forth comparative figures as of the end of and for the
preceding fiscal year together with comparative budgeted figures for the fiscal
year then ended, all in reasonable detail and certified by the independent
certified public accounting firm regularly retained by the Borrower or another
independent certified public accounting firm of recognized national standing
reasonably acceptable to the Required Lenders, together with (y) a report
thereon by such accountants that is not qualified as to going concern or scope
of audit and to the effect that such
59
financial statements present fairly the consolidated financial condition and
results of operations of the Borrower and its Subsidiaries as of the dates and
for the periods indicated in accordance with GAAP applied on a basis consistent
with that of the preceding year or containing disclosure of the effect on the
financial condition or results of operations of any change in the application of
accounting principles and practices during such year, and (z) a report by such
accountants to the effect that, based on and in connection with their
examination of the financial statements of the Borrower and its Subsidiaries,
they obtained no knowledge of the occurrence or existence of any Default or
Event of Default relating to accounting or financial reporting matters, or a
statement specifying the nature and period of existence of any such Default or
Event of Default disclosed by their audit; provided, however, that such
accountants shall not be liable by reason of the failure to obtain knowledge of
any Default or Event of Default that would not be disclosed or revealed in the
course of their audit examination, and (ii) an unaudited consolidating balance
sheet of the Borrower and its Subsidiaries as of the end of such fiscal year and
unaudited consolidating statements of income for the fiscal year then ended, all
in reasonable detail.
5.2 Other Business and Financial Information. The Borrower will
deliver to each Lender:
(a) Commencing with the quarter ending June 30, 2002, concurrently
with each delivery of the financial statements described in Section 5.1, a
Compliance Certificate with respect to the period covered by the financial
statements then being delivered, executed by a Financial Officer of the
Borrower, together with a Covenant Compliance Worksheet reflecting the
computation of the financial covenants set forth in Sections 6.1 through 6.3 as
of the last day of the period covered by such financial statements; provided,
however, that the Compliance Certificate delivered with respect to the financial
statements delivered pursuant to Section 5.1(a) for June 30, 2002 shall be
prepared on a pro forma basis in accordance with GAAP as if the Xxxxx
Acquisition had occurred on such date and any Indebtedness incurred, assumed or
acquired by the Borrower or a Subsidiary in connection with the Xxxxx
Acquisition had been Indebtedness of the Borrower for such period;
(b) As soon as available and in any event within forty-five (45)
days after the end of each fiscal year, beginning with the fiscal year ending
December 31, 2002, consolidated projections for the Borrower and its
Subsidiaries for the succeeding fiscal year, consisting of a consolidated
balance sheet and consolidated statements of income and cash flows, together
with a certificate of a Financial Officer of the Borrower to the effect that
such projections have been prepared in good faith and are reasonable estimates
of the financial position and results of operations of the Borrower and its
Subsidiaries for the period covered thereby; and as soon as available from time
to time thereafter, any modifications or revisions to or restatements of such
projections;
(c) Promptly upon receipt thereof, copies of any "management letter"
submitted to the Borrower or any of its Subsidiaries by its certified public
accountants in connection with each annual, interim or special audit, and
promptly upon completion thereof, any response reports from the Borrower or any
such Subsidiary in respect thereof;
(d) Promptly upon the sending, filing or receipt thereof, copies
of (i) all financial statements, reports, notices and proxy statements that the
Borrower or any of its Subsidiaries
60
shall send or make available generally to its shareholders, (ii) all regular,
periodic and special reports, registration statements and prospectuses (other
than on Form S-8) that the Borrower or any of its Subsidiaries shall render to
or file with the Securities and Exchange Commission, the National Association of
Securities Dealers, Inc. or any national securities exchange, and (iii) all
press releases and other statements made available generally by the Borrower or
any of its Subsidiaries to the public concerning material developments in the
business of the Borrower or any of its Subsidiaries;
(e) Promptly upon the sending or receipt thereof, copies of all
notices or other correspondence that the Borrower shall send to, or receive
from, the holders of the American Phoenix Acquisition Indebtedness or the
trustee therefor;
(f) Promptly upon receipt thereof by the Borrower, copies of all
financial statements for Xxxxx received pursuant to the Xxxxx Acquisition
Documentation;
(g) Promptly upon (and in any event within five (5) Business Days
after) any Responsible Officer of the Borrower obtaining knowledge thereof,
written notice of any of the following:
(i) the occurrence of any Default or Event of Default,
together with a written statement of a Responsible Officer of the
Borrower specifying the nature of such Default or Event of Default, the
period of existence thereof and the action that the Borrower has taken
and proposes to take with respect thereto;
(ii) the institution or threatened institution of any action,
suit, investigation or proceeding against or affecting the Borrower or
any of its Subsidiaries, including any such investigation or proceeding
by any Governmental Authority (other than routine periodic inquiries,
investigations or reviews), that would, if adversely determined, be
reasonably likely, individually or in the aggregate, to have a Material
Adverse Effect, and any material development in any litigation or other
proceeding previously reported pursuant to Section 4.5 or this
subsection;
(iii) the receipt by the Borrower or any of its Subsidiaries
from any Governmental Authority of (y) any notice asserting any failure
by the Borrower or any of its Subsidiaries to be in compliance with
applicable Requirements of Law or that threatens the taking of any
action against the Borrower or such Subsidiary or sets forth
circumstances that, if taken or adversely determined, would be
reasonably likely to have a Material Adverse Effect, or (z) any notice
of any actual or threatened suspension, limitation or revocation of,
failure to renew, or imposition of any restraining order, escrow or
impoundment of funds in connection with, any license, permit,
accreditation or authorization of the Borrower or any of its
Subsidiaries, where such action would be reasonably likely to have a
Material Adverse Effect;
(iv) the occurrence of any ERISA Event, together with (x) a
written statement of a Responsible Officer of the Borrower specifying
the details of such ERISA Event and the action that the Borrower has
taken and proposes to take with respect thereto, (y) a copy of any
notice with respect to such ERISA Event that may be required to be
filed
61
with the PBGC and (z) a copy of any notice delivered by the PBGC to
the Borrower or such ERISA Affiliate with respect to such ERISA Event;
(v) the occurrence of any material default under, or any
proposed or threatened termination or cancellation of, any Material
Contract or other material contract or agreement to which the Borrower
or any of its Subsidiaries is a party, the termination or cancellation
of which would be reasonably likely to have a Material Adverse Effect;
(vi) the occurrence of any of the following: (x) the assertion
of any Environmental Claim against or affecting the Borrower, any of
its Subsidiaries or any of their respective real property, leased or
owned; (y) the receipt by the Borrower or any of its Subsidiaries of
notice of any alleged violation of or noncompliance with any
Environmental Laws; or (z) the taking of any remedial action by the
Borrower, any of its Subsidiaries or any other Person in response to
the actual or alleged generation, storage, release, disposal or
discharge of any Hazardous Substances on, to, upon or from any real
property leased or owned by the Borrower or any of its Subsidiaries;
but in each case under clauses (x), (y) and (z) above, only to the
extent the same would be reasonably likely to have a Material Adverse
Effect; and
(vii) any other matter or event that has, or would be
reasonably likely to have, a Material Adverse Effect, together with a
written statement of a Responsible Officer of the Borrower setting
forth the nature and period of existence thereof and the action that
the Borrower has taken and proposes to take with respect thereto; and
(h) As promptly as reasonably possible, such other information about
the business, condition (financial or otherwise), operations or properties of
the Borrower or any of its Subsidiaries (including any Plan and any information
required to be filed under ERISA) as the Administrative Agent or any Lender may
from time to time reasonably request.
5.3 Corporate Existence; Franchises; Maintenance of Properties. The
Borrower will, and will cause each of its Subsidiaries to, (i) maintain and
preserve in full force and effect its corporate existence, except as expressly
permitted otherwise by Section 7.1, (ii) obtain, maintain and preserve in full
force and effect all other rights, franchises, licenses, permits,
certifications, approvals and authorizations required by Governmental
Authorities and necessary to the ownership, occupation or use of its properties
or the conduct of its business, except to the extent the failure to do so would
not be reasonably likely to have a Material Adverse Effect, and (iii) keep all
material properties in good working order and condition (normal wear and tear
excepted) and from time to time make all necessary repairs to and renewals and
replacements of such properties, except to the extent that any of such
properties are obsolete or are being replaced. Nothing contained in this Section
5.3 shall prevent either the Borrower or a Subsidiary from discontinuing any
part of the business of either the Borrower or such Subsidiary if the
discontinuance is in the best interest of the Borrower and after giving effect
thereto, no Default or Event of Default would exist.
5.4 Compliance with Laws. The Borrower will, and will cause each of
its Subsidiaries to, comply in all material respects with all Requirements of
Law applicable in respect of the conduct of its business and the ownership and
operation of its properties, except to
62
the extent the failure so to comply would not be reasonably likely to have a
Material Adverse Effect. Nothing contained herein shall prevent either the
Borrower or its Subsidiaries form contesting in good faith by appropriate
proceedings any Requirement of Law.
5.5 Payment of Obligations. The Borrower will, and will cause each
of its Subsidiaries to, (i) pay all liabilities and obligations as and when due
(subject to any applicable subordination provisions), except to the extent
failure to do so would not be reasonably likely to have a Material Adverse
Effect, and (ii) pay and discharge all taxes, assessments and governmental
charges or levies imposed upon it, upon its income or profits or upon any of its
properties, prior to the date on which penalties would attach thereto, and all
lawful claims that, if unpaid, might become a Lien upon any of the properties of
the Borrower or any of its Subsidiaries; provided, however, that neither the
Borrower nor any of its Subsidiaries shall be required to pay any such tax,
liability, obligation, assessment, charge, levy or claim that is reasonably
being contested in good faith and by proper proceedings as to assessment,
applicability, amount or validity and as to which the Borrower or such
Subsidiary is maintaining adequate reserves with respect thereto in accordance
with GAAP.
5.6 Insurance. The Borrower will, and will cause each of its
Subsidiaries to, maintain with financially sound and reputable insurance
companies insurance with respect to its assets, properties and business, against
such hazards and liabilities, of such types and in such amounts, as is
customarily maintained by companies in the same or similar businesses similarly
situated.
5.7 Maintenance of Books and Records; Inspection. The Borrower will,
and will cause each of its Subsidiaries to, (i) maintain adequate books,
accounts and records, in which full, true and correct entries shall be made of
all financial transactions in relation to its business and properties, and
prepare all financial statements required under this Agreement, in each case in
accordance with GAAP and in compliance with the requirements of any Governmental
Authority having jurisdiction over it, and (ii) subject to Section 10.13, permit
employees or agents of the Administrative Agent or any Lender to inspect its
properties and examine or audit its books, records, working papers and accounts
and make copies and memoranda of them, and to discuss its affairs, finances and
accounts with its officers and employees and, upon notice to the Borrower, the
independent public accountants of the Borrower and its Subsidiaries (and by this
provision the Borrower authorizes such accountants to discuss the finances and
affairs of the Borrower and its Subsidiaries), all at such times and from time
to time, upon reasonable notice and during business hours, as may be reasonably
requested.
5.8 Permitted Acquisitions.
(a) Subject to the provisions of subsection (b) below and the
requirements contained in the definition of Permitted Acquisition, and subject
to the other terms and conditions of this Agreement, the Borrower may from time
to time on or after the Closing Date effect Permitted Acquisitions, provided
that, with respect to each Permitted Acquisition:
(i) no Default or Event of Default shall have occurred and
be continuing at the time of the consummation of such Permitted
Acquisition or would exist immediately after giving effect thereto;
63
(ii) after giving effect to such Permitted Acquisition and
any Borrowings made in connection therewith, the Borrower will be in
compliance with the financial covenants contained in Sections 6.1
through 6.3, in each case such compliance determined with regard to
calculations made on a pro forma basis in accordance with GAAP as if
any Indebtedness incurred, assumed or acquired by the Borrower or a
Subsidiary in connection with such Permitted Acquisition had been
Indebtedness of the Borrower for those periods applicable to such
covenants;
(iii) the Acquisition Amount with respect thereto together
with the aggregate of the Acquisition Amounts for all other
Acquisitions consummated during the same fiscal quarter or the period
of three consecutive fiscal quarters immediately prior thereto (but
specifically excluding, if applicable, any Acquisitions consummated on
or prior to the Closing Date) shall not exceed $100,000,000;
(iv) the Acquisition Amount (without regard to the issuance
of any Capital Stock of the Borrower) with respect thereto together
with the aggregate (without duplication) of (A) the Acquisition Amounts
(without regard to the issuance of any Capital Stock of the Borrower)
for all other Acquisitions consummated during the same fiscal quarter
or the period of three consecutive fiscal quarters immediately prior
thereto (but specifically excluding, if applicable, any Acquisitions
consummated on or prior to the Closing Date), and (B) the amount of
cash paid by the Borrower and its Subsidiaries in connection with
earnout and contingent obligations during the same fiscal quarter or
the period of three consecutive fiscal quarters immediately prior
thereto for all Acquisitions, shall not exceed $75,000,000;
(v) the Acquisition Amount (without regard to the issuance
of any Capital Stock of the Borrower) with respect thereto paid,
assumed or incurred by the Borrower and its Subsidiaries for all
Permitted Acquisitions consummated after the Closing Date shall not
exceed $35,000,000 during any period of four consecutive fiscal
quarters; and
(vi) the Acquisition Amount with respect thereto together
with the aggregate of the Acquisition Amounts for all other Permitted
Acquisitions consummated after the Closing Date shall not exceed
$375,000,000.
(b) Not less than ten (10) Business Days prior to the consummation
of any Permitted Acquisition with respect to which the Acquisition Amount
exceeds $25,000,000, the Borrower shall have delivered to the Administrative
Agent and each Lender the following:
(i) a reasonably detailed description of the material terms
of such Permitted Acquisition (including, without limitation, the
purchase price and method and structure of payment) and of each Person
or business that is the subject of such Permitted Acquisition (each, a
"Target");
(ii) historical financial statements of the Target (or, if
there are two or more Targets that are the subject of such Permitted
Acquisition and that are part of the same consolidated group,
consolidated historical financial statements for all such Targets) for
64
the two (2) most recent fiscal years available and, if available, for
any interim periods since the most recent fiscal year-end;
(iii) consolidated projected income statements of the Borrower
and its Subsidiaries (giving effect to such Permitted Acquisition and
the consolidation with the Borrower of each relevant Target) for the
three-year period following the consummation of such Permitted
Acquisition, in reasonable detail, together with any appropriate
statement of assumptions and pro forma adjustments; and
(iv) a certificate, in form and substance reasonably
satisfactory to the Administrative Agent, executed by a Financial
Officer of the Borrower setting forth the Acquisition Amount and
further to the effect that, to the best of such individual's knowledge,
(x) the consummation of such Permitted Acquisition will not result in a
violation of any provision of this Section (the calculations of the
financial covenants determined in accordance with Section 5.8(a)(ii) to
be attached to the certificate), (y) the Borrower believes in good
faith that it will continue to comply with such financial covenants for
a period of one year following the date of the consummation of such
Permitted Acquisition, and (z) after giving effect to such Permitted
Acquisition and any Borrowings in connection therewith, the Borrower
believes in good faith that it will have sufficient availability under
the Revolving Credit Commitments to meet its ongoing working capital
requirements.
(c) As soon as reasonably practicable after the consummation of any
Permitted Acquisition with respect to which the Acquisition Amount exceeds
$25,000,000 (or with respect to any other Permitted Acquisition of lesser
amount, upon the written request of any Lender), the Borrower will deliver to
the Administrative Agent and each Lender a copy of the fully executed
acquisition agreement (including material schedules and exhibits thereto) and
other material documents and closing papers delivered in connection therewith.
(d) The consummation of each Permitted Acquisition shall be deemed
to be a representation and warranty by the Borrower that (except as shall have
been approved in writing by the Required Lenders) all conditions thereto set
forth in this Section and in the description furnished under clause (i) of
subsection (b) above have been satisfied, that the same is permitted in
accordance with the terms of this Agreement, and that the matters certified to
by the Financial Officer of the Borrower in the certificate referred to in
clause (iv) of subsection (b) above are, to the best of such individual's
knowledge, true and correct in all material respects as of the date such
certificate is given, which representation and warranty shall be deemed to be a
representation and warranty as of the date thereof for all purposes hereunder,
including, without limitation, for purposes of Sections 3.2 and 8.1.
5.9 Creation or Acquisition of Subsidiaries. Subject to the
provisions of Section 7.5, the Borrower may from time to time create or acquire
new Wholly Owned Subsidiaries in connection with Permitted Acquisitions or
otherwise, and the Wholly Owned Subsidiaries of the Borrower may create or
acquire new Wholly Owned Subsidiaries, provided that, if required by Section
5.10, concurrently with (and in any event within ten (10) Business Days
thereafter) the creation or direct or indirect acquisition by the Borrower or a
Subsidiary thereof,
65
(a) each such new Subsidiary will execute and deliver to the
Administrative Agent a joinder to the Subsidiary Guaranty pursuant to which such
new Subsidiary shall become a party thereto and shall guarantee the payment in
full of the Obligations of the Borrower under this Agreement and the other
Credit Documents; and
(b) all the Capital Stock of such new Subsidiary will be pledged to
the Administrative Agent as follows: (i) if the Borrower directly owns any of
the Capital Stock of such new Subsidiary, the Borrower will execute and deliver
to the Administrative Agent an amendment or supplement to the Pledge Agreement
pursuant to which all such Capital Stock shall be pledged to the Administrative
Agent, together with the certificates evidencing such Capital Stock and undated
stock powers duly executed in blank; and (ii) if any of the Capital Stock of
such new Subsidiary is owned by another Subsidiary of the Borrower (the "Parent
Subsidiary"), to the extent not already covered by the Pledge Agreement, the
Parent Subsidiary will execute and deliver to the Administrative Agent an
appropriate joinder, amendment or supplement to the Pledge Agreement, pursuant
to which all of the Capital Stock of such new Subsidiary owned by such Parent
Subsidiary shall be pledged to the Administrative Agent, together with the
certificates evidencing such Capital Stock and undated stock powers duly
executed in blank.
5.10 Subsidiary Guarantors; Pledge of Capital Stock. The Borrower
will cause (i) each of its Subsidiaries that has assets or active operations
(other than those Subsidiaries identified on Schedule 5.10 hereto) to be, at all
times, a Subsidiary Guarantor and (ii) all of the Capital Stock of the
Subsidiary Guarantors to be pledged to the Administrative Agent on terms
satisfactory to it. If the Borrower sells or otherwise disposes of all of the
Capital Stock of any Subsidiary Guarantor pursuant to any Asset Disposition
permitted by Section 7.4, the Administrative Agent shall (x) release such
Subsidiary Guarantor from its obligations under the Subsidiary Guaranty and (y)
release any Liens it may have with respect to such Capital Stock, and (z) upon
reasonable notice, return to the Borrower any certificate evidencing such
Capital Stock. Notwithstanding anything in this Section 5.10 to the contrary,
with respect to any Foreign Subsidiary, the Capital Stock of such Foreign
Subsidiary will not be pledged under the Pledge Agreement and such Foreign
Subsidiary will not be required to be a Subsidiary Guarantor hereunder to the
extent that pledging a percentage of Capital Stock of such Foreign Subsidiary
under the Security Documents exceeding 65% or the providing a Subsidiary
Guaranty by such Foreign Subsidiary would have a materially negative tax impact
on the Borrower, and the Administrative Agent receives a certificate of a
Financial Officer of the Borrower to such effect.
5.11 Further Assurances. The Borrower will, and will cause each
of its Subsidiaries to, make, execute, endorse, acknowledge and deliver any
amendments, modifications or supplements hereto and restatements hereof and any
other agreements, instruments or documents, and take any and all such other
actions, as may from time to time be reasonably requested by the Administrative
Agent or the Required Lenders to effect, confirm or further assure or protect
and preserve the interests, rights and remedies of the Administrative Agent and
the Lenders under this Agreement and the other Credit Documents.
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ARTICLE VI
FINANCIAL COVENANTS
The Borrower covenants and agrees that, until the termination of the
Commitments and the payment in full of all principal and interest with respect
to the Loans together with all other amounts then due and owing hereunder:
6.1 Leverage Ratio. The Borrower will not permit the Leverage Ratio
as of the last day of any fiscal quarter during the periods set forth below to
be greater than the ratio set forth below opposite such period:
Maximum
Date Leverage Ratio
---- --------------
September 30, 2002 through 2.25 : 1.00
December 31, 2003
Thereafter 2.00 : 1.00
6.2 Fixed Charge Coverage Ratio. The Borrower will not permit the
Fixed Charge Coverage Ratio as of the last day of any fiscal quarter during the
periods set forth below to be less than the ratio set forth below opposite such
period:
Minimum Fixed Charge
Date Coverage Ratio
---- --------------
September 30, 2002 through 1.25 : 1.0
December 31, 2004
Thereafter 1.50 : 1.0
6.3 Cash Flow Coverage Ratio. The Borrower will not permit the Cash
Flow Coverage Ratio as of the last day of any fiscal quarter during the periods
set forth below to be less than the ratio set forth below opposite such period:
Minimum Cash Flow
Date Coverage Ratio
---- --------------
September 30, 2002 through
December 31, 2003 3.50 : 1.0
January 1, 2004 through
December 31, 2004 3.75 : 1.0
Thereafter 4.00 : 1.0
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ARTICLE VII
NEGATIVE COVENANTS
The Borrower covenants and agrees that, until the termination of the
Commitments and the payment in full of all principal and interest with respect
to the Loans together with all other amounts then due and owing hereunder:
7.1 Merger; Consolidation. The Borrower will not, and will not
permit or cause any of its Subsidiaries to, liquidate, wind up or dissolve, or
enter into any consolidation, merger or other combination, or agree to do any of
the foregoing; provided, however, that:
(i) the Borrower may merge or consolidate with another
Person so long as (x) the Borrower is the surviving entity, (y) unless
such other Person is a Wholly Owned Subsidiary immediately prior to
giving effect thereto, such merger or consolidation shall constitute a
Permitted Acquisition and the applicable conditions and requirements of
Sections 5.8 and 5.9 shall be satisfied, and (z) immediately after
giving effect thereto, no Default or Event of Default would exist; and
(ii) any Subsidiary may merge or consolidate with another
Person so long as (x) the surviving entity is the Borrower or a
Subsidiary Guarantor, (y) unless such other Person is a Wholly Owned
Subsidiary immediately prior to giving effect thereto, such merger or
consolidation shall constitute a Permitted Acquisition and the
applicable conditions and requirements of Sections 5.8 and 5.9 shall be
satisfied, and (z) immediately after giving effect thereto, no Default
or Event of Default would exist.
7.2 Indebtedness. The Borrower will not, and will no t permit or
cause any of its Subsidiaries to, create, incur, assume or suffer to exist any
Indebtedness other than:
(i) Indebtedness incurred under this Agreement, the Notes
and the Subsidiary Guaranty;
(ii) Indebtedness existing on the Closing Date and described
in Schedule 7.2.1;
(iii) accrued expenses (including salaries, accrued vacation
and other compensation), current trade or other accounts payable and
other current liabilities arising in the ordinary course of business
and not incurred through the borrowing of money, provided that the same
shall be paid when due except to the extent being contested in good
faith and by appropriate proceedings;
(iv) loans and advances by the Borrower or any Subsidiary
Guarantors to any other Subsidiary Guarantor or by any Subsidiary
Guarantor to the Borrower, provided that any such loan or advance is
subordinated in right and time of payment to the Obligations;
(v) the American Phoenix Acquisition Indebtedness;
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(vi) Indebtedness of the Borrower under Hedge Agreements the
effect of which is to fix or limit interest rates payable by Borrower
as to the Loans;
(vii) unsecured Indebtedness (and secured Indebtedness to the
Persons indicated by an asterisk on Schedule 7.2.2) of the Borrower or
its Subsidiaries issued in connection with a Permitted Acquisition to a
Target or its securityholders at the time of such Acquisition that is
evidenced by one or more written agreements or instruments which shall
provide that such Indebtedness (a) shall have covenants and
undertakings that, taken as a whole, are materially less restrictive
than those contained herein, and (b) shall bear a cash interest rate
not exceeding 12.5% per annum, which Indebtedness shall not exceed
$35,000,000 in aggregate principal amount outstanding at any time and
which Indebtedness outstanding on the date hereof is set forth on
Schedule 7.2.2 (the Indebtedness described hereinabove, "Acquisition
Indebtedness"), it being understood that such Acquisition Indebtedness
shall include similar "seller-financed" Indebtedness of a Target that
is assumed by the Borrower or its Subsidiaries in connection with a
Permitted Acquisition;
(viii) earnout and contingent obligations due and owing by the
Borrower or its Subsidiaries in connection with Permitted Acquisitions
or Acquisitions consummated before the date hereof and set forth on
Schedule 7.2.3;
(ix) cash earnout and contingent obligations due and owing by
the Borrower or its Subsidiaries in connection with Permitted
Acquisitions or Acquisitions, not to exceed $30,000,000 at any time;
(x) purchase money Indebtedness of the Borrower and its
Subsidiaries incurred solely to finance the payment of all or part of
the purchase price of any equipment, real property or other fixed
assets acquired in the ordinary course of business, including
Indebtedness in respect of capital lease obligations, and any renewals,
refinancings or replacements thereof (subject to the limitations on the
principal amount thereof set forth in this clause (ix)), which
Indebtedness shall not exceed $7,500,000 in aggregate principal amount
outstanding at any time;
(xi) reimbursement obligations with respect to secured letters
of credit issued to support reinsurance agreements between HRH Captive
and CNA in an aggregate stated amount not to exceed $5,000,000; and
(xii) other unsecured Indebtedness not exceeding $10,000,000
in aggregate principal amount outstanding at any time.
7.3 Liens. The Borrower will not, and will not permit or cause
any of its Subsidiaries to, directly or indirectly, make, create, incur, assume
or suffer to exist, any Lien upon or with respect to any part of its property or
assets, whether now owned or hereafter acquired, or file or permit the filing
of, or permit to remain in effect, any financing statement or other similar
notice of any Lien with respect to any such property, asset, income or profits
under the Uniform Commercial Code of any state or under any similar recording or
notice statute, or agree to do any of the foregoing, other than the following
(collectively, "Permitted Liens"):
69
(i) Liens in existence on the Closing Date and set forth on
Schedule 7.3;
(ii) Liens imposed by law, such as Liens of carriers,
warehousemen, mechanics, materialmen and landlords, and other similar
Liens incurred in the ordinary course of business for sums not
constituting borrowed money that are not overdue for a period of more
than thirty (30) days or that are being contested in good faith by
appropriate proceedings and for which adequate reserves have been
established in accordance with GAAP (if so required);
(iii) Liens (other than any Lien imposed by ERISA, the
creation or incurrence of which would result in an Event of Default
under Section 8.1(k)) incurred in the ordinary course of business in
connection with worker's compensation, unemployment insurance or other
forms of governmental insurance or benefits, or to secure the
performance of letters of credit, bids, tenders, statutory obligations,
surety and appeal bonds, leases, government contracts and other similar
obligations (other than obligations for borrowed money) entered into in
the ordinary course of business;
(iv) Liens for taxes, assessments or other governmental
charges or statutory obligations that are not delinquent or remain
payable without any penalty or that are being contested in good faith
by appropriate proceedings and for which adequate reserves have been
established in accordance with GAAP (if so required);
(v) Liens securing the purchase money Indebtedness permitted
under Section 7.2(x), provided that any such Lien (a) shall attach to
such property concurrently with or within ten (10) days after the
acquisition thereof by the Borrower or such Subsidiary, (b) shall not
exceed the lesser of (y) the fair market value of such property or (z)
the cost thereof to the Borrower or such Subsidiary and (c) shall not
encumber any other property of the Borrower or any of its Subsidiaries;
(vi) any attachment or judgment Lien not constituting an Event
of Default under Section 8.1(i) that is being contested in good faith
by appropriate proceedings and for which adequate reserves have been
established in accordance with GAAP (if so required);
(vii) Liens arising from the filing, for notice purposes only,
of financing statements in respect of true leases;
(viii) Liens on Borrower Margin Stock, to the extent the fair
market value thereof exceeds 25% of the fair market value of the assets
of the Borrower and its Subsidiaries (including Borrower Margin Stock);
(ix) with respect to any real property occupied by the
Borrower or any of its Subsidiaries, all easements, rights of way,
licenses and similar encumbrances on title that do not materially
impair the use of such property for its intended purposes;
(x) Liens on cash and marketable securities securing
Indebtedness permitted under Section 7.2(xi); and
70
(xi) other Liens securing obligations of the Borrower and its
Subsidiaries not exceeding $5,000,000 in aggregate amount outstanding
at any time.
7.4 Disposition of Assets. The Borrower will not, and will not
permit or cause any of its Subsidiaries to, sell, assign, lease, convey,
transfer or otherwise dispose of (whether in one or a series of transactions)
all or any portion of its assets, business or properties (including, without
limitation, any Capital Stock of any Subsidiary), or enter into any arrangement
with any Person providing for the lease by the Borrower or any Subsidiary as
lessee of any asset that has been sold or transferred by the Borrower or such
Subsidiary to such Person, or agree to do any of the foregoing, except for:
(i) the sale or exchange of used or obsolete equipment to
the extent (y) the proceeds of such sale are applied towards, or such
equipment is exchanged for, replacement or substitute equipment or (z)
such equipment is no longer necessary for the operations of the
Borrower or its applicable Subsidiary in the ordinary course of
business;
(ii) the sale or other disposition by the Borrower and its
Subsidiaries of any Borrower Margin Stock to the extent the fair market
value thereof exceeds 25% of the fair market value of the assets of the
Borrower and its Subsidiaries (including Borrower Margin Stock),
provided that fair value is received in exchange therefor;
(iii) the sale, lease or other disposition of assets by a
Subsidiary of the Borrower to the Borrower or to a Subsidiary if,
immediately after giving effect thereto, no Default or Event of Default
would exist; and
(iv) the sale or disposition of assets outside the ordinary
course of business for fair value and for cash, provided that (w) the
Net Cash Proceeds from such sales or dispositions, when aggregated with
the Net Cash Proceeds from all other sales and dispositions not
otherwise specifically permitted under this Section that are
consummated during the same fiscal quarter or the period of three
consecutive fiscal quarters immediately prior thereto, do not exceed
$30,000,000 in the aggregate for the Borrower and its Subsidiaries
during any fiscal year, (x) such Net Cash Proceeds are delivered to the
Administrative Agent promptly after receipt thereof for application in
prepayment of the Loans in accordance with, and to the extent required
under, the provisions of Section 2.6(f), (y) in no event shall the
Borrower or any of its Subsidiaries sell or otherwise dispose of any of
the Capital Stock of any Subsidiary Guarantor, and (z) immediately
after giving effect thereto, no Default or Event of Default would
exist.
7.5 Investments. The Borrower will not, and will not permit or cause
any of its Subsidiaries to, directly or indirectly, purchase, own, invest in or
otherwise acquire any Capital Stock, evidence of indebtedness or other
obligation or security or any interest whatsoever in any other Person, or make
or permit to exist any loans, advances or extensions of credit to, or any
investment in cash or by delivery of property in, any other Person, or purchase
or otherwise acquire (whether in one or a series of related transactions) any
portion of the assets, business or properties of another Person (including
pursuant to an Acquisition), or create or acquire any Subsidiary, or become a
partner or joint venturer in any partnership or joint venture (collectively,
"Investments"), or make a commitment or otherwise agree to do any of the
foregoing, other than:
71
(i) Cash Equivalents;
(ii) Investments consisting of purchases and acquisitions of
supplies, materials and equipment in the ordinary course of business,
(iii) Investments consisting of loans and advances to
employees for reasonable travel, relocation and business expenses in
the ordinary course of business, extensions of trade credit in the
ordinary course of business, and prepaid expenses incurred in the
ordinary course of business;
(iv) without duplication, Investments consisting of
intercompany Indebtedness permitted under clause (iv) of Section 7.2;
(v) Investments existing on the Closing Date and described
in Schedule 7.5;
(vi) Investments consisting of the making of capital
contributions or the purchase of Capital Stock (x) by the Borrower or
any Subsidiary in any other Wholly Owned Subsidiary (other than HRH
Captive) provided that the Borrower complies with the provisions of
Sections 5.8 and 5.9, and (y) by any Subsidiary in the Borrower;
(vii) Investments consisting of the making of capital
contributions or the purchase of Capital Stock in HRH Captive provided
that (x) the aggregate amount of the initial capital contribution by
the Borrower and its Subsidiaries shall not exceed $400,000 (y) the
aggregate amount of all subsequent capital contributions shall not
exceed $125,000, and (z) the only Person with which HRH Captive enters
into reinsurance agreements is CNA;
(viii) Permitted Acquisitions;
(ix) Investments consisting of receivables of Premium Funding
Associates, which receivables shall not exceed $30,000,000 at any time;
(x) Investments in connection with the Borrower's Deferred
Compensation Plans;
(xi) Investments in key man or split dollar life insurance
policies for certain officers and executives of the Borrower (and other
similar policies);
(xii) other Investments not exceeding $8,000,000 in the
aggregate at any time.
7.6 Restricted Payments.
(a) The Borrower will not, and will not permit or cause any of its
Subsidiaries to, directly or indirectly, declare or make any dividend payment,
or make any other distribution of cash, property or assets, in respect of any of
its Capital Stock or any warrants, rights or options to acquire its Capital
Stock, or purchase, redeem, retire or otherwise acquire for value any shares of
its Capital Stock or any warrants, rights or options to acquire its Capital
Stock, or set aside funds for any of the foregoing, except that:
72
(i) the Borrower may declare and make dividend payments or
other distributions payable solely in its common stock;
(ii) the Borrower may declare and make dividend payments or
other distributions in an aggregate amount not to exceed $20,000,000
during each fiscal year, provided that, in each case, immediately after
giving effect thereto, no Default or Event of Default would exist;
(iii) the Borrower may purchase, redeem, retire or otherwise
acquire shares of its Capital Stock (A) in order to fund its Deferred
Compensation Plans and (B) in addition thereto, in an aggregate amount
not to exceed $20,000,000 during any fiscal year, provided that, in
each case, immediately after giving effect thereto, no Default or Event
of Default would exist; and
(iv) each Subsidiary of the Borrower may declare and make
dividend payments or other distributions to the Borrower or another
Wholly Owned Subsidiary of the Borrower, to the extent not prohibited
under applicable Requirements of Law.
(b) The Borrower will not, and will not permit or cause any of its
Subsidiaries to, make (or give any notice in respect of) any voluntary or
optional payment or prepayment of principal on the American Phoenix Acquisition
Indebtedness or any Acquisition Indebtedness, or directly or indirectly make any
redemption (including pursuant to any change of control provision), retirement,
defeasance or other acquisition for value of the American Phoenix Acquisition
Indebtedness or any Acquisition Indebtedness, or make any deposit or otherwise
set aside funds for any of the foregoing purposes; provided, that nothing in
this Section shall prohibit:
(i) optional prepayments of cash earnout obligations in
respect of the Xxxxx Acquisition (so long as the Borrower notifies the
Administrative Agent in writing at least five (5) Business Days prior
to any such prepayment); and
(ii) other optional prepayments of Acquisition Indebtedness
not to exceed $3,000,000 in aggregate principal amount during any
fiscal year.
7.7 Transactions with Affiliates. The Borrower will not, and will
not permit or cause any of its Subsidiaries to, enter into any transaction
(including, without limitation, any purchase, sale, lease or exchange of
property or the rendering of any service) with any officer, director,
stockholder or other Affiliate of the Borrower or any Subsidiary, except in the
ordinary course of its business and upon fair and reasonable terms that are no
less favorable to it than would obtain in a comparable arm's length transaction
with a Person other than an Affiliate of the Borrower or such Subsidiary;
provided, however, that nothing contained in this Section shall prohibit:
(i) transactions described on Schedule 7.7 or otherwise
expressly permitted under this Agreement; and
(ii) the payment by the Borrower of reasonable and customary
fees to members of its board of directors.
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7.8 Lines of Business. The Borrower will not, and will not permit
or cause any of its Subsidiaries to, engage in any business other than the
businesses engaged in by it on the date hereof and businesses and activities
reasonably related thereto.
7.9 Certain Amendments. The Borrower will not, and will not permit
or cause any of its Subsidiaries to, (i) amend, modify or waive, or permit the
amendment, modification or waiver of, any provision of any agreement or
instrument evidencing or governing any the American Phoenix Acquisition
Indebtedness or Acquisition Indebtedness, the effect of which would be to (a)
increase the principal amount due thereunder, (b) shorten or accelerate the time
of payment of any amount due thereunder, (c) increase the applicable interest
rate or amount of any fees or costs due thereunder, (d) amend any of the
subordination provisions thereunder (including any of the definitions relating
thereto), (e) make any covenant therein more restrictive or add any new
covenant, or (f) otherwise materially and adversely affect the Lenders, or
breach or otherwise violate any of the subordination provisions applicable
thereto, including, without limitation, restrictions against payment of
principal and interest thereon, or (ii) amend, modify or change any provision of
its articles or certificate of incorporation or bylaws, or the terms of any
class or series of its Capital Stock, other than in a manner that could not
reasonably be expected to adversely affect the Lenders.
7.10 Limitation on Certain Restrictions. The Borrower will not, and
will not permit or cause any of its Subsidiaries to, directly or indirectly,
create or otherwise cause or suffer to exist or become effective any restriction
or encumbrance on (i) the ability of the Borrower and the Subsidiary Guarantors
to perform and comply with their respective obligations under the Credit
Documents or (ii) the ability of any Subsidiary of the Borrower to make any
dividend payments or other distributions in respect of its Capital Stock, to
repay Indebtedness owed to the Borrower or any other Subsidiary, to make loans
or advances to the Borrower or any other Subsidiary, or to transfer any of its
assets or properties to the Borrower or any other Subsidiary, in each case other
than such restrictions or encumbrances existing under or by reason of the Credit
Documents or applicable Requirements of Law.
7.11 No Other Negative Pledges. The Borrower will not, and will not
permit or cause any of its Subsidiaries to, directly or indirectly, enter into
or suffer to exist any agreement or restriction that prohibits or conditions the
creation, incurrence or assumption of any Lien upon or with respect to any part
of its property or assets, whether now owned or hereafter acquired, or agree to
do any of the foregoing, other than as set forth in (i) this Agreement, (ii) any
agreement or instrument creating a Permitted Lien (but only to the extent such
agreement or restriction applies to the assets subject to such Permitted Lien),
and (iii) operating leases of real or personal property entered into by the
Borrower or any of its Subsidiaries as lessee in the ordinary course of
business.
7.12 Fiscal Year. The Borrower will not, and will not permit or cause
any of its Subsidiaries to, change the ending date of its fiscal year to a date
other than December 31.
7.13 Accounting Changes. The Borrower will not, and will not permit
or cause any of its Subsidiaries to, make or permit any material change in its
accounting policies or reporting practices, except as may be required by GAAP.
74
ARTICLE VIII
EVENTS OF DEFAULT
8.1 Events of Default. The occurrence of any one or more of the
following events shall constitute an "Event of Default":
(a) The Borrower shall fail to pay any principal of any Loan when
due;
(b) The Borrower shall fail to pay any interest on any Loan, any fee
or any other Obligation when due, and such failure shall continue unremedied for
three (3) Business Days;
(c) The Borrower shall fail to observe, perform or comply with any
condition, covenant or agreement contained in any of Sections 2.14, 5.1, 5.2,
5.3(i), 5.8, 5.9, 5.10 or in Article VI or Article VII;
(d) The Borrower or any of its Subsidiaries shall fail to observe,
perform or comply with any condition, covenant or agreement contained in this
Agreement or any of the other Credit Documents other than those enumerated in
subsections (a), (b) and (c) above, and such failure (i) is deemed by the terms
of the relevant Credit Document to constitute an Event of Default or (ii) shall
continue unremedied for any grace period specifically applicable thereto or, if
no such grace period is applicable, for a period of thirty (30) days after the
earlier of (y) the date on which a Responsible Officer of the Borrower acquires
knowledge thereof and (z) the date on which written notice thereof is delivered
by the Administrative Agent or any Lender to the Borrower;
(e) Any representation or warranty made or deemed made by or on
behalf of the Borrower or any of its Subsidiaries in this Agreement, any of the
other Credit Documents or in any certificate, instrument, report or other
document furnished in connection herewith or therewith or in connection with the
transactions contemplated hereby or thereby shall prove to have been false or
misleading in any material respect as of the time made, deemed made or
furnished;
(f) The Borrower or any of its Subsidiaries shall (i) fail to pay
when due (whether by scheduled maturity, acceleration or otherwise and after
giving effect to any applicable grace period) (y) any principal of or interest
on any Indebtedness (other than the Indebtedness incurred pursuant to this
Agreement) having an aggregate principal amount of at least $4,000,000 or (z)
any termination or other payment under any Hedge Agreement covering a notional
amount of Indebtedness of at least $4,000,000 or (ii) fail to observe, perform
or comply with any condition, covenant or agreement contained in any agreement
or instrument evidencing or relating to any such Indebtedness, or any other
event shall occur or condition exist in respect thereof, and the effect of such
failure, event or condition is to cause, or permit the holder or holders of such
Indebtedness (or a trustee or agent on its or their behalf) to cause (with the
giving of notice, lapse of time, or both), such Indebtedness to become due, or
to be prepaid, redeemed, purchased or defeased, prior to its stated maturity;
(g) The Borrower or any of its Subsidiaries shall (i) file a
voluntary petition or commence a voluntary case seeking liquidation, winding-up,
reorganization, dissolution,
75
arrangement, readjustment of debts or any other relief under the Bankruptcy Code
or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, (ii) consent to the institution of, or fail to controvert
in a timely and appropriate manner, any petition or case of the type described
in subsection (h) below, (iii) apply for or consent to the appointment of or
taking possession by a custodian, trustee, receiver or similar official for or
of itself or all or a substantial part of its properties or assets, (iv) fail
generally, or admit in writing its inability, to pay its debts generally as they
become due, (v) make a general assignment for the benefit of creditors or (vi)
take any corporate action to authorize or approve any of the foregoing;
(h) Any involuntary petition or case shall be filed or commenced
against the Borrower or any of its Subsidiaries seeking liquidation, winding-up,
reorganization, dissolution, arrangement, readjustment of debts, the appointment
of a custodian, trustee, receiver or similar official for it or all or a
substantial part of its properties or any other relief under the Bankruptcy Code
or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, and such petition or case shall continue undismissed and
unstayed for a period of sixty (60) days; or an order, judgment or decree
approving or ordering any of the foregoing shall be entered in any such
proceeding;
(i) Any one or more money judgments, writs or warrants of
attachment, executions or similar processes involving an aggregate amount
(exclusive of amounts fully bonded or covered by insurance as to which the
surety or insurer, as the case may be, has acknowledged its liability in
writing) in excess of $2,000,000 shall be entered or filed against the Borrower
or any of its Subsidiaries or any of their respective properties and the same
shall not be dismissed, stayed or discharged for a period of thirty (30) days or
in any event later than five days prior to the date of any proposed sale
thereunder;
(j) Any Subsidiary of the Borrower party to the Subsidiary Guaranty
or any Person acting on behalf of any such Subsidiary shall deny or disaffirm
such Subsidiary's obligations under the Subsidiary Guaranty;
(k) Any ERISA Event or any other event or condition shall occur or
exist with respect to any Plan or Multiemployer Plan and, as a result thereof,
together with all other ERISA Events and other events or conditions then
existing, the Borrower and its ERISA Affiliates have incurred or would be
reasonably likely to incur liability to any one or more Plans or Multiemployer
Plans or to the PBGC (or to any combination thereof) in excess of $1,000,000;
(l) Any one or more licenses, permits, accreditations or
authorizations of the Borrower or any of its Subsidiaries shall be suspended,
limited or terminated or shall not be renewed, or any other action shall be
taken, by any Governmental Authority in response to any alleged failure by the
Borrower or any of its Subsidiaries to be in compliance with applicable
Requirements of Law, and such action, individually or in the aggregate, would be
reasonably likely to have a Material Adverse Effect;
(m) Any one or more Environmental Claims shall have been asserted
against the Borrower or any of its Subsidiaries (or a reasonable basis shall
exist therefor); the Borrower and its Subsidiaries have incurred or would be
reasonably likely to incur liability as a result thereof;
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and such liability, individually or in the aggregate, has or would be reasonably
likely to have a Material Adverse Effect;
(n) Any of the following shall occur: (i) any Person or group of
Persons acting in concert as a partnership or other group shall, as a result of
a tender or exchange offer, open market purchases, privately negotiated
purchases or otherwise, have become, after the date hereof, the "beneficial
owner" (within the meaning of such term under Rule 13d-3 under the Exchange Act)
of securities of the Borrower representing 25% or more of the combined voting
power of the then outstanding securities of the Borrower ordinarily (and apart
from rights accruing under special circumstances) having the right to vote in
the election of directors; or (ii) the Board of Directors of the Borrower shall
cease to consist of a majority of the individuals who constituted the Board of
Directors immediately following the consummation of the Transactions or who
shall have become a member thereof subsequent to the date hereof after having
been nominated, or otherwise approved in writing, by at least a majority of
individuals who constituted the Board of Directors of the Borrower immediately
following the consummation of the Transactions (or their replacements approved
as herein required).
8.2 Remedies: Termination of Commitments, Acceleration, etc. Upon
and at any time after the occurrence and during the continuance of any Event of
Default, the Administrative Agent shall at the direction, or may with the
consent, of the Required Lenders, take any or all of the following actions at
the same or different times:
(a) Declare the Commitments and the Swingline Commitment to be
terminated, whereupon the same shall terminate (provided that, upon the
occurrence of an Event of Default pursuant to Section 8.1(g) or Section 8.1(h),
the Commitments and the Swingline Commitment shall automatically be terminated);
(b) Declare all or any part of the outstanding principal amount of
the Loans to be immediately due and payable, whereupon the principal amount so
declared to be immediately due and payable, together with all interest accrued
thereon and all other amounts payable under this Agreement, the Notes and the
other Credit Documents, shall become immediately due and payable without
presentment, demand, protest, notice of intent to accelerate or other notice or
legal process of any kind, all of which are hereby knowingly and expressly
waived by the Borrower (provided that, upon the occurrence of an Event of
Default pursuant to Section 8.1(g) or Section 8.1(h), all of the outstanding
principal amount of the Loans and all other amounts described in this subsection
(b) shall automatically become immediately due and payable without presentment,
demand, protest, notice of intent to accelerate or other notice or legal process
of any kind, all of which are hereby knowingly and expressly waived by the
Borrower); and
(c) Exercise all rights and remedies available to it under this
Agreement, the other Credit Documents and applicable law.
8.3 Remedies: Set-Off. In addition to all other rights and remedies
available under the Credit Documents or applicable law or otherwise, upon and at
any time after the occurrence and during the continuance of any Event of
Default, each Lender may, and each is hereby authorized by the Borrower, at any
such time and from time to time, to the fullest extent permitted by applicable
law, without presentment, demand, protest or other notice of any kind,
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all of which are hereby knowingly and expressly waived by the Borrower, to set
off and to apply any and all deposits (general or special, time or demand,
provisional or final) and any other property at any time held (including at any
branches or agencies, wherever located), and any other indebtedness at any time
owing, by such Lender to or for the credit or the account of the Borrower
against any or all of the Obligations to such Lender now or hereafter existing,
whether or not such Obligations may be contingent or unmatured, the Borrower
hereby granting to each Lender a continuing security interest in and Lien upon
all such deposits and other property as security for such Obligations. Each
Lender agrees promptly to notify the Borrower and the Administrative Agent after
any such set-off and application; provided, however, that the failure to give
such notice shall not affect the validity of such set-off and application.
ARTICLE IX
THE ADMINISTRATIVE AGENT
9.1 Appointment. Each Lender hereby irrevocably appoints and
authorizes Wachovia to act as Administrative Agent hereunder and under the other
Credit Documents and to take such actions as Administrative Agent on its behalf
hereunder and under the other Credit Documents, and to exercise such powers and
to perform such duties, as are specifically delegated to the Administrative
Agent by the terms hereof or thereof, together with such other powers and duties
as are reasonably incidental thereto.
9.2 Nature of Duties. The Administrative Agent shall have no
duties or responsibilities other than those expressly set forth in this
Agreement and the other Credit Documents. The Administrative Agent shall not
have, by reason of this Agreement or any other Credit Document, a fiduciary
relationship in respect of any Lender; and nothing in this Agreement or any
other Credit Document, express or implied, is intended to or shall be so
construed as to impose upon the Administrative Agent any obligations or
liabilities in respect of this Agreement or any other Credit Document except as
expressly set forth herein or therein. The Administrative Agent may execute any
of its duties under this Agreement or any other Credit Document by or through
agents or attorneys-in-fact and shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact that it selects with reasonable
care. The Administrative Agent shall be entitled to consult with legal counsel,
independent public accountants and other experts selected by it with respect to
all matters pertaining to this Agreement and the other Credit Documents and its
duties hereunder and thereunder 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. The Lenders hereby acknowledge that the
Administrative Agent shall not be under any duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Credit Document unless it shall be requested in writing to do so by
the Required Lenders (or, where a higher percentage of the Lenders is expressly
required hereunder, such Lenders).
9.3 Exculpatory Provisions. Neither the Administrative Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (i) liable for any action taken or omitted to be taken by it
or such Person under or in connection with the Credit Documents, except for its
or such Person's own gross negligence or willful misconduct, (ii) responsible in
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any manner to any Lender for any recitals, statements, information,
representations or warranties herein or in any other Credit Document or in any
document, instrument, certificate, report or other writing delivered in
connection herewith or therewith, for the execution, effectiveness, genuineness,
validity, enforceability or sufficiency of this Agreement or any other Credit
Document, or for the financial condition of the Borrower, its Subsidiaries or
any other Person, or (iii) required to ascertain or make any inquiry concerning
the performance or observance of any of the terms, provisions or conditions of
this Agreement or any other Credit Document or the existence or possible
existence of any Default or Event of Default, or to inspect the properties,
books or records of the Borrower or any of its Subsidiaries.
9.4 Reliance by Administrative Agent. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any notice,
statement, consent or other communication (including, without limitation, any
thereof by telephone, telecopy, telex, telegram or cable) believed by it in good
faith to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons. The Administrative Agent may deem and treat each
Lender as the owner of its interest hereunder for all purposes hereof unless and
until a written notice of the assignment, negotiation or transfer thereof shall
have been given to the Administrative Agent in accordance with the provisions of
this Agreement. The Administrative Agent shall be entitled to refrain from
taking or omitting to take any action in connection with this Agreement or any
other Credit Document (i) if such action or omission would, in the reasonable
opinion of the Administrative Agent, violate any applicable law or any provision
of this Agreement or any other Credit Document or (ii) unless and until it shall
have received such advice or concurrence of the Required Lenders (or, where a
higher percentage of the Lenders is expressly required hereunder, such Lenders)
as it deems appropriate or it shall first have been indemnified to its
satisfaction by the Lenders against any and all liability and expense (other
than liability and expense arising from its own gross negligence or willful
misconduct) that may be incurred by it by reason of taking, continuing to take
or omitting to take any such action. Without limiting the foregoing, no Lender
shall have any right of action whatsoever against the Administrative Agent as a
result of the Administrative Agent's acting or refraining from acting hereunder
or under any other Credit Document in accordance with the instructions of the
Required Lenders (or, where a higher percentage of the Lenders is expressly
required hereunder, such Lenders), and such instructions and any action taken or
failure to act pursuant thereto shall be binding upon all of the Lenders
(including all subsequent Lenders).
9.5 Non-Reliance on Administrative Agent and Other Lenders. Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or Affiliates has
made any representation or warranty to it and that no act by the Administrative
Agent or any such Person hereinafter taken, including any review of the affairs
of the Borrower and its Subsidiaries, shall be deemed to constitute any
representation or warranty by the Administrative Agent to any Lender. Each
Lender represents to the Administrative Agent that (i) it has, independently and
without reliance upon the Administrative Agent or any other Lender and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, prospects, operations,
properties, financial and other condition and creditworthiness of the Borrower
and its Subsidiaries and made its own decision to enter into this Agreement and
extend credit to the Borrower hereunder, and (ii) it will, independently and
without reliance upon the Administrative Agent or any other Lender and based on
such documents and information as it shall deem
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appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action hereunder and under the other
Credit Documents and to make such investigation as it deems necessary to inform
itself as to the business, prospects, operations, properties, financial and
other condition and creditworthiness of the Borrower and its Subsidiaries.
Except as expressly provided in this Agreement and the other Credit Documents,
the Administrative Agent shall have no duty or responsibility, either initially
or on a continuing basis, to provide any Lender with any credit or other
information concerning the business, prospects, operations, properties,
financial or other condition or creditworthiness of the Borrower, its
Subsidiaries or any other Person that may at any time come into the possession
of the Administrative Agent or any of its officers, directors, employees,
agents, attorneys-in-fact or Affiliates.
9.6 Notice of Default. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
unless the Administrative Agent shall have received written notice from the
Borrower or a Lender referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default." In the
event that the Administrative Agent receives such a notice, the Administrative
Agent will give notice thereof to the Lenders as soon as reasonably practicable;
provided, however, that if any such notice has also been furnished to the
Lenders, the Administrative Agent shall have no obligation to notify the Lenders
with respect thereto. The Administrative Agent shall (subject to Sections 9.4
and 10.6) take such action with respect to such Default or Event of Default as
shall reasonably be directed by the Required Lenders; provided that, unless and
until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders except
to the extent that this Agreement expressly requires that such action be taken,
or not be taken, only with the consent or upon the authorization of the Required
Lenders or all of the Lenders.
9.7 Indemnification. To the extent the Administrative Agent is not
reimbursed by or on behalf of the Borrower, and without limiting the obligation
of the Borrower to do so, the Lenders agree (i) to indemnify the Administrative
Agent and its officers, directors, employees, agents, attorneys-in-fact and
Affiliates, ratably in proportion to their respective percentages as used in
determining the Required Lenders as of the date of determination, from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses (including, without limitation,
attorneys' fees and expenses) or disbursements of any kind or nature whatsoever
that may at any time (including, without limitation, at any time following the
repayment in full of the Loans and the termination of the Commitments) be
imposed on, incurred by or asserted against the Administrative Agent in any way
relating to or arising out of this Agreement or any other Credit Document or any
documents contemplated by or referred to herein or the transactions contemplated
hereby or thereby or any action taken or omitted by the Administrative Agent
under or in connection with any of the foregoing, and (ii) to reimburse the
Administrative Agent upon demand, ratably in proportion to their respective
percentages as used in determining the Required Lenders as of the date of
determination, for any expenses incurred by the Administrative Agent in
connection with the preparation, negotiation, execution, delivery,
administration, amendment, modification, waiver or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or
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responsibilities under, this Agreement or any of the other Credit Documents
(including, without limitation, reasonable attorneys' fees and expenses and
compensation of agents and employees paid for services rendered on behalf of the
Lenders); provided, however, that no Lender shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements to the extent resulting from the gross
negligence or willful misconduct of the party to be indemnified.
9.8 The Administrative Agent in its Individual Capacity. With respect
to its Commitment, the Loans made by it and the Note or Notes issued to it, the
Administrative Agent in its individual capacity and not as Administrative Agent
shall have the same rights and powers under the Credit Documents as any other
Lender and may exercise the same as though it were not performing the agency
duties specified herein; and the terms "Lenders," "Required Lenders," "holders
of Notes" and any similar terms shall, unless the context clearly otherwise
indicates, include the Administrative Agent in its individual capacity. The
Administrative Agent and its Affiliates may accept deposits from, lend money to,
make investments in, and generally engage in any kind of banking, trust,
financial advisory or other business with the Borrower, any of its Subsidiaries
or any of their respective Affiliates as if the Administrative Agent were not
performing the agency duties specified herein, and may accept fees and other
consideration from any of them for services in connection with this Agreement
and otherwise without having to account for the same to the Lenders.
9.9 Successor Administrative Agent. The Administrative Agent may
resign at any time by giving thirty (30) days' prior written notice to the
Borrower and the Lenders. Upon any such notice of resignation, the Required
Lenders will, with the prior written consent of the Borrower (which consent
shall not be unreasonably withheld), appoint from among the Lenders a successor
to the Administrative Agent (provided that the Borrower's consent shall not be
required in the event a Default or Event of Default shall have occurred and be
continuing). If no successor to the Administrative Agent shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within such thirty-day period, then the retiring Administrative Agent may, on
behalf of the Lenders and after consulting with the Lenders and the Borrower,
appoint a successor Administrative Agent from among the Lenders. Upon the
acceptance of any appointment as Administrative Agent by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations hereunder and under the
other Credit Documents. After any retiring Administrative Agent's resignation as
Administrative Agent, the provisions of this Article shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Administrative
Agent. If no successor to the Administrative Agent has accepted appointment as
Administrative Agent by the thirtieth (30th) day following a retiring
Administrative Agent's notice of resignation, the retiring Administrative
Agent's resignation shall nevertheless thereupon become effective, and the
Lenders shall thereafter perform all of the duties of the Administrative Agent
hereunder and under the other Credit Documents until such time, if any, as the
Required Lenders appoint a successor Administrative Agent as provided for
hereinabove.
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9.10 Swingline Lender. The provisions of this article (other than
Section 9.9) shall apply to the Swingline Lender mutatis mutandis to the same
extent as such provisions apply to the Administrative Agent.
9.11 Syndication Agent, Documentation Agent. Notwithstanding any
other provision of this Agreement or any of the other Credit Documents, the
Syndication Agent and the Documentation Agent are named as such for recognition
purposes only, and in their capacities as such shall have no powers, rights,
duties, responsibilities or liabilities with respect to this Agreement and the
other Credit Documents and the transactions contemplated hereby and thereby.
ARTICLE X
MISCELLANEOUS
10.1 Fees and Expenses. The Borrower agrees (i) whether or not the
transactions contemplated by this Agreement shall be consummated, to pay upon
demand all reasonable out-of-pocket costs and expenses of the Administrative
Agent and the Arranger (including, without limitation, the reasonable fees and
expenses of counsel to the Administrative Agent) in connection with (w) the
Administrative Agent's and the Arranger's due diligence investigation in
connection with, and the preparation, negotiation, execution, delivery and
syndication of, this Agreement and the other Credit Documents, and any
amendment, modification or waiver hereof or thereof or consent with respect
hereto or thereto, (ii) to pay upon demand all reasonable out-of-pocket costs
and expenses of the Administrative Agent and each Lender (including, without
limitation, reasonable attorneys' fees and expenses) in connection with (y) any
refinancing or restructuring of the credit arrangement provided under this
Agreement, whether in the nature of a "work-out," in any insolvency or
bankruptcy proceeding or otherwise and whether or not consummated, and (z) the
enforcement, attempted enforcement or preservation of any rights or remedies
under this Agreement or any of the other Credit Documents, whether in any
action, suit or proceeding (including any bankruptcy or insolvency proceeding)
or otherwise, and (iii) to pay and hold the Administrative Agent and each Lender
harmless from and against all liability for any intangibles, documentary, stamp
or other similar taxes, fees and excises, if any, including any interest and
penalties, and any finder's or brokerage fees, commissions and expenses (other
than any fees, commissions or expenses of finders or brokers engaged by the
Administrative Agent or any Lender), that may be payable in connection with the
transactions contemplated by this Agreement and the other Credit Documents.
10.2 Indemnification. The Borrower agrees, whether or not the
transactions contemplated by this Agreement shall be consummated, to indemnify
and hold the Arranger, the Administrative Agent and each Lender and each of
their respective directors, officers, employees, agents and Affiliates (each, an
"Indemnified Person") harmless from and against any and all claims, losses,
damages, obligations, liabilities, penalties, costs and expenses (including,
without limitation, reasonable attorneys' fees and expenses) of any kind or
nature whatsoever, whether direct, indirect or consequential (collectively,
"Indemnified Costs"), that may at any time be imposed on, incurred by or
asserted against any such Indemnified Person as a result of, arising from or in
any way relating to the preparation, execution, performance or enforcement of
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this Agreement or any of the other Credit Documents, any of the transactions
contemplated herein or therein or any transaction financed or to be financed in
whole or in part, directly or indirectly, with the proceeds of any Loans
(including, without limitation, in connection with the actual or alleged
generation, presence, discharge or release of any Hazardous Substances on, into
or from, or the transportation of Hazardous Substances to or from, any real
property at any time owned or leased by the Borrower or any of its Subsidiaries,
any other Environmental Claims or any violation of or liability under any
Environmental Law), or any action, suit or proceeding (including any inquiry or
investigation) by any Person, whether threatened or initiated, related to any of
the foregoing, and in any case whether or not such Indemnified Person is a party
to any such action, proceeding or suit or a subject of any such inquiry or
investigation; provided, however, that no Indemnified Person shall have the
right to be indemnified hereunder for any Indemnified Costs to the extent
resulting from the gross negligence or willful misconduct of such Indemnified
Person. All of the foregoing Indemnified Costs of any Indemnified Person shall
be paid or reimbursed by the Borrower, as and when incurred and upon demand.
10.3 Governing Law; Consent to Jurisdiction. THIS AGREEMENT AND THE
OTHER CREDIT DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE
CONFLICTS OF LAW PROVISIONS THEREOF). THE BORROWER HEREBY CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF ANY STATE COURT WITHIN MECKLENBURG COUNTY, NORTH
CAROLINA OR ANY FEDERAL COURT LOCATED WITHIN THE WESTERN DISTRICT OF THE STATE
OF NEW YORK FOR ANY PROCEEDING INSTITUTED HEREUNDER OR UNDER ANY OF THE OTHER
CREDIT DOCUMENTS, OR ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY
OF THE OTHER CREDIT DOCUMENTS, OR ANY PROCEEDING TO WHICH THE ADMINISTRATIVE
AGENT OR ANY LENDER OR THE BORROWER IS A PARTY, INCLUDING ANY ACTIONS BASED
UPON, ARISING OUT OF, OR IN CONNECTION WITH ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENT (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE
AGENT OR ANY LENDER OR THE BORROWER. THE BORROWER IRREVOCABLY AGREES TO BE BOUND
(SUBJECT TO ANY AVAILABLE RIGHT OF APPEAL) BY ANY JUDGMENT RENDERED OR RELIEF
GRANTED THEREBY AND FURTHER WAIVES ANY OBJECTION THAT IT MAY HAVE BASED ON LACK
OF JURISDICTION OR IMPROPER VENUE OR FORUM NON CONVENIENS TO THE CONDUCT OF ANY
SUCH PROCEEDING. THE BORROWER CONSENTS THAT ALL SERVICE OF PROCESS BE MADE BY
REGISTERED OR CERTIFIED MAIL DIRECTED TO IT AT ITS ADDRESS SET FORTH
HEREINBELOW, AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE UNITED
STATES MAILS, PROPER POSTAGE PREPAID AND PROPERLY ADDRESSED. NOTHING IN THIS
SECTION SHALL AFFECT THE RIGHT TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY LENDER
TO BRING ANY ACTION OR PROCEEDING AGAINST THE BORROWER IN THE COURTS OF ANY
OTHER JURISDICTION.
10.4 Waiver of Jury Trial. EACH OF THE BORROWER AND EACH LENDER
HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ITS
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RESPECTIVE RIGHTS TO TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT
OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS, OR
ANY PROCEEDING TO WHICH THE BORROWER OR ANY LENDER IS A PARTY, INCLUDING ANY
ACTIONS BASED UPON, ARISING OUT OF, OR IN CONNECTION WITH ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENT (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE
BORROWER OR ANY LENDER. The scope of this waiver is intended to be
all-encompassing of any and all disputes that may be filed in any court and that
relate to the subject matter of this transaction, including, without limitation,
contract claims, tort claims, breach of duty claims and all other common law and
statutory claims. Each of the Borrower and each Lender (i) acknowledges that
this waiver is a material inducement to enter into a business relationship, that
it has relied on this waiver in entering into this Agreement, and that it will
continue to rely on this waiver in its related future dealings with the other
parties hereto, and (ii) further warrants and represents that it has reviewed
this waiver with its legal counsel and that, based upon such review, it
knowingly and voluntarily waives its jury trial rights to the extent permitted
by applicable law. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, MODIFICATIONS OR SUPPLEMENTS TO OR RESTATEMENTS OF THIS
AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS. IN THE EVENT OF LITIGATION, THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
10.5 Notices. All notices and other communications provided for
hereunder shall be in writing (including telegraphic, telex, facsimile
transmission or cable communication) and mailed, telegraphed, telexed,
telecopied, cabled or delivered to the party to be notified at the following
addresses:
(a) if to the Borrower, to Hilb, Xxxxx and Xxxxxxxx Company, 0000
Xxxxxxxx Xxxxx, Xxxx Xxxxx, Xxxxxxxx 00000-0000, Attention: Chief Financial
Officer, Telecopy No. (000) 000-0000;
(b) if to the Administrative Agent, to Wachovia Bank, National
Association, One Wachovia Center, DC-4, 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxx Xxxxxxxx 00000-0000, Attention: Syndication Agency Services, Telecopy No.
(000) 000-0000; and
(c) if to any Lender, to it at the address set forth in the
Register;
or in each case, to such other address as any party may designate for itself by
like notice to all other parties hereto. All such notices and communications
shall be deemed to have been given (i) if mailed as provided above by any method
other than overnight delivery service, on the third Business Day after deposit
in the mails, (ii) if mailed by overnight delivery service, telegraphed,
telexed, telecopied or cabled, when delivered for overnight delivery, delivered
to the telegraph company, confirmed by telex answerback, transmitted by
telecopier or delivered to the cable company, respectively, or (iii) if
delivered by hand, upon delivery; provided that notices and communications to
the Administrative Agent shall not be effective until received by the
Administrative Agent.
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10.6 Amendments, Waivers, etc. No amendment, modification, waiver or
discharge or termination of, or consent to any departure by the Borrower from,
any provision of this Agreement or any other Credit Document, shall be effective
unless in a writing signed by the Required Lenders (or by the Administrative
Agent at the direction or with the consent of the Required Lenders), and then
the same shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such amendment,
modification, waiver, discharge, termination or consent shall:
(a) unless agreed to by each Lender directly affected thereby,
(i) reduce or forgive the principal amount of any Loan, reduce the rate of or
forgive any interest thereon, or reduce or forgive any fees or other Obligations
(other than fees payable to the Administrative Agent for its own account), (ii)
extend the Tranche A Maturity Date, the Tranche B Maturity Date, the Revolving
Credit Maturity Date or any other date (including any scheduled date for the
mandatory reduction or termination of any Commitments) fixed for the payment of
any principal of or interest on any Loan (other than (x) payments of principal
due and payable under Section 2.6 on account of Asset Dispositions, Equity
Issuances and Debt Issuances and (y) additional interest payable under Section
2.8(b) at the election of the Required Lenders, as provided therein), any fees
(other than fees payable to the Administrative Agent for its own account) or any
other Obligations, (iii) increase or extend any Commitment of such Lender (it
being understood that a waiver of any Event of Default, if agreed to by the
requisite Lenders hereunder, shall not constitute such an increase), or (iv)
amend the definition of "Interest Period" to permit an Interest Period that is
longer than six months in duration to be applicable to any LIBOR Loans;
(b) unless agreed to by all of the Lenders, (i) change the
percentage of the aggregate Commitments or of the aggregate unpaid principal
amount of the Loans, or the number or percentage of Lenders, that shall be
required for the Lenders or any of them to take or approve, or direct the
Administrative Agent to take, any action hereunder (including as set forth in
the definition of "Required Lenders"), (ii) release any Subsidiary Guarantor
from its obligations under the Subsidiary Guaranty or release the Liens of the
Administrative Agent with respect to any Collateral, in each case, except
pursuant to (x) Section 5.10 or (y) an Asset Disposition approved by the
Required Lenders, or (iii) change any provision of Section 2.15 or this Section;
and
(c) unless agreed to by the Swingline Lender or the Administrative
Agent in addition to the Lenders required as provided hereinabove to take such
action, affect the respective rights or obligations of the Swingline Lender or
the Administrative Agent, as applicable, hereunder or under any of the other
Credit Documents;
and provided further that (x) if any amendment, modification, waiver or consent
would adversely affect the holders of Loans of a particular Class (the "affected
Class") relative to holders of Loans of any other Class (including, without
limitation, by way of reducing the relative proportion of any payments,
prepayments or Commitment reductions to be applied for the benefit of holders of
Loans of the affected Class under Sections 2.6(e) and 2.6(f)), then such
amendment, modification, waiver or consent shall require the consent of Lenders
holding more than fifty-one percent (51%) of the aggregate outstanding principal
amount of all Loans of the affected Class, and (y) the 2001 Fee Letter and 2002
Fee Letter may be amended or modified,
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and any rights thereunder waived, in a writing signed by the parties thereto.
Notwithstanding anything set forth in this Section 10.6 to the contrary, it is
specifically agreed that the Revolving Credit Maturity Date may be extended
pursuant to the terms of Section 2.1(c)(ii) without obtaining the consent or
approval of either the Tranche A Lenders or the Tranche B Lenders.
10.7 Assignments, Participations.
(a) Each Lender may assign to one or more other Eligible Assignees
(each, an "Assignee") all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitments,
the outstanding Loans made by it and the Note or Notes held by it); provided,
however, that (i) any such assignment (other than an assignment to a Lender or
an Affiliate or Approved Fund of a Lender) shall not be made without the prior
written consent of the Administrative Agent and the Borrower (to be evidenced by
its counterexecution of the relevant Assignment and Acceptance), which consent
shall not be unreasonably withheld (provided that the Borrower's consent shall
not be required in the event a Default or Event of Default shall have occurred
and be continuing), (ii) each such assignment shall be of a uniform, and not
varying, percentage of all of the assigning Lender's rights and obligations
under this Agreement, and with respect to each Class of Loans, each such
assignment by a Lender of any of its interests relating to Loans of a particular
Class shall be made in such manner so that the same portion of its Commitment,
Loans, Note or Notes and other interests under and with respect to such Class is
assigned to the relevant Assignee, (iii) except in the case of an assignment to
a Lender or an Affiliate or Approved Fund of a Lender, no such assignment shall
be in an aggregate principal amount (determined as of the date of the Assignment
and Acceptance with respect to such assignment) less than (x) in the case of
Tranche A Term Loans and Revolving Credit Commitments, the aggregate amount of
$5,000,000, determined by combining the amount of the assigning Lender's
outstanding Tranche A Term Loans and Revolving Loans and Unutilized Revolving
Credit Commitment (or, if less, the full amount of the assigning Lender's
outstanding Tranche A Term Loans and the entire Revolving Credit Commitment),
(y) in the case of Tranche B Term Loans, the aggregate amount of $1,000,000
(provided that simultaneous transfers by any Lender to Approved Funds of such
Lender may be aggregated for purposes of the foregoing minimum assignment
amount), or (z) in the case of Swingline Loans, the entire Swingline Commitment
and the full amount of the outstanding Swingline Loans, and (iv) the parties to
each such assignment will execute and deliver to the Administrative Agent, for
its acceptance and recording in the Register, an Assignment and Acceptance,
together with any Note or Notes subject to such assignment, and will pay a
nonrefundable processing fee of $3,000 to the Administrative Agent for its own
account (provided that in the case of multiple simultaneous transfers by any
Lender to Approved Funds of such Lender, only one processing fee of $3,000 shall
be payable under the foregoing). Upon such execution, delivery, acceptance and
recording of the Assignment and Acceptance, from and after the effective date
specified therein, which effective date shall be at least five Business Days
after the execution thereof (unless the Administrative Agent shall otherwise
agree), (A) the Assignee thereunder shall be a party hereto and, to the extent
that rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of the
assigning Lender hereunder with respect thereto and (B) the assigning Lender
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights (other than
rights under the provisions of this Agreement and the other Credit Documents
relating to indemnification or
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payment of fees, costs and expenses, to the extent such rights relate to the
time prior to the effective date of such Assignment and Acceptance) and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of such
assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto). The terms and provisions of each Assignment
and Acceptance shall, upon the effectiveness thereof, be incorporated into and
made a part of this Agreement, and the covenants, agreements and obligations of
each Lender set forth therein shall be deemed made to and for the benefit of the
Administrative Agent and the other parties hereto as if set forth at length
herein.
(b) The Administrative Agent will maintain at its address for
notices referred to herein a copy of each Assignment and Acceptance delivered to
and accepted by it and a register for the recordation of the names and addresses
of the Lenders and the Commitments of, and principal amount of the Loans owing
to, each Lender from time to time (the "Register"). The entries in the Register
shall be conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Administrative Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower and
each Lender at any reasonable time and from time to time upon reasonable prior
notice.
(c) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an Assignee and, if required,
counterexecuted by the Borrower, together with the Note or Notes subject to such
assignment and the processing fee referred to in subsection (a) above, the
Administrative Agent will (i) accept such Assignment and Acceptance, (ii) on the
effective date thereof, record the information contained therein in the Register
and (iii) give notice thereof to the Borrower and the Lenders. Within five (5)
Business Days after its receipt of such notice, the Borrower, at its own
expense, will execute and deliver to the Administrative Agent, in exchange for
the surrendered Note or Notes, a new Note or Notes to the order of the Assignee
(and, if the assigning Lender has retained any portion of its rights and
obligations hereunder, to the order of the assigning Lender), prepared in
accordance with the applicable provisions of Section 2.4 as necessary to
reflect, after giving effect to the assignment, the Commitments (or outstanding
Term Loans, as the case may be) of the Assignee and (to the extent of any
retained interests) the assigning Lender, dated the date of the replaced Note or
Notes and otherwise in substantially the form of Exhibits X-0, X-0, X-0 and A-4,
as applicable. The Administrative Agent will return canceled Notes to the
Borrower.
(d) Each Lender may, without the consent of the Borrower, the
Administrative Agent or any other Lender, sell to one or more other Persons
(each, a "Participant") participations in any portion comprising less than all
of its rights and obligations under this Agreement (including, without
limitation, a portion of its Commitments, the outstanding Loans made by it and
the Note or Notes held by it); provided, however, that (i) such Lender's
obligations under this Agreement shall remain unchanged and such Lender shall
remain solely responsible for the performance of such obligations, (ii) no
Lender shall sell any participation (other than to its Affiliates) that, when
taken together with all other participations, if any, sold by such Lender,
covers all of such Lender's rights and obligations under this Agreement, (iii)
the Borrower, the Administrative Agent and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement, and no
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Lender shall permit any Participant to have any voting rights or any right to
control the vote of such Lender with respect to any amendment, modification,
waiver, consent or other action hereunder or under any other Credit Document
(except as to actions that would (x) reduce or forgive the principal amount of
any Loan, reduce the rate of or forgive any interest thereon, or reduce or
forgive any fees or other Obligations, (y) extend the Term Loan Maturity Date,
the Revolving Credit Maturity Date or any other date fixed for the payment of
any principal of or interest on any Loan, any fees or any other Obligations, or
(z) increase or extend any Commitment of any Lender), and (iv) no Participant
shall have any rights under this Agreement or any of the other Credit Documents,
each Participant's rights against the granting Lender in respect of any
participation to be those set forth in the participation agreement, and all
amounts payable by the Borrower hereunder shall be determined as if such Lender
had not granted such participation. Notwithstanding the foregoing, each
Participant shall have the rights of a Lender for purposes of Sections 2.16(a),
2.16(b), 2.17, 2.18 and 8.3, and shall be entitled to the benefits thereto, to
the extent that the Lender granting such participation would be entitled to such
benefits if the participation had not been made, provided that no Participant
shall be entitled to receive any greater amount pursuant to any of such Sections
than the Lender granting such participation would have been entitled to receive
in respect of the amount of the participation made by such Lender to such
Participant had such participation not been made.
(e) Nothing in this Agreement shall be construed to prohibit any
Lender from pledging or assigning all or any portion of its rights and interest
hereunder or under any Note to (i) any Federal Reserve Bank or other creditor as
security for borrowings therefrom or (ii) in the case of a Tranche B Lender
which is an investment fund, to the trustee under the indenture to which such
fund is a party in support of its obligations to the trustee for the benefit of
the applicable trust beneficiaries; provided, however, that no such pledge or
assignment shall release a Lender from any of its obligations hereunder.
(f) Any Lender or participant 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 Borrower and its Subsidiaries
furnished to it by or on behalf of any other party hereto, provided that such
Assignee or Participant or proposed Assignee or Participant agrees in writing to
keep such information confidential to the same extent required of the Lenders
under Section 10.3.
10.8 No Waiver. The rights and remedies of the Administrative Agent
and the Lenders expressly set forth in this Agreement and the other Credit
Documents are cumulative and in addition to, and not exclusive of, all other
rights and remedies available at law, in equity or otherwise. No failure or
delay on the part of the Administrative Agent or any Lender in exercising any
right, power or privilege shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or privilege preclude other
or further exercise thereof or the exercise of any other right, power or
privilege or be construed to be a waiver of any Default or Event of Default. No
course of dealing between any of the Borrower and the Administrative Agent or
the Lenders or their agents or employees shall be effective to amend, modify or
discharge any provision of this Agreement or any other Credit Document or to
constitute a waiver of any Default or Event of Default. No notice to or demand
upon the Borrower in any case shall entitle the Borrower to any other or further
notice or demand in similar or other circumstances or constitute a waiver of the
right of the Administrative Agent or any Lender to
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exercise any right or remedy or take any other or further action in any
circumstances without notice or demand.
10.9 Successors and Assigns. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto, and all references herein to any party shall be
deemed to include its successors and assigns; provided, however, that (i) the
Borrower shall not sell, assign or transfer any of its rights, interests, duties
or obligations under this Agreement without the prior written consent of all of
the Lenders and (ii) any Assignees and Participants shall have such rights and
obligations with respect to this Agreement and the other Credit Documents as are
provided for under and pursuant to the provisions of Section 10.7.
10.10 Survival. All representations, warranties and agreements made
by or on behalf of the Borrower or any of its Subsidiaries in this Agreement and
in the other Credit Documents shall survive the execution and delivery hereof or
thereof, the making and repayment of the Loans. In addition, notwithstanding
anything herein or under applicable law to the contrary, the provisions of this
Agreement and the other Credit Documents relating to indemnification or payment
of fees, costs and expenses, including, without limitation, the provisions of
Sections 2.16(a), 2.16(b), 2.17, 2.18, 9.7, 10.1 and 10.2, shall survive the
payment in full of all Loans, the termination of the Commitments, and any
termination of this Agreement or any of the other Credit Documents.
10.11 Severability. To the extent any provision of this Agreement is
prohibited by or invalid under the applicable law of any jurisdiction, such
provision shall be ineffective only to the extent of such prohibition or
invalidity and only in such jurisdiction, without prohibiting or invalidating
such provision in any other jurisdiction or the remaining provisions of this
Agreement in any jurisdiction.
10.12 Construction. The headings of the various articles, sections
and subsections of this Agreement have been inserted for convenience only and
shall not in any way affect the meaning or construction of any of the provisions
hereof. Except as otherwise expressly provided herein and in the other Credit
Documents, in the event of any inconsistency or conflict between any provision
of this Agreement and any provision of any of the other Credit Documents, the
provision of this Agreement shall control.
10.13 Confidentiality. Each Lender agrees to keep confidential,
pursuant to its customary procedures for handling confidential information of a
similar nature and in accordance with safe and sound lending practices, all
nonpublic information provided to it by or on behalf of the Borrower or any of
its Subsidiaries in connection with this Agreement or any other Credit Document;
provided, however, that any Lender may disclose such information (i) to its
directors, employees and agents and to its auditors, counsel and other
professional advisors, (ii) at the demand or request of any bank regulatory
authority, court or other Governmental Authority having or asserting
jurisdiction over such Lender, as may be required pursuant to subpoena or other
legal process, or otherwise in order to comply with any applicable Requirement
of Law, (iii) in connection with any proceeding to enforce its rights hereunder
or under any other Credit Document or any other litigation or proceeding related
hereto or to which it is a party, (iv) to the Administrative Agent or any other
Lender, (v) to the extent the same has become publicly
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available other than as a result of a breach of this Agreement and (vi) pursuant
to and in accordance with the provisions of Section 10.7(f).
10.14 Counterparts; Effectiveness. This Agreement may be executed in
any number of counterparts and by different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. This
Agreement shall become effective upon the execution of a counterpart hereof by
each of the parties hereto and receipt by the Administrative Agent and the
Borrower of written or telephonic notification of such execution and
authorization of delivery thereof.
10.15 Disclosure of Information. The Borrower agrees and consents
to the Administrative Agent's disclosure of information relating to this
transaction to Gold Sheets and other similar bank trade publications. Such
information will consist of deal terms and other information customarily found
in such publications.
10.16 Entire Agreement. THIS AGREEMENT AND THE OTHER DOCUMENTS AND
INSTRUMENTS EXECUTED AND DELIVERED IN CONNECTION HEREWITH (A) EMBODY THE ENTIRE
AGREEMENT AND UNDERSTANDING BETWEEN THE PARTIES HERETO AND THERETO RELATING TO
THE SUBJECT MATTER HEREOF AND THEREOF, (B) SUPERSEDE ANY AND ALL PRIOR
AGREEMENTS AND UNDERSTANDINGS OF SUCH PERSONS, ORAL OR WRITTEN, RELATING TO THE
SUBJECT MATTER HEREOF AND THEREOF, INCLUDING, WITHOUT LIMITATION, THE COMMITMENT
LETTER FROM WACHOVIA TO THE BORROWER DATED MAY 3, 2002 BUT SPECIFICALLY
EXCLUDING THE 2001 FEE LETTER AND THE 2002 FEE LETTER, AND (C) MAY NOT BE
AMENDED, SUPPLEMENTED, CONTRADICTED OR OTHERWISE MODIFIED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
[the remainder of this page left blank intentionally]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
HILB, XXXXX AND XXXXXXXX COMPANY
By: /s/Xxxxxxx Xxxxx
--------------------------------------------------
Title: Senior Vice President, CFO and Treasurer
--------------------------------------------------
(signatures continued)
S-1
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent and as a Lender
By: /s/Xxxxxx X. Xxxxxx
--------------------------------------------------
Title: Director
--------------------------------------------------
PNC BANK, NATIONAL ASSOCIATION, as Documentation Agent
and as a Lender
By: /s/Xxx Xxxxx
--------------------------------------------------
Title: Vice President
--------------------------------------------------
BANK OF AMERICA, N.A.
By: /s/Xxxxxxxxx X. Xxxxx
--------------------------------------------------
Title: Senior Vice President
--------------------------------------------------
FLEET NATIONAL BANK
By: /s/Xxxxxxx X. Xxxxx
--------------------------------------------------
Title: Senior Associate
--------------------------------------------------
SUNTRUST BANK
By: /s/X. Xxxx Key
--------------------------------------------------
Title: Director
--------------------------------------------------
(signatures continued)
S-2
BRANCH BANKING AND TRUST COMPANY
By: /s/ R. Xxxxxxx Xxxx
--------------------------------------------------
Title: Senior Vice President
--------------------------------------------------
COMERICA BANK
By: /s/Xxxxxx X. Xxxxx
--------------------------------------------------
Title: Vice President
--------------------------------------------------
S-3
