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TERM LOAN AGREEMENT
among
XXXXXXXX COMMUNICATIONS, INC.,
XXXXXXXX GRAPHICS, INC.,
VARIOUS FINANCIAL INSTITUTIONS
and
BANKERS TRUST COMPANY,
as ADMINISTRATIVE AGENT
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Dated as of June 30, 1997
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TABLE OF CONTENTS
Page
SECTION 1. Amount and Terms of Credit................................... 1
1.01 The Commitments.............................................. 1
1.02 Notice of Borrowing.......................................... 1
1.03 Disbursement of Funds........................................ 2
1.04 Notes ..................................................... 3
1.05 Pro Rata Borrowings.......................................... 3
1.06 Interest..................................................... 3
1.07 Interest Periods............................................. 4
1.08 Increased Costs, Illegality, etc. ........................... 5
1.09 Compensation................................................. 8
1.10 Change of Applicable Lending Office.......................... 8
1.11 Replacement of Banks......................................... 8
1.12 Conversions.................................................. 9
SECTION 2. Fees; Reductions of Commitment............................... 9
2.01 Fees ..................................................... 9
SECTION 3. Prepayments; Payments; Taxes................................. 10
3.01 Mandatory and Voluntary Payment; Mandatory and Voluntary
Reduction of Commitments............................. 10
3.02 Method and Place of Payment.................................. 11
3.03 Net Payments................................................. 11
SECTION 4. Conditions Precedent......................................... 15
4.01 Execution of Agreement; Notes................................ 15
4.02 No Default; Representations and Warranties................... 15
4.03 Opinions of Counsel.......................................... 16
4.04 Corporate Documents; Proceedings; etc. ...................... 16
4.05 Adverse Change, etc. ........................................ 16
4.06 Litigation................................................... 17
4.07 Subsidiaries Guaranty........................................ 17
4.08 Existing Pledge Agreement Amendment.......................... 17
4.09 Existing Security Agreement Amendment........................ 18
4.10 Mortgage Amendments; etc..................................... 18
(i)
Page
4.11 Canadian Debenture and Pledge Agreement...................... 18
4.12 Form of Collateral Assignments of Rights..................... 18
4.13 Lockbox, Blocked Account and Concentration Account
Agreements........................................... 19
4.14 Collateral Access Agreements................................. 19
4.15 Amendment to the Existing Credit Agreement................... 19
4.16 Solvency Certificate......................................... 19
4.17 Notice of Borrowing.......................................... 19
4.18 Fees, etc. .................................................. 19
SECTION 5. Representations, Warranties and Agreements.................... 19
5.01 Corporate Status............................................. 20
5.02 Corporate Power and Authority................................ 20
5.03 No Violation................................................. 20
5.04 Litigation................................................... 21
5.05 Use of Proceeds.............................................. 21
5.06 Governmental Approvals....................................... 21
5.07 Investment Company Act....................................... 21
5.08 Public Utility Holding Company Act........................... 21
5.09 True and Complete Disclosure................................. 21
5.10 Financial Condition; Financial Statements.................... 22
5.11 Locations of Offices, Records and Inventory.................. 22
5.12 Fictitious Business Names.................................... 23
5.13 Security Interests........................................... 23
5.14 Tax Returns and Payments..................................... 23
5.15 Compliance with ERISA........................................ 24
5.16 Subsidiaries................................................. 25
5.17 Patents, etc. ............................................... 25
5.18 Compliance with Statutes, etc. .............................. 26
5.19 Properties................................................... 27
5.20 Labor Relations; Collective Bargaining Agreements............ 27
5.21 Restrictions on Restricted Subsidiaries...................... 28
5.22 Material Contracts........................................... 28
5.23 Senior Indebtedness, etc. ................................... 28
5.24 Existing Collateral Documents................................ 28
SECTION 6. Affirmative Covenants......................................... 29
6.01 Financial Information........................................ 29
6.02 Corporate Franchises......................................... 30
(ii)
Page
6.03 Compliance with Statutes, etc. .............................. 31
6.04 ERISA ..................................................... 31
6.05 Good Repair.................................................. 33
6.06 Additional Security; Further Assurances; etc. ............... 33
6.07 Insurance.................................................... 34
6.08 Taxes ..................................................... 34
6.09 Corporate Separateness....................................... 34
6.10 New Wholly-Owned Restricted Subsidiaries..................... 35
SECTION 7. Negative Covenants........................................... 35
7.01 Limitation on Indebtedness................................... 36
7.02 Limitation on Restricted Payments............................ 39
7.03 Limitation on Restrictions on Distributions from Restricted
Subsidiaries......................................... 40
7.04 Limitation on Sales of Assets and Subsidiary Stock........... 42
7.05 Limitation on Affiliate Transactions......................... 43
7.06 Change of Control............................................ 44
7.07 Limitation on the Issuance of Preferred Stock of Restricted
Subsidiaries......................................... 44
7.08 When Communications or Borrower May Merge or Transfer
Assets............................................... 44
7.09 Ownership of Restricted Subsidiaries......................... 45
7.09 Further Instruments and Acts................................. 45
SECTION 8. Events of Default............................................ 45
8.01 Events of Default Defined.................................... 45
8.02 Acceleration................................................. 47
8.03 Other Remedies............................................... 48
SECTION 9. Definitions.................................................. 48
9.01 General Definitions.......................................... 48
9.02 Accounting Terms and Determinations.......................... 79
9.03 Other Defined Terms.......................................... 80
SECTION 10. The Agent................................................... 80
10.01 Appointment................................................. 80
10.02 Nature of Duties of Agent................................... 81
10.03 Lack of Reliance on Agent................................... 81
10.04 Certain Rights of the Agent................................. 82
(iii)
Page
10.05 Reliance by Agent........................................... 82
10.06 Indemnification of Agent.................................... 82
10.07 The Agent in Its Individual Capacity........................ 83
10.08 Holders of Notes............................................ 83
10.09 Successor Agent............................................. 83
10.10 Collateral Matters.......................................... 84
10.11 Actions with Respect to Defaults............................ 86
10.12 Delivery of Information..................................... 86
SECTION 11. Special Provisions Providing Lien Priorities; etc. .......... 86
11.01 Priorities With Respect to Collateral....................... 87
11.02 Priority on Distribution of Proceeds of Collateral.......... 88
11.03 Certain Dispositions of Collateral.......................... 89
11.04 Waiver of Set-Off........................................... 89
11.05 Right to Contest............................................ 90
11.06 Payment Invalidated......................................... 90
11.07 Right to Amend, etc. ....................................... 90
11.08 Creation of Future Obligations.............................. 91
11.09 Waiver of Liability For Actions Taken With Respect To
Second Priority Secured Obligations and Collateral... 91
11.10 Financing Issues............................................ 92
11.11 Effectiveness............................................... 92
11.12 Further Assurances.......................................... 92
11.13 Nature of the Obligations................................... 93
11.14 Benefits of this Section 11................................. 93
SECTION 12. Miscellaneous............................................... 93
12.01 Payment of Expenses; Indemnification; etc................... 93
12.02 Right of Setoff............................................. 94
12.03 Notices..................................................... 95
12.04 Benefit of Agreement; Assignments; Participations........... 95
12.05 No Waiver; Remedies Cumulative.............................. 98
12.06 Payments Pro Rata........................................... 99
12.07 Computations................................................ 99
12.08 GOVERNING LAW; SUBMISSION TO JURISDICTION;
VENUE; WAIVER OF JURY TRIAL.......................... 99
12.09 Counterparts................................................101
12.10 Effectiveness...............................................101
12.11 Headings Descriptive........................................101
(iv)
12.12 Amendment or Waiver; etc. ..................................101
12.13 Survival....................................................102
12.14 Domicile of Loans...........................................103
12.15 Register....................................................103
12.16 Confidentiality.............................................103
12.17 Designated Senior Indebtedness..............................104
12.18 Limitation on Additional Amounts, etc. .....................104
12.19 Maximum Rate................................................105
12.20 Post Closing Actions........................................106
SECTION 13. Parent Guaranty.............................................107
13.01 The Parent Guaranty.........................................107
13.02 Bankruptcy..................................................108
13.03 Nature of Liability.........................................108
13.04 Independent Obligation......................................108
13.05 Authorization...............................................108
13.06 Reliance....................................................109
13.07 Subordination...............................................110
13.08 Waiver .....................................................110
13.09 Limitation on Enforcement...................................111
SCHEDULE I List of Banks
SCHEDULE II Governmental Approvals
SCHEDULE III Chief Executive Offices, Records Locations and Inventory
and Equipment Locations
SCHEDULE IV Fictitious Business Names
SCHEDULE V Tax Matters
SCHEDULE VI Subsidiaries
SCHEDULE VII Real Properties
SCHEDULE VIII Collective Bargaining Agreements
SCHEDULE IX Insurance
SCHEDULE X Existing Indebtedness
EXHIBIT A Form of Notice of Borrowing
EXHIBIT B Form of Note
EXHIBIT C Form of Section 3.03(e) Certificate
EXHIBIT D-1 Form of Opinion of Shearman & Sterling, special counsel to
the Credit Parties
(v)
EXHIBIT D-2 Form of Opinion of Xxxxxxx X. Xxxxx, Esq., General
Counsel to Communications and the Borrower
EXHIBIT E Form of Officer's Certificate
EXHIBIT F Form of Solvency Certificate
EXHIBIT G Form of Subsidiaries Guaranty
EXHIBIT H-1 Existing Pledge Agreement
EXHIBIT H-2 Form of Existing Pledge Agreement Amendment
EXHIBIT I-1 Existing Security Agreement
EXHIBIT I-2 Form of Existing Security Agreement Amendment
EXHIBIT K-1 Existing Canadian Debenture
EXHIBIT K-2 Form of Existing Canadian Pledge Agreement
EXHIBIT K-3 Existing Canadian Debenture Amendment
EXHIBIT K-4 Form of Existing Canadian Pledge Agreement Amendment
EXHIBIT L Form of Collateral Assignment of Rights
EXHIBIT M-1 Form of Lockbox Agreement
EXHIBIT M-2 Form of Blocked Account Agreement
EXHIBIT M-3 Form of Concentration Account Agreement
EXHIBIT N Form of Collateral Access Agreement
EXHIBIT O Form of Compliance Certificate
EXHIBIT P Form of Assignment and Assumption Agreement
(vi)
TERM LOAN AGREEMENT, dated as of June 30, 1997, among XXXXXXXX
COMMUNICATIONS, INC., a Delaware corporation ("Communications" or the "Parent
Guarantor"), XXXXXXXX GRAPHICS, INC., a New York Corporation (the "Borrower"),
the financial institutions party hereto from time to time (the "Banks"), and
BANKERS TRUST COMPANY, as Administrative Agent (all capitalized terms used
herein and defined in Section 9 are used herein as therein defined).
W I T N E S S E T H :
WHEREAS, the Borrower wishes to obtain a term loan facility to
prepay outstandings under the revolving credit facility pursuant to the Existing
Credit Agreement and thereby improve its liquidity; and
WHEREAS, subject to and upon the terms and conditions set
forth herein, the Banks are willing to make available to the Borrower the credit
facility provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 The Commitments. Subject to and upon the terms and
conditions set forth herein, each Bank severally agrees to make, on the Closing
Date, a term loan or term loans (each, a "Loan" and, collectively, the "Loans")
to the Borrower, which Loans shall (i) be denominated in Dollars, (ii) at any
time prior to the Syndication Date, be incurred and maintained as a single
Borrowing of Base Rate Loans (subject to mandatory conversion in whole into a
single Borrowing of Eurodollar Loans pursuant to Section 1.12), (iii) at any
time on and after the Syndication Date, be maintained as and/or converted into a
single Borrowing of Eurodollar Loans (subject to conversion, in whole or in
part, into Base Rate Loans pursuant to Section 1.08 or as provided in last
sentence of Section 1.07) and (iv) be made by each such Bank in that initial
aggregate principal amount as is equal to the Commitment of such Bank on the
Closing Date (before giving effect to any reductions thereto on such date
pursuant to Section 3.01(b)). Once repaid, Loans incurred hereunder may not be
reborrowed.
1.02 Notice of Borrowing. (a) When the Borrower desires to
incur the Loans hereunder, it shall give the Administrative Agent at its Notice
Office at least one Business Day's (or same day notice if acceptable to the
Administrative Agent) prior
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written notice (or telephonic notice promptly confirmed in writing) of the Loans
to be made hereunder, provided that any such notice shall be deemed to have been
given on a certain day only if given before 11:00 A.M. (New York time) on such
day. Such written notice or written confirmation of telephonic notice (the
"Notice of Borrowing"), except as otherwise expressly provided in Section 1.08,
shall be irrevocable and shall be given by the Borrower in the form of Exhibit
A, appropriately completed to specify (i) the aggregate principal amount of the
Loans to be incurred pursuant to such Borrowing and (ii) the date of such
Borrowing (which shall be a Business Day). The Administrative Agent shall
promptly give each Bank notice of such proposed Borrowing, of such Bank's
proportionate share thereof and of the other matters required by the immediately
preceding sentence to be specified in the Notice of Borrowing.
(b) Without in any way limiting the obligation of the Borrower
to confirm in writing any telephonic notice permitted to be given hereunder, the
Administrative Agent may act without liability upon the basis of such telephonic
notice, believed by the Administrative Agent in good faith to be from an
Authorized Officer of the Borrower prior to receipt of written confirmation. In
each such case, the Borrower hereby waives the right to dispute the
Administrative Agent's record of the terms of such telephonic notice.
1.03 Disbursement of Funds. No later than 12:00 Noon (New York
time) on the Closing Date, each Bank will make available its pro rata portion
(determined in accordance with Section 1.05) of the Loans to be made on such
date. All such amounts will be made available in Dollars and in immediately
available funds at the Payment Office of the Administrative Agent, and the
Administrative Agent will make available to the Borrower by depositing to its
account at the Payment Office the aggregate of the amounts so made available by
the Banks in the type of funds received. Unless the Administrative Agent shall
have been notified by any Bank prior to the Closing Date that such Bank does not
intend to make available to the Administrative Agent such Bank's portion of the
Loans to be made on such date, the Administrative Agent may assume that such
Bank has made such amount available to the Administrative Agent on the Closing
Date and the Administrative Agent may, in reliance upon such assumption, make
available to the Borrower a corresponding amount. If such corresponding amount
is not in fact made available to the Administrative Agent by such Bank, the
Administrative Agent shall be entitled to recover such corresponding amount on
demand from such Bank. If such Bank does not pay such corresponding amount
forthwith upon the Administrative Agent's demand therefor, the Administrative
Agent shall promptly notify the Borrower and the Borrower shall immediately pay
such corresponding amount to the Administrative Agent. The Administrative Agent
shall also be entitled to recover on demand from such Bank or the Borrower, as
the case may be, interest on such corresponding amount in respect of each day
from the date such corre-
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sponding amount was made available by the Administrative Agent to the Borrower
until the date such corresponding amount is recovered by the Administrative
Agent, at a rate per annum equal to (i) if recovered from such Bank, at the
overnight Federal Funds Rate and (ii) if recovered from the Borrower, the rate
of interest applicable to the Loans, as determined pursuant to Section 1.08.
Nothing in this Section 1.04 shall be deemed to relieve any Bank from its
obligation to make Loans hereunder or to prejudice any rights which the Borrower
may have against any Bank as a result of any failure by such Bank to make Loans
hereunder.
1.04 Notes. (a) The Borrower's obligation to pay the principal
of, and interest on, the Loans made by each Bank shall be evidenced by a
promissory note duly executed and delivered by the Borrower substantially in the
form of Exhibit B, with blanks appropriately completed in conformity herewith
(each, a "Note" and, collectively, the "Notes"). The Note issued to each Bank
shall (i) be executed by the Borrower, (ii) be payable to the order of such Bank
and be dated the Closing Date (or if issued thereafter, the date of issuance),
(iii) be in a stated principal amount equal to the principal amount of the Loans
made by such Bank and be payable in Dollars in the outstanding principal amount
of Loans evidenced thereby, (iv) mature on the Final Maturity Date, (v) bear
interest as provided in the appropriate clause of Section 1.06 in respect of the
Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby,
(vi) be subject to voluntary and mandatory prepayment as provided in Section
3.01 and (vii) be entitled to the benefits of this Agreement and the other
Credit Documents.
(b) Each Bank will note on its internal records the amount of
each Loan made by it and each payment in respect thereof and will prior to any
transfer of any of its Notes endorse on the reverse side thereof the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
or any error in such notation shall not affect the Borrower's obligations in
respect of such Loans.
1.05 Pro Rata Borrowings. All Loans made under this Agreement
shall be incurred from the Banks pro rata on the basis of their Commitments. It
is understood that no Bank shall be responsible for any default by any other
Bank of its obligation to make Loans hereunder and that each Bank shall be
obligated to make the Loans provided to be made by it hereunder, regardless of
the failure of any other Bank to make its Loans hereunder.
1.06 Interest. (a) The Borrower agrees to pay interest in
respect of the unpaid principal amount of each Base Rate Loan from the date the
proceeds thereof are made available to the Borrower until the maturity thereof
(whether by acceleration
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or otherwise) at a rate per annum which shall be equal to the sum of the
Applicable Margin plus the Base Rate, each as in effect from time to time.
(b) The Borrower agrees to pay interest in respect of the
unpaid principal amount of each Eurodollar Loan from the date the proceeds
thereof are made available to the Borrower until the maturity thereof (whether
by acceleration or otherwise) at a rate per annum which shall, during each
Interest Period applicable thereto, be equal to the sum of the Applicable Margin
(as in effect from time to time) plus the Eurodollar Rate for such Interest
Period.
(c) Overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan and any other overdue amount payable
hereunder shall, in each case, bear interest at a rate per annum equal to the
greater of (x) 2% per annum in excess of the rate otherwise applicable to Base
Rate Loans from time to time and (y) the rate which is 2% in excess of the rate
borne by such Loans at the time of the payment default, in each case with such
interest to be payable on demand.
(d) Accrued (and theretofore unpaid) interest shall be payable
(i) in respect of each Base Rate Loan, quarterly in arrears on each Quarterly
Payment Date, (ii) in respect of each Eurodollar Loan, on the last day of each
Interest Period applicable thereto and (iii) in respect of each Loan, on any
repayment or prepayment (on the amount repaid or prepaid), at maturity (whether
by acceleration or otherwise) and, after such maturity, on demand.
(e) Upon each Interest Determination Date, the Administrative
Agent shall determine the Eurodollar Rate for the respective Interest Period or
Interest Periods to be applicable to Eurodollar Loans and shall promptly notify
the Borrower and the Banks thereof. Each such determination shall, absent
manifest error, be final and conclusive and binding on all parties hereto.
1.07 Interest Periods. All Eurodollar Loans outstanding
hereunder at any time shall have a single interest period applicable thereto at
such time of three (3) months duration (each, an "Interest Period"), provided
that:
(i) the initial Interest Period for the Eurodollar Loans
shall commence on the Syndication Date and each Interest Period
occurring thereafter in respect of such Eurodollar Loans shall commence
(x) on the day on which the next preceding Interest Period applicable
thereto expires or (y) only in the circumstances provided in Section
1.08(d)(y) (where all Eurodollar Loans have theretofore been converted
into Base Rate Loans), on the Business Day specified in Section
1.08(d)(y);
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(ii) if any Interest Period for a Eurodollar Loan begins on a
day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period, such Interest Period shall
end on the last Business Day of such calendar month;
(iii) if any Interest Period for a Eurodollar Loan would
otherwise expire on a day which is not a Business Day, such Interest
Period shall expire on the next succeeding Business Day; provided,
however, that if any Interest Period for a Eurodollar Loan would
otherwise expire on a day which is not a Business Day but is a day of
the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
and
(iv) no Interest Period shall be selected which extends
beyond the Final Maturity Date.
If upon the expiration of an Interest Period, the Borrower is
not permitted by virtue of the application of clause (iv) above to elect a new
Interest Period to be applicable to a Borrowing of Eurodollar Loans as provided
above, the Borrower shall be deemed to have elected to convert such Borrowing
into a Borrowing of Base Rate Loans effective as of the expiration date of such
current Interest Period.
1.08 Increased Costs, Illegality, etc. (a) In the event that
any Bank shall have determined in good faith (which determination shall, absent
manifest error, be final and conclusive and binding upon all parties hereto but,
with respect to clause (i) below, may be made only by the Administrative Agent):
(i) on any Interest Determination Date that, by reason of
any changes arising after the date of this Agreement affecting the
interbank Eurodollar market, adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis provided for in
the definition of Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs
or reductions in the amounts received or receivable hereunder with
respect to any Eurodollar Loan because of (x) any change arising after
the date of this Agreement in any applicable law or governmental rule,
regulation, order, guideline or request (whether or not having the
force of law) or in the interpretation or administration thereof and
including the introduction of any new law or governmental rule,
regulation, order, guideline or request, such as, for example, but not
limited to: (A) a change in the basis of taxation of payment to any
Bank of the principal of or interest on the Notes or any other amounts
payable
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hereunder (except for changes in the rate of tax on, or determined by
reference to, the net income or profits or franchise taxes based on net
income of such Bank pursuant to the laws of the jurisdiction in which
it is organized or in which its principal office or applicable lending
office is located or any subdivision hereof or therein) or (B) a change
in official reserve requirements (except to the extent included in the
computation of the Eurodollar Rate) or any special deposit, assessment
or similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Bank (or its applicable lending
office) and/or (y) other circumstances since the date of this Agreement
affecting such Bank or the interbank Eurodollar market or the position
of such Bank in such market; or
(iii) at any time after the date of this Agreement, that the
making or continuance of any Eurodollar Loan has been made (x) unlawful
by any law or governmental rule, regulation or order, (y) impossible by
compliance by any Bank in good faith with any governmental request
(whether or not having force of law) or (z) impracticable as a result
of a contingency occurring after the date of this Agreement which
materially and adversely affects the applicable interbank market;
then, and in any such event, such Bank (or the Administrative Agent, in the case
of clause (i) above) shall promptly give notice (by telephone promptly confirmed
in writing) to the Borrower and, except in the case of clause (i) above, to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Banks). Thereafter (x) in the
case of clause (i) above, on the last day of the then current Interest Period,
all Loans shall be automatically converted to Base Rate Loans, until such time
as the circumstances described in clause (i) shall no longer be applicable, in
which event Section 1.08(d) shall apply, (y) in the case of clause (ii) above,
the Borrower shall, subject to the provisions of Section 12.18 (to the extent
applicable), pay to such Bank, upon its written request therefor, such
additional amounts (in the form of an increased rate of, or a different method
of calculating, interest or otherwise as such Bank in its sole discretion shall
determine) as shall be required to compensate such Bank for such increased costs
or reductions in amounts received or receivable hereunder (a written notice as
to the additional amounts owed to such Bank, showing in reasonable detail the
basis for the calculation thereof, submitted to the Borrower by such Bank shall,
absent manifest error, be final and conclusive and binding on all the parties
hereto) and (z) in the case of clause (iii) above, the Borrower shall take one
of the actions specified in Section 1.08(b) as promptly as possible and, in any
event, within the time period required by law.
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(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.08(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.08(a)(iii) shall), upon at least three Business Days' written notice
to the Administrative Agent, require the affected Bank to convert such
Eurodollar Loan into a Base Rate Loan, until such time as the circumstances
described in Section 1.08(a)(ii) or (iii) shall no longer be applicable in which
event clause (d) below shall apply, provided that, if more than one Bank is
affected at any time, then all affected Banks must be treated the same pursuant
to this Section 1.08(b).
(c) If at any time after the date of this Agreement any Bank
determines that the introduction of or any change (which introduction or change
shall have occurred after the date of this Agreement) in any applicable law or
governmental rule, regulation, order, guideline, directive or request (whether
or not having the force of law) concerning capital adequacy, or any change in
interpretation or administration thereof by any governmental authority, central
bank or comparable agency, will have the effect of increasing the amount of
capital required or expected to be maintained by such Bank or any corporation
controlling such Bank based on the existence of such Bank's Commitments
hereunder or its obligations hereunder, then the Borrower agrees to pay, subject
to the provisions of Section 12.18 (to the extent applicable), to such Bank,
upon its written demand therefor, such additional amounts as shall be required
to compensate such Bank or such other corporation for the increased cost to such
Bank or such other corporation or the reduction in the rate of return to such
Bank or such other corporation as a result of such increase of capital. In
determining such additional amounts, each Bank will act reasonably and in good
faith and will use averaging and attribution methods which are reasonable,
provided that such Bank's determination of compensation owing under this Section
1.08(c) shall, absent manifest error, be final and conclusive and binding on all
the parties hereto. Each Bank, upon determining that any additional amounts will
be payable pursuant to this Section 1.08(c), will give prompt written notice
thereof to the Borrower, which notice shall show in reasonable detail the basis
for calculation of such additional amounts.
(d) In the event that any Base Rate Loan is outstanding at any
time and the relevant circumstances described in Section 1.08(a)(i), (ii) and/or
(iii), as the case may be, cease to be applicable, the respective Bank(s) or the
Administrative Agent (as applicable) shall give prompt notice thereof to the
Borrower and the Administrative Agent (as applicable) and (x) if a Borrowing of
Eurodollar Loans is outstanding at such time (from one or more Banks which were
not affected by such circumstances or as a result of the application of
following clause (y)), then on the last day of the Interest Period then
applicable thereto the Base Rate Loans of the respective affected Bank or Banks
to which the circumstances described above have ceased to be applicable shall
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be converted back into (and thereafter shall form a part of) the respective
Borrowing of Eurodollar Loans (until such time, if any, as Section 1.08(a) and
(b) shall thereafter become applicable) and (y) if no Eurodollar Loans remain
outstanding at such time, then on the third Business Day thereafter the Base
Rate Loans of the respective Bank or Banks to which the circumstances described
above shall cease to be applicable shall be converted into a Borrowing of
Eurodollar Loans (with an Interest Period of three months beginning on said
third Business Day).
1.09 Compensation. The Borrower shall compensate each Bank,
upon its written request (which request shall set forth in reasonable detail the
basis for requesting such compensation), for all reasonable 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 Bank to fund its Eurodollar Loans, but excluding loss of
anticipated profits) which such Bank may sustain: (i) if any repayment
(including any repayment made pursuant to Section 3.01 or as a result of an
acceleration of the Loans pursuant to Section 8) occurs on a date which is not
the last day of an Interest Period with respect thereto; (ii) if any pre-payment
of any of its Eurodollar Loans is not made on any date specified in a notice of
prepayment given by such Borrower; or (iii) as a consequence of (x) any other
default by such Borrower to repay its Loans when required by the terms of this
Agreement or any Note held by such Bank or (y) any election made pursuant to
Section 1.08(b).
1.10 Change of Applicable Lending Office. Each Bank agrees
that on the occurrence of any event giving rise to the operation of Section
1.08(a)(ii) or (iii), Section 1.08(c) or Section 3.03 with respect to such Bank,
it will, if requested by the Borrower, use reasonable efforts (subject to
overall policy considerations of such Bank) to designate another lending office
for any Loans affected by such event, provided that such designation is made on
such terms that such Bank and its lending office suffer no economic, legal or
regulatory disadvantage, with the object of avoiding the consequence of the
event giving rise to the operation of such Section. Nothing in this Section 1.10
shall affect or postpone any of the obligations of the Borrower or the right of
any Bank provided in Sections 1.08 and 3.03.
1.11 Replacement of Banks. (x) Upon the occurrence of an event
giving rise to the operation of Section 1.08(a)(ii) or (iii), Section 1.08(c) or
Section 3.03 with respect to any Bank which results in such Bank charging to the
Borrower increased costs in excess of those being generally charged by the other
Banks or (y) in the case of certain refusals by a Bank to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as (and to the extent)
provided in Section 12.12(b), the
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Borrower shall have the right, if no Default under Section 8.01(1), (6) or (7)
and no Event of Default then exists (or, in the case of preceding clause (y), no
Default under Section 8.01(1), (6) or (7) and no Event of Default will exist
immediately after giving effect to such replacement), to replace such Bank (the
"Replaced Bank") with one or more other Eligible Transferees (collectively, the
"Replacement Bank") and each of whom shall be required to be reasonably
acceptable to the Administrative Agent, provided that (i) at the time of any
replacement pursuant to this Section 1.11, the Replacement Bank shall enter into
one or more Assignment and Assumption Agreements pursuant to Section 12.04(b)
(and with all fees payable pursuant to said Section 12.04(b) to be paid by the
Replacement Bank) pursuant to which the Replacement Bank shall acquire all of
the outstanding Loans of the Replaced Bank and, in connection therewith, shall
pay to the Replaced Bank in respect thereof an amount equal to the principal of,
and all accrued interest on, all outstanding Loans of the Replaced Bank and (ii)
all obligations of the Borrower due and owing to the Replaced Bank at such time
(other than those specifically described in clause (i) above in respect of which
the assignment purchase price has been, or is concurrently being, paid) shall be
paid in full to such Replaced Bank concurrently with such replacement. Upon the
execution of the respective Assignment and Assumption Agreements, the payment of
amounts referred to in clauses (i) and (ii) above, recordation of the assignment
on the Register by the Administrative Agent pursuant to Section 12.15 and, if so
requested by the Replacement Bank, delivery to the Replacement Bank of the
appropriate Note or Notes executed by the Borrower, the Replacement Bank shall
become a Bank hereunder and the Replaced Bank shall cease to constitute a Bank
hereunder, except with respect to indemnification provisions under this
Agreement (including, without limitation, Sections 1.08, 1.09, 3.03, 10.06 and
12.01), which shall survive as to such Replaced Bank. It is understood and
agreed that replacements pursuant to this Section 1.11 shall be effected by
means of assignments which otherwise meet the applicable requirements of Section
12.04(b).
1.12 Conversions. On the Syndication Date, the entire
outstanding principal amount of Loans made to the Borrower and then outstanding
shall be automatically converted into a single Borrowing of Eurodollar Loans
(with the first Interest Period applicable thereto to begin on the Syndication
Date).
SECTION 2. Fees; Reductions of Commitment.
2.01 Fees. (a) The Borrower shall pay to the Administrative
Agent, for its own account, such fees as have been previously agreed to in
writing by the Borrower and the Administrative Agent.
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(b) In addition to any other fees payable pursuant to this
Agreement or any other agreement, if any Loans remain outstanding on either of
the 12 or 30 month anniversaries of the Closing Date, then on each such date an
additional cash fee shall be paid to each Bank (and retained by it for its own
account) in an amount equal to 1.0% of the aggregate principal amount of the
Loans of such Bank outstanding on the respective such date, and if any Loans
remain outstanding on any of the 6, 9, 18 or 24 month anniversaries of the
Closing Date, then additional cash fees shall be paid to each Bank on each such
date in an amount equal to 1/2 of 1% of the aggregate principal amount of the
Loans of such Bank outstanding on the respective such date (which fees shall be
retained by each Bank for its own account).
SECTION 3. Prepayments; Payments; Taxes.
3.01 Mandatory and Voluntary Payment; Mandatory and Voluntary
Reduction of Commitments. (a) The Total Commitment (and the Commitment of each
Bank) shall terminate in its entirety on July 30, 1997 unless the Closing Date
has occurred on or before such date.
(b) In addition to any other mandatory commitment reductions
pursuant to this Section 3.01, the Total Commitment (and the commitment of each
Bank) shall terminate in its entirety on the Closing Date (after giving effect
to the making of Loans on such date).
(c) The Borrower shall have the right to prepay the Loans,
without premium or penalty, in whole or in part at any time and from time to
time on the following terms and conditions: (i) the Borrower shall give the
Administrative Agent prior to 12:00 Noon (New York City time) at least three
Business Days' prior written notice (or telephonic notice promptly confirmed in
writing) of its intent to prepay Loans and the amount of such prepayment, which
notice the Administrative Agent shall promptly transmit to each of the Banks;
(ii) each partial prepayment shall be in an aggregate principal amount of at
least $1,000,000; (iii) if any partial prepayment of then outstanding Loans
shall reduce the aggregate principal amount of outstanding Loans to an amount
less than $1,000,000, then all then outstanding Loans shall be required to be
repaid in full at such time; (iv) prepayments of Eurodollar Loans made pursuant
to this Section 3.01(c) on any date which is not the last day of an Interest
Period applicable thereto shall be accompanied by the payment of all breakage
and similar costs required to be paid as a result thereof pursuant to Section
1.09; and (v) each prepayment in respect of any Loans shall be applied pro rata
among the Banks (based on the respective outstanding principal amounts of their
outstanding Loans).
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(d) In addition to any other mandatory repayments or
commitment reductions pursuant to this Section 3.01, on each date after the
Closing Date upon which Communications receives any proceeds from any sale or
issuance of its equity, an amount equal to 50% of the cash proceeds of the
respective sale or issuance (net of all reasonable costs associated therewith,
including, without limitation, all due diligence costs and expenses paid for, or
reimbursed by, Communications, underwriting or similar fees discounts and
commissions, attorneys' fees and expenses paid for, or reimbursed by,
Communications and other direct costs associated therewith) shall be applied as
a mandatory repayment of principal of outstanding Loans in accordance with the
requirements of Section 3.01(e).
(e) Each mandatory repayment of Loans required by this Section
3.01 shall be applied pro rata to the then outstanding principal amount of the
Loans of the various Banks.
(f) In addition to the repayments specified above, (i) Excess
Proceeds Repayments shall be required to be made in accordance with, and to the
extent required by, Section 7.04 and (ii) repayments following the occurrence of
a Change of Control shall be required in accordance with the provisions of
Section 7.06. All repayments pursuant to this clause (i) shall, except to the
extent otherwise expressly provided in the second sentence of Section 7.06, be
applied in accordance with the provisions of Section 3.01(e).
3.02 Method and Place of Payment. Except as otherwise
specifically provided herein, all payments under this Agreement or any Note
shall be made to the Administrative Agent for the account of the Bank or Banks
entitled thereto not later than 12:00 Noon (New York time) on the date when due
and shall be made in Dollars in immediately available funds at the Payment
Office of the Administrative Agent. The Administrative Agent will thereafter
cause to be distributed on the same day (if payment was actually received by the
Administrative Agent prior to 12:00 Noon (New York time) on such day) like funds
relating to the payment of principal, interest or fees ratably to the Banks
entitled thereto. Any payments under this Agreement which are made later than
12:00 Noon (New York time) shall be deemed to have been made on the next
succeeding Business Day. Whenever any payment to be made hereunder or under any
Note shall be stated to be due on a day which is not a Business Day, the due
date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable at the applicable
rate during such extension.
3.03 Net Payments. (a) Except as provided in Section 3.03(e),
any and all payments by the Borrower (or any other Credit Party on its behalf)
hereunder, under
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the Loans or under the Guaranties to or for the benefit of any Bank or the
Administrative Agent shall be made free and clear of and without deduction for
any and all present or future taxes, levies, imposts, deductions, charges or
withholdings and penalties, interests and all other liabilities with respect
thereto ("Taxes"), excluding, (i) in the case of each such Bank or the
Administrative Agent, taxes imposed on its net income (including, without
limitation, any taxes imposed on branch profits) and franchise taxes (that are
imposed on or computed by reference to net income) imposed on it by the
jurisdiction under the laws of which such Bank or the Administrative Agent (as
the case may be) is organized or any political subdivision thereof, and (ii) in
the case of each Bank, taxes imposed on its net income (including, without
limitation, any taxes imposed on branch profits), and franchise taxes imposed on
it, by the jurisdiction of such Bank's Applicable Lending Office or any
political subdivision thereof (all such nonexcluded Taxes being hereinafter
referred to as "Covered Taxes"). Except as provided in Section 3.03(e), if the
Borrower or any Credit Party shall be required by law to deduct any Covered
Taxes from or in respect of any sum payable hereunder, under any Loan or under
the Guaranties to or for the benefit of any Bank or the Administrative Agent,
(A) the sum payable shall be increased as may be necessary so that after making
all required deductions of Covered Taxes (including deductions of Covered Taxes
applicable to additional sums payable under this Section 3.03) such Bank or the
Administrative Agent, as the case may be, receives an amount equal to the sum it
would have received had no such deductions been made, (B) the Borrower shall
make such deductions and (C) the Borrower shall pay the full amount so deducted
to the relevant taxation authority or other authority in accordance with
applicable law. If any amounts are payable in respect of Taxes pursuant to the
preceding sentence, the Borrower agrees to reimburse any Bank, or the
Administrative Agent, within thirty days of the date of the written request of
such Bank or the Administrative Agent, as the case may be, for taxes imposed on
or measured by the net income or profits of such Bank or the Administrative
Agent pursuant to the laws of the jurisdiction in which the principal office or
Applicable Lending Office of such Bank or the Administrative Agent is located or
under the laws of any political subdivision or taxing authority of any such
jurisdiction in which the principal office or Applicable Lending Office of such
Bank or the Administrative Agent is located and for any withholding of income or
similar taxes imposed by the United States as such Bank or the Administrative
Agent shall determine are payable by, or withheld from, such Bank or the
Administrative Agent in respect of such amounts so paid to or on behalf of such
Bank or the Administrative Agent pursuant to the preceding sentence and in
respect of any amounts paid to or on behalf of such Bank or the Administrative
Agent pursuant to this sentence ("Second Tier Taxes"). The written request
referred to in the preceding sentence shall certify and set forth in reasonable
detail the calculation of the payment and specify the type of such Taxes. Any
such certificate submitted in good faith to the Borrower shall, absent manifest
error, be final, conclusive and binding on all parties; provided, however, that
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notwithstanding any of the foregoing with respect to the above-referenced
calculations, none of the Banks or the Administrative Agent shall be obligated
to provide any information with respect to its assets, income or operations
other than assets, income or operations solely attributable to this Agreement,
any Loan or any Guaranty.
(b) In addition, the Borrower agrees to pay any present or
future stamp, documentary, excise, privilege, intangible or similar levies that
arise at any time or from time to time (i) from any payment made under any and
all Credit Documents, (ii) from the transfer of the rights of any Bank (other
than a Defaulting Bank) under any Credit Documents to any transferee pursuant to
Section 1.11, or (iii) from the execution or delivery by the Borrower of, or
from the filing or recording or maintenance of, or otherwise with respect to the
exercise by the Administrative Agent or the Banks of their rights (subject to
the provisions of Section 3.03(a), excluding transfers pursuant to Section
12.04) under, any and all Credit Documents (hereinafter referred to as "Other
Taxes").
(c) Except as provided in Section 3.03(e), the Borrower shall
indemnify, to the extent not previously withheld and paid to the relevant
taxation authority or other authority in accordance with applicable law, each
Bank and the Administrative Agent for the full amount of (i) Covered Taxes
imposed on or with respect to amounts payable hereunder, (ii) Other Taxes, and
(iii) any Second Tier Taxes (other than Covered Taxes imposed by any
jurisdiction on amounts payable under this Section 3.03) paid by such Bank or
the Administrative Agent, as the case may be, and any liability (including
penalties, interest and expenses) arising solely therefrom or with respect
thereto. Payment of this indemnification shall be made within 30 days from the
date such Bank or the Administrative Agent certifies and sets forth in
reasonable detail the calculation thereof as to the amount and type of such
Taxes. Any such certificate submitted by the Bank or Administrative Agent in
good faith to the Borrower shall, absent manifest error, be final, conclusive
and binding on all parties; provided, however, that notwithstanding any of the
foregoing with respect to the above-referenced calculations, none of the Banks
or the Administrative Agent shall be obligated to provide any information with
respect to its assets, income or operations other than assets, income or
operations solely attributable to this Agreement, any Loan or any Guaranty.
(d) Within 30 days after having received a receipt of Covered
Taxes or Other Taxes, the Borrower will furnish to the Administrative Agent the
original or a certified copy of a receipt evidencing payment thereof.
(e) Each Foreign Bank agrees to deliver to each of the
Borrower and the Administrative Agent on or prior to the Closing Date, or in the
case of a Foreign Bank that is an assignee or transferee of an interest under
this Agreement pursuant to Section
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1.11 or 12.04 (unless the respective Foreign Bank was already a Bank hereunder
immediately prior to such assignment or transfer), on or prior to the date of
such assignment or transfer to such Foreign Bank, (i) two accurate and complete
original signed copies of Internal Revenue Service Form 4224 or 1001 (or
successor forms) certifying to such Foreign Bank's entitlement to a complete
exemption from United States withholding tax with respect to payments to be made
under any and all Credit Documents or (ii) if the Foreign Bank is not a "bank"
within the meaning of Section 881(c)(3)(A) of the Code and cannot deliver either
Internal Revenue Service Form 1001 or 4224 pursuant to clause (i) above with
respect to any payments of interest, (x) a certificate substantially in the form
of Exhibit C (any such certificate, a "Section 3.03(e) Certificate") and (y) two
accurate and complete original signed copies of Internal Revenue Service Form
W-8 (or successor form) certifying to such Foreign Bank's entitlement to a
complete exemption from United States withholding tax with respect to payments
of interest to be made under any and all Credit Documents. In addition, each
Foreign Bank agrees that from time to time after the Closing Date, when a lapse
in time or change in circumstances renders the previous certification obsolete
or inaccurate in any material respect, it will deliver to the Borrower and the
Administrative Agent two new accurate and complete original signed copies of
Internal Revenue Service Form 4224 or 1001, or Form W-8 and a Section 3.03(e)
Certificate, as the case may be, and such other forms and statements as may be
required in order to confirm or establish the entitlement of such Foreign Bank
to a continued exemption from or reduction in United States withholding tax with
respect to payments under any and all Credit Documents or it shall immediately
notify the Borrower and the Administrative Agent of its inability to deliver any
such Form or Certificate, in which case such Foreign Bank shall not be required
to deliver any such Form or Certificate pursuant to this Section 3.03(e).
Notwithstanding anything to the contrary contained in Section 3.03(a) and (c),
but subject to the immediately succeeding sentence, (x) the Borrower shall be
entitled, to the extent it is required to do so by law, to deduct or withhold
income or similar taxes imposed by the United States (or any political
subdivision or taxing authority thereof or therein) from interest, fees or other
amounts payable hereunder for the account of any Foreign Bank for U.S. Federal
income tax purposes to the extent that such Foreign Bank has not provided to the
Borrower Internal Revenue Service Forms that establish a complete exemption from
such deduction or withholding and (y) the Borrower shall not be obligated
pursuant to Section 3.03(a) and (c) hereof to indemnify or to gross-up payments
to be made to a Foreign Bank in respect of income or similar taxes imposed by
the United States if (I) such Foreign Bank has not provided to the Borrower the
forms or statements required to be provided to the Borrower pursuant to this
Section 3.03(e) or (II) in the case of a payment, other than interest, to a
Foreign Bank described in clause (ii) above, to the extent that such forms or
statements do not establish a complete exemption from withholding of such taxes.
Notwithstanding anything to the contrary contained in the preceding sentence or
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elsewhere in this Section 3.03 and except as set forth in Section 12.04(b), the
Borrower agrees to pay additional amounts and to indemnify each Bank or the
Administrative Agent in the manner set forth in Section 3.03(a) and (c) (without
regard to the identity of the jurisdiction requiring the deduction or
withholding) in respect of any amounts deducted or withheld by it as described
in the immediately preceding sentence as a result of any changes after the
Closing Date in any applicable law, treaty, governmental rule, regulation,
guideline or order, or in the interpretation thereof, relating to the deducting
or withholding of income or similar Taxes.
(f) If any Taxes for which the Borrower would be required to
make payment under this Section 3.03 are imposed, the Bank or the Administrative
Agent, as the case may be, shall use its reasonable best efforts to avoid or
reduce such Taxes by taking any appropriate action (including, without
limitation, assigning its rights hereunder to a related entity or a different
office) which would not in the sole opinion of such Bank or Administrative Agent
be otherwise disadvantageous to such Bank or Administrative Agent, as the case
may be.
(g) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 3.03 shall survive the payment in full of the
Obligations.
(h) If the Borrower pays any additional amount under this
Section 3.03 to a Bank and such Bank determines in its sole discretion that it
has actually received or realized in connection therewith any refund or any
reduction of, or credit against, its liabilities with respect to Taxes in or
with respect to the taxable year in which the additional amount is paid, such
Bank shall pay to the Borrower an amount that the Bank shall, in its sole
discretion, determine is equal to the net benefit, after tax, which was obtained
by the Bank in such year as a consequence of such refund, reduction or credit.
(i) Notwithstanding any provision of this Agreement to the
contrary, Section 3.03 is the only provision of this Agreement that requires the
Borrower (or any Credit Party) to make any payment to a Bank, the Administrative
Agent or any of their successors and assigns, by reason of any Tax imposed upon
a Bank, the Administrative Agent or any of their successors and assigns.
SECTION 4. Conditions Precedent. The obligation of each Bank
to make Loans on the Closing Date, is subject to the satisfaction of the
following conditions:
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4.01 Execution of Agreement; Notes. On or prior to the Closing
Date (i) the Effective Date shall have occurred and (ii) there shall have been
delivered to the Administrative Agent for the account of each of the Banks the
appropriate Note executed by the Borrower, in each case in the amount, maturity
and as otherwise provided herein.
4.02 No Default; Representations and Warranties. On the
Closing Date and after giving effect to the Loans made on such date, (i) there
shall exist no Default or Event of Default and (ii) all representations and
warranties contained herein and in the other Credit Documents shall be true and
correct in all material respects with the same effect as though such
representations and warranties had been made on the Closing Date (it being
understood and agreed that any representation or warranty which by its terms is
made as of a specified date shall be required to be true and correct in all
material respects only as of such specified date).
4.03 Opinions of Counsel. On the Closing Date, the
Administrative Agent shall have received (i) from Shearman & Sterling, special
counsel to the Credit Parties, an opinion addressed to the Administrative Agent,
the Collateral Agent and each of the Banks and dated the Closing Date in the
form set forth as Exhibit D-1 and (ii) from Xxxxxxx X. Xxxxx, Esq., General
Counsel to Communications and the Borrower, an opinion addressed to the
Administrative Agent, the Collateral Agent and each of the Banks and dated the
Closing Date in the form set forth as Exhibit D-2. Without limiting the
foregoing, Shearman & Sterling's opinion as required pursuant to the immediately
preceding sentence shall contain an unqualified opinion, in form satisfactory to
the Administrative Agent, to the effect that all Loans and related Obligations
constitute "Senior Indebtedness" under, and as defined in, the Senior
Subordinated Notes Indenture.
4.04 Corporate Documents; Proceedings; etc. (a) On the Closing
Date, the Administrative Agent shall have received a certificate of each Credit
Party, dated the Closing Date, signed by an Authorized Officer of such Credit
Party, and attested to by the Secretary or any Assistant Secretary of such
Credit Party, in the form of Exhibit E with appropriate insertions, together
with copies of the certificate of incorporation (or equivalent organizational
document) and by-laws of such Credit Party and the resolutions of such Credit
Party referred to in such certificate, and the foregoing shall be reasonably
acceptable to the Administrative Agent.
(b) All corporate and legal proceedings and all instruments
and agreements in connection with the transactions contemplated by this
Agreement and the other Documents shall be reasonably satisfactory in form and
substance to the Administrative Agent and the Required Banks, and the
Administrative Agent shall have received all in-
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formation and copies of all documents and papers, including records of corporate
proceedings, governmental approvals, good standing certificates and bring-down
telegrams or facsimiles, if any, which the Administrative Agent reasonably may
have requested in connection therewith, such documents and papers where
appropriate to be certified by proper corporate or governmental authorities.
4.05 Adverse Change, etc. (a) On or prior to the Closing Date,
nothing shall have occurred (and neither the Administrative Agent nor the Banks
shall have become aware of any facts, conditions or other information not
previously known) which the Administrative Agent or the Required Banks shall
determine could reasonably be expected to have a material adverse effect on the
rights or remedies of the Administrative Agent or the Banks, or on the ability
of any Credit Party to perform its obligations to the Administrative Agent and
the Banks or which could reasonably be expected to have a Material Adverse
Effect.
(b) All necessary governmental (domestic and foreign) and
third party approvals and/or consents in connection with the making of the Loans
and the Transaction, the other transactions contemplated by the Documents and
otherwise referred to herein or therein shall have been obtained and remain in
effect, and all applicable waiting periods shall have expired without any action
being taken by any competent authority which restrains, prevents, or imposes
materially adverse conditions upon, the consummation of the Transaction or the
other transactions contemplated by the Documents or otherwise referred to herein
or therein. Additionally, there shall not exist any judgment, order, injunction
or other restraint issued or filed or a hearing seeking injunctive relief or
other restraint pending or notified prohibiting or imposing materially adverse
conditions upon the Transaction or the other transactions contemplated by the
Documents.
4.06 Litigation. On the Closing Date, no litigation by any
entity (private or governmental) shall be pending or threatened with respect to
this Agreement, any other Document or any documentation executed in connection
herewith or therewith or the transactions contemplated hereby or thereby, or
which the Administrative Agent or the Required Banks shall determine could
reasonably be expected to have a Material Adverse Effect.
4.07 Subsidiaries Guaranty. On the Closing Date, each of the
Wholly-Owned Restricted Subsidiaries of the Borrower, as well as any other
Restricted Subsidiary of the Borrower which has guaranteed outstandings pursuant
to the Existing Credit Agreement, shall have duly authorized, executed and
delivered a Subsidiaries Guaranty in the form of Exhibit G (as modified, amended
or supplemented from time
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to time in accordance with the terms thereof and hereof, the "Subsidiaries
Guaranty"), and the Subsidiaries Guaranty shall be in full force and effect.
4.08 Existing Pledge Agreement Amendment. On the Closing Date,
the parties to the Existing Pledge Agreement shall have duly authorized,
executed and delivered an amendment thereto in the form of Exhibit H-2 (the
"Existing Pledge Agreement Amendment"), which amendment shall be in full force
and effect. Without limiting the foregoing, the consent of the requisite lenders
pursuant to the Existing Credit Agreement shall have been obtained to the
amendment of the Existing Pledge Agreement as required above.
4.09 Existing Security Agreement Amendment. On the Closing
Date, the parties thereto shall have duly authorized, executed and delivered an
amendment to the Existing Security Agreement in the form of Exhibit I-2 (the
"Existing Security Agreement Amendment"), which amendment shall be in full force
and effect. Without limiting the foregoing, the consent of the requisite lenders
pursuant to the Existing Credit Agreement shall have been obtained to the
amendment of the Existing Security Agreement as required above.
4.10 Mortgage Amendments; etc. On or prior to the Closing
Date, the Collateral Agent shall have received:
(i) fully executed counterparts of amendments (the "Mortgage
Amendments"), in form and substance satisfactory to the
Administrative Agent and the Required Banks, to each of the
Existing Mortgages, together with evidence that counterparts
of each of the Mortgage Amendments have been delivered to the
title company insuring the Lien of the Existing Mortgages for
recording in all places to the extent necessary or desirable,
in the judgment of the Collateral Agent, effectively to
maintain a valid and enforceable first priority mortgage lien
(subject to Permitted Encumbrances relating thereto) on the
Existing Mortgaged Properties in favor of the Collateral Agent
(or such other trustee as may be required or desired under
local law) for the benefit of the Secured Creditors; and
(ii) endorsements reasonably satisfactory to the Collateral
Agent to each Existing Mortgage Policy assuring the Collateral
Agent that each Existing Mortgage is a valid and enforceable
first priority mortgage lien on the respective Existing
Mortgaged Properties, free and clear of all defects and
encumbrances except Permitted Encumbrances.
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4.11 Canadian Debenture and Pledge Agreement. On the Closing
Date, the parties thereto shall have entered into amendments, in the form of
Exhibits K-3 and K-4 hereto, respectively, to the Existing Canadian Debenture
(the "Existing Canadian Debenture Amendment") and the Existing Canadian Pledge
Agreement (the "Existing Canadian Pledge Agreement Amendment"), and shall have
taken such actions in connection therewith (including making any required
filings under the PPSA of the relevant jurisdictions or otherwise) as may be
determined by the Collateral Agent to be necessary or desirable in connection
therewith.
4.12 Form of Collateral Assignments of Rights. On the Closing
Date, the form of the Collateral Assignment of Rights pursuant to the Existing
Credit Agreement shall be amended, so that all such Collateral Assignments of
Rights executed and delivered after the Closing Date shall be in the form of
Exhibit L hereto.
4.13 Lockbox, Blocked Account and Concentration Account
Agreements. On the Closing Date, all Lockbox Agreements, Blocked Account
Agreements and Concentration Account Agreements previously entered into with
respect to the Existing Credit Agreement (and which remain in effect on the
Closing Date) shall be modified so that same are in the forms of Exhibits X-0,
X-0 xxx X-0, respectively, hereto.
4.14 Collateral Access Agreements. On the Closing Date, the
Borrower shall have caused all Existing Credit Agreement Collateral Access
Agreements to be replaced with Collateral Access Agreements in the form of
Exhibit N hereto.
4.15 Amendment to the Existing Credit Agreement. On or prior
to the Closing Date, the Existing Credit Agreement shall have been amended
pursuant to an amendment in form and substance satisfactory to the
Administrative Agent and the Required Banks. Without limiting the foregoing,
such amendment shall authorize the modifications to the Collateral Documents
previously delivered pursuant to the Existing Credit Agreement, as required by
preceding Section 4.08 through 4.14, inclusive.
4.16 Solvency Certificate. On the Closing Date, there shall
have been delivered to the Administrative Agent a solvency certificate in the
form of Exhibit F from the chief financial officer of the Borrower and dated the
Closing Date.
4.17 Notice of Borrowing. Prior to the making of any Loan on
the Closing Date, the Administrative Agent shall have received a Notice of
Borrowing meeting the requirements of Section 1.02(a).
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4.18 Fees, etc. On the Closing Date, the Borrower shall have
paid to the Administrative Agent and each Bank all costs, fees and expenses
(including, without limitation, reasonable legal fees and expenses) payable to
the Administrative Agent and such Bank to the extent then due.
SECTION 5. Representations, Warranties and Agreements. To
induce the Banks to enter into this Agreement and to make Loans provided for
herein, each of Communications and the Borrower makes the following
representations, warranties and agreements, as to itself and as to each of its
Restricted Subsidiaries, with the Banks, all of which shall survive the
execution and delivery of this Agreement and the making of the Loans:
5.01 Corporate Status. Each Credit Party (i) is a duly
organized and validly existing corporation in good standing under the laws of
the jurisdiction of its organization and has the corporate power and authority
to own its property and assets and to transact the business in which it is
engaged and presently proposes to engage and (ii) has duly qualified and is
authorized to do business and is in good standing in all jurisdictions where it
is required to be so qualified except where the failure to be so qualified, when
aggregated with all other such failures, would not reasonably be expected to
have a Material Adverse Effect.
5.02 Corporate Power and Authority. Each Credit Party has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Credit Documents to which it is a party. Each Credit Party has duly
executed and delivered each Credit Document to which it is a party and each such
Credit Document constitutes the legal, valid and binding obligation of such
Credit Party enforceable in accordance with its terms, except that such
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws of general application relating to
or affecting the rights and remedies of creditors, (ii) federal securities or
other laws or regulations or public policy insofar as they may restrict the
enforceability of rights to indemnification and (iii) general principles of
equity (regardless of whether enforcement is sought in equity or at law).
5.03 No Violation. Neither the execution, delivery and
performance by any Credit Party of the Credit Documents to which it is a party
nor compliance with the terms and provisions thereof, nor the consummation of
the transactions contemplated therein (i) will contravene any applicable
provision of any law, statute, rule, regulation, order, writ, injunction or
decree of any court or governmental instrumentality, (ii) will, after giving
effect to any waivers, conflict or be inconsistent with
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or result in any breach of any of the terms, covenants, conditions or provisions
of, or constitute a default under, or (other than pursuant to the Collateral
Documents) result in the creation or imposition of (or the obligation to create
or impose) any Lien upon any of the property or assets of such Credit Party or
any of its Restricted Subsidiaries pursuant to the terms of any indenture,
mortgage, deed of trust, agreement or other instrument to which such Credit
Party or any of its Restricted Subsidiaries is a party or by which it or any of
its property or assets are bound or to which it may be subject (including
without limitation the Existing Credit Agreement and the Senior Subordinated
Notes Indenture) or (iii) will violate any provision of the charter or By-Laws
of Communications, the Borrower or any of the Borrower's Restricted
Subsidiaries, except, in the case of clauses (i) and (ii) any immaterial
contravention, conflict, inconsistency, breach or default (but not under the
Existing Credit Agreement or the Senior Subordinated Notes Indenture) which is
not reasonably likely to adversely affect any Bank or have a Material Adverse
Effect.
5.04 Litigation. There are no actions, suits or proceedings
pending or, to the best knowledge of the Borrower, threatened with respect to
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries
that, after giving effect to expected insurance proceeds and indemnity payments,
are reasonably likely to have a Material Adverse Effect.
5.05 Use of Proceeds. (a) The proceeds of the Loans shall be
utilized (i) to pay certain fees and expenses owing in relation to this
Agreement and the extensions of credit hereunder and (ii) to repay outstanding
Revolving Loans under, and as defined in, the Existing Credit Agreement.
(b) No part of the proceeds of any Loan will be used to
purchase or carry any Margin Stock or to extend credit for the purpose of
purchasing or carrying any Margin Stock.
5.06 Governmental Approvals. Except as set forth on Schedule
II hereto and except for the filing of the Mortgage Amendments and the filing of
continuation statements as required under the Collateral Documents, no order,
consent, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, any foreign or domestic
governmental or public body or authority, or any subdivision thereof, is
required to authorize or is required in connection with (i) the execution,
delivery and performance by each Credit Party of any Credit Document or (ii) the
legality, validity, binding effect or enforceability of any Credit Document as
against each Credit Party thereto.
-21-
5.07 Investment Company Act. None of Communications, the
Borrower or any of the Borrower's Restricted Subsidiaries is an "investment
company" within the meaning of the Investment Company Act of 1940, as amended.
5.08 Public Utility Holding Company Act. None of
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries is
a "holding company," or 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.
5.09 True and Complete Disclosure. As of the Closing Date,
there is no fact known to any Credit Party (other than matters of general
economic, political or social nature) which materially and adversely affects the
business, property, assets, liabilities, financial condition or prospects of the
Borrower and its Restricted Subsidiaries taken as a whole which has not been
disclosed herein or in such other documents, certificates and statements
furnished to the Banks for use in connection with the transactions contemplated
hereby.
5.10 Financial Condition; Financial Statements. (a) On and as
of the Closing Date on a pro forma basis after giving effect to the Transaction
and all Indebtedness incurred, and to be incurred, and Liens created and to be
created, by each Credit Party in connection with this Agreement, (w) the value
of the assets the Borrower, and of the Borrower and its Restricted Subsidiaries
on a consolidated basis, at a fair valuation, would exceed the debts and
liabilities, subordinated, contingent or otherwise, of the Borrower, and of the
Borrower and its Restricted Subsidiaries on a consolidated basis, (x) the fair
salable value of the property of the Borrower, and of the Borrower and its
Restricted Subsidiaries on a consolidated basis, will be greater than the amount
that will be required to pay the probable liability of the Borrower, and of the
Borrower and its Restricted Subsidiaries on a consolidated basis, on their debts
and other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured, (y) the Borrower, and the
Borrower and its Restricted Subsidiaries on a consolidated basis, will be able
to pay their debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured, and (z) the Borrower,
and the Borrower and its Restricted Subsidiaries on a consolidated basis, will
not have unreasonably small capital with which to conduct the businesses in
which they are engaged as such businesses are now conducted and are proposed to
be conducted following the Closing Date.
(b) Communications has furnished to the Banks the following
financial statements, which have been prepared in accordance with GAAP
consistently applied throughout the periods involved: (i) Communications'
consolidated balance sheet as of,
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and consolidated statements of operations, shareholders' equity and cash flows
for the fiscal years ended, March 31, 1996 and March 31, 1997, in each case,
audited by the Auditors, and accompanied by an unqualified opinion thereof.
After giving effect to the Transaction, since March 31, 1997, there has occurred
no Material Adverse Effect, and nothing has occurred which is reasonably likely
to result in a Material Adverse Effect.
5.11 Locations of Offices, Records and Inventory. The address
of the principal place of business and chief executive office of Communications
and the Borrower as of the date hereof and as of the Closing Date is set forth
on Schedule III. The books and records of the Borrower, and all of its chattel
paper and records of Accounts, are maintained exclusively at the locations
listed on Schedule III. As of the date hereof and as of the Closing Date, there
is no jurisdiction in which the Borrower has any chattel paper, records of
Account and Inventory (except for Inventory in transit) other than those
jurisdictions identified on Schedule III. Schedule III also contains a complete
list of the legal names and addresses of each facility or warehouse at which
Inventory is stored as of the date hereof and as of the Closing Date. None of
the receipts received by the Borrower from any warehouseman states that the
goods covered thereby are to be delivered to bearer or to the order of a named
person other than the Borrower or its Restricted Subsidiaries or to a named
person and such named person's assigns.
5.12 Fictitious Business Names. Except as set forth in
Schedule IV, no Credit Party has used any corporate or fictitious name since
August 1, 1990, other than the corporate name shown on its Governing Documents.
5.13 Security Interests. On and after the Closing Date, each
of the Collateral Documents create, as security for the Obligations, a valid and
enforceable perfected security interest in and Lien on all of the Collateral,
superior to and prior to the rights of all third persons and subject to no other
Liens, other than Liens Permitted by this Agreement and under the Collateral
Documents. At all times on or after the Closing Date, the respective grantor
under each Collateral Document shall have good and marketable title to all the
Collateral subject thereto free and clear of all Liens other than Liens
permitted under this Agreement. No filings or recordings are required in order
to perfect the security interests created under any Collateral Document except
for filings or recordings made as required in connection with any such
Collateral Document.
5.14 Tax Returns and Payments. Each of Communications, the
Borrower and each of their respective Subsidiaries has timely filed or caused to
be timely filed with the appropriate taxing authority, all material returns and
other material
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statements, forms and reports for taxes required to be filed by or with respect
to the income, properties or operations of Communications, the Borrower and/or
any of their respective Subsidiaries. Such returns accurately reflect all
liability for material taxes of Communications, the Borrower and their
respective Subsidiaries for the periods covered thereby. Each of Communications,
the Borrower and their respective Subsidiaries has paid all material taxes
payable by it other than taxes which are not yet due and payable, and other than
those contested in good faith and for which adequate reserves have been
established in accordance with generally accepted accounting principles. Except
as provided in Schedule V, there is no material action, suit, proceeding,
investigation, audit, or claim now pending or, to the knowledge of
Communications or the Borrower, threatened by any authority regarding any taxes
relating to Communications, the Borrower or any of their respective
Subsidiaries. Except as provided in Schedule V, as of the Closing Date, none of
Communications, the Borrower or any of their respective Subsidiaries has entered
into an agreement or waiver or been requested to enter into an agreement or
waiver extending any statute of limitations relating to the payment or
collection of material taxes of Communications, the Borrower or any of their
respective Subsidiaries, or is aware of any circumstances that would cause the
taxable years or other taxable periods of Communications, the Borrower or any of
their respective Subsidiaries not to be subject to the normally applicable
statute of limitations. None of Communications, the Borrower or any of their
respective Subsidiaries have provided, with respect to themselves or property
held by them, any consent under Section 341 of the Code. None of Communications,
the Borrower or any of their respective Subsidiaries has incurred, or will
incur, any material tax liability with respect to the Transaction and the other
transactions contemplated hereby.
5.15 Compliance with ERISA. Except to the extent that all
events and obligations described in the following clauses of this Section 5.15
and then in existence would not, in the aggregate, be reasonably likely to have
a Material Adverse Effect; (i) each Plan (other than a Multiemployer Plan) is in
substantial compliance with ERISA and the Code; to the knowledge of
Communications, the Borrower, any Subsidiary of Communications, or any ERISA
Affiliate, each Multiemployer Plan is in substantial compliance with ERISA and
the Code; no Reportable Event has occurred with respect to a Plan (other than a
Multiemployer Plan); no Multiemployer Plan is insolvent (as defined in Section
4245 of ERISA) or in reorganization (as defined in Section 4241 of ERISA); no
Plan (other than a Multiemployer Plan) has an Unfunded Current Liability; no
Plan (other than a Multiemployer Plan) has an accumulated or waived funding
deficiency or has applied for an extension of any amortization period within the
meaning of Section 412 of the Code or Section 302 of ERISA; all contributions
required to be made with respect to a Plan and a Foreign Pension Plan have been
timely made; neither Communications nor the Borrower nor any Subsidiary of
Communica-
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tions nor any ERISA Affiliate has incurred any liability which as of the date
hereof has not been fully satisfied, to or on account of a Plan pursuant to
Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of
ERISA or Section 401(a)(29), 4971, 4975 or 4980 of the Code or expects to incur
any liability under any of the foregoing Sections with respect to any Plan; no
proceedings have been instituted to terminate or appoint a trustee to administer
any Plan; no condition exists which presents a material risk to Communications,
the Borrower or any Subsidiary of Communications or any ERISA Affiliate of
incurring a liability to or on account of a Plan pursuant to the foregoing
provisions of ERISA and the Code; using actuarial assumptions and computation
methods consistent with Part 1 of subtitle E of Title IV of ERISA, there would
be no liabilities of Communications, the Borrower, any Subsidiaries and any
ERISA Affiliates to all Plans which are multiemployer plans (as defined in
Section 4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom, as
of the close of the most recent fiscal year of each such Plan ended prior to the
Closing Date, which would result in a Material Adverse Effect; no lien imposed
under the Code or ERISA on the assets of Communications or any Subsidiary of
Communications or any ERISA Affiliate exists or is likely to arise on account of
any Plan; and Communications and its Subsidiaries do not maintain or contribute
to any employee welfare benefit plan (as defined in Section 3(1) of ERISA) which
provides benefits to retired employees or other former employees (other than as
required by Section 601 of ERISA) or any employee pension benefit plan (as
defined in Section 3(2) of ERISA) the obligations with respect to which could
reasonably be expected to have a Material Adverse Effect. With respect to Plans
that are Multiemployer Plans the representations and warranties in this Section
5.15, other than any made with respect to liability under Section 4201 or 4204
of ERISA, are made to the knowledge of the Borrower.
(ii) Each Foreign Pension Plan has been maintained in
substantial compliance with its terms and with the requirements of any and all
applicable laws, statutes, rules, regulations and orders and has been
maintained, where required, in good standing with applicable regulatory
authorities. Neither Communications, nor the Borrower nor any of their
Subsidiaries has incurred any obligation in connection with the termination of
or withdrawal from any Foreign Pension Plan. No Foreign Pension Plan has any
unfunded liabilities, either on a "going concern" or on a "winding up" basis and
determined in accordance with all applicable laws and actuarial practices and
using actuarial assumptions and methods that are reasonable in the
circumstances. No event has occurred or will occur and no condition exists or
will exist with respect to any Foreign Pension Plan that has resulted or could
reasonably be expected to result in any Foreign Pension Plan having its
registration revoked or being wound up (in whole or in part) or refused for the
purposes of any applicable pension benefits or tax laws or being placed under
the administration of any relevant pension benefits regulatory
-25-
authority or being required to pay any taxes or penalties under any applicable
pension benefits or tax laws.
5.16 Subsidiaries. Schedule VI hereto lists each Subsidiary of
the Borrower, and the direct and indirect ownership interest of the Borrower
therein, in each case existing on the Closing Date. Communications is the record
and beneficial owner of 100% of the capital stock of the Borrower. On the
Closing Date, the only material asset of Communications is the capital stock of
the Borrower owned by it, and on such date Communications owns no other capital
stock of any other Person.
5.17 Patents, etc. Communications and each of its Restricted
Subsidiaries have obtained all material patents, trademarks, servicemarks, trade
names, copyrights, licenses and other rights, free from burdensome restrictions,
that are necessary for the operation of their respective businesses as presently
conducted and as proposed to be conducted except where a failure to do so could
not reasonably be expected to have a Material Adverse Effect.
5.18 Compliance with Statutes, etc. (a) Each of
Communications, the Borrower and the Borrower's Restricted Subsidiaries is in
compliance with all applicable statutes, regulations and orders of, and all
applicable restrictions imposed by, all governmental bodies, domestic or
foreign, in respect of the conduct of its business and the ownership of its
property, except such noncompliances as are not likely to, in the aggregate,
have a Material Adverse Effect.
(b) Except as set forth in the Offering Memorandum, each of
Communications, the Borrower and the Borrower's Restricted Subsidiaries is in
compliance with all applicable Environmental Laws governing its business for
which failure to comply is likely to have a Material Adverse Effect, and none of
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries is
liable for any material penalties, fines or forfeitures for failure to comply
with any of the foregoing in the manner set forth above. All licenses, permits,
registrations or approvals required for the business of Communications, the
Borrower and each of the Borrower's Restricted Subsidiaries, as conducted as of
the Closing Date, under any Environmental Law have been secured and each of
Communications, the Borrower and the Borrower's Restricted Subsidiaries is in
material compliance therewith, except such licenses, permits, registrations or
approvals the failure to secure or to comply therewith is not likely to have a
Material Adverse Effect. None of Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries is in any respect in noncompliance with,
breach of or default under any applicable writ, order, judgment, injunction, or
decree to which any of Communications, the Borrower or such Restricted
Subsidiary is a party or which would affect the ability of Communications, the
Borrower or such Restricted Subsidiary to
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operate its business or other Real Property and no event has occurred and is
continuing which, with the passage of time or the giving of notice or both,
would be reasonably likely to constitute noncompliance, breach of or default
thereunder, except in each such case, such noncompliances, breaches or defaults
as are not likely to, in the aggregate, have a Material Adverse Effect. Except
as set forth in the Offering Memorandum delivered to the Administrative Agent,
there are as of the Closing Date no Environmental Claims pending or, to the best
knowledge of the Borrower, threatened, which (a) question the validity, term or
entitlement of Communications, the Borrower or any of the Borrower's Restricted
Subsidiaries for any permit, license, order or registration required for the
operation of any facility which Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries currently operates and (b) wherein an
unfavorable decision, ruling or finding would be reasonably likely to have a
Material Adverse Effect. To the best knowledge of the Borrower, there are no
facts, circumstances, conditions or occurrences on any Real Property of
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries or
on any property adjoining or adjacent to any such Real Property, that are
reasonably expected (i) to form the basis of an Environmental Claim against
Communications, the Borrower any of the Borrower's Restricted Subsidiaries or
any Real Property of Communications, the Borrower or any of the Borrower's
Restricted Subsidiaries, or (ii) to cause such Real Property to be subject to
any restrictions on the ownership, occupancy, use or transferability of such
Real Property under any Environmental Law, except in each such case, such
Environmental Claims or restrictions that individually or in the aggregate are
not likely to have a Material Adverse Effect.
(c) Except as set forth in the Offering Memorandum, Hazardous
Materials have not at any time been (i) generated, used, treated or stored on,
or transported to or from, by Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries, any Real Property of Communications, the
Borrower or any of the Borrower's Restricted Subsidiaries, except Hazardous
Materials generated, used, treated or stored on, or transported to or from, any
Real Property of Communications, the Borrower or any of the Borrower's
Restricted Subsidiaries in the ordinary course of business and in compliance
with Environmental Laws ("Permitted Materials") or (ii) released or disposed of
(not including the sale of Inventory) on any such Real Property in violation of
any Environmental Laws or in any quantity or amount which would require any
clean-up, removal, treatment or remediation, in each case where such occurrence
or event is likely to have a Material Adverse Effect.
5.19 Properties. Communications and each of its Restricted
Subsidiaries has good title to all material properties owned by it free and
clear of all Liens, other than as permitted by this Agreement. Schedule VII
contains a true and complete list of each Real Property owned, if any, and each
Real Property leased by
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Communications, the Borrower or any of the Borrower's Restricted Subsidiaries on
the Closing Date and the type of interest therein held by Communications, the
Borrower or the respective such Restricted Subsidiary.
5.20 Labor Relations; Collective Bargaining Agreements. (a)
Set forth on Schedule VIII hereto is a list (including dates of termination) of
all collective bargaining or similar agreements between or applicable to the
Borrower or any of its Restricted Subsidiaries and any union, labor organization
or other bargaining agent in respect of the employees of the Borrower and/or any
of its Restricted Subsidiaries on the Closing Date.
(b) Neither the Borrower nor any of its Restricted
Subsidiaries is engaged in any unfair labor practice that is reasonably likely
to have a Material Adverse Effect. There is (i) no significant unfair labor
practice complaint pending against Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries or, to the best knowledge of the Borrower,
threatened against any of them, before the National Labor Relations Board, and
no significant grievance or significant arbitration proceeding arising out of or
under any collective bargaining agreement is pending on the Closing Date against
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries
or, to the best knowledge of the Borrower, threatened against any of them, (ii)
no significant strike, labor dispute, slowdown or stoppage is pending against
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries
or, to the best knowledge of the Borrower, threatened against Communications,
the Borrower or any of the Borrower's Restricted Subsidiaries, except (with
respect to any matter specified in clause (i) and (ii) above, either
individually or in the aggregate) such as is not reasonably likely to have a
Material Adverse Effect.
5.21 Restrictions on Restricted Subsidiaries. Except for
restrictions contained in the Credit Documents, the Existing Credit Agreement
Documents, the Senior Subordinated Note Documents and in agreements with respect
to the Existing Indebtedness, as of the Closing Date there are no contractual or
consensual restrictions on the Borrower or any of its Wholly-Owned Restricted
Subsidiaries which prohibit or otherwise restrict (i) the transfer of cash or
other assets (x) between the Borrower and any of its Wholly-Owned Restricted
Subsidiaries or (y) between any Restricted Subsidiaries of the Borrower or (ii)
the ability of the Borrower or any of its Wholly-Owned Restricted Subsidiaries
to grant security interests to the Banks in the Collateral.
5.22 Material Contracts. Neither the Borrower nor any of its
Restricted Subsidiaries is in breach of or in default under any Material
Contract.
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5.23 Senior Indebtedness, etc. All Obligations pursuant to
this Agreement constitute "Senior Indebtedness" under, and as defined in, and
for all purposes of, the Senior Subordinated Notes Indenture. The Borrower and
its Restricted Subsidiaries have not more than $1.0 million of outstanding
Indebtedness under Section 4.03(b)(xiv) of the Senior Subordinated Notes
Indenture (other than Indebtedness pursuant to this Agreement). $24.0 million of
Indebtedness pursuant to this Agreement is permitted under Section 4.03(b)(xiv)
of the Senior Subordinated Notes Indenture and $1.0 million of Indebtedness
pursuant to this Agreement is permitted under Section 4.03(b)(i) of the Senior
Subordinated Notes Indenture.
5.24 Existing Collateral Documents. True and correct copies,
as same are in effect on the Closing Date but before giving effect to the
amendments thereto required pursuant to Section 4 hereof, of each of (i) the
Existing Pledge Agreement is set forth as Exhibit H-1, (ii) the Existing
Security Agreement is set forth as Exhibit I-1, (iii) the Existing Canadian
Debenture is set forth as Exhibit K-1 and (iv) the Existing Canadian Pledge
Agreement is set forth as Exhibit K-2.
SECTION 6. Affirmative Covenants. Communications and the
Borrower hereby covenant and agree that on the Closing Date and thereafter, for
so long as this Agreement is in effect and until the Total Commitments have
terminated, no Notes are outstanding and the Loans, together with interest,
Fees, Expenses and all other Obligations (other than any indemnities described
in Section 12.01 hereof which are not then due and payable) incurred hereunder,
are paid in full:
6.01 Financial Information. Communications and the Borrower
shall furnish to, or cause to be furnished to, the Banks the following
information within the following time periods:
(a) as soon as available and in any event within 90 days after
the end of each fiscal year of Communications or the Borrower, as the
case may be, (i) audited Financial Statements as of the close of the
fiscal year and for the fiscal year, together with a comparison to the
Financial Statements for the prior year, in each case accompanied by
(A) report thereon of the Auditors unqualified as to scope, which
report shall state that such consolidated financial statements fairly
present the consolidated financial position of Communications or the
Borrower, as the case may be, and each of its consolidated Subsidiaries
as at the date indicated and the results of their operations and cash
flow for the periods indicated in conformity with GAAP (except as
otherwise stated therein) and that the examination by the Auditors has
been made in accordance with generally accepted auditing standards and
(B) a written statement signed by the Auditors
-29-
stating that in the course of the regular audit of the business of
Communications and the Borrower, which audit was conducted by the
Auditors in accordance with generally accepted auditing standards, the
Auditors have not obtained any knowledge of the existence of any
Default or Event of Default under any provision of Sections 7.01 and
7.02 of this Agreement, or, if such Auditors shall have obtained from
such examination any such knowledge, they shall disclose in such
written statement the existence of the Default or Event of Default and
the nature thereof, it being understood that such Auditors shall not be
required hereunder to perform any special audit procedures and shall
have no liability, directly or indirectly, to anyone for failure to
obtain knowledge of any such Default or Event of Default and (ii) a
compliance certificate substantially in the form of Exhibit O along
with a schedule in form reasonably satisfactory to the Administrative
Agent of the calculations used in determining, as of the end of such
fiscal year, whether the Borrower was in compliance with the covenants
set forth in Section 7 of this Agreement for such year. To the extent
that Communications' or the Borrower's, as the case may be, annual
report on Form 10-K contains any of the foregoing items, the Banks will
accept such Form 10-K in lieu of such items required to be furnished by
Communications or the Borrower, as the case may be;
(b) as soon as available and in any event within 45 days after
the end of each fiscal quarter of Communications or the Borrower, as
the case may be, (except the last fiscal quarter of any fiscal year),
(i) Financial Statements as at the end of such period and for the
fiscal year to date, together with a comparison to the Financial
Statements for the same periods in the prior year, all in reasonable
detail and duly certified (subject to the addition of footnotes and
audit and normal year-end adjustments) by the chief executive officer,
chief financial officer or vice president - corporate controller of
Communications or the Borrower, as the case may be, as having been
prepared substantially in accordance with GAAP and (ii) a compliance
certificate substantially in the form of Exhibit O along with a
schedule in form reasonably satisfactory to the Administrative Agent of
the calculations used in determining, as of the end of such fiscal
quarter, whether the Borrower was in compliance with the covenants set
forth in Section 7 of this Agreement for such quarter. To the extent
that Communications' or the Borrower's, as the case may be, quarterly
report on Form 10-Q contains any of the foregoing items, the Banks will
accept such Form 10-Q in lieu of such items required to be furnished by
Communications or the Borrower, as the case may be;
(c) promptly and in any event within five Business Days after
becoming aware of the occurrence of a Default or Event of Default, a
certificate of the
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chief executive officer or chief financial officer of the Borrower
specifying the nature thereof and the Borrower's proposed response
thereto, each in reasonable detail; and
(d) promptly upon the earlier of the mailing or filing
thereof, copies of all 00-Xx, 00-Xx, 0-Xx, proxy statements, annual
reports, quarterly reports, registration statements and any other
filings or other communications made by the either of the Borrower or
Communications to holders of its publicly traded securities, to the
holders of its Senior Subordinated Notes or the Securities Exchange
Commission from time to time pursuant to the Securities Exchange Act of
1934, as amended, or the Securities Act of 1933, as amended.
6.02 Corporate Franchises. Communications will, and will cause
each of its Restricted Subsidiaries to, do or cause to be done, all things
necessary to preserve and keep in full force and effect its existence, material
rights and authority to do business, provided that any transaction permitted by
Section 7 will not constitute a breach of this Section 6.02 and provided further
that Communications shall not be required to preserve, with respect to itself,
any material right or authority to do business and with respect to any of its
Restricted Subsidiaries, any such existence, material right or authority to do
business if Communications shall reasonably determine that such preservation is
no longer desirable in the ordinary course of business, and the loss thereof
shall not be reasonably likely to have a Material Adverse Effect.
6.03 Compliance with Statutes, etc. Communications and the
Borrower will, and will cause each of their respective Restricted Subsidiaries
to, comply with all applicable statutes, regulations and orders of, and all
applicable restrictions imposed by, all governmental bodies, domestic or
foreign, in respect of the conduct of its business and the ownership of its
property (including applicable Environmental Laws) other than those the
non-compliance with which (individually or in the aggregate) would not have a
Material Adverse Effect. Neither Communications nor any of its Restricted
Subsidiaries will generate, use, treat, store, release or dispose of, or permit
the generation, use, treatment, storage, release or disposal of Hazardous
Materials on any of its Real Property, or transport or permit the transportation
of Hazardous Materials to or from any such Real Property, except for quantities
used or stored at such Real Properties in material compliance with all
applicable Environmental Laws and required in connection with the normal
operation, use and maintenance of such Real Property or the operation of the
business of the Borrower and its Restricted Subsidiaries. If required to do so
under any applicable Environmental Law, the Borrower agrees to undertake, and
agrees to cause each of its Restricted Subsidiaries to undertake, any cleanup,
removal, remedial or other action necessary to remove and clean up any Hazardous
Materials from any Real Property in accordance with the requirements of
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all such applicable Environmental Laws and in accordance with orders and
directives of all governmental authorities; provided that neither Communications
nor any of its Restricted Subsidiaries shall be required to take any such action
where same is being contested by appropriate legal proceedings in good faith by
Communications or such Restricted Subsidiary.
6.04 ERISA. As soon as possible and, in any event, within
fifteen (15) days after Communications, the Borrower or any of the Borrower's
Subsidiaries or any ERISA Affiliate knows or has reason to know of the
occurrence of any of the following events relating to a Plan, the Borrower will
deliver to each of the Banks a certificate of the chief financial officer of the
Borrower setting forth details as to such occurrence and the action, if any,
that Communications, the Borrower, such Subsidiary or such ERISA Affiliate is
required or proposes to take, together with any notices required to be given to
or filed with or by Communications, the Borrower, such Subsidiary, the ERISA
Affiliate, the PBGC, a Plan participant or the Plan administrator with respect
thereto: that a Reportable Event has occurred (other than with respect to a Plan
which is a Multiemployer Plan) which could reasonably be expected to result in
material liability of Communications, the Borrower, any of the Borrower's
Subsidiaries or any ERISA Affiliate; that, with respect to a Plan, an
accumulated funding deficiency has been incurred or an application will be or
has been made to the Secretary of the Treasury for a waiver or modification of
the minimum funding standard (including any required installment payments) or an
extension of any amortization period under Section 412 of the Code or Section
302 of ERISA with respect to a Plan; that a contribution required to be made to
a Plan or Foreign Pension Plan by Communications, the Borrower, any of the
Borrower's Subsidiaries or any ERISA Affiliate has not been timely made; that a
Plan has been or is reasonably expected to be terminated; that a Plan that is a
Multiemployer Plan has been or is reasonably expected to be reorganized,
partitioned or declared insolvent under Title IV of ERISA; that a Plan, which is
not a Multiemployer Plan, has an Unfunded Current Liability giving rise to a
lien under ERISA or the Code; that proceedings may be or have been instituted to
terminate a Plan; that a proceeding has been instituted pursuant to Section 515
of ERISA to collect a delinquent contribution of Communications, the Borrower,
any of the Borrower's Subsidiaries or any ERISA Affiliate to a Plan; or that
Communications, the Borrower, any Subsidiary or any ERISA Affiliate will or is
reasonably expected to incur any material liability (including any contingent or
secondary liability) to or on account of the termination of or withdrawal from a
Plan under Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with
respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or
Section 409 or 502(i) or 502(l) of ERISA; or that Communications, the Borrower
or any Subsidiary may incur any material liability pursuant to any employee
welfare benefit plan (as defined in Section 3(1) of ERISA)
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that provides benefits to retired employees or other former employees (other
than as required by Section 601 of ERISA) or any employee pension benefit plan
(as defined in Section 3(2) of ERISA) as a result of the adoption or amendment
of any such plan. Upon the request of the Administrative Agent, Communications
will deliver to each of the Banks a complete copy of the annual report (Form
5500) of each Plan required to be filed with the Internal Revenue Service. In
addition to any certificates or notices delivered to the Banks pursuant to the
first sentence hereof, copies of any material notices received by
Communications, the Borrower, any Subsidiary of Communications or the Borrower
or any ERISA Affiliate with respect to any Plan or Foreign Pension Plan shall be
delivered to the Banks no later than 15 Business Days after the date such notice
has been received by Communications, the Borrower or such Subsidiary or the
ERISA Affiliate, as applicable.
6.05 Good Repair. The Borrower will, and will cause each of
its Restricted Subsidiaries to, ensure that its material properties and
equipment used or useful in its business in whomsoever's possession they may be,
are kept in good repair, working order and condition, normal wear and tear
excepted, provided that violations of the foregoing provisions of this Section
6.05 shall not constitute a breach of this covenant unless such violations,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
6.06 Additional Security; Further Assurances; etc. (a) If at
any time Communications, the Borrower or any of their respective Restricted
Subsidiaries grant a security interest in any of their assets or properties to
support extensions of credit pursuant to the Existing Credit Agreement (as same
is in effect from time to time), then Communications and the Borrower will, or
will cause the respective Restricted Subsidiary to, provide for the granting of
a security interest in such assets or properties to secure the Obligations
pursuant to this Agreement, on substantially the same basis as is provided in
the Collateral Documents as in effect on the Closing Date (after giving effect
to the amendments required pursuant to Section 4). All such security interests
shall be granted pursuant to documentation (the "Additional Security Documents")
in a form which secures the Obligations under this Agreement on a
second-priority basis in accordance with the provisions of Section 11 hereof.
(b) Communications and the Borrower shall, and shall cause
each of their respective Restricted Subsidiaries to, defend the Collateral
against all claims and demands of all Persons (other than the Secured Creditors)
at any time claiming the same or any interest therein. Communications and the
Borrower shall, and shall cause their respective Restricted Subsidiaries to,
comply with the requirements of all state and federal laws in order to grant to
the Secured Creditors valid and perfected first priority security interests in
the Collateral, subject only to Liens permitted by this Agreement
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and the priorities contained in Section 11 hereof and in the Security Documents.
The Collateral Agent is hereby authorized by Communications and the Borrower to
file any UCC financing statements covering the Collateral whether or not the
signature of Communications or the Borrower appears thereon. Communications and
the Borrower shall do whatever the Collateral Agent may reasonably request, from
time to time, to effect the purposes of this Agreement and the other Credit
Documents, including without limitation, filing notices of liens, UCC financing
statements and amendments, renewals and continuations thereof; cooperating with
the Collateral Agent's representatives; keeping stock records; obtaining waivers
from landlords and mortgagees and from warehousemen and their landlords and
mortgagees (provided that Communications or the Borrower, as the case may be,
shall not be required to pay any consideration (other than de minimis amounts)
or incur any material obligation or relinquish any material right in connection
with any such waiver); and, paying claims which might, if unpaid, become a Lien
on the Collateral other than a Permitted Lien. Furthermore, the Borrower shall
cause to be delivered to the Collateral Agent such opinions of counsel, title
insurance and other related documents as may be reasonably requested by the
Collateral Agent to assure itself that this Section 6.08 has been complied with.
(c) Each of Communications and the Borrower agrees that each
action required by this Section 6.06 shall be completed as soon as possible, but
in no event later than 60 days after such action is requested to be taken by the
Collateral Agent.
6.07 Insurance. Schedule IX hereto sets forth a true and
complete listing of all insurance maintained by the Borrower and each of its
Restricted Subsidiaries as of the Closing Date. The Borrower agrees to maintain,
and to cause each of its Restricted Subsidiaries to maintain, public liability
insurance, third party property damage insurance and replacement value (or such
higher coverage as the Borrower may obtain) insurance on the Collateral under
such policies of insurance, with such insurance companies, in such amounts,
covering such risks and with such deductibles or self-insured retentions as are
in accordance with normal industry practice for similarly situated businesses.
6.08 Taxes. Communications and the Borrower will, and will
cause each of their respective Subsidiaries to, pay and discharge all material
income and other material taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits, or upon any properties belonging
to it, or payable by it pursuant to the Tax Sharing Agreements, prior to the
date on which penalties or interest attach thereto; provided, that neither
Communications nor any of its Subsidiaries shall be required to pay any such
tax, assessment, charge or levy which is being contested in good faith and by
proper proceedings if it has maintained adequate reserves (in the good
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faith judgment of the management of such Person) with respect thereto in
accordance with GAAP. In no event shall the Borrower and its Subsidiaries make
payments with respect to Federal income taxes computed on a consolidated,
combined or unitary basis which exceed the relevant amounts required to be paid
by them pursuant to the Tax Sharing Agreement as furnished to the Administrative
Agent prior to the Closing Date.
6.09 Corporate Separateness. Communications shall take, and
shall cause each of its Restricted Subsidiaries and Unrestricted Subsidiaries to
take, all actions as are necessary to keep the operations of Communications, the
Borrower and the Borrower's Restricted Subsidiaries separate and apart from
those of any Unrestricted Subsidiaries, including, without limitation, ensuring
that all customary formalities regarding their respective corporate existence,
including holding regular board of directors' and shareholders' meetings and
maintenance of corporate offices and records, are followed. None of
Communications, the Borrower nor any of the Borrower's Restricted Subsidiaries
shall make any payment to a creditor of any Unrestricted Subsidiary in respect
of any liability of any Unrestricted Subsidiary. All financial statements
provided to creditors shall clearly evidence the corporate separateness of
Communications, the Borrower and the Borrower's Restricted Subsidiaries from any
Unrestricted Subsidiaries, and Communications, the Borrower and the Borrower's
Restricted Subsidiaries shall maintain their own respective payroll (if any) and
separate books of account and bank accounts from Unrestricted Subsidiaries. Each
Unrestricted Subsidiary shall pay its respective liabilities, including all
administrative expenses, from its own separate assets, and assets of
Communications, the Borrower and the Borrower's Restricted Subsidiaries shall at
all times be separately identified and segregated from the assets of
Unrestricted Subsidiaries. Finally, none of Communications, the Borrower nor any
of the Borrower's Restricted Subsidiaries nor any Unrestricted Subsidiaries
shall take any action, or conduct its affairs in a manner which is likely to
result in the corporate existence of any Unrestricted Subsidiary being ignored,
or in the assets and liabilities of any Unrestricted Subsidiary being
substantively consolidated with those of Communications, the Borrower or any of
the Borrower's Restricted Subsidiaries in a bankruptcy, reorganization or other
insolvency proceeding.
6.10 New Wholly-Owned Restricted Subsidiaries; Additional
Subsidiary Guarantors. To the extent (x) the Borrower creates or acquires any
Wholly- Owned Restricted Subsidiary after the Effective Date in accordance with
the other provisions of this Agreement or (y) any Restricted Subsidiary of
Communications or the Borrower directly or indirectly guarantees any extensions
of credit pursuant to the Existing Credit Agreement, then in either such case,
each such Restricted Subsidiary shall be required to become a party to the
Subsidiaries Guaranty by executing a counterpart thereof or enter into an
amendment thereto satisfactory to the
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Administrative Agent and, if requested by the Administrative Agent or the
Required Banks, shall be required to enter into the Collateral Documents entered
into by the entities which were Subsidiary Guarantors on the Closing Date, in
each case by entering into counterparts thereof or amendments thereto, in form
and substance reasonably satisfactory to the extent requested by the
Administrative Agent and the Collateral Agent. In connection with the foregoing
to the extent requested by the Administrative Agent or the Collateral Agent, the
Company shall be required to cause to be delivered such relevant documentation
(including opinions of counsel) of the type described in Section 4 as the
respective Restricted Subsidiary would have had delivered if it were a Credit
Party on the Closing Date.
SECTION 7. Negative Covenants. Communications and the Borrower
hereby covenant and agree that, as of the Closing Date, and thereafter, for so
long as this Agreement is in effect and until the Total Commitments have
terminated, no notes are outstanding and the Loans, together with interest,
Fees, Expenses and all other Obligations (other than any indemnities described
in Section 12.01 hereof which are not then due and payable) incurred hereunder
are paid in full:
7.01 Limitation on Indebtedness. (a) Communications and the
Borrower shall not, and shall not permit any of their Restricted Subsidiaries
to, Incur any Indebtedness.
(b) Notwithstanding Section 7.01(a), the Borrower and its
Restricted Subsidiaries may Incur any or all of the following Indebtedness:
(i) Indebtedness of the Borrower Incurred pursuant to the
Existing Credit Agreement (including related Guarantees and security
agreements; provided that such security agreements shall only be
permitted if all Obligations pursuant to this Agreement are secured
thereby on substantially the same basis provided in the Collateral
Documents as in effect on the Closing Date after giving effect to the
amendments required pursuant to Section 4) in an aggregate principal
amount outstanding at any time not to exceed the greater of (x) the sum
of (i) 90% of the consolidated book value of the accounts receivable of
the Borrower and its Restricted Subsidiaries and (ii) 60% of the
consolidated book value of the inventory of the Borrower and its
Restricted Subsidiaries, in each case as determined at the time of the
respective Incurrence in accordance with GAAP and (y) $75,000,000, in
each case less the sum of (x) any amount of Indebtedness outstanding
pursuant to this Section 7.01(b)(i) permanently repaid as described in
Section 7.04 hereof and (y) the amount of any Indebtedness (other than
pursuant to this Agreement) outstanding on the Closing Date pursuant to
Section 4.03(b)(xiv) of the Senior Subordinated Notes Indenture, to
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the extent the Indebtedness described in this clause (y) remains
outstanding on the date of any determination pursuant to this
clause (i);
(ii) Indebtedness of the Borrower (and any Guarantee or Liens
with respect thereto; provided that such Liens shall only be permitted
if all Obligations pursuant to this Agreement are secured thereby on
substantially the same basis provided in the Collateral Documents as in
effect on the Closing Date after giving effect to the amendments
required pursuant to Section 4) originally Incurred pursuant to the
term loan provisions of the Existing Credit Agreement in an aggregate
principal amount outstanding at any time not to exceed (A) $44,800,000
less (B) the aggregate sum of all principal payments actually made from
time to time after the Closing Date under the Existing Credit Agreement
and any amount of Indebtedness outstanding pursuant to this Section
7.01(b)(ii) permanently repaid as described in Section 7.04 hereof;
(iii) Indebtedness owed to and held by the Borrower or a
Wholly- Owned Restricted Subsidiary of the Borrower; provided, however,
that any subsequent issuance or transfer of any Capital Stock which
results in any such Wholly-Owned Restricted Subsidiary of the Borrower
ceasing to be a Wholly- Owned Restricted Subsidiary of the Borrower or
any subsequent transfer of such Indebtedness (other than to the
Borrower or another Wholly-Owned Restricted Subsidiary of the Borrower)
shall be deemed, in each case, to constitute the Incurrence of such
Indebtedness;
(iv) the Senior Subordinated Notes may remain outstanding in
an aggregate principal amount not to exceed $185,000,000;
(v) Indebtedness outstanding on the Closing Date after giving
effect to the Transaction (other than Indebtedness outstanding pursuant
to the Existing Credit Agreement or otherwise described in clause (i),
(ii), (iii) or (iv) above);
(vi) Guarantees by the Borrower or a Subsidiary Guarantor of
Indebtedness of a Subsidiary Guarantor otherwise permitted to be
Incurred by the Subsidiary Guarantor (other than Indebtedness permitted
by clause (x) below) or Guarantees by a Subsidiary Guarantor of Senior
Indebtedness of the Borrower permitted to be Incurred by the Borrower
under this Indenture;
(vii) Refinancing Indebtedness in respect of Indebtedness
Incurred pursuant to clause (iv) or (v) above (excluding Indebtedness
outstanding on the Closing Date pursuant to Section 4.03(b)(xiv) of the
Senior Subordinated Notes Indenture) or clause (ix) and (x) below;
provided, however, that Refinancing
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Indebtedness the proceeds of which are used to Refinance the Senior
Subordinated Notes or any other Indebtedness that is subordinated in
right of payment to Obligations pursuant to this Agreement shall only
be permitted under this clause (vii) if such Refinancing Indebtedness,
by its terms or by the terms of any agreement or instrument pursuant to
which such Refinancing Indebtedness is Incurred or is outstanding, is
expressly made subordinate in right of payment to the Obligations
pursuant to this Agreement at least to the extent that the Indebtedness
to be Refinanced is subordinated to such Obligations; provided further,
however, that Refinancing Indebtedness the proceeds of which are used
to Refinance Indebtedness Incurred pursuant to clause (x) below shall
only be permitted under this clause (vii) if such Refinancing
Indebtedness is Incurred by the Borrower or the Restricted Subsidiary
that originally Incurred the Indebtedness pursuant to clause (x) below;
(viii) Indebtedness (A) in respect of performance, surety or
appeal bonds provided in the ordinary course of business or (B) arising
from agreements providing for indemnification, adjustment of purchase
price or similar obligations, or from Guarantees or letters of credit,
surety bonds or performance bonds securing any obligations of the
Borrower or any of its Restricted Subsidiaries pursuant to such
agreements, in any case Incurred in connection with the acquisition or
disposition of any business, assets or Restricted Subsidiary (other
than Guarantees of Indebtedness or other obligations Incurred by any
Person acquiring all or any portion of such business, assets or
Restricted Subsidiary for the purpose of financing such acquisition),
in a principal amount not to exceed the gross proceeds actually
received by the Borrower or any Restricted Subsidiary in connection
with such disposition;
(ix) Indebtedness, in an aggregate principal amount
outstanding at any time not to exceed $2.0 million, Incurred by the
Borrower in connection with the purchase, redemption, acquisition,
cancellation or other retirement for value of shares of Capital Stock
of the Borrower, any of its Restricted Subsidiaries or Communications,
options on any such shares or related stock appreciation rights or
similar securities (including phantom equity rights) held by employees,
former employees, directors or former directors of Communications, the
Borrower or its Restricted Subsidiaries (or their estates or
beneficiaries under their estates), upon death, disability, retirement,
termination of employment or pursuant to any agreement under which such
shares of stock or related rights were issued; provided, however, that
(A) such Indebtedness, by its terms or by the terms of any agreement or
instrument pursuant to which such Indebtedness is Incurred, is
expressly made subordinate in right of payment
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to all Obligations under this Agreement and (B) such Indebtedness, by
its terms or by the terms of any agreement or instrument pursuant to
which such Indebtedness is Incurred, provides that no payments of
principal of such Indebtedness, including by way of sinking fund,
mandatory redemption or otherwise (including defeasance), may be made
by the Borrower at any time while any of the Loans are outstanding;
(x) Indebtedness of any Restricted Subsidiary Incurred and
outstanding on or prior to the date on which such Restricted Subsidiary
was acquired by the Borrower (other than Indebtedness Incurred as
consideration in, or to provide all or any portion of the funds or
credit support utilized to consummate, the transaction or series of
related transactions pursuant to which such Restricted Subsidiary
became a Restricted Subsidiary or was acquired by the Borrower), so
long as the aggregate principal amount of all Indebtedness Incurred in
any fiscal year pursuant to clauses (x), (xi), (xii) and (xiii) of this
Section 7.01 does not exceed $25,000,000;
(xi) Capital Lease Obligations, so long as the aggregate
principal amount of all Indebtedness Incurred in any fiscal year
pursuant to clauses (x), (xi), (xii) and (xiii) of this Section 7.01
does not exceed $25,000,000;
(xii) Indebtedness constituting purchase money obligations
for property acquired in the ordinary course of business or other
similar financing transactions, so long as the aggregate principal
amount of all Indebtedness Incurred in any fiscal year pursuant to
clauses (x), (xi), (xii) and (xiii) of this Section 7.01 does not
exceed $25,000,000;
(xiii) Indebtedness Incurred to finance Capital Expenditures
or the acquisition of Additional Assets in any fiscal year in an
aggregate principal amount not to exceed 6% of the Borrower's
consolidated net sales for the immediately preceding fiscal year and
Refinancing Indebtedness in respect thereof, so long as the aggregate
principal amount of all Indebtedness Incurred in any fiscal year
pursuant to clauses (x), (xi), (xii) and (xiii) of this Section 7.01
does not exceed $25,000,000; and
(xiv) Indebtedness Incurred pursuant to this Agreement.
(c) The Borrower shall not Incur any Indebtedness pursuant to
Section 7.01(b) if such Indebtedness is subordinate in right of payment to any
Senior Indebtedness unless such Indebtedness is expressly subordinated (at least
to the same extent) in right of payment to all Obligations pursuant to this
Agreement. In addition,
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the Borrower shall not Incur any Secured Indebtedness pursuant to Sections 7.01
(b)(i) and (ii) unless contemporaneously therewith effective provision is made
to secure the Obligations pursuant to this Agreement equally and ratably with
such Secured Indebtedness for so long as such Secured Indebtedness is secured by
a Lien; provided that, to the extent Indebtedness pursuant to the Existing
Credit Agreement or any obligations pursuant to Interest Rate Agreements (as
defined in the Collateral Documents) are secured by Liens, the Obligations
pursuant to this Agreement shall be secured on the basis provided in Section 11
hereof and in accordance with the priorities (as to Collateral) established
pursuant to the amendments to the Collateral Documents entered into in
accordance with the requirements of Section 4.
(d) On and after the Closing Date, the Borrower and its
Restricted Subsidiaries shall not Incur any Indebtedness under Section
4.03(b)(xiv) of the Senior Subordinated Notes Indenture (other than (x)
Indebtedness Incurred pursuant to this Agreement and (y) at any time after the
repayment of Loans hereunder, such other Indebtedness in an aggregate principal
amount not to exceed at any time outstanding the aggregate principal amount of
all such repayments made since the Closing Date).
7.02 Limitation on Restricted Payments. (a) Communications and
the Borrower shall not, and shall not permit any of their Restricted
Subsidiaries to, directly or indirectly, to make any Restricted Payment.
(b) The provisions of Section 7.02(a) shall not prohibit:
(i) any purchase or redemption of Subordinated Obligations
made by exchange for, or out of the proceeds of the substantially
concurrent sale of, indebtedness of the Borrower which is permitted to
be Incurred pursuant to Section 7.01(b)(vii);
(ii) the repurchase (or dividends to Communications for the
repurchase) of shares of, or options to purchase shares of, Capital
Stock of the Borrower or any of its Restricted Subsidiaries or of
Communications from employees, former employees, directors or former
directors of Communications, the Borrower or any of its Restricted
Subsidiaries (or permitted transferees of such employees, former
employees, directors or former directors), pursuant to the terms of the
agreements (including employment agreements) or plans (or amendments
thereto) approved by the Board of Directors under which such persons
purchase or sell, or are granted the option to purchase or sell, shares
of such stock; provided, however, that the aggregate amount of all such
repurchases or dividends after the Closing Date shall not exceed $2.0
million;
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(iii) any payments pursuant to any tax-sharing agreement
between the Borrower and any other Person with which the Borrower is
required or permitted to file a consolidated tax return or with which
the Borrower is or could be part of a consolidated group for tax
purposes;
(iv) payments to Communications necessary for Communications
to pay corporate overhead expenses, not to exceed $250,000 in any
fiscal year;
(v) payments to Communications sufficient to permit
Communications to pay for the registration of its securities with the
SEC (including all reasonable professional fees and expenses); and
(vi) Investments in Unrestricted Subsidiaries made in exchange
for Capital Stock (other than Disqualified Stock) of Communications.
7.03 Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, create or otherwise cause or permit to exist or
become effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary of the Borrower (a) to pay dividends or make any other
distributions on its Capital Stock owned by, or pay any Indebtedness owed to,
the Borrower, (b) to make any loans or advances to the Borrower or (c) transfer
any of its property or assets to the Borrower, except:
(i) any encumbrance or restriction pursuant to the Existing
Credit Agreement or any other agreement in effect at or entered into on
the date of this Agreement and any extensions, refinancings, renewals
or replacements of any such agreement; provided, however, that the
encumbrances and restrictions in any such extension, refinancing,
renewal or replacement are no less favorable in any material respect to
the Banks than those encumbrances or restrictions being extended,
refinanced, renewed or replaced;
(ii) any encumbrance or restriction with respect to a
Restricted Subsidiary of the Borrower pursuant to an agreement relating
to any Indebtedness Incurred by such Restricted Subsidiary on or prior
to the date on which such Restricted Subsidiary was acquired by the
Borrower (other than Indebtedness Incurred as consideration in, or to
provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant
to which such Restricted Subsidiary became a Restricted Subsidiary of,
or was acquired by, the Borrower) and outstanding on such date;
-41-
(iii) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing of Indebtedness Incurred pursuant to an
agreement referred to in clause (ii) above or contained in any
amendment to an agreement referred to in clause (ii) above; provided,
however, that the encumbrances and restrictions with respect to such
Restricted Subsidiary contained in any such refinancing agreement or
amendment are no less favorable in any material respect to the Banks
than encumbrances and restrictions with respect to such Restricted
Subsidiary contained in the agreements referred to in clause (ii)
above;
(iv) any encumbrance or restriction consisting of customary
nonassignment provisions in leases governing leasehold interests to the
extent such provisions restrict the transfer of the lease or the
property leased thereunder;
(v) in the case of clause (c) above, restrictions contained
in security agreements or mortgages securing Indebtedness of a
Restricted Subsidiary of the Borrower to the extent such restrictions
restrict the transfer of the property subject to such security
agreements or mortgages;
(vi) any restriction with respect to a Restricted Subsidiary
of the Borrower imposed pursuant to an agreement entered into for the
sale or disposition of all or substantially all the Capital Stock or
assets of such Restricted Subsidiary pending the closing of such sale
or disposition;
(vii) encumbrances and restrictions contained in any
Indebtedness or any agreement relating to any Indebtedness of the
Borrower or a Restricted Subsidiary of the Borrower permitted pursuant
to Section 7.01; provided, however, that either (A) such encumbrances
and restrictions are no more restrictive than the encumbrances and
restrictions imposed by the Existing Credit Agreement or (B) each
Restricted Subsidiary subject to any such encumbrances or restrictions
after the Closing Date shall Guarantee the Loans on a senior basis;
pursuant to the Subsidiaries Guaranty; and
(viii) any encumbrance or restriction existing under or by
reason of applicable law.
Nothing contained in this Section 7.03 shall prevent the
Borrower or any Restricted Subsidiary of the Borrower from restricting the sale
or other disposition of property or assets of the Borrower or any Restricted
Subsidiary of the Borrower that secure Indebtedness of the Borrower or any of
its Restricted Subsidiaries.
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7.04 Limitation on Sales of Assets and Subsidiary Stock. (a)
In addition to any mandatory repayments required pursuant to Section 3.01, in
the event and to the extent that the Net Available Cash received by the Borrower
or any of its Restricted Subsidiaries from one or more Asset Dispositions
occurring on or after the Issue Date in any period of 12 consecutive months
ended after the Closing Date exceeds 10% of Adjusted Consolidated Assets as of
the beginning of such 12-month period, then the Borrower shall (i) within 12
months after the date such Net Available Cash so received exceeds such 10% of
Adjusted Consolidated Assets and to the extent the Borrower elects (or is
required by the terms of any Indebtedness) (A) apply an amount equal to or less
than such excess Net Available Cash to permanently repay (and in the case of any
repayment of revolving loans or similar obligations, to permanently reduce the
correlating commitments) Senior Indebtedness of the Borrower or (B) invest an
amount, equal to or less than the difference between such excess Net Available
Cash and the amount so applied pursuant to clause (A) (or enter into a
definitive agreement committing to so invest within 12 months after the date of
such agreement), in Additional Assets and (ii) apply an amount equal to the
difference between such excess Net Available Cash and the amount applied
pursuant to clause (i) as provided in the following paragraphs of this Section
7.06. The amount of such excess Net Available Cash required to be applied
pursuant to clause (ii) of the preceding sentence shall constitute "Excess
Proceeds."
(b) If, as of the first day of any calendar month, the
aggregate amount of Excess Proceeds totals at least $5 million, the Borrower
must, not later than the fifteenth Business Day of such month, apply an amount
equal to such Excess Proceeds to prepay principal of outstanding Loans (the
"Excess Proceeds Repayment"). Each repayment pursuant to the preceding sentence
shall be accompanied by the payment of all accrued but unpaid interest on the
principal amount of Loans so repaid.
7.05 Limitation on Affiliate Transactions. (a) The Borrower
shall not, and shall not permit any of its Restricted Subsidiaries to, enter
into, renew or extend any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate of
the Borrower (an "Affiliate Transaction") unless the terms thereof (1) are no
less favorable to the Borrower or such Restricted Subsidiary (or, in the case of
an Affiliate Transaction between the Borrower and a Restricted Subsidiary, are
no less favorable to the Borrower or are, in the good faith determination of the
Board of Directors, in the best interests of the Borrower) than those which
could be obtained at the time of such transaction in arm's-length dealings with
a Person who is not such an Affiliate and (2) if such Affiliate Transaction
involves an amount in excess of $2.5 million, the terms thereof are set forth in
writing and either (A) have been approved by a majority of the disinterested
members of the Board of Directors or (B) for which the Borrower or such
Restricted Subsidiary delivers to the
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Administrative Agent a written opinion of a nationally recognized investment
banking firm stating that the transaction is fair to the Borrower or such
Restricted Subsidiary from a financial point of view.
(b) The provisions of Section 7.05(a) shall not prohibit (i)
any Restricted Payment permitted to be paid pursuant to Section 7.02, (ii) any
issuance of securities, or other payments, awards or grants in cash, securities
or otherwise pursuant to, or the funding of, employment arrangements, stock
options and stock ownership plans approved by the Board of Directors, (iii) the
grant of stock options or similar rights to employees and directors of the
Borrower pursuant to plans approved by the Board of Directors, (iv) loans or
advances to employees in the ordinary course of business in accordance with the
past practices of the Borrower or its Restricted Subsidiaries; (v) the payment
of reasonable fees to directors of the Borrower and its Restricted Subsidiaries
who are not employees of the Borrower or its Restricted Subsidiaries; (vi) any
payments or other transactions pursuant to any tax-sharing agreement between the
Borrower and any other Person with which the Borrower is required or permitted
to file a consolidated tax return or with which the Borrower is or could be part
of a consolidated group for tax purposes; (vii) any Affiliate Transaction
between the Borrower and a Wholly-Owned Restricted Subsidiary or between Wholly-
Owned Restricted Subsidiaries; (viii) the Transaction; (ix) any employment or
other agreement providing for compensation between the Borrower or any of its
Restricted Subsidiaries and Xxxxx X. Xxxxxxxx or Xxxxxxx X. Xxxxx that is
approved, in good faith, by the Board of Directors; (x) the payment of fees to
Xxxxxx Xxxxxxx & Co. Incorporated or its Affiliates for financial, advisory,
consulting or investment banking services that the Board of Directors of the
Borrower deems to be advisable or appropriate for the Borrower or any Restricted
Subsidiary to obtain (and including the payment to Xxxxxx Xxxxxxx & Co.
Incorporated or its Affiliates of any underwriting discounts or commissions or
placement agency fees in connection with the issuance and sale of any securities
by the Borrower or any Restricted Subsidiary of the Borrower), so long as the
amount of such fees is no greater than the amount of fees which would be payable
for such services in arm's-length dealings with a Person who is not an
Affiliate; or (xi) sales of Capital Stock of Communications or the Borrower to
Xxxxxx Xxxxxxx & Co. Incorporated or its Affiliates.
7.06 Change of Control. On the 15th day following the
occurrence of any Change of Control, the Borrower shall repay in full 100% of
the outstanding principal amount of all Loans, together with all accrued and
unpaid interest thereon to the date of such repayment. Notwithstanding anything
to the contrary contained in the immediately preceding sentence, the Borrower
shall not be required to repay the outstanding Loans of any Bank which agrees in
writing, prior to the 15th day following the occurrence of the respective Change
of Control, that such Bank waives its right to
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receive such repayment. It is understood and agreed that no Bank shall be
obligated to grant any such waiver under any circumstances, and the granting
thereof shall be in the sole discretion of the respective Bank.
7.07 Limitation on the Issuance of Preferred Stock of
Restricted Subsidiaries. The Borrower shall not sell or otherwise dispose of any
shares of Preferred Stock of any Restricted Subsidiary of the Borrower, and
shall not permit any Restricted Subsidiary of the Borrower, directly or
indirectly, to issue, sell or otherwise dispose of any shares of its Preferred
Stock, except, in each case, (i) to the Borrower or a Wholly-Owned Restricted
Subsidiary of the Borrower or (ii) if, immediately after giving effect to such
issuance, sale or other disposition, such Restricted Subsidiary would no longer
constitute a Restricted Subsidiary of the Borrower (and none of Communications,
the Borrower nor any of their respective Subsidiaries shall retain any equity
interest therein).
7.08 When Communications or Borrower May Merge or Transfer
Assets. After the Closing Date, neither Communications nor the Borrower shall
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person.
7.09 Ownership of Restricted Subsidiaries. Communications will
not at any time directly own equity interests in any Subsidiary other than the
Borrower.
7.09 Further Instruments and Acts. Upon request of the
Administrative Agent, Communications and the Borrower will execute and deliver
such further instruments and do such further acts as may be reasonably necessary
or proper to carry out more effectively the purpose of this Agreement and the
other Credit Documents.
SECTION 8. Events of Default. An "Event of Default" occurs
if:
8.01 Events of Default Defined.
(1) the Borrower defaults in any payment of interest on any
Loan, or any other amount (other than principal of Loans owing pursuant
to this Agreement or any other Credit Document, when the same becomes
due and payable, and such default continues for a period of 30 days;
(2) the Borrower defaults in the payment of the principal of
any Loan or Note when the same becomes due and payable at its Stated
Maturity, as a result of any mandatory repayment under Section 3.01,
7.04 or 7.06, upon declaration or otherwise;
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(3) the Borrower fails to comply with Section 7.08;
(4) the Borrower fails to comply with Section 7.01, 7.02,
7.03, 7.05, 7.06 and 7.07 and such failure continues for 30 days after
the notice specified below;
(5) Communications or the Borrower fails to comply with any of
its agreements in this Agreement or any other Credit Document (other
than those referred to in (1), (2), (3) or (4) above) and such failure
continues for 60 days after the notice specified below;
(6) Indebtedness of Communications, the Borrower or any
Significant Subsidiary is not paid within any applicable grace period
after final maturity thereof or becomes, or is declared by the holders
thereof to be, immediately and unconditionally due and payable because
of a default, the total amount of such Indebtedness unpaid or becoming
or declared to be due and payable exceeds $10,000,000 or its foreign
currency equivalent and such failure continues (or such payment shall
not have been waived or extended or such Indebtedness shall continue to
be due and payable) for 30 days after the notice specified below;
(7) Communications, the Borrower or any Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief
against it in an involuntary case;
(C) consents to the appointment of a Custodian of it
or for any substantial part of its property; or
(D) makes a general assignment for the benefit of its
creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(8) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against Communications, the
Borrower or any Significant Subsidiary in an involuntary case;
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(B) appoints a Custodian of Communications, the
Borrower or any Significant Subsidiary or for any substantial
part of its property; or
(C) orders the winding up or liquidation of
Communications, the Borrower or any Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order
or decree remains unstayed and in effect for 60 days;
(9) any judgment or decree for the payment of money in excess of
$10,000,000 (provided that the amount of such money judgment or decree
shall be calculated net of any insurance coverage that the Borrower has
determined in good faith is available in whole or in part with respect
to such money judgment or decree) is entered against Communications,
the Borrower or any Significant Subsidiary and is not discharged and
there is a period of 60 days following the entry of such judgment or
decree during which such judgment or decree is not discharged, waived
or the execution thereof stayed and, in each case, such default
continues for 10 days after the notice specified below;
(10) any Collateral Document shall cease to be in full force and
effect, or shall cease to give the Collateral Agent on behalf of the
Secured Creditors the Liens, rights, powers and privileges purported to
be created thereby in favor of the Collateral Agent, or any Credit
Party shall default in any material respect in the due performance or
observance of any term, covenant or agreement on its part to be
performed or observed pursuant to any such Collateral Document and such
failure shall continue for 30 days after the notice specified below; or
(11) any Guaranty or provision thereof shall cease to be in full
force or effect as to the relevant Guarantor, or any Guarantor or
Person acting by or on behalf of such Guarantor shall deny or disaffirm
such Guarantor's obligations under the relevant Guaranty, or any
Guarantor shall default in the due performance or observance of any
material term, covenant or agreement on its part to be performed or
observed pursuant to any Guaranty.
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body.
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A Default under clause (4), (5), (6), (9) or (10) of this
Section is not an Event of Default until the Administrative Agent or Banks
holding at least 25% in principal amount of the outstanding Loans notify the
Borrower of the Default and the Borrower does not cure such Default within the
time specified after receipt of such Notice. Such Notice must specify the
Default, demand that it be remedied and state that such notice is a "Notice of
Default".
The Borrower shall deliver to the Administrative Agent, within
5 Business Days after the occurrence thereof, written notice in the form of an
Officers' Certificate of any event which with the giving of notice and the lapse
of time would become an Event of Default under clause (4), (5), (6), (9) or (10)
of this Section, its status and what action the Borrower is taking or proposes
to take with respect thereto.
8.02 Acceleration. If an Event of Default (other than an Event
of Default specified in Section 8.01(7) or (8) with respect to the Borrower)
occurs and is continuing, the Administrative Agent shall, upon the written
request of the holders of at least a majority of the outstanding principal
amount of Loans, by written notice to the Borrower, declare the principal amount
of and accrued interest on all the Loans as of the date of such declaration to
be due and payable. Upon such a declaration, such principal and interest shall
be due and payable immediately. If an Event of Default specified in Section
8.01(7) or (8) with respect to the Borrower occurs, the principal of and
interest on all the Loans shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the Administrative
Agent or any Bank. The holders of a majority in principal amount of the
outstanding Loans by notice to the Administrative Agent may rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default have been cured or
waived except nonpayment of principal or interest that has become due solely
because of acceleration. No such rescission shall affect any subsequent Default
or impair any right consequent thereto.
8.03 Other Remedies. If an Event of Default occurs and is
continuing, the Administrative Agent and the Banks may, subject to the
provisions of Section 11, pursue any available remedy to collect the payment of
principal of or interest on the Loans or to enforce the performance of any
provision of the Notes, this Agreement or any other Credit Document.
The Administrative Agent may maintain a proceeding even if it
does not possess any of the Notes or does not produce any of them in the
proceeding. A delay or omission by the Administrative Agent or any Bank in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a
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waiver of or acquiescence in the Event of Default. No remedy is exclusive of any
other remedy. All available remedies are cumulative.
SECTION 9. Definitions.
9.01 General Definitions. As used herein, the following terms
shall have the meanings herein specified (to be equally applicable to both the
singular and plural forms of the terms defined):
"Accounts" of any Person shall mean all of such Person's
rights to payment for goods sold or leased or services performed by such Person,
whether presently existing or hereafter arising, including, without limitation,
rights evidenced by accounts, instruments, notes, drafts, documents, chattel
paper, and all other forms of obligations owing to such Person arising out of
the sale of goods or the rendition of services by such Person, whether or not
earned by performance, and any and all credit insurance, letters of credit,
guaranties and other security therefor, as well as all merchandise returned to
or reclaimed by such Person, and such Person's books and records (except minute
books) relating to any of the foregoing.
"Additional Security Documents" shall have the meaning
provided in Section 6.06(a).
"Additional Assets" means (i) any property or assets (other
than Indebtedness and Capital Stock) in a Related Business; or (iii) Capital
Stock constituting a minority interest in any Person that at such time is a
Restricted Subsidiary of the Borrower; provided, however, that any such
Restricted Subsidiary described in clauses (ii) or (iii) above is primarily
engaged in a Related Business.
"Adjusted Certificate of Deposit Rate" shall mean, on any day,
the sum (rounded to the nearest 1/100 of 1%) of (1) the rate obtained by
dividing (x) the most recent weekly average dealer offering rate for negotiable
certificates of deposit with a three-month maturity in the secondary market as
published in the most recent Federal Reserve System publication entitled "Select
Interest Rates," published weekly on Form H.15 as of the date hereof, or if such
publication or a substitute containing the foregoing rate information shall not
be published by the Federal Reserve System for any week, the weekly average
offering rate determined by the Administrative Agent on the basis of quotations
for such certificates received by it from three certificate of deposit dealers
in New York of recognized standing or, if such quotations are unavailable, then
on the basis of other sources reasonably selected by the Administrative Agent,
by (y) a percentage equal to 100% minus the stated maximum rate of all reserve
requirements as specified in Regulation D
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applicable on such day to a three-month certificate of deposit of a member bank
of the Federal Reserve System in excess of $100,000 (including, without
limitation, any marginal, emergency, supplemental, special or other reserves),
plus (2) the then daily net annual assessment rate as estimated by the
Administrative Agent for determining the current annual assessment payable by
the Administrative Agent to the Federal Deposit Insurance Corporation for
insuring three-month certificates of deposit.
"Adjusted Consolidated Assets" means at any time the total
amount of assets of the Borrower and its consolidated Restricted Subsidiaries
(less applicable depreciation, amortization and other valuation reserves), after
deducting therefrom all current liabilities of the Borrower and its consolidated
Restricted Subsidiaries (excluding intercompany items), all as set forth on the
consolidated balance sheet of the Borrower and its consolidated Restricted
Subsidiaries as of the end of the most recent fiscal quarter ended at least 45
days prior to the date of determination.
"Administrative Agent" shall mean Bankers Trust Company in its
capacity as Administrative Agent for the Banks hereunder, and shall include any
successor thereto as Administrative Agent, appointed as such pursuant to Section
10.09.
"Affiliate", of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control", when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Section 7, "Affiliate", shall also mean any beneficial owner of
shares representing 10% or more of the total voting power of the Voting Stock
(on a fully diluted basis) of Communications or the Borrower or of rights or
warrants to purchase such stock (whether or not currently exercisable) and any
Person who would be an Affiliate of any such beneficial owner pursuant to the
first sentence hereof.
"Affiliate Transaction" shall have the meaning provided in
Section 7.05.
"Agreement" shall mean this Term Loan Agreement as same may be
supplemented, modified or amended from time to time in accordance with the
provisions hereof.
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"Applicable Lending Office" shall mean, with respect to each
Bank, such Bank's Eurodollar Lending Office in the case of a Eurodollar Rate
Loan, and such Bank's Domestic Lending Office in the case of a Base Rate Loan.
"Applicable Margin" shall mean a percentage per annum which
shall initially equal (x) in the case of Eurodollar Loans, 4.0% and (y) in the
case of Base Rate Loans, 3.0%, provided that the Applicable Margins for each
type of loan shall increase on each three-month anniversary of the Closing Date
in accordance with the table set forth below:
Applicable Margin Applicable Margin for
Month Anniversary for Eurodollar Loans Base Rate Loans
----------------- -------------------- ---------------
0 4.0% 3.0%
3 4.25% 3.25%
6 4.5% 3.5%
9 5.0% 4.0%
12 5.5% 4.5%
15 6.0% 5.0%
18 6.5% 5.5%
21 7.0% 6.0%
24 7.5% 6.5%
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Borrower or any Restricted Subsidiary, including any disposition by means of
a merger, consolidation or similar transaction (each referred to for the
purposes of this definition as a "disposition"), of (i) any shares of Capital
Stock of a Restricted Subsidiary (other than directors' qualifying shares) or
(ii) any assets of the Borrower or any Restricted Subsidiary outside the
ordinary course of business of the Borrower or such Restricted Subsidiary (other
than (y) a disposition by a Restricted Subsidiary to the Borrower or by the
Borrower or a Restricted Subsidiary to a Wholly-Owned Restricted Subsidiary and
(z) for purposes of Section 7.04 only, a Restricted Payment permitted by Section
7.02); provided, however, that for purposes of Section 7.04 only, the term
"Asset Disposition" shall not include any disposition of assets if such
disposition is governed by Section 7.08.
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"Assignment and Assumption Agreement" shall mean an assignment
and assumption agreement entered into by an assigning Bank and an assignee Bank
in accordance with Section 12.04, substantially in the form of Exhibit P.
"Auditors" shall mean a nationally-recognized firm of
independent public accountants selected by Communications or the Borrower and
reasonably satisfactory to the Administrative Agent. For purposes of this
Agreement, Communications' current firm of independent public accountants, Ernst
& Young, shall be deemed to be satisfactory to the Administrative Agent.
"Authorized Officer" of any Credit Party shall mean any of the
President, the Chief Financial Officer, the Treasurer, any Assistant Treasurer,
any Vice-President, the Secretary or any Assistant Secretary of such Credit
Party or any other officer of such Credit Party which is designated in writing
to the Administrative Agent by any of the foregoing officers of such Credit
Party as being authorized to give such notices under this Agreement.
"Average Life" means, as of the date of determination, with
respect to any Indebtedness, the quotient obtained by dividing (i) the sum of
the products of numbers of years from the date of determination to the dates of
each successive scheduled principal payment of such Indebtedness multiplied by
the amount of such payment by (ii) the sum of all such payments.
"Bankruptcy Law" shall mean Xxxxx 00, Xxxxxx Xxxxxx Code, or
any similar Federal or state law for the relief of debtors.
"Banks" is defined to mean the lenders who are from time to
time parties to this Agreement.
"Base Rate" shall mean the higher of (x) 1/2 of 1% in excess
of the Federal Reserve reported certificate of deposit rate and (y) the rate
that BTCo announces from time to time as its prime lending rate, as in effect
from time to time.
"Base Rate" at any time shall mean the highest of (i) 1/2 of
1% in excess of the Adjusted Certificate of Deposit Rate, (ii) 1/2 of 1% in
excess of the overnight Federal Funds Rate and (iii) the Prime Lending Rate.
"Base Rate Loan" shall mean each Loan converted into such
pursuant to Section 1.08, until such time (if any) as converted back into a
Eurodollar Loan in accordance with the requirements of Section 1.08(d).
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"Blocked Account Agreements" shall mean all blocked account
agreements executed and delivered pursuant to the Existing Credit Agreement,
until such time as same are replaced by blocked account agreements in the form
of Exhibit M-2 hereto, and any blocked account agreements at any time entered
into in the form of Exhibit M-2 hereto.
"Board of Directors" means the Board of Directors of the
Borrower or any committee thereof duly authorized to act on behalf of such
Board.
"Borrower" shall have the meaning provided in the first
paragraph of this Agreement.
"BTCC" shall mean BT Commercial Corporation, in its individual
capacity.
"BTCo" shall mean Bankers Trust Company in its individual
capacity.
"Business Day" shall mean (i) for all purposes other than as
covered by clause (ii) below, any day except Saturday, Sunday and any day which
shall be in New York City a legal holiday or a day on which banking institutions
are authorized or required by law or other government action to close and (ii)
with respect to all notices and determinations in connection with, and payments
of principal and interest on, Eurodollar Loans, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and between
banks in Dollars in the New York interbank Eurodollar market.
"Canadian Debenture" shall mean the Existing Canadian
Debenture, as same may be modified, amended or supplemented from time to time in
accordance with the terms thereof and hereof, including pursuant to the Existing
Canadian Debenture Amendment.
"Canadian Pledge Agreement" shall mean the Existing Canadian
Pledge Agreement, as same may be modified, amended or supplemented from time to
time in accordance with the terms thereof and hereof, including pursuant to the
Existing Canadian Pledge Agreement Amendment.
"Capital Expenditures" means expenditures (whether paid in
cash or accrued as liabilities and including Capital Lease Obligations) of the
Borrower and its Restricted Subsidiaries relating to the acquisition of
equipment used or useful in the business of the Borrower or any Restricted
Subsidiary or in a Related Business.
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"Capital Lease Obligations" means an obligation that is
required to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent of any other amount due under such
lease prior to the first date upon which such lease may be terminated by the
lessee without payment of a penalty.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.
"Change of Control" means such time as (i) a "person" or
"group" (within the meaning of Sections 13(d) and 14(d) of the Exchange Act),
other than the Permitted Holders and their respective Affiliates, becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of (A) more
than forty percent (40%) of the total voting power of the then outstanding
Voting Stock of the Borrower or Communications and (B) more than the total
voting power of the then outstanding Voting Stock of the Borrower or
Communications, as the case may be, beneficially owned by the Permitted Holders
and their respective Affiliates, treating the Permitted Holders and their
respective Affiliates as a "group"; or (ii) during any period of two consecutive
calendar years, individuals who at the beginning of such period constituted the
Board of Directors of (A) the Borrower (together with any new directors whose
election by the Borrower's Board of Directors or whose nomination for election
by the Borrower's Board of Directors or whose nomination for election by the
Borrower's shareholders was approved by a vote of at least two thirds of the
directors then still in office who either were directors at the beginning of
such period or whose election or nomination for election was previously so
approved) or (B) Communications (together with any new directors whose election
by Communications' Board of Directors or whose nomination for election by
Communications' shareholders was approved by a vote of at least two-thirds of
the directors then still in office who either were directors at the beginning of
such period or whose election or nomination for election was previously so
approved), in either case, cease for any reason to constitute a majority of the
directors of the Borrower or Communications, as the case may be, then in office;
or (iii) (A) the Borrower or Communications consolidates with or merges into any
other Person or conveys, transfers or leases all or substantially all its assets
to any Person or (B) any Person mergers into the Borrower or Communications, in
either event pursuant to a transaction in which any Voting Stock of the Borrower
or Communications, as the
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case may be, outstanding immediately prior to the effectiveness thereof is
reclassified or changed into or exchanged for cash, securities or other
property; provided, however, that any consolidation, conveyance, transfer or
lease (x) between the Borrower and any of its Restricted Subsidiaries, between
Communications and the Borrower or between Restricted Subsidiaries of the
Borrower (including the reincorporation of the Borrower or Communications in
another jurisdiction) or (y) for the purpose of creating a public holding
company for the Borrower or Communications in another jurisdiction or (z) for
the purpose of creating a public holding company for the Borrower or
Communications in which all holders of the capital stock of the Borrower or
Communications, as the case may be, would be entitled to receive (other than
cash in lieu of fractional shares) solely capital stock of the holding company
in amounts proportionate to their holdings of such capital stock of the Borrower
or Communications immediately prior to such transaction, shall be excluded from
the operation of this clause (iii) or (iv) Communications shall at any time
cease to own 100% of the capital stock of the Borrower.
"Closing Date" shall mean the date of the extension of Loans
hereunder, which shall occur on or after the Effective Date and on or prior to
July 31, 1997.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"Collateral" shall mean all of the Collateral as defined in
each of the Collateral Documents.
"Collateral Access Agreements" shall mean any landlord
waivers, mortgagee waivers, bailee letters or any similar acknowledgement
agreements of any warehousemen or processor in possession of Inventory, in each
case substantially in the form of Exhibit N hereto (or prior to obtaining any
such agreement, in the form previously attached as Exhibit N to the Existing
Credit Agreement), in each case with such changes thereto as are reasonably
acceptable to the Administrative Agent.
"Collateral Agent" shall mean BTCC acting as collateral agent
pursuant to the Collateral Documents.
"Collateral Assignments of Rights" shall mean each collateral
assignment of rights executed and delivered in substantially the form of Exhibit
L hereto (or, if executed and delivered prior to the Closing Date, in the form
of Exhibit L to the Existing Credit Agreement).
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"Collateral Documents" shall mean all contracts, instruments
and other documents now or hereafter executed and delivered in connection with
this Agreement, pursuant to which liens and security interests were or are
granted to the Collateral Agent in the Collateral for the benefit of the Secured
Creditors (including the Banks), including, without limitation, the Pledge
Agreement, the Security Agreement, each Mortgage, the Canadian Debenture, the
Canadian Pledge Agreement and, after the execution and delivery thereof, each
Additional Security Document.
"Commitment" shall mean, for each Bank, the amount set forth
opposite such Bank's name in Schedule I, as the same may be (x) reduced from
time to time pursuant to Section 3.01 or (y) adjusted from time to time as a
result of assignments to or from such Bank pursuant to Section 1.11 or 12.04(b).
"Communications" means Xxxxxxxx Communications, Inc., a
Delaware corporation, and its successors.
"Concentration Account Agreements" shall mean each
concentration account agreement executed and delivered pursuant to the Existing
Credit Agreement, until such time as same are replaced by concentration account
agreements in the form of Exhibit M-3 hereto, and any concentration account
agreement at any time entered into in the form of Exhibit M-3 hereto.
"Covered Taxes" shall have the meaning provided such term in
Section 3.03(a).
"Credit Documents" shall mean, collectively, this Agreement,
the Notes, the Subsidiaries Guaranty and each of the Collateral Documents, as
the same may be modified, amended, extended, restated or supplemented from time
to time.
"Credit Parties" shall mean, collectively, Communications, the
Borrower and the Subsidiary Guarantors.
"Custodian" shall mean any receiver, trustee, assignee,
liquidator, custodian or similar official under any Bankruptcy Law.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
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"Disposition" means the sale, assignment, transfer, lease,
conveyance or other disposition by Communications, the Borrower or their
respective Restricted Subsidiaries of any Collateral, including, without
limitation an involuntary disposition as a result of a casualty or condemnation.
"Disqualified Stock" means, with respect to any Person, any
Capital Stock which by its terms or upon the happening of any event (i) matures
or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise,
(ii) is convertible or exchangeable for Indebtedness or Disqualified Stock or
(iii) is redeemable at the option of the holder thereof, in whole or in part, in
each case on or prior to the first anniversary of the Stated Maturity of the
Senior Subordinated Notes (as in effect on the Closing Date); provided, however,
that any Capital Stock that would not constitute Disqualified Stock but for
provisions thereof giving holders thereof the right to require such Person to
repurchase or redeem such Capital Stock upon the occurrence of any "asset sale"
or "change of control", occurring prior to the first anniversary of the Stated
Maturity of the Senior Subordinated Notes (as in effect on the Closing Date)
shall not constitute Disqualified Stock if the "asset sale" or "change of
control" provisions applicable to such Capital Stock are no more favorable to
the holders of such Capital Stock than the provisions contained in Section 4.06
and Section 4.08 of the Senior Subordinated Notes Indenture (as in effect on the
Closing Date) and such Capital Stock specifically provides that such Person will
not repurchase or redeem any such Capital Stock pursuant to such provision prior
to such Person's repayment of all Loans as are required to be repaid pursuant to
Section 7.04 and Section 7.06.
"Documents" shall mean all Credit Documents and all Existing
Credit Agreement Documents.
"Dollars" and the sign "$" shall each mean freely transferable
lawful money of the United States.
"Domestic Lending Office" shall mean, with respect to any
Bank, the office of such Bank specified as its "Domestic Lending Office"
opposite its name on Schedule I, as such Schedule may be amended from time to
time.
"Effective Date" shall have the meaning provided in Section
12.10.
"Eligible Transferee" shall mean and include a commercial
bank, financial institution, any fund that invests in bank loans and any other
"accredited investor" (as defined in Regulation D of the Securities Act).
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"Environmental Law" shall mean any applicable Federal, state,
provincial, foreign or local statute, law, rule, regulation, ordinance, code,
guide, policy and rule of common law now or hereafter in effect and in each case
as amended, and any judicial or administrative interpretation thereof, including
any judicial or administrative order, consent decree or judgment, relating to
the environment, health, safety or Hazardous Materials, including, without
limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, as amended,
33 U.S.C. SS. 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. SS. 2601
et seq.; the Clean Air Act, 42 U.S.C. SS. 7401 et seq.; the Safe Drinking Water
Act, 42 U.S.C. ss. 300F et seq.; the Oil Pollution Act of 1990, 33 U.S.C SS.
2701 et seq. and any applicable state, provincial and local or foreign
counterparts, or equivalents or similar statutes.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigations (other than internal
reports prepared by the Borrower or any of its Restricted Subsidiaries solely in
the ordinary course of such Person's business or as required in connection with
a financing transaction and not in response to any third party action or request
of any kind) or proceedings relating in any way to any Environmental Law or any
permit issued, or any approval given, under any such Environmental Law
(hereafter, "Claims"), including, without limitation, (a) any and all Claims by
governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any Environmental
Law, and (b) any and all Claims by any third party seeking damages,
contribution, indemnification, cost recovery, compensation, specific performance
or injunctive relief resulting from Hazardous Materials arising from alleged
injury or threat of injury to health, safety or the environment.
"Equipment" means all of the Borrower's present and hereafter
acquired machinery, equipment, furniture, furnishings, fixtures, motor vehicles,
tools, parts, dies, jigs, goods, and any and all attachments, accessories,
accessions, replacements, substitutions, additions, and improvements thereto,
wherever located (but shall exclude any such attachment, accessories,
accessions, replacements, substitutions, additions and improvements which accrue
to lessors with respect to any equipment leased by the Borrower or subject to a
prior lien as permitted hereunder).
"Equipment Acquisition Loans" shall mean all Equipment
Acquisition Loans under, and as defined in, the Existing Credit Agreement.
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"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to ERISA are to ERISA, as in
effect at the date of this Agreement and any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in
Section 3(9) of ERISA) which together with Communications, the Borrower or any
Restricted Subsidiary of Communications or the Borrower would be deemed to be a
"single employer" within the meaning of Section 414(b) or (c) of the Code, and
for the purpose of any specific provision of this Agreement which expressly
refers to Section 302 of ERISA or Section 412, 4971 or 4977 of the Code, within
the meaning of Section 414(b), (c), (m) or (o) of the Code.
"Eurodollar Lending Office" shall mean, with respect to any
Bank, the office of such Bank specified as its "Eurodollar Lending Office"
opposite its name on Schedule I, as such Schedule may be amended from time to
time (or, if no such office is specified, its Domestic Lending Office), or such
other office or Affiliate of such Bank as such Bank may from time to time
specify to the Borrower and the Administrative Agent.
"Eurodollar Loan" shall mean each Loan outstanding at any time
hereunder, except during such time (and then only to the extent) as the
respective such Loan is required to be maintained as a Base Rate Loan in
accordance with the provisions of Section 1.08.
"Eurodollar Rate" shall mean (a) the offered quotation to
first-class banks in the New York interbank Eurodollar market by BTCo for Dollar
deposits of amounts in immediately available funds comparable to the outstanding
principal amount of the Eurodollar Loan of BTCo with maturities comparable to
the Interest Period applicable to such Eurodollar Loan commencing two Business
Days thereafter as of 10:00 A.M. (New York time) on the date which is two
Business Days prior to the commencement of such Interest Period, divided (and
rounded off to the nearest 1/16 of 1%) by (b) a percentage equal to 100% minus
the then stated maximum rate of all reserve requirements (including, without
limitation, any marginal, emergency, supplemental, special or other reserves
required by applicable law) applicable to any member bank of the Federal Reserve
System in respect of Eurocurrency funding or liabilities as defined in
Regulation D (or any successor category of liabilities under Regulation D).
"Event of Default" has the meaning provided in Section 8.
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"Excess Proceeds" shall have the meaning provided in Section
7.04.
"Excess Proceeds Repayment" shall have the meaning provided in
Section 7.04.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Existing Canadian Debenture" shall mean the Canadian
Debenture under, and as defined in, the Existing Credit Agreement, as same is in
effect immediately prior to the occurrence of the Closing Date and immediately
before giving effect to the Existing Canadian Debenture Amendment.
"Existing Canadian Debenture Amendment" shall have the meaning
provided in Section 4.11.
"Existing Canadian Pledge Agreement" shall mean the Canadian
Pledge Agreement under, and as defined in, the Existing Credit Agreement, as
same is in effect immediately prior to the occurrence of the Closing Date and
immediately before giving effect to the Existing Canadian Pledge Agreement
Amendment.
"Existing Canadian Pledge Agreement Amendment" shall have the
meaning provided in Section 4.11.
"Existing Credit Agreement" is defined to mean the Credit
Agreement, dated as of August 15, 1995, among Communications, the Borrower, the
lenders party thereto and the Existing Credit Agreement Agent, together with the
related documents thereto (including any Guarantees and security documents), in
each case as such agreements may be amended (including any amendment and
restatement thereof), supplemented, replaced or otherwise modified from time to
time, including any agreement extending the maturity of, refinancing or
otherwise restructuring (including, but not limited to, the inclusion of
additional borrowers or guarantors thereunder that are Restricted Subsidiaries
of Communications or the Borrower and whose obligations are guaranteed by
Communications or the Borrower thereunder) all or a portion of the Indebtedness
under such agreement or any successor agreement.
"Existing Credit Agreement Agent" shall mean BTCC, as Agent
pursuant to the Existing Credit Agreement, and any successor thereto.
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"Existing Credit Agreement Collateral Access Agreements" shall
mean all Collateral Access Agreements entered into pursuant to, and as required
by, the Existing Credit Agreement.
"Existing Credit Agreement Credit Parties" shall mean each of
the Credit Parties under, and as defined in, the Existing Credit Agreement.
"Existing Credit Agreement Documents" shall mean all Credit
Documents under, and as defined in, the Existing Credit Agreement.
"Existing Credit Agreement Obligations" shall mean all
Obligations under, and as defined, in the Existing Credit Agreement (in any
event including all principal of, and interest on, all loans pursuant to the
Existing Credit Agreement, all amounts owing in respect of unpaid drawings under
letters of credit issued thereunder, and all interest, fees and other amounts
owing pursuant to the Existing Credit Agreement).
"Existing Credit Agreement Required Lenders" shall mean the
Required Lenders under, and as defined in, the Existing Credit Agreement.
"Existing Credit Agreement Termination Date" shall mean that
date upon which all commitments pursuant to the Existing Credit Agreement have
terminated, no letter of credit or promissory note remains outstanding
thereunder and all loans and letter of credit obligations, together with
interest, fees, expenses and other obligations pursuant to the Existing Credit
Agreement (other than any indemnities described therein which are not then due
and payable) are paid in full.
"Existing Indebtedness" shall mean all Indebtedness of the
Borrower and its Restricted Subsidiaries outstanding prior to, and to remain
outstanding on and after, the Closing Date, and set forth on Schedule X, without
giving effect to extensions or renewals thereto, except as expressly provided
therein.
"Existing Mortgage Policies" shall mean each mortgage
insurance policy issued with respect to an Existing Mortgage under the Existing
Credit Agreement.
"Existing Mortgaged Property" shall mean all Real Property of
the Borrower and its Restricted Subsidiaries listed as such on Schedule VII
(which shall include all Real Property subject to any Existing Mortgage).
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"Existing Mortgages" shall mean all Mortgages under, and as
defined in, the Existing Credit Agreement, granted by the Existing Credit
Agreement Credit Parties pursuant to the Existing Credit Agreement and which
have not been released by the lenders thereunder prior to the Closing Date.
"Existing Pledge Agreement" shall mean the Pledge Agreement
under, and as defined in, the Existing Credit Agreement, as same is in effect
immediately prior to the occurrence of the Closing Date and immediately before
giving effect to the Existing Pledge Agreement Amendment.
"Existing Pledge Agreement Amendment" shall have the meaning
provided in Section 4.08.
"Existing Security Agreement" shall mean the Security
Agreement under, and as defined in, the Existing Credit Agreement, as same is in
effect immediately prior to the occurrence of the Closing Date and immediately
before giving effect to the Existing Security Agreement Amendment.
"Existing Security Agreement Amendment" shall have the meaning
provided in Section 4.09.
"Expenses" shall mean all present and future expenses incurred
by or on behalf of the Administrative Agent in connection with this Agreement,
any other Credit Document or otherwise in its capacity as Administrative Agent
under this Agreement, whether incurred heretofore or hereafter.
"Federal Funds Rate" shall mean for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal Funds
brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean all fees payable pursuant to, or referenced
in, Section 2.01.
"Final Maturity Date" shall mean March 31, 2001.
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"Financial Statements" shall mean the consolidated and, if
requested by the Administrative Agent, consolidating balance sheet and statement
of operations and statement of cash flows and statements of changes in
shareholders' equity of each of (x) Communications and (y) the Borrower, for the
period specified prepared in accordance with GAAP and consistent with prior
practices; provided however, that so long as Communications owns all the capital
stock of the Borrower, owns no other significant assets and owns no capital
stock of any other Subsidiary, separate financial statements for the Borrower
shall not be required to be furnished pursuant to Sections 6.01(a) and (b).
"First Priority Secured Obligations" shall mean all Existing
Credit Agreement Obligations and all Secured Interest Rate Protection
Obligations, in each case secured pursuant to the Collateral Documents.
"Foreign Bank" shall mean any Bank organized under the laws of
a jurisdiction outside of the United States.
"Foreign Pension Plan" means any plan, fund (including,
without limitation, any superannuation fund) or other similar program or
arrangement established or maintained outside the United States of America by
Communications, the Borrower or any one or more of their Restricted Subsidiaries
primarily for the benefit of employees of Communications, the Borrower or such
Restricted Subsidiaries residing outside the United States of America, which
plan, fund or other similar program provides, or results in, retirement income,
a deferral of income in contemplation of retirement or payments to be made upon
any termination of employment, and which plan is not subject to ERISA or the
Code.
"GAAP" shall mean generally accepted accounting principles in
the United States as in effect from time to time subject to Section 9.02.
"Governing Documents" shall mean, as to any Person, the
certificate or articles of incorporation and by-laws or other organizational or
governing documents of such Person.
"Governmental Authority" shall mean any nation or government,
any state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness or other
financial
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obligation of any other Person and any obligation, direct or indirect,
contingent or otherwise, of such Person (i) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Indebtedness or other
financial obligation of such other Person (whether arising by virtue of
partnership arrangements, or by agreements to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for the purpose of
assuring in any other manner the obligee of such Indebtedness or other financial
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, however, that the term
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning. The term "Guarantor" shall mean any Person Guaranteeing
any Indebtedness or financial obligation.
"Guaranty" shall mean the Parent Guaranty and the Subsidiaries
Guaranty.
"Hazardous Materials" shall mean (a) any petroleum or
petroleum products, radioactive materials, asbestos in any form that is or could
become friable, urea formaldehyde foam insulation, transformers or other
equipment that contained dielectric fluid containing levels of polychlorinated
biphenyls, and radon gas; (b) any chemicals, materials or substances defined as
or included in the definition of "hazardous substances," "hazardous waste,"
"hazardous materials," "extremely hazardous waste," "restricted hazardous
waste," "toxic substances," "toxic pollutants," "contaminants," or "pollutants,"
or words of similar import, under any Environmental Law; and (c) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority.
"Highest Lawful Rate" shall mean, at any given time during
which any Obligations shall be outstanding hereunder, the maximum nonusurious
interest rate, if any, that at any time or from time to time may be contracted
for, taken, reserved, charged or received on the Obligations owing under this
Agreement, under the laws of the State of New York (or the law of any other
jurisdiction whose laws may be mandatorily applicable notwithstanding other
provisions of this Agreement and the other Credit Documents), or under
applicable federal laws which may presently or hereafter be in effect and which
allow a higher maximum nonusurious interest rate than under New York (or such
other jurisdiction's) law, in any case after taking into account, to the extent
permitted by applicable law, any and all relevant payments or charges under this
Agreement and any other Credit Documents executed in connection herewith, and
any available exemptions, exceptions and exclusions.
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"Holder" means the Person in whose name a Security is
registered on the Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise
become liable for; provided, however, that any Indebtedness or Capital Stock of
a Person existing at the time such Person becomes a Restricted Subsidiary of the
Borrower (whether by merger, consolidation, acquisition or otherwise) shall be
deemed to be Incurred by such Restricted Subsidiary at the time it becomes a
Restricted Subsidiary. The term "Incurrence" when used as a noun shall have a
correlative meaning.
"Indebtedness" of any Person means, without duplication:
(i) the principal of and premium (if any) in respect of (A)
indebtedness of such Person for money borrowed and (B) indebtedness
evidenced by notes, debentures, bonds or other similar instruments for
the payment of which such Person is responsible or liable (other than
Interest Rate Protection Agreements);
(ii) all Capital Lease Obligations of such Person;
(iii) all obligations of such Person issued or assumed as the
deferred purchase price of property which purchase price is due more
than six months after the date of placing such property in service or
taking delivery and title thereto, all conditional sale obligations of
such Person and all obligations of such Person under any title
retention agreement (but excluding trade accounts payable arising in
the ordinary course of business);
(iv) all obligations of such Person for the reimbursement of any
obligor on any letter of credit, banker's acceptance or similar credit
transaction (other than obligations with respect to letters of credit
securing obligations (other than obligations described in clauses (i)
through (iii) above) entered into in the ordinary course of business of
such Person to the extent such letters of credit are not drawn upon or,
if and to the extent drawn upon, such drawing is reimbursed no later
than the third Business Day following receipt by such Person of a
demand for reimbursement following payment on the letter of credit);
(v) the amount of all obligations of such Person with respect to
the redemption, repayment or other repurchase of any Disqualified
Stock, and in respect of a Restricted Subsidiary, all obligations of
such Restricted
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Subsidiary with respect to the redemption, repayment or other
repurchase of any Preferred Stock (but excluding, in each case, any
accrued dividends);
(vi) all obligations of the type referred to in clauses (i)
through (v) of other Persons and all dividends of other Persons for the
payment of which, in either case, such Person is responsible or liable,
directly or indirectly, as obligor, Guarantor or otherwise, including
by means of any Guarantee; and
(vii) all obligations of the type referred to in clauses (i)
through (vi) of other Persons secured by any Lien on any property or
asset of such Person (whether or not such obligation is assumed by such
Person), the amount of such obligation being deemed to be the lesser of
the fair market value of such property or assets (as determined by the
Board of Directors) or the amount of the obligation so secured.
The amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and,
with respect to contingent obligations, the maximum liability upon the
occurrence of the contingency giving rise to the obligation; provided, however,
(i) that the amount outstanding at any time of any Indebtedness Incurred with
original issue discount is the face amount of such Indebtedness less the
remaining unamortized portion of the original issue discount of such
Indebtedness at such time as determined in conformity with GAAP and (ii) that
Indebtedness shall not include (A) any liability for Federal, state, local or
other taxes, (B) any obligations under Interest Rate Protection Agreements or
Raw Material Hedge Agreements or (C) any liability arising from the honoring by
a bank or other financial institution of a check, draft or similar instrument
inadvertently drawn against insufficient funds in the ordinary course of
business.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section
1.07.
"Interest Rate Protection Agreement" means any interest rate
or currency swap agreement, interest rate cap agreement or other financial
agreement or arrangement designed to protect the Borrower or any Restricted
Subsidiary against fluctuations in interest rates or currency values.
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"Inventory" of any Person shall mean all of the inventory
owned by such Person, including without limitation: (i) all raw materials, work
in process, parts, components, assemblies, supplies and materials used or
consumed in such Person's business; (ii) all goods, wares and merchandise,
finished or unfinished, held for sale or lease or leased or furnished or to be
furnished under contracts of service; and (iii) all goods returned or
repossessed by such Person.
"Investment" in any Person means any direct or indirect
advance, loan (other than advances to customers in the ordinary course of
business that are recorded as accounts receivable) or other extension of credit
(including by way of Guarantee or similar arrangement) or capital contribution
to (by means of any transfer of cash or other property to others or any payment
for property or services of the account or use of others), or any purchase or
acquisition of Capital Stock, Indebtedness or other similar instruments issued
by such Person. For purposes of the definition of "Unrestricted Subsidiary," the
definition of "Restricted Payment," and Section 7.02 (i) "Investment" shall
include the portion (proportionate to the Borrower's equity interest in such
Subsidiary) of the fair market value of the net assets of any Restricted
Subsidiary of the Borrower at the time that such Restricted Subsidiary is
designated an Unrestricted Subsidiary; provided, however, that upon a
redesignation of such Subsidiary as a Restricted Subsidiary, the Borrower shall
be deemed to continue to have a permanent "Investment" in such Subsidiary at the
time of such redesignation equal to the amount (if positive) equal to (x) the
Borrower's "Investment" in such Subsidiary at the time of such redesignation
less (y) the portion (proportionate to the Borrower's equity interest in such
Subsidiary) of the fair market value of the net assets of such Subsidiary at the
time of such redesignation; and (ii) any property transferred to or from an
Unrestricted Subsidiary shall be valued at its fair market value at the time of
such transfer, in each case as determined in good faith by the Board of
Directors.
"Issue Date" means the date on which the Senior Subordinated
Notes were originally issued.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or other
title retention agreement or lease in the nature thereof).
"Loan" shall have the meaning provided in Section 1.01.
"Lockbox Agreements" shall mean all lockbox agreements
executed and delivered pursuant to the Existing Credit Agreement, until such
time as same
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are replaced by lockbox agreements in the form of Exhibit M-1 hereto, and any
lockbox agreements at any time entered into in the form of Exhibit M-1 hereto.
"Margin Stock" shall have the meaning provided in Regulation
U.
"Material Adverse Effect" shall mean a material adverse effect
on (i) the business, prospects, operations, results of operations, assets,
liabilities or financial condition of the Borrower or of Communications and its
Restricted Subsidiaries taken as a whole, (ii) any Credit Party's ability to
perform its material obligations under the Credit Documents to which it is a
party, or (iii) the material rights and remedies of the Administrative Agent,
the Collateral Agent or the Banks under any Credit Document.
"Material Contract" shall mean any contract or other
arrangement (other than the Credit Documents), whether written or oral, to which
the Borrower or its Restricted Subsidiaries is a party as to which the breach,
nonperformance, cancellation or failure to renew by any party thereto may be
reasonably expected to have a Material Adverse Effect.
"Moody's" means Xxxxx'x Investors Service, Inc. and its
successors.
"Mortgage Amendments" shall have the meaning provided in
Section 4.10.
"Mortgages" shall mean all Existing Mortgages, as modified by
the Mortgage Amendments or as same may be further modified, amended or
supplemented from time to time in the future in accordance with the terms
thereof and hereof, as well as any additional mortgages granted by any of the
Credit Parties after the Closing Date.
"MSCP Entities" means, collectively, Xxxxxx Xxxxxxx Capital
Partners III, L.P., a Delaware limited partnership, Xxxxxx Xxxxxxx Capital
Investors, L.P., a Delaware limited partnership, and MSCP III 892 Investors,
L.P., a Delaware limited partnership.
"MSLEF" means The Xxxxxx Xxxxxxx Leveraged Equity Fund II,
L.P., a Delaware limited partnership.
"Multiemployer Plan" shall mean a "multiemployer plan" as
defined in Section 4001(a)(3) of ERISA.
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"Net Available Cash" from an Asset Disposition means cash
payments received therefrom (including any cash payments received by way of
deferred payment of principal (but not interest) pursuant to a note or
installment receivable or otherwise including upon release to the Borrower or a
Restricted Subsidiary from any reserve established by the Borrower or such
Restricted Subsidiary against any liabilities associated with such Asset
Disposition, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring person of
Indebtedness or other obligations relating to such properties or assets or
received in any other noncash form) in each case net of all legal, title and
recording tax expenses, commissions and other fees and expenses incurred, and
all Federal, state, provincial, foreign and local taxes required to be accrued
as a liability under GAAP, as a consequence of such Asset Disposition (without
regard to the consolidated results of operations of the Borrower and its
Restricted Subsidiaries, taken as whole), and in each case net of all payments
made on any Indebtedness which is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon or other security
agreement of any kind with respect to such assets, or which must by its terms,
or in order to obtain a necessary consent to such Asset Disposition, or by
applicable law be repaid out of the proceeds from such Asset Disposition, and,
until released to the Borrower or a Restricted Subsidiary, net of appropriate
amounts to be provided by the Borrower or any Restricted Subsidiary of the
Borrower as a reserve against any liabilities associated with such Asset
Disposition, including pension and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Disposition, all as
determined in accordance with GAAP, and net of all distributions and other
payments required to be made to minority interest holders in Restricted
Subsidiaries or joint ventures as a result of such Asset Disposition.
"Net Cash Proceeds," with respect to any issuance or sale of
Capital Stock, means the cash proceeds of such issuance or sale net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other fees actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof.
"Note" shall have the meaning provided in Section 1.04(a).
"Notice of Borrowing" shall have the meaning provided in
Section 1.02(a).
"Notice Office" shall mean the office of the Administrative
Agent located at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx
Xxxxxxx,
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or such other office as the Administrative Agent may hereafter designate in
writing as such to the other parties hereto.
"Obligations" shall mean, without duplication, the unpaid
principal of and interest on (including interest accruing on or after the filing
of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to Communications, the Borrower or
any Restricted Subsidiary of the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) the Notes,
the Fees, the Expenses and all other obligations and liabilities of
Communications, the Borrower or any Restricted Subsidiary of the Borrower to the
Administrative Agent, the Collateral Agent or the Banks, whether direct or
indirect, absolute or contingent, due or to become due, whether now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, the Notes, any other Credit Document or any other document made,
delivered or given in connection herewith or therewith.
"Offering Memorandum" shall mean the Offering Memorandum,
dated August 10, 1995, issued in connection with the private placement of the
Senior Subordinated Notes.
"Officer" means the Chairman of the Board, the President, any
Vice President, the Treasurer or the Secretary of the Borrower.
"Officers' Certificate" means a certificate signed by two
Officers.
"Opinion of Counsel" means a written opinion from legal
counsel who is acceptable to the Administrative Agent. The counsel may be an
employee of or counsel to the Borrower or the Administrative Agent.
"Other Taxes" shall have the meaning given such term in
Section 3.03(b).
"Parent Guarantor" shall have the meaning provided in the
first paragraph of this Agreement.
"Parent Guaranty" shall mean the Guaranty provided by
Communications pursuant to Section 13.
"Payment Office" shall mean the office of the Administrative
Agent located at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, ABA Number:
000000000, Account Name: BTCo Investor Cash A/C, Account Number: 000355784,
Reference:
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Xxxxxxxx Graphics, Inc., Attention: Xxxxxxxx Xxxxxx, or such other office as the
Administrative Agent may hereafter designate in writing as such to the other
parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA and any Person succeeding to the
functions thereof.
"Permitted Encumbrances" shall mean, with respect to any
Mortgage, the Permitted Encumbrances related thereto as described in the
respective Mortgage Policy relating thereto.
"Permitted Holders" means, collectively, MSLEF and the MSCP
Entities.
"Permitted Investment" means (i) an Investment in the Borrower
or in a Restricted Subsidiary or a Person which will, upon the making of such
Investment, become a Restricted Subsidiary; provided, however, that the primary
business of such Restricted Subsidiary or such Person is a Related Business;
(ii) an Investment by the Borrower or any Restricted Subsidiary in another
Person if as a result of such Investment such other Person is merged or
consolidated with or into, or transfers or conveys all or substantially all its
assets to, the Borrower or a Restricted Subsidiary; provided, however, that such
Person's primary business is a Related Business; (iii) a Temporary Cash
Investment; (iv) receivables owing to the Borrower or any Restricted Subsidiary,
if created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms; provided, however, that
such trade terms may include such concessionary trade terms as the Borrower or
any such Restricted Subsidiary deems reasonable under the circumstances; (v)
payroll, travel and similar advances to cover matters that are expected at the
time of such advances ultimately to be treated as expenses for accounting
purposes and that are made in the ordinary course of business; (vi) loans or
advances to employees made in the ordinary course of business in accordance with
past practices of the Borrower or of its Restricted Subsidiaries; (vii) stock,
obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Borrower or any Restricted
Subsidiary or in satisfaction of judgments, (viii) Interest Rate Protection
Agreements and Raw Material Hedge Agreements and (ix) Investments at any time
not exceeding $2 million (valued at the fair market value at the time any such
Investment was made).
"Permitted Materials" shall have the meaning given to such
term in Section 5.18.
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"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
government or any agency or political subdivision thereof or any other entity.
"Plan" shall mean any multiemployer or single-employer plan as
defined in Section 4001 of ERISA, which (i) is maintained or contributed to by
(or to which there is an obligation to contribute of), or (ii) at any time
during the five year period preceding (A) in the case of any Loan, the date of
the making of such Loan or (B) in the case of any event or condition described
in Section 6.04, the date thereof, was maintained or contributed to by (or to
which there is or was an obligation to contribute to), Communications, the
Borrower, a Restricted Subsidiary of Communications or the Borrower or an ERISA
Affiliate.
"Pledge Agreement" shall mean the Existing Pledge Agreement,
as same may be modified, amended or supplemented from time to time in accordance
with the terms thereof and hereof, including pursuant to the Existing Pledge
Agreement Amendment.
"PPSA" shall mean the Personal Property Security Act
(Ontario).
"Preferred Stock", as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Prime Lending Rate" shall mean the rate which BTCo announces
from time to time as its prime lending rate, the Prime Lending Rate to change
when and as such prime lending rate changes. The Prime Lending Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. BTCo may make commercial loans or other loans
at rates of interest at, above or below the Prime Lending Rate.
"Proceeds" shall mean all proceeds of any Collateral.
"Quarterly Payment Date" shall mean the last Business Day of
each January, April, July and October occurring after the Closing Date.
"Raw Material Hedge Agreement" means an agreement designed to
hedge against fluctuations in the cost of raw materials entered into by the
Borrower
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or its Subsidiaries in the ordinary course of business in connection with their
business operations.
"Real Property" of any Person shall mean all of the right,
title and interest of such Person in and to land, improvements and fixtures,
including leaseholds.
"Refinance" means, in respect of any Indebtedness, to
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue Indebtedness in exchange, substitution or replacement for, such
Indebtedness. "Refinanced" and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that Refinances
any Indebtedness of the Borrower or any Restricted Subsidiary of the Borrower
existing on the Closing Date or Incurred in compliance with this Agreement,
including Indebtedness that Refinances Refinancing Indebtedness; provided,
however, that (i) such Refinancing Indebtedness has a Stated Maturity no earlier
than the Stated Maturity of the Indebtedness being Refinanced, (ii) such
Refinancing Indebtedness has an Average Life at the time such Refinancing
Indebtedness is Incurred that is equal to or greater than the Average Life of
the Indebtedness being Refinanced and (iii) such Refinancing Indebtedness has an
aggregate principal amount (or if Incurred with original issue discount, an
aggregate issue price) that is equal to or less than the aggregate principal
amount (or if Incurred with original issue discount, the aggregate accreted
value) then outstanding or committed (plus fees, accrued interest and expenses,
including any premium and defeasance costs) under the Indebtedness being
Refinanced; provided further, however, that Refinancing Indebtedness shall not
include Indebtedness of a Restricted Subsidiary of the Borrower that Refinances
Indebtedness of the Borrower.
"Register" shall have the meaning provided in Section 12.15.
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing reserve requirements.
"Regulation U" shall mean Regulation U of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor thereto.
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"Related Business" means as of any date the businesses of the
Borrower and its Subsidiaries as conducted on the Closing Date and any business
related, ancillary or complementary thereto.
"Remedial Actions" means any claim, proceeding or action to
foreclose upon, take possession or control of, sell, lease or otherwise dispose
of, or in any other manner realize, take steps to realize or seek to realize
upon, the whole or any part of any Collateral, whether pursuant to the UCC, by
foreclosure, by setoff, by self-help repossession, by notification to account
debtors, by deed in lieu of foreclosure, by exercise of power of sale, by
judicial action or otherwise, or the exercise of any other remedies with respect
to any Collateral available under any of the Collateral Documents, or under
applicable law.
"Replaced Bank" shall have the meaning provided in Section
1.11.
"Replacement Bank" shall have the meaning provided in Section
1.11.
"Reportable Event" shall mean any of the events described in
Section 4043 of ERISA with respect to a Plan as to which the 30-day notice
requirement has not been waived by the PBGC.
"Required Banks" shall mean, collectively, Banks the sum of
whose outstanding Loans (or, if prior to the Closing Date, Commitments)
represent an amount greater than 50% of the sum of all outstanding Loans (or, if
prior to the Closing Date, the Commitments); provided that until the first date
on or after the Closing Date upon which BTCo and its Affiliates own less than a
majority of the outstanding principal amount of Loans, the Required Banks shall
be required to include (if there are any Banks other than BTCo and its
Affiliates) at least one Bank which is not BTCo or an Affiliate thereof.
"Required Secured Creditors" shall mean, with respect to any
Collateral Document, the Required Lenders as defined therein.
"Restricted Payment" with respect to any Person means (i) the
declaration or payment of any dividends or any other distributions of any sort
in respect of its Capital Stock (including any payment in connection with any
merger or consolidation involving such Person) or similar payment to the direct
or indirect holders of its Capital Stock (other than dividends or distributions
payable solely in its Capital Stock (other than Disqualified Stock) or options,
warrants or other rights to acquire its Capital Stock (other than Disqualified
Stock) and dividends or distributions payable solely to the Borrower or a
Restricted Subsidiary, and other
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than pro rata dividends or other distributions made by a Subsidiary of the
Borrower that is not a Wholly-Owned Subsidiary to minority stockholders (or
owners of an equivalent interest in the case of a Subsidiary that is an entity
other than a corporation)), (ii) the purchase, redemption or other acquisition
or retirement for value of any Capital Stock of the Borrower held by any Person
or of any Capital Stock of a Subsidiary of the Borrower held by any Affiliate of
the Borrower (other than a Restricted Subsidiary), including the exercise of any
option to exchange any Capital Stock (other than into Capital Stock of the
Borrower that is not Disqualified Stock), (iii) the purchase, repurchase,
redemption, defeasance or other acquisition or retirement for value, prior to
scheduled maturity, scheduled repayment or scheduled sinking fund payment of any
Subordinated Obligations (other than the purchase, repurchase or other
acquisition of Subordinated Obligations purchased in anticipation of satisfying
a sinking fund obligation, principal installment or final maturity, in each case
due within one year of the date of acquisition) or (iv) the making of any
Investment, other than a Permitted Investment, in any Person.
"Restricted Subsidiary" means any Subsidiary of the Borrower
that is not an Unrestricted Subsidiary.
"S&P" means Standard & Poor's Ratings Group and its
successors.
"SEC" means the Securities and Exchange Commission.
"Section 3.03(e) Certificate" shall have the meaning provided
in Section 3.03(e).
"Second Priority Secured Obligations" shall mean all
Obligations under, or with respect to, this Agreement.
"Second Tier Taxes" shall have the meaning provided in Section
3.03(a).
"Secured Creditors" shall have the meaning provided in the
various Collateral Documents (after giving effect to the amendments thereto
required pursuant to Section 4), and in any event shall include (x) the lenders
from time to time party to the Existing Credit Agreement, (y) various lenders
entering into Interest Rate Agreements as more fully provided in the various
Collateral Documents and (z) the Banks pursuant to this Agreement.
"Secured Indebtedness" means any Indebtedness of the Borrower
or any of its Restricted Subsidiaries secured by a Lien.
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"Secured Interest Rate Protection Obligations" shall mean all
obligations relating to Interest Rate Protection Agreements secured pursuant to
the Collateral Documents in accordance with the terms thereof.
"Secured Obligations" shall mean all obligations secured in
accordance with the provisions of the various Collateral Documents, in any event
including all Existing Credit Agreement Obligations, all Obligations pursuant to
this Agreement and all Secured Interest Rate Protection Obligations.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreement" shall mean the Existing Security
Agreement, as same may be modified, amended or supplemented from time to time in
accordance with the terms thereof and hereof, including pursuant to the Existing
Security Agreement Amendment.
"Senior Indebtedness" of any Person means all obligations of
such Person which would constitute Senior Indebtedness under, and as defined in,
the Senior Subordinated Notes Indenture as in effect on the Closing Date, or
which constitutes Senior Indebtedness under, and as defined in, the
documentation governing any Indebtedness which Refinances (or successively
Refinances) such Indebtedness and is incurred pursuant to the provisions of
Section 7.01(b)(vii).
"Senior Subordinated Note Documents" shall mean and include
each of the documents and other agreements entered into (including, without
limitation, the Senior Subordinated Notes and the Senior Subordinated Notes
Indenture) relating to the issuance by the Borrower of the Senior Subordinated
Notes, as in effect on the Closing Date and as the same may be entered into,
modified, supplemented or amended from time to time to the extent permitted
pursuant to the terms hereof and thereof.
"Senior Subordinated Notes Indenture" shall mean the
Indenture, dated as of August 15, 1995, entered into by and between the Borrower
and NationsBank of Georgia, National Association, as trustee thereunder, as in
effect on the Closing Date and as the same may be modified, amended or
supplemented from time to time to the extent permitted in accordance with the
terms hereof and thereof.
"Senior Subordinated Notes" shall mean the Borrower's 12-3/4%
Senior Subordinated Notes due 2005, as in effect on the Closing Date and as the
same may be modified, supplemented or amended from time to time to the extent
permitted pursuant to the terms hereof and thereof.
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"Shareholders' Agreement" shall have the meaning assigned that
term in the Existing Credit Agreement, as same is in effect on the Closing Date.
"Significant Subsidiary" means any Restricted Subsidiary that
would be a "Significant Subsidiary" of the Borrower within the meaning of Rule
1-02 under Regulation S-X promulgated by the SEC.
"Stated Maturity" means, with respect to any Indebtedness, the
date specified in such security or other relevant documentation as the fixed
date on which the final payment of principal of such Indebtedness is due and
payable, including pursuant to any mandatory redemption provision (but excluding
any provision providing for the repurchase of such security at the option of the
holder thereof upon the happening of any contingency unless such contingency has
occurred).
"Subordinated Obligation" means the Senior Subordinated Notes,
any Indebtedness which Refinances same, and any other Indebtedness of the
Borrower (whether outstanding on the Issue Date or thereafter incurred) which is
subordinate or junior in right of payment to the Loans pursuant to a written
agreement to that effect.
"Subsidiaries Guaranty" shall have the meaning provided in
Section 4.07.
"Subsidiary" shall mean as to any Person, a corporation,
partnership or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Credit Agreement shall
refer to a Subsidiary or Subsidiaries of Communications or the Borrower, as
appropriate.
"Subsidiary Guarantor" shall mean, at any time, any Restricted
Subsidiary of the Borrower which has theretofore executed and delivered the
Subsidiaries Guaranty or a counterpart thereof.
"Syndication Date" shall mean the earlier of (x) the date
which is 30 days after the Closing Date and (y) the date occurring three
Business Days after the date upon which the Administrative Agent determined in
its sole discretion (and
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notifies the Borrower) that the primary syndication (and the resulting addition
of institutions as Banks pursuant to Section 12.04) has been completed, notice
of which shall be promptly given to the Borrower.
"Tax Sharing Agreements" shall have the meaning assigned that
term in the Existing Credit Agreement, as same is in effect on the Closing Date.
"Taxes" shall have the meaning provided in Section 3.03.
"Temporary Cash Investments" means any of the following: (i)
any investment in direct obligations of the United States of America or any
agency thereof or obligations guaranteed by the United States of America or any
agency thereof, (ii) investments in time deposit accounts, certificates of
deposit and money market deposits maturing within 180 days of the date of
acquisition thereof issued by a bank or trust company which is organized under
the laws of the United States of America, any state thereof or any foreign
country recognized by the United States, and which bank or trust company has
capital, surplus and undivided profits aggregating in excess of $50,000,000 (or
the foreign currency equivalent thereof) and has outstanding debt which is rated
"A" (or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act) or any money-market fund sponsored by a registered broker dealer
or mutual fund distributor, (iii) repurchase obligations with a term of not more
than 30 days for underlying securities of the types described in clause (i)
above entered into with a bank meeting the qualifications described in clause
(ii) above, (iv) investments in commercial paper, maturing not more than 90 days
after the date of acquisition, issued by a corporation (other than an Affiliate
of the Borrower) organized and in existence under the laws of the United States
of America or any foreign country recognized by the United States of America
with a rating at the time as of which any investment therein is made of "P-1"
(or higher) according to Xxxxx'x or "A-1" (or higher) according to S&P, and (v)
investments in securities with maturities of six months or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States of America, or by any political subdivision or taxing
authority thereof, and rated at least "A" by S&P or "A" by Xxxxx'x.
"Total Commitments" shall mean, at any time, the sum of the
Commitments of each of the Banks at such time.
"Transaction" shall mean the entering into of this Agreement
and the incurrence of Loans hereunder, the utilization of the proceeds hereof as
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contemplated by Section 5.05 and the taking of the other actions specified in
Section 4 of this Agreement.
"Unfunded Current Liability" of any Plan shall mean the
amount, if any, by which the actuarial present value of the accumulated plan
benefits under the Plan as of the close of its most recent plan year, exceeds
the fair market value of the assets allocable thereto, each determined in
accordance with Statement of Financial Accounting Standards No. 35, based upon
the actuarial assumptions used by the Plan's actuary in the most recent annual
valuation of the Plan.
"Uniform Commercial Code" means the New York Uniform
Commercial Code as in effect from time to time.
"Unrestricted Subsidiary" means (i) any Subsidiary of the
Borrower that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors in the manner provided below and (ii) any
Subsidiary of an Unrestricted Subsidiary. The Board of Directors may designate
any Subsidiary (including any newly acquired or newly formed Subsidiary) of the
Borrower to be an Unrestricted Subsidiary unless such Subsidiary owns any
Capital Stock or Indebtedness of, or holds any Lien on any property of, the
Borrower or any Restricted Subsidiary of the Borrower that is not a Subsidiary
of the Subsidiary to be so designated; provided, however, that either (A) the
Subsidiary to be so designated has total assets of $1,000 or less or (B) if such
Subsidiary has assets greater than $1,000, such designation would be permitted
as a Permitted Investment pursuant to clause (ix) of the definition thereof. The
Board of Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided, however, that immediately after giving effect to such
designation (x) the Borrower could Incur $1.00 of additional Indebtedness under
Section 4.03(a) of the Senior Subordinated Notes Indenture as same is in effect
on the Closing Date (and without giving effect to any modifications, supplements
or amendments thereto, or terminations or waivers thereof) and (y) no Default or
Event of Default shall have occurred and be continuing. Any such designation by
the Board of Directors shall be evidenced by the Borrower to the Administrative
Agent by promptly filing with the Administrative Agent a copy of the board
resolution giving effect to such designation and an officers' certificate
certifying that such designation complied with the foregoing provisions.
"Voting Stock" of a Person means all classes of Capital Stock
or other interests (including partnership interests) of such Person then
outstanding and normally entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof.
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"Wholly-Owned Restricted Subsidiary" shall mean, as to any
Person, (i) any corporation 100% of whose capital stock (other than director's
qualifying shares) is at the time owned by such Person and/or one or more
Wholly-Owned Restricted Subsidiaries of such Person and (ii) any partnership,
association, joint venture or other entity in which such Person and/or one or
more Wholly-Owned Restricted Subsidiaries of such Person has a 100% equity
interest at such time. Unless the context otherwise requires, each reference to
a Wholly-Owned Restricted Subsidiary shall be to a Wholly-Owned Restricted
Subsidiary of the Borrower.
9.02 Accounting Terms and Determinations. Unless otherwise
defined or specified herein all accounting terms used in this Agreement shall be
construed in accordance with GAAP, applied on a basis consistent in all material
respects with the Financial Statements delivered to the Administrative Agent on
or before the Closing Date. All accounting determinations for purposes of
determining compliance with the covenants contained in Section 7, and all
defined terms as used in said Section 7, shall be made consistent with practices
in effect as of the Closing Date and, if applicable, in accordance with GAAP as
in effect on the Closing Date (or, if the Administrative Agent shall have given
its prior written approval thereto, such determinations may be made by the
Borrower in accordance with GAAP as in effect on the date for which the
determinations of such compliance shall be made), and applied on a basis
consistent in all material respects with the audited Financial Statements
delivered to the Administrative Agent on or before the Closing Date, except as
otherwise previously disclosed to the Administrative Agent. The Financial
Statements required to be delivered hereunder from and after the Closing Date,
and all financial records, shall be maintained in accordance with GAAP. If GAAP
shall change from the basis used in preparing the audited Financial Statements
delivered to the Administrative Agent on or before the Closing Date, the
certificates required to be delivered pursuant to Section 6.01 demonstrating
compliance with the covenants contained herein shall include (except as
otherwise provided above) at the election of the Borrower or upon the request of
the Required Banks, calculations setting forth the adjustments necessary to
demonstrate how the Borrower is in compliance with the financial covenants based
upon GAAP as in effect on the Closing Date.
9.03 Other Defined Terms. Terms not otherwise defined herein
which are defined in the UCC as in effect in the State of New York shall have
the meanings given them in such UCC. The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement, and references to Article, Section, Schedule, Exhibit and like
references are references to this Agreement unless otherwise specified.
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SECTION 10. The Agent.
10.01 Appointment. (a) Each Bank hereby designates (x) BTCo as
Administrative Agent and (y) BTCC as Collateral Agent (for purposes of this
Section 10, the term "Agent" shall include BTCo as Administrative Agent pursuant
to this Agreement and BTCC as Collateral Agent under the Collateral Documents)
to act as herein specified. Each Bank hereby irrevocably authorizes, and each
holder of any Note shall be deemed irrevocably to authorize, the Agent to take
such action on its behalf under the provisions of this Agreement and the Notes
and any other instruments and agreements referred to herein and to exercise such
powers and to perform such duties hereunder and thereunder as are specifically
delegated to or required of the Agent by the terms hereof and thereof and such
other powers as are reasonably incidental thereto. Subject to the provisions of
Section 11, the Collateral Agent shall hold all Collateral and the
Administrative Agent shall hold all payments of principal, interest, Fees,
charges and Expenses received pursuant to this Agreement or any other Credit
Document for the benefit of the Banks to be distributed as provided herein. The
Agent may perform any of its duties hereunder by or through its agents or
employees.
(b) The provisions of this Section 10 are solely for the
benefit of the Agent and the Banks, and neither Communications nor any of its
Subsidiaries shall have any rights as a third party beneficiary of any of the
provisions hereof (other than Sections 10.09 and 10.10(c)). In performing its
functions and duties under this Agreement, the Agent shall act solely as agent
of the Banks and does not assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with or for Communications
or any of its Subsidiaries.
10.02 Nature of Duties of Agent. The Agent shall have no
duties or responsibilities except those expressly set forth in this Agreement
and the other Credit Documents. Neither the Agent nor any of its officers,
directors, employees or agents shall be liable for any action taken or omitted
by it as such hereunder or in connection herewith, unless caused by its or their
gross negligence or willful misconduct. The duties of the Agent shall be
mechanical and administrative in nature; the Agent shall not have by reason of
this Agreement or the other Credit Documents a fiduciary relationship in respect
of any Bank; and nothing in this Agreement or the other Credit Documents,
expressed or implied, is intended to or shall be so construed as to impose upon
the Agent any obligations in respect of this Agreement or the other Credit
Documents except as expressly set forth herein or therein.
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10.03 Lack of Reliance on Agent. (a) Independently and without
reliance upon the Agent, each Bank, to the extent it deems appropriate, has made
and shall continue to make (i) its own independent investigation of the
financial or other condition and affairs of the Borrower and its Subsidiaries in
connection with the taking or not taking of any action in connection herewith
and (ii) its own appraisal of the creditworthiness of the Borrower and its
Subsidiaries, and, except as expressly provided in this Agreement, the Agent
shall not have any duty or responsibility, either initially or on a continuing
basis, to provide any Bank with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or at
any time or times thereafter.
(b) The Agent shall not be responsible to any Bank for any
recitals, statements, information, representations or warranties herein or in
any document, certificate or other writing delivered in connection herewith or
for the execution, effectiveness, genuineness, validity, enforceability,
collectibility, priority or sufficiency of this Agreement or the Notes or the
financial or other condition of the Borrower or any of its Subsidiaries. The
Agent shall not be required to make any inquiry concerning either the
performance or observance of any of the terms, provisions or conditions of this
Agreement or the Notes, or the financial condition of the Borrower or any of its
Subsidiaries, or the existence or possible existence of any Default or Event of
Default.
10.04 Certain Rights of the Agent. The Agent shall have the
right to request instructions from the Required Banks at any time. If the Agent
requests instructions from the Required Banks with respect to any act or action
(including the failure to act) in connection with this Agreement, the Agent
shall be entitled to refrain from such act or taking such action unless and
until the Agent shall have received instructions from the Required Banks, and
the Agent shall not incur liability to any Person by reason of so refraining.
Without limiting the foregoing, no Bank shall have any right of action
whatsoever against the Agent as a result of the Agent acting or refraining from
acting hereunder in accordance with the instructions of the Required Banks.
10.05 Reliance by Agent. The Agent shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, statement, certificate, telex, teletype or telecopier message,
cablegram, radiogram, order or other documentary, teletransmission or telephone
message believed by it to be genuine and correct and to have been signed, sent
or made by the proper person. The Agent may consult with legal counsel
(including counsel for the Borrower with respect to matters concerning the
Borrower and its Subsidiaries), independent public accountants and other experts
selected by it and shall not be liable for any action
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taken or omitted to be taken by it in good faith in accordance with the advice
of such counsel, accountants or experts.
10.06 Indemnification of Agent. To the extent the Agent is not
reimbursed and indemnified by the Borrower or, in the case of the Collateral
Agent, the other Secured Creditors, each Bank will reimburse and indemnify the
Agent, in proportion to the Banks' respective "percentages" as used in
determining the Required Banks, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including counsel fees and disbursements) or disbursements of any kind
or nature whatsoever (including all Expenses) which may be imposed on, incurred
by or asserted against the Agent in performing its duties hereunder, in any way
relating to or arising out of this Agreement or the other Credit Documents;
provided that no Bank shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Agent's gross negligence or willful
misconduct. The agreements contained in this Section shall survive any
termination of this Agreement and the other Credit Documents and the payment in
full of the Obligations.
10.07 The Agent in Its Individual Capacity. With respect to
its obligation to lend under this Agreement, the Loans made by it and the Notes
issued to it, the Agent shall have the same rights and powers hereunder as any
other Bank or holder of a Note or participation interests and may exercise the
same as though it was not performing the duties specified herein; and the terms
"Banks," "Required Banks," "holders of Notes," or any similar terms shall,
unless the context clearly otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend money to, acquire
equity interests in, and generally engage in any kind of banking, trust,
financial advisory or other business with Communications or any Affiliate of
Communications as if it were not performing the duties specified herein, and may
accept fees and other consideration from Communications for services in
connection with this Agreement and otherwise without having to account for the
same to the Banks. Without limiting the foregoing, the Banks acknowledge that
BTCC is the agent pursuant to the Existing Credit Agreement.
10.08 Holders of Notes. The Agent may deem and treat the payee
of any Note as the owner thereof for all purposes hereof unless and until a
written notice of the assignment or transfer thereof shall have been filed with
the Agent. Any request, authority or consent of any Person who, at the time of
making such request or giving such authority or consent, is the holder of any
Note, shall be
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conclusive and binding on any subsequent holder, transferee or assignee of such
Note or of any Note or Notes issued in exchange therefor.
10.09 Successor Agent. (a) The Agent may, upon five (5)
Business Days' notice to the Banks and the Borrower, resign at any time
(effective upon the appointment of a successor Agent (including the Banks acting
as such pursuant to following clause (c)) pursuant to the provisions of this
Section 10.09) by giving written notice thereof to the Banks and the Borrower.
Upon any such resignation, the Required Banks shall have the right, upon five
(5) days' notice and approval by the Borrower (which approval shall not be
unreasonably withheld), to appoint a successor Agent. If no successor Agent (i)
shall have been so appointed by the Required Banks, and (ii) shall have accepted
such appointment, within fifteen (15) days after the retiring Agent's giving of
notice of resignation, then, upon five (5) days' notice, the retiring Agent may,
on behalf of the Banks, appoint a successor Agent.
(b) Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article 10 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement.
(c) In the event that no successor Agent is appointed pursuant
to clause (a) above, the Agent's resignation shall become effective forty days
after notice of such resignation is given to the Borrower and the Banks, and the
Required Banks shall perform the duties of the Agent until a successor Agent is
appointed as provided herein.
10.10 Collateral Matters. (a) Each Bank authorizes and directs
the Collateral Agent to enter into the Collateral Documents for the benefit of
the Banks. Each Bank hereby agrees, and each holder of any Note by the
acceptance thereof will be deemed to agree, that, except as otherwise set forth
herein, any action taken by the Required Banks in accordance with the provisions
of this Agreement, or by the Required Secured Creditors under the Collateral
Documents, and the exercise by the Required Banks or Required Secured Creditors,
as the case may be, of the powers set forth herein or therein, together with
such other powers as are reasonably incidental thereto, shall be authorized and
binding upon all of the Banks. The Collateral Agent is hereby authorized on
behalf of all of the Banks, without the necessity of any notice to or further
consent from any Bank, to take any action with
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respect to any Collateral or Collateral Documents which may be necessary to
perfect and maintain perfected the security interest in and liens upon the
Collateral granted pursuant to the Collateral Documents.
(b) The Banks hereby authorize the Collateral Agent, at its
option and in its discretion, upon the direction of the Agent to release any
Lien granted to or held by the Collateral Agent upon any Collateral (i) upon
termination of the Commitments and payment and satisfaction of all of the
Obligations at any time arising under or in respect of this Agreement or the
Credit Documents or the transactions contemplated hereby or thereby, (ii)
constituting property being sold or disposed of upon receipt of the proceeds of
such sale by the Collateral Agent if the Borrower certifies to the Collateral
Agent that the sale or disposition is made in compliance with this Agreement and
the Existing Credit Agreement (and the Agent may rely conclusively on any such
certificate, without further inquiry) or (iii) if approved, authorized or
ratified in writing by the Required Banks or Required Secured Creditors, as the
case may be, unless such release is required to be approved by all of the Banks
hereunder. Upon request by the Agent at any time, the Banks will confirm in
writing the Collateral Agent's authority to release particular types or items of
Collateral pursuant to this Section 10.10.
(c) Upon any sale and transfer of Collateral which is
expressly permitted pursuant to the terms of this Agreement and the Existing
Credit Agreement, or consented to in writing by the Required Banks or Required
Secured Creditors, as the case may be, or all of the Banks, as applicable, and
upon at least five (5) Business Days' prior written request by the Borrower, the
Collateral Agent shall (and is hereby irrevocably authorized by the Banks to)
execute such documents as may be necessary to evidence the release of the Liens
granted to the Collateral Agent for the benefit of the Banks herein or pursuant
hereto upon the Collateral that was sold or transferred; provided that (i) the
Collateral Agent shall not be required to execute any such document on terms
which, in the Collateral Agent's opinion, would expose the Collateral Agent to
liability or create any obligation or entail any consequence other than the
release of such Liens without recourse, representation or warranty and (ii) such
release shall not in any manner discharge, affect or impair the Obligations or
any Liens upon (or obligations of the Borrower or any of its Subsidiaries in
respect of) all interests retained by the Borrower or any of its Subsidiaries,
including, without limitation, the proceeds of the sale, all of which shall
continue to constitute part of the Collateral. In the event of any sale or
transfer of Collateral, or any foreclosure with respect to any of the
Collateral, the Collateral Agent shall be authorized to deduct all of the
Expenses reasonably incurred by the Collateral Agent from the proceeds of any
such sale, transfer or foreclosure.
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(d) The Collateral Agent shall have no obligation whatsoever
to the Banks or to any other Person to assure that the Collateral exists or is
owned by the Borrower or any of its Subsidiaries or is cared for, protected or
insured or that the Liens granted to the Collateral Agent herein or pursuant
hereto have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority, or to exercise
or to continue exercising at all or in any manner or under any duty of care,
disclosure or fidelity any of the rights, authorities and powers granted or
available to the Collateral Agent in this Section 10.10 or in any of the
Collateral Documents, it being understood and agreed that in respect of the
Collateral, or any act, omission or event related thereto, the Collateral Agent
may act in any manner it may deem appropriate, in its sole discretion, given the
Collateral Agent's own interest in the Collateral as one of the Banks and that
the Collateral Agent shall have no duty or liability whatsoever to the Banks,
except for its gross negligence or willful misconduct.
(e) It is acknowledged and agreed by all the Banks that (i)
the priorities with respect to the Collateral are as set forth in the Collateral
Documents and are expressly subject to the provisions of Section 11 hereof and
(ii) to the extent the provisions of the Collateral Documents are inconsistent
with any of the provisions of this Section 10, the provisions of the respective
Collateral Document shall prevail.
10.11 Actions with Respect to Defaults. In addition to the
Agent's right to take actions on its own accord as permitted under this
Agreement, the Agent may take such action with respect to an Event of Default as
shall be directed by the Required Banks or, in the case of any Collateral
Document, the Required Secured Creditors; provided that until the Agent shall
have received such directions, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such Event
of Default as it shall deem advisable and in the best interests of the Banks or,
in the case of Collateral Documents, the Secured Creditors (or the lenders
pursuant to the Existing Credit Agreement).
10.12 Delivery of Information. The Agent shall not be required
to deliver to any Bank originals or copies of any documents, instruments,
notices, communications or other information received by the Agent from
Communications, the Borrower, any Subsidiary, the Required Banks, any Bank or
any other Person under or in connection with this Agreement or any other Credit
Document except (i) as specifically provided in this Agreement or any other
Credit Document and (ii) as specifically requested from time to time in writing
by any Bank with respect to a specific document, instrument, notice or other
written communication received by
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and in the possession of such Agent at the time of receipt of such request and
then only in accordance with such specific request.
SECTION 11. Special Provisions Providing Lien Priorities; etc.
To induce the lenders pursuant to the Existing Credit Agreement to enter into
the amendments thereto and to the related Collateral Documents as required by
Section 4 hereof, and thereby permit the extensions of credit pursuant to this
Agreement and the securing of the Obligations pursuant to this Agreement
pursuant to the Collateral Documents (on a second priority basis as more fully
provided below), the following agreements are made by the Banks (and their
successors and assigns) for the benefit of the other Secured Creditors
(including without limitation the lenders pursuant to the Existing Credit
Agreement) under, and as defined in, the various Collateral Documents.
11.01 Priorities With Respect to Collateral. The Banks
acknowledge and agree that all Secured Obligations shall be secured pursuant to
the Collateral Documents in accordance with the terms thereof; provided that,
notwithstanding anything to the contrary contained in this Agreement or any
other Credit Document, as between the First Priority Secured Obligations and
Second Priority Secured Obligations, the following priorities with respect to
the Collateral shall apply:
(i) the First Priority Secured Obligations shall be
entitled to a first priority security interest in all
Collateral, superior and prior to the rights of the holders of
the Second Priority Secured Obligations with respect thereto,
which rights of the holders of Second Priority Obligations to
any and all Collateral shall be subject to the prior interests
of the holders of the First Priority Secured Obligations under
the Collateral Documents; and
(ii) the holders of the Second Priority Secured
Obligations, for themselves and their successors and assigns,
hereby acknowledge and agree for the benefit of the First
Priority Secured Creditors that they shall not be entitled to
receive, in respect of the Second Priority Secured Obligations
held by them, any of the proceeds of any Collateral following
the occurrence of an Event of Default or received as a result
of the enforcement of rights pursuant to the Collateral
Documents until all First Priority Secured Obligations have
been indefeasibly paid in full in cash or cash equivalents.
The Banks (for themselves and their successors and assigns)
hereby agree that, unless the Credit Agreement Termination
Date (as defined in the Security
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Agreement as amended on the Closing Date pursuant to Section
4) has occurred and no First Priority Secured Obligations are
outstanding, they shall have no rights to institute
foreclosure or other enforcement rights under the Collateral
Documents or any other Credit Document or otherwise, but shall
only be entitled to share in the proceeds of the Collateral as
realized and following the indefeasible payment in full in
cash or cash equivalents of all First Priority Secured
Obligations. The foregoing provisions shall not affect, or
impair, the right of the Banks to accelerate the maturity of
any Loans pursuant to Section 8 hereof or to institute legal
proceedings (not including enforcement actions with respect to
the Collateral) to collect amounts due pursuant to this
Agreement.
(iii) Until all First Priority Secured Obligations
have been indefeasibly paid in full in cash or cash
equivalents, each holder of the Second Priority Secured
Obligations hereby agrees (x) not to exercise, with respect to
the Second Priority Secured Obligations, any right of setoff
or counterclaim with respect to the Collateral or any Proceeds
thereof, (y) that all Proceeds of Collateral shall be paid to
the Collateral Agent for application to the First Priority
Secured Obligations and (z) that any Proceeds of Collateral
received by any holder of the Second Priority Secured
Obligations in its capacity as such shall be segregated and
held in trust and paid over to the Collateral Agent for the
benefit of the holders of all Secured Obligations (in
accordance with the priorities set forth above) in the same
form as received, with any necessary endorsements.
(iv) The holders of the Second Priority Secured
Obligations acknowledge and agree that Collateral (or Liens
thereon pursuant to the Collateral Documents) may be released
from the security interests created pursuant to the Collateral
Documents in accordance with the requirements of the
respective Collateral Documents and, except as expressly
required thereby, no consent of the holders of the Second
Priority Secured Obligations shall be required in connection
therewith.
The foregoing provisions shall be effective at all times
during the term of this Agreement, and notwithstanding (without
limitation): (i) the initiation of any bankruptcy, moratorium,
reorganization or other insolvency proceeding with respect to
Communications, the Borrower or any of their Subsidiaries; (ii) the
priorities which would otherwise result under the terms of the
respective Collateral Documents or under applicable law; (iii) the
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taking of possession of any Collateral by any Bank; or (iv) any other
matter whatsoever; and shall continue in full force and effect until
all Secured Obligations have been repaid in full.
11.02 Priority on Distribution of Proceeds of Collateral. In
the event of:
(a) any distribution of any Collateral upon any
bankruptcy, arrangement, receivership, assignment for the
benefit of creditors or any other action or proceeding
involving the readjustment of the obligations and indebtedness
of Communications, the Borrower or any of their Subsidiaries,
or the application of any Collateral to the payment thereof;
(b) any distribution of the Collateral upon the
liquidation or dissolution of Communications, the Borrower or
any of their Subsidiaries, or the winding up of the assets or
business of Communications, the Borrower or any of their
Subsidiaries;
(c) any realization by any of the Secured Creditors
or the Collateral Agent with respect to the Liens pursuant to
the Credit Documents whether through a Remedial Action or
otherwise; or
(d) any Disposition of any Collateral, to the extent
that any part of the proceeds of such disposition are required
to be applied to any of the Secured Obligations or held by the
Collateral Agent in accordance with the provisions of any of
the Collateral Documents;
then, in any such event, as between the Secured Creditors all of the
Collateral and any Proceeds thereof so distributed, applied or realized
upon shall be distributed or paid to (or retained by) the Collateral
Agent for application first, to the Collateral Agent to pay the
Collateral Agent's fees, expenses and indemnities provided for in this
Agreement, the Existing Credit Agreement and in the Collateral
Documents, second, to the First Priority Secured Obligations and third,
after the indefeasible payment in full in cash or cash equivalents of
all First Priority Secured Obligations, the remaining amount of such
Proceeds shall be distributed or paid to (or retained by) the
Collateral Agent for application to the Second Priority Secured
Obligations then due and payable.
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11.03 Certain Dispositions of Collateral. Notwithstanding
anything to the contrary contained above, to the extent Collateral is sold in
accordance with the requirements of Section 8.1 of the Existing Credit Agreement
and relevant provisions of this Agreement (and is not sold as a result of any
Remedial Action pursuant to a Security Document) at a time when no Default or
Event of Default exists pursuant to Section 8.01(7) and (8), the proceeds
thereof shall be applied in accordance with the requirements of this Agreement
and the Existing Credit Agreement.
11.04 Waiver of Set-Off. Notwithstanding anything to the
contrary contained elsewhere in this Agreement or any other Credit Document, at
all times prior to the Existing Credit Agreement Termination Date, and unless
the Existing Credit Agreement Required Lenders otherwise expressly consent, the
Banks shall have no right and hereby waive any right to set-off (whether
pursuant to Section 12.02, applicable law or otherwise) any amounts owed to it
by Communications, the Borrower or any Guarantor against or on account of any of
the Obligations.
11.05 Right to Contest. Each holder of Obligations and each
Bank agrees for itself, and its successors and assigns, not to contest or
support any other Person in contesting, in any proceeding, including without
limitation, any bankruptcy, insolvency or liquidation proceeding, the priority,
validity or enforceability of the Liens held by the Collateral Agent or the
Secured Creditors in the Collateral or the priority, validity or enforceability
of the Secured Obligations, or the provisions of this Section 11.
Notwithstanding anything to the contrary contained in the immediately preceding
sentence, the Banks shall be entitled to assert the provisions of the Collateral
Documents (subject to the provisions of this Section 11) in accordance with the
terms thereof.
11.06 Payment Invalidated. In the event that any of the First
Priority Secured Obligations shall be paid in full and subsequently, for
whatever reason (including, but not limited to, an order or judgment for
disgorgement of a preference under Title 11 of the United Stated Code, or any
similar law, or the settlement of any claim in respect thereof), formerly paid
or satisfied First Priority Secured Obligations become unpaid or unsatisfied,
the terms and conditions of this Section 11 shall be fully applicable thereto
until all such First Priority Secured Obligations are again paid in full.
11.07 Right to Amend, etc. As between the Banks and the other
Secured Creditors, it is agreed that the Secured Creditors (excluding the Banks
in their capacities as such) may at any time and from time to time, in their
sole discretion, and without any obligation to give any notice or receive any
consent from
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any Bank in its capacity as such, change the manner, place or terms of payment,
or change or extend the time of payment of, or renew, alter, refinance, increase
or add to the First Priority Secured Obligations (subject, in the case of an
increase in outstanding Indebtedness constituting Secured Obligations, to
compliance to the relevant provisions of Section 7.01 hereof), or obtain,
release, or dispose of any Collateral therefor, or amend or supplement in any
manner the Existing Credit Agreement, the Collateral Documents or any other
agreements or instruments evidencing, securing or relating to the First Priority
Secured Obligations, and the provisions of this Section 11 shall continue in
full force and effect with respect to all such First Priority Secured
Obligations; provided, however, that the actions of the Secured Creditors in
effecting any amendments, waivers or modifications of the Collateral Documents
shall be required to be taken in compliance with the relevant provisions
regarding amendments contained in the respective Collateral Document.
11.08 Creation of Future Obligations. All of the First
Priority Secured Obligations shall be deemed to have been funded by the Secured
Creditors in reliance upon the agreements contained in this Section 11, and each
Bank expressly waives notice of acceptance of the agreements set forth herein,
notice of reliance thereon and any other agreements and notice of the creation
of any First Priority Secured Obligations after the date hereof, and agrees that
the Secured Creditors shall be entitled to rely upon the agreements set forth
herein at all times in creating First Priority Secured Obligations. It is
expressly agreed that, subject to the provisions of Section 7.01, additional
extensions of credit may be made pursuant to the Existing Credit Agreement or
Interest Rate Protection Agreements (including but not limited to refinancings
permitted pursuant to Section 7.01), and that such additional obligations may be
designated as First Priority Secured Obligations (and shall be entitled to the
priorities with respect to the Collateral as are provided in this Section 11),
and that, except to the extent the Incurrence of any Indebtedness would violate
Section 7.01, no further consent of the Banks shall be required in connection
therewith and that the provisions of this Section 11 shall be fully applicable
to the obligations so created in the future. The Banks hereby authorize the
Collateral Agent to amend the Security Documents as necessary or desirable to
effect the foregoing agreements.
11.09 Waiver of Liability For Actions Taken With Respect To
Second Priority Secured Obligations and Collateral. (a) Neither the
Administrative Agent, the Existing Credit Agent, the Collateral Agent nor any
Secured Creditor shall have any liability to the holder of any Second Priority
Secured Obligations (in its capacity as such), and each Bank (in its capacity as
such), on behalf of itself and its successors and assigns, hereby waives to the
extent permitted by applicable law any claim, right, action or cause of action
which it may now or hereafter have
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against the Administrative Agent, the Existing Credit Agreement Agent, the
Collateral Agent or any other Secured Creditor (including, without limitation,
any and all claims, rights, actions or causes of action that any Bank may
otherwise have against the Administrative Agent, the Collateral Agent or any
other Secured Creditor under Section 9-207, 9-504 and 9-507 of the UCC) arising
out of, any and all actions which the Administrative Agent, the Collateral Agent
or any other Secured Creditor, in good faith, takes or omits to take with
respect to the Secured Obligations, any obligor with respect to the Secured
Obligations or any Collateral, including, without limitation, actions with
respect to: the creation, perfection or continuation of Liens with respect to
any Collateral; any Remedial Action or Disposition of any Collateral; the
release of any Collateral; the custody, valuation, protection, preservation, use
or depreciation of any Collateral; the realizing upon or failure to realize upon
any Collateral; or the collection of the Obligations. To the extent that any of
the foregoing waivers is not permitted by applicable law, it is agreed that the
applicable standard by which any non-waivable rights, duties or claims are to be
measured shall be that neither the Administrative Agent, the Existing Credit
Agreement Agent, the Collateral Agent nor any other Secured Creditor shall have
any liability or responsibility to any holder of any Second Priority Secured
Obligations, for any actions or omissions other than actions or omissions
constituting gross negligence or wilful misconduct as finally determined by a
court of competent jurisdiction.
11.10 Financing Issues. If Communications, the Borrower or any
of their Restricted Subsidiaries shall be subject to a bankruptcy, insolvency,
liquidation or similar proceeding (including as a result of the commencement of
a case under the Bankruptcy Code) and the Administrative Agent, the Existing
Credit Agreement Agent, the Collateral Agent, the Secured Creditors or any of
them shall desire to permit the usage of cash collateral or to provide financing
to Communications, the Borrower or any of their respective Restricted
Subsidiaries under Section 363 or Section 364 of the Bankruptcy Code, then: each
of the holders of the Second Priority Secured Obligations agrees that (i) notice
received two Business Days' prior to the entry of an order approving such usage
of cash collateral and five Business Days' prior to the entry of an order
approving such financing shall be adequate notice; and (ii) provided it receives
a Lien in any property arising or acquired after the commencement of such
proceeding which may be substituted for the Collateral subject to such usage
under Section 363 of the Bankruptcy Code or which secures such financing under
Section 364 of the Bankruptcy Code (which Lien shall be subordinated to any Lien
in such property held by the Administrative Agent, the Collateral Agent, or the
Secured Creditors, as the case may be, on terms substantially the same as the
terms set forth in this Section 11), it will raise no
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objection to such usage or financing on the grounds that its junior Lien
position with respect to any Collateral is not adequately protected.
11.11 Effectiveness. The provisions in this Section 11 shall
be effective both before and after the commencement of a bankruptcy, insolvency,
liquidation or similar proceeding. All references in this Agreement to
Communications, the Borrower or any of their respective Subsidiaries shall
include such entity as debtor in possession or any receiver or trustee for such
entity.
11.12 Further Assurances. Each of the holders of the
Obligations agrees to take such further action and shall execute and deliver to
the Administrative Agent, the Existing Credit Agreement Agent, the Collateral
Agent and the Secured Creditors such additional documents and instruments (in
recordable form, if requested) as the Administrative Agent, the Existing Credit
Agreement Agent, the Collateral Agent or the Secured Creditors may reasonably
request to effectuate the terms of and agreements contemplated by this Section
11.
11.13 Obligations as Designated Senior Indebtedness under
Senior Subordinated Notes Indenture. (a) The parties hereto expressly
acknowledge and agree that the Obligations constitute Indebtedness (as defined
in the Senior Subordinated Notes Indenture) of (and with full recourse, as a
general claim, to and against) the Borrower and the various Guarantors (by
virtue of the Guaranties), which (i) is senior and superior in right of payment
to the respective obligations of the Borrower and the Guarantors under the
Senior Subordinated Notes, the Guaranties thereof contained in the Senior
Subordianted Note Documents and the Senior Subordinated Note Documents, (ii) is
not subordinate in right of payment to any other Indebtedness (as defined in the
Senior Subordinated Notes Indenture) of the Borrower or any Guarantor and (iii)
is, therefore "Senior Indebtedness" (as defined in the Senior Subordinated Notes
Indenture) of the Borrower and such Guarantors, respectively. The parties hereto
further acknowledge and agree that, at any time when all Indebtedness under the
Existing Credit Agreement has been repaid in full, the Obligations constitute
Designated Senior Indebtedness (as defined in the Senior Subordinated Notes
Indenture) of the Borrower and the Guarantors.
(b) The parties hereto further acknowledge and agree that,
without limiting the effect of the preceding sentence (including, without
limitation, the seniority and superiority of the Obligations in right of
payment), the priorities with respect to the Collateral and the Proceeds thereof
shall be governed by the provisions of this Section 11, and the provisions of
Section 11.13(a) shall in no event limit or modify the agreements contained in
Sections 11.01 through 11.12, or the provisions of the Collateral Documents.
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11.14 Benefits of this Section 11. It is acknowledged and
agreed that the provisions of this Section 11 are agreed to in order to induce
the Existing Credit Agreement Required Lenders to enter into the amendments to
the Existing Credit Agreement and Collateral Documents as contemplated by
Section 4, and that the provisions of this Section 11 may be directly enforced
by the various Secured Creditors and the Collateral Agent or Existing Credit
Agreement Agent on their behalf. In no event shall any of the provisions of this
Section 11 be supplemented, modified or waived except in a written agreement
executed by the Existing Credit Agreement Agent (with the prior written consent
of the Existing Credit Agreement Required Lenders).
SECTION 12. Miscellaneous.
12.01 Payment of Expenses; Indemnification; etc. The Borrower
agrees that it shall: (i) whether or not the transactions herein contemplated
are consummated, pay all reasonable out-of-pocket costs and expenses of the
Administrative Agent (including, without limitation, the reasonable fees and
disbursements of White & Case and the Administrative Agent's local counsel and
consultants) in connection with the preparation, execution and delivery of this
Agreement and the other Credit Documents and the documents and instruments
referred to herein and therein and any amendment, waiver or consent relating
hereto or thereto, of the Administrative Agent in connection with its
syndication efforts with respect to this Agreement and of the Administrative
Agent and, after the occurrence of an Event of Default, each of the Banks in
connection with the enforcement of this Agreement and the other Credit Documents
and the documents and instruments referred to herein and therein (including,
without limitation, the fees and disbursements of counsel for the Administrative
Agent); (ii) pay and hold each of the Banks harmless from and against any and
all present and future stamp, excise and other similar documentary taxes with
respect to the foregoing matters and save each of the Banks harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such Bank) to pay such taxes;
and (iii) indemnify the Administrative Agent and each Bank, and each of their
respective officers, directors, employees, representatives and agents from and
hold each of them harmless against any and all liabilities, obligations
(including removal or remedial actions), losses, damages, penalties, claims,
actions, judgments, suits, costs, expenses and disbursements (including
reasonable attorneys' and consultants' fees and disbursements) incurred by,
imposed on or assessed against any of them as a result of, or arising out of, or
in any way related to, or by reason of, (a) any investigation, litigation or
other proceeding (whether or not the Administrative Agent or any Bank is a party
thereto) related to the entering into and/or performance of this Agreement or
any other Credit
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Document or the use of the proceeds of any Loans hereunder or the consummation
of any transactions contemplated herein or in any other Credit Document or the
exercise of any of their rights or remedies provided herein or in the other
Credit Documents, or (b) the actual or alleged presence of Hazardous Materials
in the air, surface water or groundwater or on the surface or subsurface of any
Real Property owned or at any time operated by the Borrower or any of its
Subsidiaries, the generation, storage, transportation, handling or disposal of
Hazardous Materials at any location, whether or not owned or operated by the
Borrower or any of its Subsidiaries, the non-compliance of any Real Property
with foreign, federal, state and local laws, regulations, and ordinances
(including applicable permits thereunder) applicable to any Real Property, or
any Environmental Claim asserted against the Borrower, any of its Subsidiaries
or any Real Property owned or at any time operated by the Borrower or any of its
Subsidiaries, including, in each case, without limitation, the reasonable fees
and disbursements of counsel and other consultants incurred in connection with
any such investigation, litigation or other proceeding (but excluding any
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified). To the extent that the undertaking to indemnify, pay or hold
harmless the Administrative Agent or any Bank set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, the Borrower shall make the maximum contribution to the payment and
satisfaction of each of the indemnified liabilities which is permissible under
applicable law.
12.02 Right of Setoff. In addition to any rights now or
hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, upon the occurrence of an Event of Default, each
Bank is hereby authorized (to the extent not prohibited by applicable law) at
any time or from time to time, without presentment, demand, protest or other
notice of any kind to the Borrower or to any other Person, any such notice being
hereby expressly waived, to set off and to appropriate and apply any and all
deposits (general or special) and any other Indebtedness at any time held or
owing by such Bank (including, without limitation, by branches and agencies of
such Bank wherever located) to or for the credit or the account of any Credit
Party against and on account of the Obligations and liabilities of such Credit
Party to such Bank under this Agreement or under any of the other Credit
Documents, including, without limitation, all interests in Obligations purchased
by such Bank pursuant to Section 12.06(b), and all other claims of any nature or
description arising out of or connected with this Agreement or any other Credit
Document, irrespective of whether or not such Bank shall have made any demand
hereunder and although said Obligations, liabilities or claims, or any of them,
shall be contingent or unmatured.
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12.03 Notices. Except as otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to any Credit Party,
at the address specified opposite its signature below or in the other relevant
Credit Documents; if to any Bank, at its address specified on Schedule II; and
if to the Administrative Agent, at its Notice Office; or, as to any Credit Party
or the Administrative Agent, at such other address as shall be designated by
such party in a written notice to the other parties hereto and, as to each Bank,
at such other address as shall be designated by such Bank in a written notice to
the Borrower and the Administrative Agent. All such notices and communications
shall, when mailed, telegraphed, telexed, telecopied, or cabled or sent by
overnight courier, be effective (x) three Business Days after deposited in the
mails, (y) one Business Day after delivered to the telegraph company, cable
company or a recognized overnight courier, as the case may be, or (z) when sent
by telex or telecopier, except that notices and communications to the
Administrative Agent shall not be effective until received by the Administrative
Agent.
12.04 Benefit of Agreement; Assignments; Participations. (a)
This Agreement shall be binding upon and inure to the benefit of and be
enforceable by the respective successors and assigns of the parties hereto;
provided, however, the Borrower may not assign or transfer any of its rights,
obligations or interest hereunder or under any other Credit Document without the
prior written consent of the Banks and, provided further, that, although any
Bank may transfer, assign or grant participations in its rights hereunder, such
Bank shall remain a "Bank" for all purposes hereunder (and may not transfer or
assign all or any portion of its obligations hereunder except as provided in
Sections 1.11 and 12.04(b)) and the transferee, assignee or participant, as the
case may be, shall not constitute a "Bank" hereunder and, provided further, that
no Bank shall transfer or grant any participation under which the participant
shall have rights to approve any amendment to or waiver of this Agreement or any
other Credit Document except to the extent such amendment or waiver would (i)
extend the final scheduled maturity of any Loan or Note in which such
participant is participating, or reduce the rate or extend the time of payment
of interest or Fees thereon (except in connection with a waiver of applicability
of any post-default increase in interest rates) or reduce the principal amount
thereof, or increase the amount of the participant's participation over the
amount thereof then in effect (it being understood that a waiver of any Default
or Event of Default or of a mandatory repayment of Loans shall not constitute a
change in the terms of such participation, (ii) consent to the assignment or
transfer by the Borrower of any of its rights and obligations under this
Agreement or (iii) release all or substantially all of the Collateral under all
of the Collateral Documents (except as
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expressly provided in the Credit Documents) supporting the Loans hereunder in
which such participant is participating. In the case of any such participation,
the participant shall (x) not have any rights under this Agreement or any of the
other Credit Documents (the participant's rights against such Bank in respect of
such participation to be those set forth in the agreement executed by such Bank
in favor of the participant relating thereto) and all amounts payable by the
Borrower hereunder shall be determined as if such Bank had not sold such
participation and (y) if such participant is not a bank, represent that either
(i) no part of its acquisition of its participation is made out of assets of any
employee benefit plan, or (ii) after consultation, in good faith, with the
Borrower and provision by the Borrower of such information as may be reasonably
requested by the participant, the acquisition and holding of such participation
does not constitute a non-exempt prohibited transaction under Section 406 of
ERISA and Section 4975 of the Code, or (iii) such participation is an "insurance
company general account," as such term is defined in the Department of Labor
Prohibited Transaction Class Exemption 95-60 (issued July 12, 1995) ("PTCE
95-60"), and, as of the date of the transfer there is no "employee benefit plan"
with respect to which the aggregate amount of such general account's reserves
and liabilities for the contracts held by or on behalf of such "employee benefit
plan" and all other "employee benefit plans" maintained by the same employer
(and affiliates thereof as defined in Section V(a)(1) of PTCE 95-60) or by the
same employee organization (in each case determined in accordance with the
provisions of PTCE 95-60) exceeds 10% of the total reserves and liabilities of
such general account (as determined under PTCE 95-60) (exclusive of separate
account liabilities) plus surplus as set forth in the National Association of
Insurance Commissioners Annual Statement filed with the state of domicile of the
participant. As used in this Section 12.04(a), the term "employee benefit plan"
shall have the meaning assigned to it in Title I of ERISA and shall also include
a "plan" as defined in Section 4975(e)(1) of the Code.
(b) Notwithstanding the foregoing, any Bank (or any Bank
together with one or more other Banks) may (x) assign all or a portion of its
outstanding Obligations hereunder to (i) its parent company and/or any affiliate
of such Bank which is at least 50% owned by such Bank or its parent company or
to one or more Banks or (ii) in the case of any Bank that is a fund that invests
in bank loans, any other fund that invests in bank loans and is managed by the
same investment advisor of such Bank or by an Affiliate of such investment
advisor or (y) assign all, or if less than all, a portion equal to at least
$2,000,000 in the aggregate for the assigning Bank or assigning Banks, of such
outstanding Obligations hereunder to one or more Eligible Transferees, each of
which assignees shall become a party to this Agreement as a Bank by execution of
an Assignment and Assumption Agreement; provided that (i) at such time Schedule
I shall be deemed modified to reflect the
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outstanding Loans of such new Bank and of the existing Banks, (ii) new Notes
will be issued, at the Borrower's expense, to such new Bank and to the assigning
Bank upon the request of such new Bank or assigning Bank, such new Notes to be
in conformity with the requirements of Section 1.04 (with appropriate
modifications) to the extent needed to reflect the revised outstanding Loans,
(iii) the Administrative Agent shall receive at the time of each such
assignment, from the assigning or assignee Bank, the payment of a non-refundable
assignment fee of $3,500 and (iv) if such Eligible Transferee is not a bank,
represent that either (i) no part of its acquisition of its Loans is made out of
assets of any employee benefit plan, or (ii) after consultation, in good faith,
with the Borrower and provision by the Borrower of such information as may be
reasonably requested by such Eligible Transferee, the acquisition and holding of
such Loans does not constitute a non-exempt prohibited transaction under Section
406 of ERISA and Section 4975 of the Code, or (iii) such assignment is an
"insurance company general account," as such term is defined in the Department
of Labor Prohibited Transaction Class Exemption 95-60 (issued July 12, 1995)
("PTCE 95-60"), and, as of the date of the assignment, there is no "employee
benefit plan" with respect to which the aggregate amount of such general
account's reserves and liabilities for the contracts held by or on behalf of
such "employee benefit plan" and all other "employee benefit plans" maintained
by the same employer (and affiliates thereof as defined in Section V(a)(1) of
PTCE 95-60) or by the same employee organization (in each case determined in
accordance with the provisions of PTCE 95-60) exceeds 10% of the total reserves
and liabilities of such general account (as determined under PTCE 95-60)
(exclusive of separate account liabilities) plus surplus as set forth in the
National Association of Insurance Commissioners Annual Statement filed with the
state of domicile of such Eligible Transferee; provided further, that such
transfer or assignment will not be effective until recorded by the
Administrative Agent on the Register pursuant to Section 12.15. As used in this
Section 12.04(b), the term "employee benefit plan" shall have the meaning
assigned to it in Title I of ERISA and shall also include a "plan" as defined in
Section 4975(e)(1) of the Code. To the extent of any assignment pursuant to this
Section 12.04(b), the assigning Bank shall be relieved of its obligations
hereunder with respect to its assigned Loans. At the time of each assignment
pursuant to this Section 12.04 (b) to a Person which is not already a Bank
hereunder and which is not a United States person (as such term is defined in
Section 7701(a)(30) of the Code) for Federal income tax purposes, the respective
assignee Bank shall, to the extent legally entitled to do so, provide to the
Borrower the forms described in Section 3.03(e). To the extent that an
assignment of all or any portion of a Bank's outstanding Obligations pursuant to
Section 1.11 or this Section 12.04(b) would, at the time of such assignment,
result in increased costs (including, without limitation, amounts described in
Section 3.03) from those being charged by the respective assigning Bank prior to
such assignment, then the
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Borrower shall not be obligated to pay such increased costs (although the
Borrower shall be obligated to pay any other increased costs of the type
described above resulting from changes after the date of the respective
assignment).
(c) Nothing in this Agreement shall prevent or prohibit any
Bank from pledging its Loans and Notes hereunder to a Federal Reserve Bank in
support of borrowings made by such Bank from such Federal Reserve Bank and, with
the consent of the Administrative Agent, any Bank which is a fund may pledge all
or any portion of its Notes or Loans to its trustee in support of its
obligations to its trustee. No pledge pursuant to this clause (c) shall release
the transferor Bank from any of its obligations hereunder.
12.05 No Waiver; Remedies Cumulative. No failure or delay on
the part of the Administrative Agent, the Collateral Agent or any Bank in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Borrower or any other Credit Party
and the Administrative Agent, the Collateral Agent or any Bank shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, power
or privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights, powers and remedies herein or in any other
Credit Document expressly provided are cumulative and not exclusive of any
rights, powers or remedies which the Administrative Agent, the Collateral Agent
or any Bank would otherwise have. No notice to or demand on any Credit Party in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent, the Collateral Agent or any Bank to any other or further
action in any circumstances without notice or demand.
12.06 Payments Pro Rata. (a) Except as otherwise provided in
this Agreement, the Administrative Agent agrees that promptly after its receipt
of each payment from or on behalf of the Borrower in respect of any Obligations
hereunder, it shall distribute such payment to the Banks (other than any Bank
that has consented in writing to waive its pro rata share of any such payment)
pro rata based upon their respective shares, if any, of the Obligations with
respect to which such payment was received.
(b) Each of the Banks agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security, by
the exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is
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applicable to the payment of the principal of, or interest on, the Loans, of a
sum which with respect to the related sum or sums received by other Banks is in
a greater proportion than the total of such Obligation then owed and due to such
Bank bears to the total of such Obligation then owed and due to all of the Banks
immediately prior to such receipt, then such Bank receiving such excess payment
shall purchase for cash without recourse or warranty from the other Banks an
interest in the Obligations of the respective Credit Party to such Banks in such
amount as shall result in a proportional participation by all the Banks in such
amount; provided that if all or any portion of such excess amount is thereafter
recovered from such Bank, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest.
12.07 Computations. All computations of interest and Fees
hereunder shall be made on the basis of a year of 360 days for the actual number
of days (including the first day but excluding the last day) occurring in the
period for which such interest or Fees are payable.
12.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER
OF JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS (EXCEPT, IN THE
CASE OF OTHER CREDIT DOCUMENTS, AS SPECIFICALLY OTHERWISE PROVIDED THEREIN) AND
THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW
YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER
CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE
UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, THE BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF
AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION
OF THE AFORESAID COURTS. THE BORROWER HEREBY FURTHER IRREVOCABLY WAIVES ANY
CLAIM THAT ANY SUCH COURTS LACK PERSONAL JURISDICTION OVER THE BORROWER, AND
AGREES NOT TO PLEAD OR CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENTS BROUGHT IN ANY OF THE
AFOREMENTIONED COURTS, THAT SUCH COURTS LACK PERSONAL JURISDICTION OVER THE
BORROWER. THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS
OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
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PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO THE BORROWER AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE
BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. THE BORROWER
HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER
IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING
COMMENCED HEREUNDER OR UNDER ANY OTHER CREDIT DOCUMENT THAT SERVICE OF PROCESS
WAS IN ANY WAY INVALID OR INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF
THE ADMINISTRATIVE AGENT, ANY BANK OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST THE BORROWER IN ANY OTHER JURISDICTION.
(b) THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID
ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR
ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE
AND HEREBY FURTHER IRREVOCABLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW,
WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION
OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
12.09 Counterparts. This Agreement may be executed in any
number of counterparts and by the 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. A set of
counterparts executed by all the parties hereto shall be lodged with the
Borrower and the Administrative Agent.
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12.10 Effectiveness. This Agreement shall become effective on
the date (the "Effective Date") on which the Borrower, the Administrative Agent
and each of the Banks shall have signed a counterpart hereof (whether the same
or different counterparts) and shall have delivered the same to the
Administrative Agent at its Notice Office or, in the case of the Banks, shall
have given to the Administrative Agent telephonic (confirmed in writing),
written or telex notice (actually received) at such office that the same has
been signed and mailed to it. The Administrative Agent shall give the Borrower
and each Bank prompt written notice of the occurrence of the Effective Date.
12.11 Headings Descriptive. The headings of the several
sections and subsections of this Agreement are inserted for convenience only and
shall not in any way affect the meaning or construction of any provision of this
Agreement.
12.12 Amendment or Waiver; etc. (a) Neither this Agreement nor
any other Credit Document nor any terms hereof or thereof may be changed,
waived, discharged or terminated unless such change, waiver, discharge or
termination is in writing signed by the respective Credit Parties party thereto
and the Required Banks, provided that (A) the various Collateral Documents may
be amended in accordance with the relevant provisions thereof governing
amendments (which shall be consistent with the Collateral Documents as amended
pursuant to the amendments required pursuant to Section 4 hereof) and (B) except
as provided in proceeding clause (A), no such change, waiver, discharge or
termination shall, without the consent of each Bank (other than a Defaulting
Bank) with Obligations being directly modified, (i) extend the final scheduled
maturity of any Loan or Note, or reduce the rate or extend the time of payment
of interest or Fees thereon, or reduce the principal amount thereof (except to
the extent repaid in cash), (ii) release all or substantially all of the
Collateral (except as expressly provided in the Collateral Documents) under all
the Collateral Documents, (iii) amend, modify or waive any provision of this
Section 12.12 (except for technical amendments with respect to additional
extensions of credit pursuant to this Agreement which afford the protections set
forth in the proviso below to such additional extensions of credit), (iv) reduce
the percentage specified in the definition of Required Banks (it being
understood that, with the consent of the Required Banks, additional extensions
of credit pursuant to this Agreement may be included in the determination of the
Required Banks on substantially the same basis as the extensions of Loans are
included on the Effective Date) or (vi) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement; provided
further, that no such change, waiver, discharge or termination shall (x)
increase the Commitment of any Bank over the amount thereof then in effect
without the consent of such Bank (it being understood that waivers or
modifications of conditions
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precedent, covenants, Defaults or Events of Default shall not constitute an
increase of the Commitment of any Bank), (y) without the consent of the
Administrative Agent, amend, modify or waive any provision of Section 10 or any
other provision as same relates to the rights or obligations of the
Administrative Agent, (x) without the consent of the Collateral Agent, amend,
modify or waive any provision relating to the rights or obligations of the
Collateral Agent.
(b) If, in connection with any proposed change, waiver,
discharge or termination to any of the provisions of this Agreement as
contemplated by clauses (i) through (vi), inclusive, of the first proviso to
Section 12.12(a), the consent of the Required Banks is obtained but the consent
of one or more of such other Banks whose consent is required is not obtained,
then the Borrower shall have the right, so long as all non-consenting Banks
whose individual consent is required are treated as described below, to replace
each such non-consenting Bank or Banks with one or more Replacement Banks
pursuant to Section 1.11 so long as at the time of such replacement, each such
Replacement Bank consents to the proposed change, waiver, discharge or
termination, provided further, that in any event the Borrower shall not have the
right to replace a Bank, or repay its Loans solely as a result of the exercise
of such Bank's rights (and the withholding of any required consent by such Bank)
pursuant to the second proviso to Section 12.12(a).
12.13 Survival. All indemnities set forth herein including,
without limitation, in Sections 1.08, 3.03, 10.06 and 12.01 shall survive the
execution, delivery and termination of this Agreement and the Notes and the
making and repayment of the Obligations.
12.14 Domicile of Loans. Each Bank may transfer and carry its
Loans at, to or for the account of any office, Subsidiary or Affiliate of such
Bank. Notwithstanding anything to the contrary contained herein, to the extent
that a transfer of Loans pursuant to this Section 12.14 would, at the time of
such transfer, result in increased costs under Section 1.08, 1.09 or 3.03 in
excess of those being charged by the respective Bank prior to such transfer,
then the Borrower shall not be obligated to pay such excess increased costs
(although the Borrower, in accordance with and pursuant to the other provisions
of this Agreement, shall be obligated to pay the costs which would apply in the
absence of such designation and any subsequent increased costs of the type
described above resulting from changes after the date of the respective
transfer).
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12.15 Register. The Borrower hereby designates the
Administrative Agent to serve as the Borrower's agent, solely for purposes of
this Section 12.15, to maintain a register (the "Register") on which it will
record the Loans made by each of the Banks and each repayment in respect of the
principal amount of the Loans of each Bank. Failure to make any such
recordation, or any error in such recordation shall not affect the Borrower's
obligations in respect of such Loans. With respect to any Bank, the transfer of
the rights to the principal of, and interest on, any Loan shall not be effective
until such transfer is recorded on the Register maintained by the Administrative
Agent with respect to ownership of such Loans and prior to such recordation all
amounts owing to the transferor with respect to such Loans shall remain owing to
the transferor. The registration of assignment or transfer of all or part of any
Loans shall be recorded by the Administrative Agent on the Register only upon
the acceptance by the Administrative Agent of a properly executed and delivered
Assignment and Assumption Agreement pursuant to Section 12.04(b). Coincident
with the delivery of such an Assignment and Assumption Agreement to the
Administrative Agent for acceptance and registration of assignment or transfer
of all or part of a Loan, or as soon thereafter as practicable, the assigning or
transferor Bank shall surrender the Note evidencing such Loan, and thereupon one
or more new Notes in the same aggregate principal amount shall be issued to the
assigning or transferor Bank and/or the new Bank. The Borrower agrees to
indemnify the Administrative Agent from and against any and all losses, claims,
damages and liabilities of whatsoever nature which may be imposed on, asserted
against or incurred by the Administrative Agent in performing its duties under
this Section 12.15.
12.16 Confidentiality. (a) Subject to the provisions of clause
(b) of this Section 12.16, each Bank agrees that it will use its reasonable
efforts not to disclose without the prior consent of the Borrower (other than to
its employees, auditors, advisors or counsel or to another Bank if the Bank or
such Bank's holding or parent company in its sole discretion determines that any
such party should have access to such information, provided such Persons shall
be subject to the provisions of this Section 12.16 to the same extent as such
Bank) any information with respect to Communications, the Borrower or any of
their respective Subsidiaries which is now or in the future furnished pursuant
to this Agreement or any other Credit Document and which is designated by the
Borrower to the Banks in writing as confidential, provided that any Bank may
disclose any such information (a) as has become generally available to the
public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, state or Federal regulatory body having or
claiming to have jurisdiction over such Bank or to the Federal Reserve Board or
the Federal Deposit Insurance Corporation or similar organizations (whether in
the United States or elsewhere) or their successors, (c) as may be required or
appropriate in respect to any summons or subpoena or in connection with any
litigation, (d) in order to comply with any law, order, regula-
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tion or ruling applicable to such Bank, (e) to the Administrative Agent or the
Collateral Agent or any other Bank or Secured Creditor and (f) to any
prospective or actual transferee or participant in connection with any
contemplated transfer or participation of any of the Notes or Loans or any
interest therein by such Bank, provided, that such prospective transferee shall
be subject to the provisions of this Section 12.16(a).
(b) The Borrower hereby acknowledges and agrees that each Bank
may share with any of its affiliates any information related to Communications,
the Borrower or any of their respective Restricted Subsidiaries (including,
without limitation, any nonpublic customer information regarding the
creditworthiness of Communications, the Borrower and their respective Restricted
Subsidiaries, provided such Persons shall be subject to the provisions of this
Section 12.16 to the same extent as such Bank).
12.17 Designated Senior Indebtedness. The Borrower hereby
irrevocably agrees that, at any time when all Indebtedness under the Existing
Credit Agreement has been repaid in full, the Indebtedness outstanding hereunder
shall constitute Designated Senior Indebtedness under, and as defined in, the
Senior Subordinated Notes Indenture at all times when the principal amount of
outstanding Loans are at least equal to $25 million.
12.18 Limitation on Additional Amounts, etc. Notwithstanding
anything to the contrary contained in Section 1.08 or 1.09 of this Agreement,
unless a Bank gives notice to the respective Borrower that it is obligated to
pay an amount under the respective Section within one year after the later of
(x) the date the Bank incurs the respective increased costs, loss, expense or
liability, reduction in amounts received or receivable or reduction in return on
capital or (y) the date such Bank has actual knowledge of its incurrence of the
respective increased costs, loss, expense or liability, reductions in amounts
received or receivable or reduction in return on capital, then such Bank shall
only be entitled to be compensated for such amount by such Borrower pursuant to
said Section 1.08 or 1.09, as the case may be, to the extent the costs, loss,
expense or liability, reduction in amounts received or receivable or reduction
in return on capital are incurred or suffered on or after the date which occurs
one year prior to such Bank giving notice to such Borrower that it is obligated
to pay the respective amounts pursuant to said Section 1.08 and 1.09, as the
case may be. This Section 12.18 shall have no applicability to any Section of
this Agreement other than said Sections 1.08 and 1.09.
12.19 Maximum Rate. Notwithstanding anything to the contrary
contained elsewhere in this Agreement or in any other Credit Document, the
Borrower, the Administrative Agent and the Banks hereby agree that all
agreements among them under this Agreement and the other Credit Documents,
whether now
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existing or hereafter arising and whether written or oral, are expressly limited
so that in no contingency or event whatsoever shall the amount paid, or agreed
to be paid, to the Administrative Agent or any Bank for the use, forbearance, or
detention of the money loaned to the Borrower and evidenced hereby or thereby or
for the performance or payment of any covenant or obligation contained herein or
therein, exceed the Highest Lawful Rate. If due to any circumstance whatsoever,
fulfillment of any provisions of this Agreement or any of the other Credit
Documents at the time performance of such provision shall be due shall exceed
the Highest Lawful Rate, then, automatically, the obligation to be fulfilled
shall be modified or reduced to the extent necessary to limit such interest to
the Highest Lawful Rate, and if from any such circumstance any Bank should ever
receive anything of value deemed interest by applicable law which would exceed
the Highest Lawful Rate, such excessive interest shall be applied to the
reduction of the principal amount then outstanding hereunder or on account of
any other then outstanding Obligations and not to the payment of interest, or if
such excessive interest exceeds the principal unpaid balance then outstanding
hereunder and such other then outstanding Obligations, such excess shall be
refunded to the Borrower. All sums paid or agreed to be paid to the
Administrative Agent or any Bank for the use, forbearance, or detention of the
Obligations and other Indebtedness of the Borrower to the Administrative Agent
or any Bank shall, to the extent permitted by applicable law, be amortized,
prorated, allocated and spread throughout the full term of such Indebtedness
until payment in full so that the actual rate of interest on account of all such
Indebtedness does not exceed the Highest Lawful Rate throughout the entire term
of such Indebtedness. The terms and provisions of this Section 12.19 shall
control every other provision of this Agreement and all agreements among the
Borrower, the Administrative Agent and the Banks.
12.20 Post-Closing Actions. Notwithstanding anything to the
contrary contained in this Agreement or the other Credit Documents, the parties
hereto acknowledge and agree that:
(a) The Borrower was not required to satisfy the conditions
precedent set forth in Section 4.13 (other than with respect to Concentration
Account Agreements, which shall be delivered on the Closing Date) and 4.14 on
the Closing Date. Not later than the 90th day after the Closing Date, the
Borrower shall have:
(i) delivered fully executed amendments to all existing Lockbox
Agreements as otherwise required by Section 4.13, it being understood
that if the Borrower is unable to obtain any such amendment to an
existing Lockbox Agreement, the Borrower shall, by such 90th day, have
entered into a new Lockbox Agreement with a financial institution
satisfactory to the Collateral Agent in the form of Exhibit M-1 hereto;
and
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(ii) used its best efforts to replace all Existing Credit
Agreement Collateral Access Agreements with Collateral Access
Agreements in accordance with the provisions of Section 4.14, it being
understood and agreed that if the Borrower is unable to replace any
such Existing Credit Agreement Collateral Access Agreement with a
Collateral Access Agreement after using its best efforts to do so, no
Default or Event of Default shall arise under this Agreement as a
result of any such failure.
In connection with the foregoing, the Borrower shall (i) to the extent requested
by the Collateral Agent on the Closing Date, deliver to the Collateral Agent
local counsel opinions in form and substance satisfactory to the Collateral
Agent prior to the 90th day following the Closing Date and (ii) deliver to the
Administrative Agent within 5 days following the Closing Date Annexes II through
X, inclusive, to this Agreement, which Annexes shall be reasonably satisfactory
to the Administrative Agent and the Required Banks.
All provisions of this Credit Agreement and the other Credit
Documents (including, without limitation, all conditions precedent,
representations, warranties, covenants and other agreements herein and therein)
shall be deemed modified to the extent necessary to effect the foregoing (and to
permit the taking of the actions described above within the time periods,
required above, rather than as otherwise provided in the Credit Documents);
provided, that (x) to the extent any representation and warranty would not be
true because the foregoing actions were not taken on the Closing Date, the
respective representation and warranty shall be required to be true and correct
in all material respects at the time the respective action is taken (or was
required to be taken) in accordance with the foregoing provisions of Section
12.20 and (y) all representations and warranties relating to the Collateral
Documents shall be required to be true immediately after the actions required to
be taken by Section 12.20 have been taken (or were required to be taken). The
acceptance of the benefits of the Loans shall constitute a representation,
warranty and covenant by the Borrower to each of the Banks that the actions
required pursuant to this Section 12.20 will be, or have been, taken within the
relevant time periods referred to in this Section 12.20 and that, at such time,
all representations and warranties contained in this Credit Agreement and the
other Credit Documents shall then be true and correct without any modification
pursuant to this Section 12.20, the parties hereto acknowledge and agree that
the failure to take any of the actions required above, within the relevant time
periods required above, shall give rise to an immediate Event of Default
pursuant to this Agreement.
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SECTION 13. Parent Guaranty.
13.01 The Parent Guaranty. In order to induce the Banks to
enter into this Agreement and to extend credit hereunder and in recognition of
the direct benefits to be received by the Parent Guarantor from the proceeds of
the Loans and the issuance of the Letters of Credit, the Parent Guarantor hereby
agrees with the Banks as follows: the Parent Guarantor hereby unconditionally
and irrevocably guarantees as primary obligor and not merely as surety the full
and prompt payment when due, whether upon maturity, by acceleration or
otherwise, of any and all indebtedness of the Borrower to the Banks hereunder.
If any or all of the indebtedness of the Borrower to the Banks becomes due and
payable hereunder, the Parent Guarantor unconditionally promises to pay such
indebtedness to the Banks, or order, on demand, together with any and all
reasonable expenses which may be incurred by (x) the Administrative Agent in
connection with the preparation, execution and delivery of this Agreement and
the other Credit Documents and the documents and instruments referred to herein
and therein and any amendment, waiver or consent relating hereto or thereto, in
connection with its syndication efforts with respect to this Agreement, or (y)
the Administrative Agent or the Banks in collecting any of the indebtedness. The
word "indebtedness" is used in this Section 13 in its most comprehensive sense
and means any and all advances, debts, obligations and liabilities of the
Borrower arising in connection with this Agreement, in each case, heretofore,
now, or hereafter made, incurred or created, whether voluntarily or
involuntarily, absolute or contingent, liquidated or unliquidated, determined or
undetermined, whether or not such indebtedness is from time to time reduced, or
extinguished and thereafter increased or incurred, whether the Borrower may be
liable individually or jointly with others, whether or not recovery upon such
indebtedness may be or hereafter become barred by any statute of limitations,
and whether or not such indebtedness may be or hereafter become otherwise
unenforceable.
13.02 Bankruptcy. Additionally, the Parent Guarantor
unconditionally and irrevocably guarantees the payment of any and all
indebtedness of the Borrower to the Banks whether or not due or payable by the
Borrower upon the occurrence in respect of the Borrower of any of the events
specified in Section 8.01(7) or (8), and unconditionally and irrevocably
promises to pay such indebtedness to the Banks, or order, on demand, in lawful
money of the United States.
13.03 Nature of Liability. The liability of the Parent
Guarantor hereunder is exclusive and independent of any security for or other
guaranty of the indebtedness of the Borrower whether executed by the Parent
Guarantor, any other guarantor or by any other party, and the liability of the
Parent Guarantor hereunder shall not be affected or impaired by (a) any
direction as to application of payment by
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the Borrower or by any other party, or (b) any other continuing or other
guaranty, undertaking or maximum liability of a guarantor or of any other party
as to the indebtedness of the Borrower, or (c) any payment on or in reduction of
any such other guaranty or undertaking, or (d) any dissolution, termination or
increase, decrease or change in personnel by the Borrower, or (e) any payment
made to the Administrative Agent or the Banks on the indebtedness which such
Administrative Agent or such Bank repays the Borrower pursuant to court order in
any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and the Parent Guarantor waives any right to the deferral or
modification of its obligations hereunder by reason of any such proceeding.
13.04 Independent Obligation. The obligations of the Parent
Guarantor hereunder are independent of the obligations of any other guarantor or
the Borrower, and a separate action or actions may be brought and prosecuted
against the Parent Guarantor whether or not action is brought against any other
guarantor or the Borrower and whether or not any other guarantor or the Borrower
be joined in any such action or actions. The Parent Guarantor waives, to the
fullest extent permitted by law, the benefit of any statute of limitations
affecting its liability hereunder or the enforcement thereof. Any payment by the
Borrower or other circumstance which operates to toll any statute of limitations
as to the Borrower shall, to the fullest extent permitted by law, operate to
toll the statute of limitations as to the Parent Guarantor.
13.05 Authorization. The Parent Guarantor authorizes the
Administrative Agent and the Banks without notice or demand (except as shall be
required by applicable statute and cannot be waived), and without affecting or
impairing its liability hereunder, from time to time to:
(a) subject to the agreement of the Borrower, change the
manner, place or terms of payment of, and/or change or extend the time
of payment of, renew, increase, accelerate or alter, any of the
indebtedness (including any increase or decrease in the rate of
interest thereon), any security therefor, or any liability incurred
directly or indirectly in respect thereof, and the Parent Guaranty
herein made shall apply to the indebtedness as so changed, extended,
renewed or altered;
(b) take and hold security for the payment of the indebtedness
and sell, exchange, release, surrender, realize upon or otherwise deal
with in any manner and in any order any property by whomsoever at any
time pledged or mortgaged to secure, or howsoever securing, the
indebtedness or any liabilities (including any of those hereunder)
incurred directly or indirectly in respect thereof or hereof, and/or
any offset thereagainst;
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(c) exercise or refrain from exercising any rights against the
Borrower or others or otherwise act or refrain from acting;
(d) release or substitute any one or more endorsers,
guarantors, the Borrower or other obligors;
(e) settle or compromise any of the indebtedness, any security
therefor or any liability (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and may
subordinate the payment of all or any part thereof to the payment of
any liability (whether due or not) of the Borrower to its creditors
other than the Banks;
(f) apply any sums by whomsoever paid or howsoever realized to
any liability or liabilities of the Borrower to the Banks regardless of
what liability or liabilities of the Parent Guarantor or the Borrower
remain unpaid; and/or
(g) consent to or waive any breach of, or any act, omission or
default under, this Agreement or any of the instruments or agreements
referred to herein, or otherwise, with the agreement of the Borrower,
amend, modify or supplement this Agreement or any of such other
instruments or agreements.
13.06 Reliance. It is not necessary for the Administrative
Agent or the Banks to inquire into the capacity or powers of the Borrower or its
Subsidiaries or the officers, directors, partners or agent acting or purporting
to act on its behalf, and any indebtedness made or created in reliance upon the
professed exercise of such powers shall be guaranteed hereunder.
13.07 Subordination. Any indebtedness of the Borrower now or
hereafter owing to the Parent Guarantor is hereby subordinated in right of
payment to the indebtedness of the Borrower owing to the Administrative Agent
and the Banks; provided that payment may be made by the Borrower on any such
indebtedness owing to the Parent Guarantor so long as the same is not prohibited
by this Agreement; and provided further, that if the Administrative Agent so
requests at a time when an Event of Default exists, all such indebtedness of the
Borrower to the Parent Guarantor shall be collected, enforced and received by
the Parent Guarantor as trustee for the Banks and be paid over to the Banks on
account of the indebtedness of the Borrower to the Banks, but without affecting
or impairing in any manner the liability of the Parent Guarantor under the other
provisions of this Parent Guaranty. Prior to the transfer by the Parent
Guarantor of any note or negotiable instrument evidencing any indebtedness of
the Borrower to the Parent Guarantor, the Parent Guarantor shall xxxx such note
or negotiable instrument with a legend that the same is subject to this
subordination.
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13.08 Waiver. (a) The Parent Guarantor waives any right
(except as shall be required by applicable statute and cannot be waived) to
require the Administrative Agent or the Banks to (i) proceed against the
Borrower, any other guarantor or any other party, (ii) proceed against or
exhaust any security held from the Borrower, any other guarantor or any other
party or (iii) pursue any other remedy in the Administrative Agent's or the
Banks' power whatsoever. The Parent Guarantor waives any defense based on or
arising out of any defense of the Borrower, any other guarantor or any other
party other than payment in full of the indebtedness, including, without
limitation, any defense based on or arising out of the disability of the
Borrower, any other guarantor or any other party, or the unenforceability of the
indebtedness or any part thereof from any cause, or the cessation from any cause
of the liability of the Borrower other than payment in full of the indebtedness.
The Administrative Agent and the Banks may, at their election, foreclose on any
security held by the Administrative Agent, the Collateral Agent or the Banks by
one or more judicial or nonjudicial sales, whether or not every aspect of any
such sale is commercially reasonable (to the extent such sale is permitted by
applicable law), or exercise any other right or remedy the Administrative Agent
and the Banks may have against the Borrower or any other party, or any security,
without affecting or impairing in any way the liability of the Parent Guarantor
hereunder except to the extent the indebtedness has been paid. The Parent
Guarantor waives, to the fullest extent permitted by law, any defense arising
out of any such election by the Administrative Agent and the Banks, even though
such election operates to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of the Parent Guarantor against any
Borrower or any other party or any security.
(b) The Parent Guarantor waives all presentments, demands for
performance, protests and notices, including without limitation notices of
nonperformance, notices of protest, notices of dishonor, notices of acceptance
of this Parent Guaranty, and notices of the existence, creation or incurring of
new or additional indebtedness. The Parent Guarantor assumes all responsibility
for being and keeping itself informed of the Borrower's financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the indebtedness and the nature, scope and extent of the risks which the Parent
Guarantor assumes and incurs hereunder, and agrees that the Administrative Agent
and the Banks shall have no duty to advise the Parent Guarantor of information
known to them regarding such circumstances or risks.
13.09 Limitation on Enforcement. The Banks agree that this
Parent Guaranty may be enforced only by the action of the Administrative Agent
or the Collateral Agent, in each case acting upon the instructions of the
Required Banks and that no Bank shall have any right individually to seek to
enforce or to enforce this Parent Guaranty, it being understood and agreed that
such rights and remedies
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may be exercised by the Administrative Agent for the benefit of the Banks upon
the terms of this Agreement. The Banks further agree that this Parent Guaranty
may not be enforced against any Affiliate, director, officer, employee or
stockholder of the Parent Guarantor.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered by their proper and duly authorized
officers as of the date set forth above.
XXXXXXXX COMMUNICATIONS, INC.,
a Delaware corporation
By /s/ Xxxxxx Xxxxxx
------------------------------
Title: Chief Financial Officer
XXXXXXXX GRAPHICS, INC.,
a New York corporation
By /s/ Xxxxxx Xxxxxx
------------------------------
Title: Chief Financial Officer
ADMINISTRATIVE AGENT:
BANKERS TRUST COMPANY, as
Administrative Agent
By /s/ Xxxxx Xxxxxxx
------------------------------
Title: Vice President
COLLATERAL AGENT:
BT COMMERCIAL CORPORATION,
As Collateral Agent
By /s/ Xxxxx Xxxxxxx
------------------------------
Title: Vice President
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