EXHIBIT 10.18
--------------------------------------------------------------------------------
REVOLVING LOAN AGREEMENT
DATED
DECEMBER 18, 1997
AMONG
U.S. LEGAL SUPPORT, INC.
AS BORROWER
AND
NATIONSBANK OF TEXAS, N.A.
AS AGENT, SWING LINE LENDER, AND ISSUING LENDER
AND
NATIONSBANK OF TEXAS, N.A.
AND THE OTHER ENTITIES DESIGNATED HEREIN
AS LENDERS
--------------------------------------------------------------------------------
TABLE OF CONTENTS
ARTICLE I
TERMS DEFINED................................ 1
Section 1.1 Definitions............................................... 1
Section 1.2 Singular and Plural of Definitions........................ 25
Section 1.3 Money..................................................... 25
Section 1.4 Captions; References...................................... 25
Section 1.5 Accounting Terms and Determinations....................... 25
Section 1.6 Knowledge................................................. 25
ARTICLE II
TERMS OF CREDIT FACILITY COMMITMENT..................... 26
Section 2.1 Revolving Credit Facility Commitment...................... 26
Section 2.2 Swing Line Facility....................................... 26
Section 2.3 Method of Borrowing....................................... 28
Section 2.4 Method of Issuing Letters of Credit; Participations
Therein; Payments Thereunder.............................. 29
Section 2.5 Fees...................................................... 30
Section 2.6 Additional Acquired Businesses............................ 30
Section 2.7 Margin and Fee Rate Adjustments........................... 32
ARTICLE III
TERMS OF CREDIT FACILITIES......................... 32
Section 3.1 Revolving Notes........................................... 32
Section 3.2 Maturity.................................................. 32
Section 3.3 Interest Rate............................................. 32
Section 3.4 Interest Payments......................................... 33
Section 3.5 Eurodollar Rate Advances.................................. 34
Section 3.6 Optional and Mandatory Prepayments of Revolving Loan
Advances; Optional Reductions of Commitments.............. 34
Section 3.7 Schedules on Revolving Notes.............................. 35
Section 3.8 General Provisions as to Payments......................... 35
Section 3.9 Application of Payments................................... 36
Section 3.10 Deposit of Cash Collateral................................ 36
ARTICLE IV
CHANGE IN CIRCUMSTANCES........................... 37
Section 4.1 Increased Cost and Reduced Return......................... 37
Section 4.2 Limitation on Eurodollar Rate Advances.................... 38
Section 4.3 Illegality................................................ 39
Section 4.4 Treatment of Affected Loans............................... 39
Section 4.5 Compensation.............................................. 39
ARTICLE V
CONDITIONS TO FUNDING............................ 42
Section 5.1 Conditions to Initial Advances or Letter of Credit........ 42
Section 5.2 Conditions to All Advances................................ 44
Section 5.3 Conditions to Letters of Credit........................... 45
i
ARTICLE VI
REPRESENTATIONS AND WARRANTIES....................... 45
Section 6.1 Existence and Power of Borrower........................... 46
Section 6.2 Subsidiaries.............................................. 46
Section 6.3 Authorization; Contravention.............................. 46
Section 6.4 Enforceable Obligations................................... 46
Section 6.5 Financial Information..................................... 47
Section 6.6 Litigation................................................ 47
Section 6.7 ERISA..................................................... 47
Section 6.8 Taxes and Filing of Tax Returns........................... 47
Section 6.9 Ownership of Assets....................................... 48
Section 6.10 Business; Compliance...................................... 48
Section 6.11 Licenses, Permits......................................... 48
Section 6.12 Compliance with Law....................................... 48
Section 6.13 Full Disclosure........................................... 48
Section 6.14 Environmental Matters..................................... 49
Section 6.15 Purpose of Credit......................................... 49
Section 6.16 Governmental Regulations.................................. 49
Section 6.17 Indebtedness.............................................. 49
Section 6.18 Insurance................................................. 49
Section 6.19 Solvency.................................................. 50
Section 6.20 Location of Collateral.................................... 50
ARTICLE VII
AFFIRMATIVE COVENANTS............................ 50
Section 7.1 Information From Borrower................................. 50
Section 7.2 Maintenance of Existence, etc............................. 51
Section 7.3 Business.................................................. 52
Section 7.4 Right of Inspection....................................... 52
Section 7.5 Maintenance of Insurance.................................. 53
Section 7.6 Payment of Taxes, Impositions and Claims.................. 53
Section 7.7 Compliance with Laws and Documents........................ 53
Section 7.8 Expenses; Environmental Law Compliance; and Indemnity..... 53
Section 7.9 Use of Proceeds........................................... 55
Section 7.10 Additional Documents................................... 55
Section 7.11 Compliance with Due Diligence Standards; Offices
and Files.............................................. 55
ARTICLE VIII
NEGATIVE COVENANTS............................. 56
Section 8.1 Financial Covenants....................................... 56
Section 8.2 Limitation on Capital Expenditures........................ 57
Section 8.3 Limitation on Debt........................................ 57
Section 8.4 Limitation on Sale of Assets.............................. 57
Section 8.5 Limitation on Liens....................................... 57
Section 8.6 Consolidations, Mergers, Sales of Assets.................. 58
Section 8.7 Investments............................................... 58
Section 8.8 Distributions............................................. 58
Section 8.9 Transactions with Affiliates and Associates............... 58
Section 8.10 Employee Plans............................................ 59
Section 8.11 Fiscal Year and Accounting Methods........................ 59
ii
Section 8.12 Governmental Regulations.................................. 59
ARTICLE IX
DEFAULTS AND REMEDIES............................ 59
Section 9.1 Events of Default........................................ 59
Section 9.2 Remedies................................................. 61
Section 9.3 Rights of Set-Off........................................ 62
Section 9.4 Remedies Cumulative, Concurrent and Non-Exclusive........ 62
Section 9.5 No Conditions Precedent to Exercise Remedies............. 62
Section 9.6 Waivers.................................................. 62
Section 9.7 Discontinuance of Proceedings............................ 63
ARTICLE X
THE AGENT.................................. 63
Section 10.1 Appointment, Powers, and Immunities...................... 63
Section 10.2 Reliance by Agent........................................ 64
Section 10.3 Defaults................................................. 64
Section 10.4 Rights as Lender......................................... 64
Section 10.5 INDEMNIFICATION.......................................... 65
Section 10.6 Non-Reliance on Agent and Other Lenders.................. 65
Section 10.7 Resignation of Agent..................................... 65
Section 10.8 Confidentiality.......................................... 66
Section 10.9 Set-off Adjustments...................................... 66
Section 10.10 Non-advancing Lenders.................................... 67
Section 10.11 Benefit of Lenders....................................... 67
Section 10.12 Amendments............................................... 68
ARTICLE XI
MISCELLANEOUS............................... 68
Section 11.1 Continuing Agreement..................................... 68
Section 11.2 Notices.................................................. 68
Section 11.3 No Waivers............................................... 69
Section 11.4 Amendments and Waivers: Consent to Deviation............. 69
Section 11.5 Survival................................................. 69
Section 11.6 Prior Understandings; No Defenses; Release; No Oral
Agreements............................................... 69
Section 11.7 Limitation on Interest................................... 69
Section 11.8 Invalid Provisions....................................... 70
Section 11.9 Assignments and Participations........................... 71
Section 11.11 Senior Debt; Borrower Subordination...................... 72
Section 11.11 Revolving Loan........................................... 72
Section 11.12 Construction............................................. 73
Section 11.13 APPLICABLE LAW........................................... 73
Section 11.14 Submission To Jurisdiction; Service of Process........... 73
Section 11.15 JURY TRIAL WAIVER........................................ 73
Section 11.16 Counterparts............................................. 73
Section 11.17 Inconsistent Provisions.................................. 74
iii
SCHEDULES AND EXHIBITS
SCHEDULE I NOTICE LIST; LOAN COMMITMENT AMOUNTS
SCHEDULE II EURODOLLAR MARGIN; BASE RATE MARGIN; COMMITMENT FEE PERCENTAGE
SCHEDULE III LOCATION OF COLLATERAL
SCHEDULE IV LIST OF FOUNDING SHAREHOLDERS
SCHEDULE V LIST OF PERMITTED LIENS
SCHEDULE VI LIST OF PERMITTED INVESTMENTS
SCHEDULE VII DEBT
EXHIBIT A FORM OF REVOLVING NOTE
EXHIBIT B REQUEST FOR ADVANCE
EXHIBIT C ASSIGNMENT AND ACCEPTANCE
EXHIBIT D RATE DESIGNATION NOTICE
EXHIBIT E FORM OF SUBSIDIARY GUARANTY
EXHIBIT F FORM OF SECURITY AGREEMENT (STOCK PLEDGE)
EXHIBIT G FORM OF SECURITY AGREEMENT
EXHIBIT H SOLVENCY CERTIFICATE
EXHIBIT I SWING LINE NOTE
EXHIBIT J ACQUISITION LETTER
EXHIBIT K COMPLIANCE CERTIFICATE
REVOLVING LOAN AGREEMENT
THIS REVOLVING LOAN AGREEMENT is entered into as of December 18, 1997, by
and among U.S. LEGAL SUPPORT, INC., a Texas corporation, and NATIONSBANK OF
TEXAS, N.A., as Issuing Lender, Swing Line Lender, and as Agent, and the lending
institutions designated as "LENDERS" on Schedule I (as such schedule may be
modified and supplemented from time to time).
PRELIMINARY STATEMENT
Borrower has requested that Lenders make available a revolving credit
facility in an aggregate amount not to exceed Forty Million and No/100 Dollars
($40,000,000.00). Upon and subject to the terms of this Agreement, Lenders are
willing to make such revolving credit facility available to Borrower.
Accordingly, in consideration of the mutual covenants contained herein,
Borrower, Agent, Swing Line Lender, Lenders, and Issuing Lender agree as
follows:
ARTICLE I
TERMS DEFINED
Section 1.1 Definitions. The following terms, as used herein, have the
following meanings:
"ACQUIRED BUSINESS" means any business (a) acquired on or prior to the
Funding Date by Borrower, directly or indirectly through one or more of its
Subsidiaries, whether through the acquisition of assets or Capital Stock, and
(b) acquired on or after the Funding Date by Borrower, directly or indirectly
through one or more of its Subsidiaries, whether through the acquisition of
assets or Capital Stock that satisfies the Acquisition Criteria.
"ACQUIRING PERSON" means any Person who or which, together with all
Affiliates and Associates of such Person, is or are the Beneficial Owner of 30%
or more of the shares of Common Stock then outstanding, but does not include any
Exempt Person.
"ACQUISITION CONSIDERATION" means, with respect to any Acquired Business,
the aggregate consideration payable by Borrower and any of its Subsidiaries, to
the sellers of that Acquired Business as the purchase price for that Acquired
Business. For purposes of this Agreement, the amount of Acquisition
Consideration applicable to any Acquired Business shall be determined as of the
Acquisition Date of that Acquired Business, in accordance with GAAP, as the
total amount paid (including amounts paid
