EXHIBIT 10(b)
LOAN AGREEMENT
between
NATIONSBANK, N.A.
as "Lender"
and
INSITUFORM TECHNOLOGIES, INC.
as "Borrower"
Effective August 20, 1997
Table of Contents
1. Effective Date. . . . . . . . . . . . . . . . . . . . . . . 1
2. Definitions and Rules of Construction.. . . . . . . . . . . 1
2.1 Listed Definitions. . . . . . . . . . . . . . . . . . . . . 1
2.2. Other Definitions. . . . . . . . . . . . . . . . . 1
2.3. References to Covered Persons. . . . . . . . . . . 1
2.4. Accounting Terms.. . . . . . . . . . . . . . . . . 1
2.5. Meaning of Satisfactory. . . . . . . . . . . . . . 1
2.6. Computation of Time Periods. . . . . . . . . . . . 2
2.7. General. . . . . . . . . . . . . . . . . . . . . . 2
3. Lender's Commitments. . . . . . . . . . . . . . . . . . . . 2
3.1. Revolving Commitment.. . . . . . . . . . . . . . . 2
3.1.1. Revolving Advances. . . . . . . . . . . . 2
3.1.2. Revolving Note. . . . . . . . . . . . . . 3
3.2. Letter of Credit Commitment. . . . . . . . . . . . 3
4. Interest; Yield Protection. . . . . . . . . . . . . . . . . 3
4.1. Interest on Draws on Letters of Credit.. . . . . . 3
4.2. Alternative Rates and Interest Periods for
Tranches of Revolving Loan.. . . . . . . . . . . . 3
4.3. Prime Rate.. . . . . . . . . . . . . . . . . . . . 4
4.4. Adjusted LIBO Rate.. . . . . . . . . . . . . . . . 4
4.5. LIBOR Increment. . . . . . . . . . . . . . . . . . 4
4.6. Conversion of Revolving Loan.. . . . . . . . . . . 6
4.7. Time of Accrual. . . . . . . . . . . . . . . . . . 6
4.8. Computation. . . . . . . . . . . . . . . . . . . . 6
4.9. Rate After Maturity. . . . . . . . . . . . . . . . 6
4.10. Taxes on Payments.. . . . . . . . . . . . . . . . . . 6
4.11. Compensation for Increase In Costs of LIBOR
Tranches.. . . . . . . . . . . . . . . . . . . . . 7
4.11.1. . . . . . . . . . . . . . . . . . . . . . 7
4.11.2. . . . . . . . . . . . . . . . . . . . . . 7
4.12. Losses on LIBOR Tranches. . . . . . . . . . . . . . . 7
5. Commitment Fee. . . . . . . . . . . . . . . . . . . . . . . 9
6. Scheduled Payments. . . . . . . . . . . . . . . . . . . . . 9
6.1. Maturity Date. . . . . . . . . . . . . . . . . . . 9
6.2. Interest Payments Before Maturity Date.. . . . . . 9
7. Voluntary Prepayments.. . . . . . . . . . . . . . . . . . . 10
8. Manner of Payments and Timing of
Application of Payments.. . . . . . . . . . . . . . . . . . 10
8.1. Payment Requirement. . . . . . . . . . . . . . . . 10
8.2. Application of Payments and Proceeds.. . . . . . . 10
8.3. Returned Instruments.. . . . . . . . . . . . . . . 10
8.4. Compelled Return of Payments or
Proceeds.. . . . . . . . . . . . . . . . . . . . . 10
8.5. Due Dates Not on Business Days.. . . . . . . . . . 11
9. Procedure for Obtaining Revolving Advances
and Letters of Credit.. . . . . . . . . . . . . . . . . . . 11
9.1. Revolving Advances.. . . . . . . . . . . . . . . . 11
9.2. Lender's Right to Make Other Revolving
Advances.. . . . . . . . . . . . . . . . . . . . . 11
9.3. Letters of Credit. . . . . . . . . . . . . . . . . 11
9.4. Amount, Number, and Purpose Restrictions
on Revolving Advances. . . . . . . . . . . . . . . 11
9.5. Each Request for a Revolving Advance a
Certification. . . . . . . . . . . . . . . . . . . 11
9.6. Requirements for Every Request for an
Revolving Advance. . . . . . . . . . . . . . . . . 12
9.7. Requirements for Every Request for
Issuance of a Letter of Credit.. . . . . . . . . . 12
9.8. Exoneration of Lender. . . . . . . . . . . . . . . 12
10. Security and Guaranties.. . . . . . . . . . . . . . . . . . 12
11. Conditions. . . . . . . . . . . . . . . . . . . . . . . . . 13
11.1. Conditions to Initial Revolving Advance.. . . . . . . 13
11.1.1. Listed Documents and Other
Items.. . . . . . . . . . . . . . . . . . 13
11.1.2. Representations and Warranties. . . . . . 13
11.1.3. No Existing Default.. . . . . . . . . . . 13
11.1.4. Payment of Fees.. . . . . . . . . . . . . 14
11.1.5. No Material Adverse Change. . . . . . . . 14
11.1.6. Other Items.. . . . . . . . . . . . . . . 14
11.2. Conditions to Subsequent Revolving
Advances.. . . . . . . . . . . . . . . . . . . . . 14
11.2.1. Conditions to Initial Revolving
Advances. . . . . . . . . . . . . . . . . 14
11.2.2. Representations and Warranties. . . . . . 14
11.2.3. No Default. . . . . . . . . . . . . . . . 14
11.2.4. No Material Adverse Change. . . . . . . . 14
12. Conditions to Issuance of Letters of Credit.. . . . . . . . 14
12.1. Reimbursement Agreement.. . . . . . . . . . . . . . . 14
12.2. No Prohibitions.. . . . . . . . . . . . . . . . . . . 15
12.3. Conditions to Initial Revolving Advances. . . . . . . 15
12.4. Representations and Warranties. . . . . . . . . . . . 15
12.5. No Default. . . . . . . . . . . . . . . . . . . . . . 15
12.6. No Material Adverse Change. . . . . . . . . . . . . . 15
13. Representations and Warranties. . . . . . . . . . . . . . . 15
13.1. Organization and Existence.. . . . . . . . . . . . . 15
13.2. Authorization. . . . . . . . . . . . . . . . . . . . 16
13.3. Due Execution. . . . . . . . . . . . . . . . . . . . 16
13.4. Enforceability of Obligations. . . . . . . . . . . . 16
13.5. Burdensome Obligations.. . . . . . . . . . . . . . . 16
13.6. Legal Restraints.. . . . . . . . . . . . . . . . . . 16
13.7. Labor Disputes.. . . . . . . . . . . . . . . . . . . 16
13.8. No Material Proceedings. . . . . . . . . . . . . . . 16
13.9. Material Licenses. . . . . . . . . . . . . . . . . . 17
13.10. Compliance with Material Laws. . . . . . . . . . . . 17
13.10.1. General Compliance with
Environmental Laws. . . . . . . . . . . . 17
13.10.2. Proceedings. . . . . . . . . . . . . . . 17
13.10.3. Investigations Regarding
Hazardous Materials.. . . . . . . . . . . 17
13.10.4. Notices and Reports Regarding
Hazardous Materials.. . . . . . . . . . . 17
13.10.5. Hazardous Materials on Real
Property. . . . . . . . . . . . . . . . . 17
13.11. Initial Financial Statements.. . . . . . . . . . . . 18
13.12. No Change in Condition.. . . . . . . . . . . . . . . 18
13.13. No Defaults. . . . . . . . . . . . . . . . . . . . . 18
13.14. Tax Liabilities; Governmental Charges. . . . . . . . 18
13.15. Pension Benefit Plans. . . . . . . . . . . . . . . . 18
13.15.1. Prohibited Transactions. . . . . . . . . 18
13.15.2. Claims.. . . . . . . . . . . . . . . . . 19
13.15.3. Reporting and Disclosure
Requirements. . . . . . . . . . . . . . . 19
13.15.4. Accumulated Funding
Deficiency. . . . . . . . . . . . . . . . 19
13.15.5. Multi-employer Plan. . . . . . . . . . . 19
13.16. Welfare Benefit Plans. . . . . . . . . . . . . . . . 19
13.17. State of Property. . . . . . . . . . . . . . . . . . 19
13.18. Subsidiaries and Affiliates. . . . . . . . . . . . . 20
13.19. Margin Stock.. . . . . . . . . . . . . . . . . . . . 20
13.20. Hostile Securities Transactions. . . . . . . . . . . 20
13.21. Investment Company Act, Etc. . . . . . . . . . . . . 20
13.22. Filings. . . . . . . . . . . . . . . . . . . . . . . 20
13.23. Broker's Fees. . . . . . . . . . . . . . . . . . . . 20
13.24. Full Disclosure. . . . . . . . . . . . . . . . . . . 20
14. Survival of Representations.. . . . . . . . . . . . . . . . 20
15. Affirmative Covenants.. . . . . . . . . . . . . . . . . . . 21
15.1. Use of Proceeds.. . . . . . . . . . . . . . . . . . . 21
15.2. Corporate Existence.. . . . . . . . . . . . . . . . . 21
15.3. Maintenance of Property and Leases. . . . . . . . . . 21
15.4. Insurance.. . . . . . . . . . . . . . . . . . . . . . 21
15.5. Payment of Taxes and Other Obligations. . . . . . . . 21
15.6. Compliance With Laws. . . . . . . . . . . . . . . . . 22
15.6.1. Environmental Laws. . . . . . . . . . . . 22
15.6.2. Pension Benefit Plans.. . . . . . . . . . 22
15.7. Discovery and Clean-Up of Hazardous
Material.. . . . . . . . . . . . . . . . . . . . . 22
15.8. Termination of Pension Benefit Plan.. . . . . . . . . 22
15.9. Notice to Lender of Material Events.. . . . . . . . . 23
15.9.1. . . . . . . . . . . . . . . . . . . . . . 23
15.9.2. . . . . . . . . . . . . . . . . . . . . . 23
15.9.3. . . . . . . . . . . . . . . . . . . . . . 23
15.9.4. . . . . . . . . . . . . . . . . . . . . . 23
15.9.5. . . . . . . . . . . . . . . . . . . . . . 24
15.9.6. . . . . . . . . . . . . . . . . . . . . . 24
15.9.7. . . . . . . . . . . . . . . . . . . . . . 24
15.9.8. . . . . . . . . . . . . . . . . . . . . . 25
15.9.9. . . . . . . . . . . . . . . . . . . . . . 25
15.10. Borrowing Officer. . . . . . . . . . . . . . . . . . 25
15.11. Accounting System. . . . . . . . . . . . . . . . . . 25
15.12. Financial Statements.. . . . . . . . . . . . . . . . 25
15.12.1. Annual Financial Statements.. . . . . . . 25
15.12.2. Quarterly Financial Statements. . . . . . 26
15.13. Other Financial Information. . . . . . . . . . . . . 26
15.13.1. Stockholder and SEC Reports.. . . . . . . 26
15.13.2. Pension Benefit Plan Reports. . . . . . . 26
15.13.3. Tax Returns.. . . . . . . . . . . . . . . 26
15.13.4. Additional. . . . . . . . . . . . . . . . 27
15.14. Forecasts or Projections.. . . . . . . . . . . . . . 27
15.15. Audits by Lender.. . . . . . . . . . . . . . . . . . 27
15.16. Access to Officers and Auditors. . . . . . . . . . . 27
15.17. Further Assurances.. . . . . . . . . . . . . . . . . 28
16. Negative Covenants. . . . . . . . . . . . . . . . . . . . . 28
16.1. Indebtedness. . . . . . . . . . . . . . . . . . . . . 28
16.2. Prepayments.. . . . . . . . . . . . . . . . . . . . . 28
16.3. Security Interests. . . . . . . . . . . . . . . . . . 28
16.3.1. . . . . . . . . . . . . . . . . . . . . . 28
16.3.2. . . . . . . . . . . . . . . . . . . . . . 29
16.3.3. . . . . . . . . . . . . . . . . . . . . . 29
16.3.4. . . . . . . . . . . . . . . . . . . . . . 29
16.3.5. . . . . . . . . . . . . . . . . . . . . . 29
16.3.6. . . . . . . . . . . . . . . . . . . . . . 29
16.4. Acquisitions. . . . . . . . . . . . . . . . . . . . . 29
16.4.1. . . . . . . . . . . . . . . . . . . . . . 29
16.4.2. . . . . . . . . . . . . . . . . . . . . . 29
16.4.3. . . . . . . . . . . . . . . . . . . . . . 29
16.4.3.1. . . . . . . . . . . . . 29
16.4.3.2. . . . . . . . . . . . . 29
16.4.4. . . . . . . . . . . . . . . . . . . . . . 30
16.4.5. . . . . . . . . . . . . . . . . . . . . . 30
16.5. Disposal of Property. . . . . . . . . . . . . . . . . 30
16.6. Restricted Payments.. . . . . . . . . . . . . . . . . 30
16.7. Mergers and Consolidations. . . . . . . . . . . . . . 30
16.8. Change of Business. . . . . . . . . . . . . . . . . . 30
16.9. Transactions With Affiliates. . . . . . . . . . . . . 30
16.10.Conflicting Agreements, Etc.. . . . . . . . . . . . . 31
00.00.Xxxx and Leaseback Transactions.. . . . . . . . . . . 31
16.12.Fiscal Year.. . . . . . . . . . . . . . . . . . . . . 31
16.13.Transactions Having a Material Adverse
Effect on a Covered Person.. . . . . . . . . . . . 31
17. Financial Covenants.. . . . . . . . . . . . . . . . . . . . 31
17.1. Special Definitions.. . . . . . . . . . . . . . . . . 31
17.2. Minimum Fixed Charge Coverage.. . . . . . . . . . . . 33
17.3. Minimum Tangible Net Worth. . . . . . . . . . . . . . 33
17.4. Maximum Funded Debt to EBITDA Ratio.. . . . . . . . . 33
17.5. Funded Debt to Total Capitalization.. . . . . . . . . 33
18. Default.. . . . . . . . . . . . . . . . . . . . . . . . . . 33
18.1. Events of Default.. . . . . . . . . . . . . . . . . . 33
18.1.1. Failure to Pay Principal or
Interest. . . . . . . . . . . . . . . . . 33
18.1.2. Failure to Pay Other Amounts Owed
to Lender.. . . . . . . . . . . . . . . . 33
18.1.3. Failure to Pay Amounts Owed to
Other Persons.. . . . . . . . . . . . . . 33
18.1.4. Acceleration of Other
Indebtedness. . . . . . . . . . . . . . . 34
18.1.5. Representations or Warranties.. . . . . . 34
18.1.6. Certain Covenants.. . . . . . . . . . . . 34
18.1.7. Financial Covenants.. . . . . . . . . . . 34
18.1.8. Other Covenants.. . . . . . . . . . . . . 34
18.1.9. Default Under Other Agreements. . . . . . 34
18.1.10. Bankruptcy; Insolvency; Etc. . . . . . . 34
18.1.11. Judgments; Attachment; Etc.. . . . . . . 35
18.1.12. Pension Benefit Plan
Termination, Etc. . . . . . . . . . . . . 35
18.1.13. Liquidation or Dissolution.. . . . . . . 35
18.1.14. Seizure of Assets. . . . . . . . . . . . 35
18.1.15. Racketeering Proceeding. . . . . . . . . 36
18.1.16. Loan Documents.. . . . . . . . . . . . . 36
18.1.17. Guaranty Default.. . . . . . . . . . . . 36
18.1.18. Qualified Audit Report.. . . . . . . . . 36
18.1.19. Material Adverse Change. . . . . . . . . 36
18.2. Rights and Remedies Upon an Event of
Default. . . . . . . . . . . . . . . . . . . . . . 36
18.2.1. Cancellation of Commitments.. . . . . . . 36
18.2.2. Acceleration. . . . . . . . . . . . . . . 36
18.2.3. Right of Set-off. . . . . . . . . . . . . 36
18.2.4. Entry Upon Premises and Access to
Information.. . . . . . . . . . . . . . . 37
18.2.5. Miscellaneous.. . . . . . . . . . . . . . 37
18.3. Application of Funds. . . . . . . . . . . . . . . . . 37
19. General.. . . . . . . . . . . . . . . . . . . . . . . . . . 37
19.1. Lender's Right to Cure. . . . . . . . . . . . . . . . 37
19.2. Rights Not Exclusive. . . . . . . . . . . . . . . . . 38
19.3. Survival of Agreements. . . . . . . . . . . . . . . . 38
19.4. Sale of Participations. . . . . . . . . . . . . . . . 38
19.4.1. . . . . . . . . . . . . . . . . . . . . . 38
19.4.2. . . . . . . . . . . . . . . . . . . . . . 38
19.4.3. . . . . . . . . . . . . . . . . . . . . . 38
19.4.4. . . . . . . . . . . . . . . . . . . . . . 38
19.5. Assignments to Affiliates.. . . . . . . . . . . . . . 39
19.6. Payment of Expenses.. . . . . . . . . . . . . . . . . 39
19.7. General Indemnity.. . . . . . . . . . . . . . . . . . 39
19.7.1. . . . . . . . . . . . . . . . . . . . . . 39
19.7.2. . . . . . . . . . . . . . . . . . . . . . 40
19.7.3. . . . . . . . . . . . . . . . . . . . . . 40
19.8. Revolving Loan Records. . . . . . . . . . . . . . . . 40
19.9. Other Security and Guaranties.. . . . . . . . . . . . 40
20. Miscellaneous.. . . . . . . . . . . . . . . . . . . . . . . 41
20.1. Notices.. . . . . . . . . . . . . . . . . . . . . . . 41
20.2. Amendments, Waivers and Consents. . . . . . . . . . . 41
20.3. Successors and Assigns. . . . . . . . . . . . . . . . 41
20.4. Severability. . . . . . . . . . . . . . . . . . . . . 41
20.5. Counterparts. . . . . . . . . . . . . . . . . . . . . 41
20.6. Governing Law; No Third Party Rights. . . . . . . . . 42
20.7. Counterpart Facsimile Execution.. . . . . . . . . . . 42
20.8. No Other Agreements.. . . . . . . . . . . . . . . . . 42
20.9. Incorporation By Reference. . . . . . . . . . . . . . 42
20.10.Negotiated Transaction. . . . . . . . . . . . . . . . 42
21. Choice of Forum.. . . . . . . . . . . . . . . . . . . . . . 42
22. Service of Process. . . . . . . . . . . . . . . . . . . . . 43
23. Jury Trial. . . . . . . . . . . . . . . . . . . . . . . . . 43
24. Statutory Notice. . . . . . . . . . . . . . . . . . . . . . 43
b.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii
c.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii
d. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii
e.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv
g.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv
h.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv
LOAN AGREEMENT
This is an agreement (this "Agreement") executed on
August 20, 1997, between INSITUFORM TECHNOLOGIES, INC., as
Borrower, and NATIONSBANK, N.A., successor by merger to The
Boatmen's National Bank of St. Louis, as Lender.
In consideration of the mutual agreements herein and
other sufficient consideration, the receipt of which is hereby
acknowledged, Borrower and Lender agree as follows:
1. Effective Date. This Agreement is effective August 20,
1997.
2. Definitions and Rules of Construction.
2.1 Listed Definitions. Capitalized terms defined in
the Glossary and Index of Defined Terms attached hereto as
Exhibit 2.1 shall have such defined meanings wherever used in
this Agreement and the other Loan Documents.
2.2 Other Definitions. If a capitalized term used in
this Agreement is not defined in the Glossary and Index of
Defined Terms, it shall have such meaning as defined elsewhere
herein, or if not defined elsewhere herein, the meaning defined
in the UCC.
2.3 References to Covered Persons. The words Covered
Person, a Covered Person, any Covered Person, each Covered Person
and every Covered Person refer to Borrower and each of its
presently existing or future acquired, organized or created
Subsidiaries (other than the Exempted Subsidiaries) separately.
The words Covered Persons refer to Borrower and its presently
existing or future acquired, organized or created Subsidiaries
(other than the Exempted Subsidiaries) collectively.
2.4 Accounting Terms. Unless the context otherwise
requires, accounting terms herein that are not defined herein
shall be calculated under GAAP. All financial measurements
contemplated hereunder respecting Borrower, including the
calculations contemplated under Sections 4.5, 5 and 17, shall be
made and calculated for Borrower and all of its presently
existing or future acquired, organized or created Subsidiaries,
unless otherwise expressly provided otherwise herein, on a
consolidated basis in accordance with GAAP, and shall be so made
or calculated based on the Financial Statements no earlier than
the delivery thereof as required hereunder.
2.5 Meaning of Satisfactory. Wherever herein a
document or matter is required to be satisfactory to Lender,
unless expressly stated otherwise such document must be
satisfactory to Lender in both form and substance, and unless
expressly stated otherwise, Lender shall have the discretion to
determine whether the document or matter is satisfactory, but
such determination must be commercially reasonable under the
circumstances. Any such determination that is based upon
customary banking practice or regulatory requirements shall be
conclusively deemed to be commercially reasonable.
2.6 Computation of Time Periods. In the computation
of periods of time from a specified date to a later specified
date, the word from shall mean from and including and the words
to and until shall each mean to but excluding. Periods of days
referred to in this Agreement shall be counted in calendar days
unless Business Days are expressly prescribed, and references in
this Agreement to months and years shall be to calendar months
and calendar years unless otherwise specified.
2.7 General. Unless the context of this Agreement
clearly requires otherwise: (i) references to the plural include
the singular and vice versa; (ii) references to any Person
include such Person's successors and assigns but, if applicable,
only if such successors and assigns are permitted by this
Agreement; (iii) references to one gender include all genders;
(iv) including is not limiting; (v) or" has the inclusive meaning
represented by the phrase "and/or"; (vi) the words hereof,
herein, hereby, hereunder and similar terms in this Agreement
refer to this Agreement as a whole, including its Exhibits, and
not to any particular provision of this Agreement; (vii) the word
Section or section and Page or page refer to a section or page,
respectively, and the word Exhibit refers to an Exhibit to this
Agreement unless it expressly refers to something else; (viii)
reference to any agreement (including this Agreement), document
or instrument means such agreement, document or instrument as
amended or modified and in effect from time to time in accordance
with the terms thereof and, if applicable, the terms hereof; and
(ix) general and specific references to any Law means such Law as
amended, modified, codified or reenacted, in whole or in part,
and in effect from time to time. Section captions and the Table
of Contents are for convenience only and shall not affect the
interpretation or construction of this Agreement or the other
Loan Documents.
3. Lender's Commitments. Subject to the terms and
conditions hereof, and in reliance upon the representations and
warranties of Borrower herein, and the representations and
warranties of Guarantors in their respective Guaranties, Lender
makes the following commitments to Borrower:
3.1 Revolving Commitment.
3.1.1 Revolving Advances. Lender will make
available from the Effective Date to the Maturity Date, a
Revolving Commitment of $20,000,000, or such lesser Dollar amount
to which it may have been changed as provided herein, available
as Revolving Advances made from time to time as provided herein.
Subject to any limitations herein, payments and prepayments that
are applied to reduce the Revolving Loan may be reborrowed.
Borrower may reduce the amount of the Revolving Commitment in
whole multiples of $1,000,000 at any time and from time to time,
or to zero at any time, but only if (i) Borrower gives Lender
written notice of Borrower's intention to make such reduction at
least one Business Day prior to the effective date of the
reduction, (ii) Borrower makes a prepayment on the Revolving Loan
in the amount (if any) by which the sum of the Revolving Loan and
the Letter of Credit Exposure exceeds the amount of the Revolving
Commitment, and (iii) Borrower pays any amount that is due to
Lender under Section 4.12 as a consequence of reduction. Any
such reduction of the amount of the Revolving Commitment, whether
scheduled or voluntary, shall be permanent. No Revolving Advance
will be made on or after the Maturity Date. At any time that
there is an Existing Default, the Revolving Commitment may be
canceled as provided in Section 18.2.1.
3.1.2 Revolving Note. The obligation of
Borrower to repay Lender's Revolving Loan shall be evidenced by
a promissory note payable to the order of Lender in a maximum
principal amount equal to the amount of the Revolving Commitment
in the form attached hereto as Exhibit 3.1.2, dated the Effective
Date.
3.2 Letter of Credit Commitment. Lender commits to
issue standby letters of credit and commercial letters of credit
for the account of Borrower or any of its Subsidiaries (other
than Exempted Subsidiaries) from time to time from the Effective
Date to the Maturity Date, but only in connection with
transactions satisfactory to Lender and only if the Letter of
Credit Exposure will not as a result of such issuance exceed the
lesser of (i) $5,000,000 and (ii) any excess of the amount of the
Revolving Commitment over the Revolving Loan. The expiration
date of any Letter of Credit will not be more than one year after
its issuance date. The expiration date of any Letter of Credit
also will not be later than the Maturity Date unless Borrower
provides cash collateral satisfactory to Lender to cover the
Letter of Credit Exposure subsequent to the Maturity Date.
4. Interest; Yield Protection.
4.1 Interest on Draws on Letters of Credit. Borrower
shall pay interest on the unreimbursed amount of each draw on a
Letter of Credit at the Prime Rate.
4.2 Alternative Rates and Interest Periods for
Tranches of Revolving Loan. The Revolving Loan may have one
Tranche or multiple Tranches as provided herein and each Tranche
shall bear interest at either the Prime Rate or the Adjusted LIBO
Rate as designated by Borrower as provided herein, provided that
no LIBOR Tranche may be less than $100,000 and there may be no
more than ten different LIBOR Tranches at any one time. If
Borrower designates a Tranche to be a LIBOR Tranche, Borrower
shall also select an Interest Period for it. The Interest Period
shall be either one, two, three, four or six months; provided
that (i) if any Interest Period would otherwise expire on a day
of a calendar month which is not a Business Day, then such
Interest Period shall expire on the next succeeding Business Day
in that calendar month unless the next succeeding Business Day
would be in the following calendar month, in which case it shall
expire on the first preceding Business Day; (ii) any Interest
Period that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall
end on the last Business Day of a calendar month; (iii) no
Interest Period shall extend beyond the Maturity Date. If a
Tranche is a LIBOR Tranche, it shall bear interest at the
Adjusted LIBO Rate throughout the applicable Interest Period
designated by Borrower as provided herein.
4.3 Prime Rate. The "Prime Rate" shall be the per
annum rate of interest established from time to time by Lender as
its prime rate. Any change in the Prime Rate shall be effective
with respect to each Prime Rate Tranche for the entire day on
which such Prime Rate change is designated by Lender to be
effective. The Prime Rate is a reference rate and does not
necessarily represent the lowest or best rate charged to any
customer of Lender.
4.4 Adjusted LIBO Rate. The "Adjusted LIBO Rate" for
any LIBOR Tranche shall be the LIBO Rate (which shall be
determined before the beginning of the Interest Period for such
Tranche as provided herein and shall apply throughout such
Interest Period) plus the LIBOR Increment determined from time to
time with respect to such Tranche as provided in Section 4.5.
The "LIBO Rate" shall be the interest rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the
quotient of
(i) the rate (rounded upwards, if necessary, to the
nearest 1/100 of 1%) at which Dollar deposits in
immediately available funds, approximately equal in
amount to such Tranche and for a maturity equal to the
applicable Interest Period, are offered or available in
the London Interbank Market for Eurodollars as of 11:00
a.m. (London time) two Business Days before the first day
of such Interest Period as reported on Dow Xxxxx Markets
Page 3750 (or any successor page), or if such page is not
available, as appearing on Reuters Screen LIBO Page;
provided, however, if more than one rate is specified on
Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates (rounded upwards,
if necessary, to the nearest 1/100 of 1%);
divided by
(ii) a number equal to one minus the decimal equivalent
of the maximum rate at which reserves (including, without
limitation, any marginal, special, supplemental, or
emergency reserves) are required to be maintained under
regulations issued from time to time by the Board of
Governors of the Federal Reserve System (or any
successor) by member banks of the Federal Reserve System
against "Eurocurrency liabilities" (as such term is used
in Regulation D); provided, however, that without
limiting the effect of the foregoing, such maximum rate
shall reflect any other reserves required to be
maintained by such member banks with respect to (i) any
category of liabilities which includes deposits by
reference to which the LIBO Rate is to be determined, or
(ii) any category of extensions of credit or other assets
which include a LIBOR Tranche. The Adjusted LIBO Rate
shall be adjusted automatically on and as of the
effective date of any change in such reserve requirement.
4.5 LIBOR Increment. The applicable LIBOR Increment
shall be determined on the Effective Date and quarterly
thereafter in accordance with the following table and based upon
both the ratio of Borrower's Funded Debt to EBITDA and the ratio
of Borrower's Funded Debt to Total Capitalization, with Funded
Debt and Total Capitalization being determined as of the end of
each fiscal quarter of Borrower and EBITDA being determined for
the four fiscal quarters then ended:
Ratio of Funded Debt to EBITDA
Ratio of Funded Debt to >3.0 <3.0>2.0 <2.0
Total Capitalization
>0.65 1.50% 1.25% 1.00% LIBOR Increment
<0.65>0.50 1.25% 1.00% 0.75% LIBOR Increment
<0.50 1.00% 0.75% 0.50% LIBOR Increment
The initial LIBOR Increment shall be determined based on
Borrower's Funded Debt and Total Capitalization as of the end of
Borrower's fiscal quarter ended June 30, 1997, and Borrower's
EBITDA for the four quarters then ended. Any change in the LIBOR
Increment shall become applicable, in the case of the first three
fiscal quarters of any fiscal year, on the 50th day, and in the
case of the fourth fiscal quarter of any fiscal year, on the
105th day of the first fiscal quarter beginning after the end of
the fiscal period covered by the most recent Financial Statements
required to be delivered to Lender as provided in Sections
15.12.1 or 15.12.2, as the case may be. If Borrower does not
deliver its Financial Statements for a fiscal period to Lender
before the 50th day, in the case of the first three fiscal
quarters of any fiscal year, and before the 105th day, in the
case of the fourth fiscal quarter of any fiscal year, of the
first fiscal quarter beginning thereafter, the highest possible
LIBOR Increment shall become applicable on the 50th day or 105th
day, respectively, of such subsequent fiscal quarter and shall
remain applicable until, but only until, Borrower delivers such
Financial Statements to Lender. As used in the foregoing table,
the symbol ">" means "equal to or greater than" and the symbol
"<" means "less than".
4.6 Conversion of Revolving Loan. Borrower may
(i) at any time convert some or all of a Prime Rate Tranche to a
LIBOR Tranche, or (ii) at the end of any Interest Period of a
LIBOR Tranche, continue some or all of such LIBOR Tranche as a
LIBOR Tranche for an additional Interest Period or convert some
or all of such LIBOR Tranche to a Prime Rate Tranche, and the
amount so converted or continued shall constitute a separate
Tranche, but if such Tranche is a LIBOR Tranche, it may not be
less than the lesser of the amount of the Revolving Loan or
$100,000. To cause any conversion or continuation, Borrower
shall give Lender, prior to 11:00 a.m., St. Louis time, two (2)
Business Days prior to the date the conversion or continuation is
to be effective (the "Conversion Date"), a written request (which
may be mailed, personally delivered or telecopied as provided in
Section 20.1) (a "Notice of Conversion/Continuation")
(i) specifying whether a conversion or continuation is requested
and the amount thereof, (ii) in the case of a conversion,
specifying whether the applicable Tranche is to be a LIBOR
Tranche or Prime Rate Tranche upon the conversion, and (iii) in
the case of conversion to or continuation of a LIBOR Tranche,
specifying the Interest Period therefor. If a Notice of
Conversion/Continuation is not made by 11:00 a.m. St. Louis time
on the second Business Day preceding the last day of the Interest
Period if the Tranche is a LIBOR Tranche, then Borrower shall be
deemed to have timely given a Notice of Conversion/Continuation
to Lender requesting to convert the Tranche to an Prime Rate
Tranche. If the Revolving Loan is a LIBOR Tranche, any
conversion or continuation shall become effective only on the day
following the last day of the current Interest Period.
4.7 Time of Accrual. Interest shall accrue on all
principal amounts outstanding from the date when first
outstanding to the date when no longer outstanding. Amounts
shall be deemed outstanding until payments are applied thereto as
provided herein.
4.8 Computation. Interest shall be computed for the
actual days elapsed over a year deemed to consist of 360 days.
4.9 Rate After Maturity. Borrower shall pay interest
on the Revolving Loan after its Maturity, and (at the option of
Lender) on the Revolving Loan and on the other Loan Obligations
after the occurrence of an Event of Default, at a rate per annum
of 2% plus the Prime Rate.
4.10 Taxes on Payments. If any Tax is required to be
withheld or deducted by Borrower from, or is otherwise payable by
Borrower in connection with, any payment due from Borrower to
Lender under the Loan Documents, Borrower (i) shall, if required,
withhold or deduct the amount of such Tax from such payment and,
in any case, pay such Tax to the appropriate taxing authority in
accordance with applicable Law and (ii) shall pay to Lender, as
applicable, (a) such additional amounts as may be necessary so
that the net amount received by Lender with respect to such
payment, after withholding or deducting all Taxes required to be
withheld or deducted, is equal to the full amount payable under
the Loan Documents, and (b) an amount equal to all Taxes payable
by Lender as a result of payments made by Borrower (whether to a
taxing authority or to Lender) pursuant to this Section. If any
Tax is withheld or deducted from, or is otherwise payable by
Borrower in connection with, any payment due to Lender under the
Loan Documents, Borrower shall, within 30 days after the date of
such payment, furnish to Lender, as applicable, the original or
a certified copy of a receipt for such Tax from the applicable
taxing authority. If any payment due to Lender under the Loan
Documents is or is expected to be made without withholding or
deducting therefrom, or otherwise paying in connection therewith,
any Tax payable to any taxing authority under circumstances that
would lead Lender to reasonably believe such withholding or
deduction is required, Borrower shall, within 30 days after any
request from Lender, as applicable, furnish to Lender a
certificate from such taxing authority, or an opinion of counsel
satisfactory to Lender, in either case stating that no Tax
payable to such taxing authority was or is, as the case may be,
required to be withheld or deducted from, or otherwise paid by
Borrower in connection with, such payment. For purposes of this
Section only, the term "Tax" shall not be deemed to include any
tax based upon net income, such as but not limited to the tax on
net income imposed under the Code and similar state or
international income taxes.
4.11 Compensation for Increase In Costs of LIBOR
Tranches. If after the Execution Date there is any change in any
Law or in any rule, order, or guideline of any Governmental
Authority (whether or not having the force of law and whether or
not failure to comply therewith would be unlawful, and including
but not limited to any imposition or increase of reserve
requirements) and as a result thereof or as a result of
compliance therewith by Lender or its parent holding company:
4.11.1 Lender is subject to any Tax, duty or
other charge with respect to a LIBOR Tranche, or the basis of
taxation of payments to Lender of the principal of or interest
with respect to such Tranche, or its obligation to make any
Revolving Advance that could be a LIBOR Tranche, change (except
for changes in the rate of Tax on the overall net income of
Lender imposed by the United States or other jurisdiction in
which Lender's principal executive office is located); or
4.11.2 any reserve (including, without
limitation, any imposed by the FRB), special deposit, compulsory
loan, assessment, or similar requirement against assets of,
deposits with or for the account of, or credit extended by,
Lender is imposed or deemed applicable or any other condition
affecting a LIBOR Revolving Loan is imposed on Lender or the
London Interbank Market;
and as a result thereof there is any increase in the cost to
Lender of agreeing to maintain a LIBOR Tranche (except to the
extent already included in the determination of the applicable
LIBO Rate), or there is a reduction in the amount received or
receivable by Lender, then Borrower shall from time to time pay
to Lender additional amounts sufficient to compensate Lender in
the amount of such increased cost. If Lender claims compensation
under this Section, Lender shall furnish a certificate to
Borrower that states in reasonable detail the additional amount
or amounts to be paid to it hereunder and the basis therefor.
Borrower shall have the burden of proving that any such
certificate is not correct.
4.12 Losses on LIBOR Tranches. Borrower shall pay to
Lender upon demand an amount sufficient to compensate Lender for
all loss and expense suffered by Lender, including but not
limited to loss of profit and the cost of acquiring funds to
carry a LIBOR Tranche, (i) if any prepayment or repayment with
respect to such LIBOR Tranche or conversion of such LIBOR Tranche
to an Prime Rate Tranche, whether or not required hereby, occurs
on a date which is not the last day of the applicable Interest
Period, or (ii) if Borrower fails to repay such LIBOR Tranche
when required by the terms of this Agreement. The minimum that
Borrower shall be obligated to pay to Lender in any such event
shall be an amount equal to (x) the greater of zero or
[Ax(B-C)xD]
-----------
360
wherein
A is the Affected Principal Amount;
B is the decimal equivalent of the LIBO Rate that is
payable by Borrower with respect to such LIBOR Tranche;
C is the decimal equivalent of the LIBO Rate determined
as provided in Section 4.4 that would apply to a
hypothetical LIBOR Tranche created on the last Business
Day on or before the first day of the Remaining Interest
Period and whose amount and whose Interest Period were
approximately equal, as determined by Lender, to the
Affected Principal Amount and the Remaining Interest
Period; and
D is the number of days from and including the first day
of the Remaining Interest Period to but excluding the
last day of the Remaining Interest Period;
plus (y) any other out-of-pocket loss or expense (including any
internal processing charge customarily charged by Lender)
suffered by Lender in liquidating deposits prior to maturity in
amounts which correspond to the Affected Principal Amount.
For purposes of this Section:
"Affected Principal Amount" means, as applicable, (i) the
entire principal amount of the applicable LIBOR Tranche
that Borrower fails to repay when required by the terms
of this Agreement, or (ii) the amount of any prepayment
or repayment with respect to such LIBOR Tranche that
occurs, or the entire amount of such LIBOR Tranche if it
converts to an Prime Rate Tranche, whether or not
required hereby, on a date which is not the last day of
the Interest Period therefor.
"Remaining Interest Period" means, as applicable, (i) a
period equal in duration to the Interest Period of such
LIBOR Tranche if Borrower has failed to repay it when
required by the terms of this Agreement, or (ii) if a
prepayment or repayment with respect to such LIBOR
Tranche, or such LIBOR Tranche converts to an Prime Rate
Tranche, whether or not required hereby, prior to the
last day of the Interest Period therefor, the period from
and including the date thereof to but excluding the last
day of such Interest Period.
If Lender claims compensation under this Section, Lender will
furnish a certificate to Borrower that states in reasonable
detail the additional amount to be paid to it hereunder and
includes a description of the method used by Lender in
calculating such amount. Borrower will have the burden of
proving that the amount of any such additional compensation
calculated by Lender is not correct. Any compensation payable by
Borrower to Lender under this Section will be payable without
regard to whether Lender has funded the applicable Tranche
through the purchase of deposits in an amount or of a maturity
corresponding to the deposits used as a reference in determining
the LIBO Rate under Section 4.4.
5. Commitment Fee. Borrower shall pay to Lender a
"Commitment Fee" calculated by applying the daily equivalent
(calculated as if a year consisted of 360 days) of the Commitment
Fee Rate to the Unused Revolving Commitment on each day during
the period from the Effective Date to the Maturity Date. The
"Unused Revolving Commitment" on any day shall be the amount of
the Revolving Commitment minus the sum of the Revolving Loan and
the Letter of Credit Exposure. The "Commitment Fee Rate" shall
be an annual rate of 0.25% if the ratio of Borrower's Funded Debt
to EBITDA is greater than or equal to 3.0 to 1.0, or 0.1875% if
the ratio of Borrower's Funded Debt to EBITDA is less than 3.0 to
1.0. Funded Debt and EBITDA and any change in the Commitment Fee
Rate shall be determined and become effective as provided in
Section 4.5. The Commitment Fee shall be payable quarterly in
arrears, commencing on the first day of the first calendar
quarter beginning after the Effective Date and continuing on the
first day of each calendar quarter thereafter and on the Maturity
Date.
6. Scheduled Payments.
6.1 Maturity Date. Borrower shall repay the
Revolving Loan and all unpaid accrued interest thereon on
September 1, 2000. The foregoing notwithstanding, the amount of
each Revolving Advance that is used for funding of amounts
payable by Borrower in connection with any particular Permitted
Acquisition shall be repaid six months after the date of the
first Revolving Advance used for such funding (an "Interim
Repayment"), together with all unpaid accrued interest on such
amount. Any such Interim Repayment will be applied by Lender
first to reduce any outstanding Prime Rate Tranche used for
funding such Permitted Acquisition and then to reduce any
outstanding LIBOR Tranches used for funding such Permitted
Acquisition in the order of the maturities of their Interest
Periods, and Borrower shall pay any amount that is due under
Section 4.12 as a consequence of the reduction of such LIBOR
Tranches.
6.2 Interest Payments Before Maturity Date. While a
Tranche is an Prime Rate Tranche, Borrower shall pay interest
accrued thereon monthly in arrears, commencing on the first day
of the first calendar month beginning after the Effective Date,
and continuing on the first day of each calendar month thereafter
until the Maturity Date. While a Tranche is a LIBOR Tranche,
Borrower shall, until the Maturity Date, pay interest accrued
thereon in arrears at the end of the applicable Interest Period,
and in addition, if the Interest Period is longer than three
months, quarterly on the last Business Day of each calendar
quarter ended during such Interest Period.
7. Voluntary Prepayments. Borrower may wholly prepay the
Revolving Loan at any time and may make partial prepayments
thereon from time to time, without penalty or premium, but only
if (i) Borrower gives Lender written notice (which may be mailed,
personally delivered or telecopied as provided in Section 20.1)
of Borrower's intention to make such prepayment at least one
Business Day prior to tendering the prepayment, (ii) the total
amount of the prepayment is a whole multiple of $500,000,
(iii) Borrower pays any accrued interest on the amount prepaid at
the time of such prepayment, and (iv) Borrower pay any amount
that is due under Section 4.12 as a consequence of such
prepayment. Each such prepayment on the Revolving Loan will be
applied by Lender first to reduce any outstanding Prime Rate
Tranche and then to reduce any outstanding LIBOR Tranches in the
order of the maturities of their Interest Periods.
8. Manner of Payments and Timing of Application of Payments.
8.1 Payment Requirement. Unless expressly provided
to the contrary elsewhere herein, Borrower shall make each
payment on the Loan Obligations to Lender as required under the
Loan Documents at the Lending Office. All such payments shall be
made in Dollars on the date when due, without deduction, set-off
or counterclaim.
8.2 Application of Payments and Proceeds. All
payments received by Lender in immediately available funds at or
before 12:00 noon, St. Louis time, on a Business Day will be
applied to the relevant Loan Obligation on the same day. Such
payments received on a day that is not a Business Day or after
12:00 noon on a Business Day will be applied to the relevant Loan
Obligation on the next Business Day.
8.3 Returned Instruments. If a payment is made by
check, draft or other instrument and the check, draft or other
instrument is returned unpaid, the application of the payment to
the Loan Obligations will be reversed and will be treated as
never having been made.
8.4 Compelled Return of Payments or Proceeds. If
Lender is for any reason compelled to surrender any payment
because such payment is for any reason invalidated, declared
fraudulent, set aside, or determined to be void or voidable as a
preference, an impermissible setoff, or a diversion of trust
funds, then this Agreement, the Guaranty and the Loan Obligations
to which such payment was applied or intended to be applied shall
be revived with respect thereto as if such application was never
made; and Borrower shall be liable to pay to Lender, and shall
indemnify Lender for and hold Lender harmless from any loss with
respect to, the amount of such payment surrendered. This Section
shall be effective notwithstanding any contrary action Lender may
take in reliance upon its receipt of any such payment. Any such
contrary action so taken by Lender shall be without prejudice to
Lender's rights under this Agreement and shall be deemed to have
been conditioned upon the application of such payment having
become final and indefeasible. The provisions of this Section
shall survive termination of the Commitment, the expiration of
the Letters of Credit and the payment and satisfaction of all of
the Loan Obligations.
8.5 Due Dates Not on Business Days. If any payment
required hereunder becomes due on a date that is not a Business
Day, then such due date shall be deemed automatically extended to
the next Business Day; provided, however, that if the next
Business Day would be in the next calendar month, such payment
shall instead be due on the immediately preceding Business Day.
9. Procedure for Obtaining Revolving Advances and Letters of
Credit.
9.1 Revolving Advances. Borrower may request a
Revolving Advance by submitting a request therefor to Lender.
Every request for a Revolving Advance shall specify a date when
the Revolving Advance is requested to be made (the "Revolving
Advance Date") and shall be irrevocable. A request for a
Revolving Advance received by Lender on a day that is not a
Business Day or that is received by Lender after 11:00 a.m.
(St. Louis time) on a Business Day shall be treated as having
been received by Lender at 11:00 a.m. (St. Louis time) on the
next Business Day. Provided that all conditions precedent herein
to a requested Revolving Advance have been satisfied, Lender will
make the amount of such requested Revolving Advance available to
Borrower on the applicable Revolving Advance Date in immediately
available funds in Dollars at the Lending Office. Such funds
will be deposited in an account of Borrower's at the Lending
Office unless Borrower gives Lender contrary specific
disbursement instructions satisfactory to Lender.
9.2 Lender's Right to Make Other Revolving Advances.
If Borrower has at any time not paid a Loan Obligation when it is
due and any grace period for payment thereof has elapsed, Lender
shall have the right to make a Revolving Advance to pay such Loan
Obligation. Lender will give notice to Borrower after any such
Revolving Advance is made. Any such Revolving Advance will be an
Prime Rate Tranche.
9.3 Letters of Credit. Borrower may request the
issuance of a Letter of Credit by submitting an issuance request
to Lender and executing the reimbursement agreement required
under Section 12.1 no less than five Business Days prior to the
requested issue date for such Letter of Credit. If all
conditions herein to issuance of such Letter of Credit have been
satisfied, Lender will issue such Letter of Credit on the
requested issue date.
9.4 Amount, Number, and Purpose Restrictions on
Revolving Advances. No Revolving Advance will be made unless it
is a whole multiple of $10,000 and not less than $100,000, but if
a Revolving Advance will be a LIBOR Tranche, it shall not be less
than $100,000. On any one day, no more than one Revolving
Advance will be made. Revolving Advances will only be made for
the purposes permitted in Section 15.1.
9.5 Each Request for a Revolving Advance a
Certification. Each submittal by Borrower of a request for a
Revolving Advance shall constitute a certification by Borrower
that (i) there is no Existing Default, (ii) all representations
and warranties of Borrower in this Agreement and each Guarantor
in its Guaranty are then true, with such exceptions as have been
disclosed to Lender in writing by Borrower or such Guarantor, and
will be true on the Revolving Advance Date, as if then made, with
such exceptions as have been disclosed to Lender in writing by
Borrower or such Guarantor, except that with respect to the
representations and warranties made regarding Financial
Statements or financial data, such representations and warranties
shall be deemed made with respect to the most recent Financial
Statements and other financial data delivered by Borrower or such
Guarantor to Lender, and (iii) all conditions herein and in the
other Loan Documents to the making of the requested Revolving
Advance have been satisfied.
9.6 Requirements for Every Request for an Revolving
Advance. A request to Lender for an Revolving Advance may be
oral or in writing, shall be from a Borrowing Officer, and shall
specify the amount of the Revolving Advance to be made, the
Revolving Advance Date, whether the Revolving Advance will be
used to fund payment of amounts payable by Borrower with respect
to a Permitted Acquisition, which portion, if any, of the
Revolving Advance is to be an Prime Rate Tranche and, if any,
each portion of the Revolving Advance that is to be a separate
LIBOR Tranche and the Interest Period therefor. If a request for
an Revolving Advance does not fully meet the foregoing
requirements, Lender may reject it and not treat it as a request
for a Revolving Advance.
9.7 Requirements for Every Request for Issuance of a
Letter of Credit. Only a written request (which may be mailed,
personally delivered or telecopied as provided in Section 20.1)
from a Borrowing Officer to Lender that specifies the amount,
requested issue date (which shall be a Business Day and in no
event later than 180 days before the Maturity Date) and
beneficiary of the requested Letter of Credit and other
information necessary for its issuance shall be treated as an
issuance request for purposes hereof.
9.8 Exoneration of Lender. Lender shall not incur
any liability to Borrower for treating a request that meets the
express requirements of Section 9.6 or Section 9.7 as a request
for an Revolving Advance or a request for issuance of a Letter of
Credit Request, as applicable, if Lender believes in good faith
that the Person making the request is a Borrowing Officer.
Lender shall not incur any liability to Borrower for failing to
treat any such request as a request for and Revolving Advance or
a request for issuance of a Letter of Credit, as applicable, if
Lender believes in good faith that the Person making the request
is not a Borrowing Officer.
10. Security and Guaranties. As security for payment and
performance of the Loan Obligations, Borrower shall cause to be
executed and delivered to Lender the unconditional, joint and
several guaranty of the Loan Obligations, in the form attached
hereto as Exhibit 10-A, by every Subsidiary of Borrower listed on
Exhibit 10-B hereto. If any fiscal year end balance sheet and
income statements of any Subsidiary of Borrower organized under
the laws of the United States or a state of the United States
existing on the Execution Date (other than an Exempted Subsidiary
or a domesticated foreign Subsidiary) that is not listed on
Exhibit 10-B reflects that the assets (excluding all intercompany
items) of such Subsidiary total $1,000,000 or more as of the end
of such fiscal year, or the revenues (excluding all intercompany
items) of such Subsidiary were $1,000,000 or more in such fiscal
year, then Borrower shall cause such Subsidiary to become a
Guarantor by executing and delivering to Lender no later than
90 days after the end of the relevant fiscal year a joinder to
the Guaranty satisfactory to Lender. If the assets (excluding
all intercompany items) of any Subsidiary of Borrower organized
under the laws of the United States or a state of the United
States, other than a domesticated foreign subsidiary, created or
acquired after the Execution Date total $1,000,000 based on its
balance sheet as of the date of its creation or acquisition or
the end of any fiscal quarter ended thereafter in the then
current fiscal year, or as of the end of any fiscal year ended
thereafter, or if the revenues (excluding all intercompany items)
of such a Subsidiary were $1,000,000 or more as reflected in its
income statements for its latest fiscal year ended before such
acquisition or any four consecutive fiscal quarters ended after
its creation or acquisition and in its then current fiscal year,
or for any fiscal year ended thereafter, then Borrower shall
cause such Subsidiary to become a Guarantor by executing and
delivering to Lender no later than 90 days after the end of the
relevant fiscal period a joinder to the Guaranty satisfactory to
Lender. If Borrower at any time transfers any of its assets to
a Subsidiary organized under the laws of the United States or a
state of the United states, other than a domesticated foreign
subsidiary, and as a consequence the assets of such Subsidiary
(excluding all intercompany items) total $1,000,000 or more as of
the date of such transfer or the end of its first fiscal quarter
ended thereafter, then Borrower shall cause such Subsidiary, if
not then a Guarantor, to become a Guarantor by executing and
delivering to Lender no later than 90 days after such transfer or
fiscal quarter-end a joinder to the Guaranty satisfactory to
Lender. Each and every obligation to deliver the Guaranty, or
join any Guarantor thereto, contained under this Section 10,
shall be subject to the prior or contemporaneous execution and
delivery by Lender of such agreements as are contemplated by
Section 9.8(e) of the Note Purchase Agreement. Upon Final
Payment, Lender will release the Guaranty, subject to
reinstatement as contemplated in Section 8.4.
11. Conditions.
11.1 Conditions to Initial Revolving Advance. Lender
will have no obligation to fund the initial Revolving Advance
unless:
11.1.1 Listed Documents and Other Items. Lender
shall have received on or before the Effective Date all of the
documents and other items listed or described in Exhibit 11.1.1
hereto as being conditions to the initial Revolving Advances,
with each being satisfactory to Lender and (as applicable) duly
executed and (also as applicable) sealed, attested, acknowledged,
certified, or authenticated.
11.1.2. Representations and Warranties. The
representations and warranties contained herein (except the
representations and warranties in Section 13.18 and as expressly
otherwise contemplated herein) shall be true and correct in all
material respects as of the time of such Revolving Advance and
with the same force and effect as if made at such time with such
exceptions as are satisfactory to Lender (and acknowledged by
Lender in writing) and have been previously disclosed to Lender
in writing by Borrower, and except that representations and
warranties made regarding financial data in Section 13.11 such
representations and warranties shall be deemed made with respect
to the most recent Financial Statements delivered by Borrower to
Lender.
11.1.3 No Existing Default. There shall be no
Existing Default and no Default or Event of Default will occur as
a result of the making of the Revolving Advance or Borrower's use
of the proceeds thereof.
11.1.4 Payment of Fees. Borrower shall have paid
and reimbursed to Lender all fees, costs and expenses that are
payable or reimbursable to Lender hereunder on or before the date
of the Revolving Advance.
11.1.5 No Material Adverse Change. There shall
not have been any change since the date of the Initial Financial
Statements which has had or is reasonably likely to have a
Material Adverse Effect.
11.1.6 Other Items. Lender shall have received
on or before the Effective Date such other consents and approvals
required to be obtained by Borrower and an opinion of counsel
meeting the requirements in the specification for the opinion of
counsel attached to Exhibit 11.1.1.
11.2 Conditions to Subsequent Revolving Advances.
Lender will have no obligation to fund any Revolving Advance
after the initial Revolving Advance unless:
11.2.1 Conditions to Initial Revolving Advances.
All of the conditions in Section 11.1 except the condition stated
in Section 11.1.2., have been and remain satisfied.
11.2.2 Representations and Warranties. The
representations and warranties contained herein (except the
representations and warranties in Section 13.18 and as expressly
otherwise contemplated herein) shall be true and correct in all
material respects as of the time of such Revolving Advance and
with the same force and effect as if made at such time, with such
exceptions as are satisfactory to Lender (as acknowledged by
Lender in writing) and have been previously disclosed to Lender
in writing by Borrower, and except that with respect to the
representations and warranties made regarding financial data in
Section 13.11, such representations and warranties shall be
deemed made with respect to the most recent Financial Statements
delivered by Borrower to Lender.
11.2.3 No Default. There shall be no Existing
Default and no Default or Event of Default will occur as a result
of the making of the Revolving Advance or Borrower's use of the
proceeds thereof.
11.2.4 No Material Adverse Change. Since the
date of the most recent prior Revolving Advance or issuance of a
Letter of Credit there shall not have been any change which has
had or is reasonably likely to have a Material Adverse Effect.
12. Conditions to Issuance of Letters of Credit. No Letter
of Credit will be issued unless as of the time of such issuance:
12.1 Reimbursement Agreement. Borrower shall have
executed and delivered to Lender an agreement, in Lender's
customary form, under which Borrower undertakes to reimburse to
Lender on demand the amount of each draw on such Letter of
Credit, together with interest from the date of the draw at the
same rate as is then accruing on the Revolving Loan. In the case
of any conflict between such agreement and this Agreement, this
Agreement shall be controlling.
12.2 No Prohibitions. No order, judgment or decree of
any Governmental Authority shall exist which purports by its
terms to enjoin or restrain Lender from issuing such Letter of
Credit, and no Law or request or directive (whether or not having
the force of law) from any Governmental Authority with
jurisdiction over Lender shall exist which prohibits, or requests
that Lender refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular, or imposes upon
Lender with respect to such Letter of Credit any restriction or
reserve or capital requirement (for which Lender is not otherwise
compensable by Borrower hereunder).
12.3 Conditions to Initial Revolving Advances. All of
the conditions in Section 11.1 have been and remain satisfied.
12.4 Representations and Warranties. The
representations and warranties contained herein (except the
representations and warranties in Section 13.18 and as expressly
otherwise contemplated herein) shall be true and correct in all
material respects as of the time of issuance of such Letter of
Credit and with the same force and effect as if made at such
time, with such exceptions (but only in the case of a Letter of
Credit whose issuance is requested after the date hereof as are
satisfactory to Lender (as acknowledged by Lender in writing) and
have been previously disclosed to Lender in writing by Borrower,
and except that with respect to the representations and
warranties made regarding financial data in Section 13.11, such
representations and warranties shall be deemed made with respect
to the most recent Financial Statements delivered by Borrower to
Lender.
12.5. No Default. There shall be no Existing Default
and no Default or Event of Default will occur as a result of the
issuance of the Letter of Credit or Borrower's use thereof.
12.6. No Material Adverse Change. Since the date of
the most recent prior Revolving Advance or issuance of a Letter
of Credit, if any, there shall not have been any change which has
had or is reasonably likely to have a Material Adverse Effect.
13. Representations and Warranties. Except as otherwise
described in the disclosure schedule that is attached hereto as
Exhibit 13 (the "Disclosure Schedule"), Borrower represents and
warrants to Lender as follows:
13.1 Organization and Existence. Each Covered Person
is duly organized and existing in good standing under the laws of
the state of its organization, is duly qualified to do business
and is in good standing in every state where the nature or extent
of its business or properties require it to be qualified to do
business, except where the failure to so qualify will not have a
Material Adverse Effect. Each Covered Person has the power and
authority to own its properties and carry on its business as now
being conducted.
13.2 Authorization. Each Covered Person is duly
authorized to execute and perform every Loan Document to which
such Covered Person is a party, and Borrower is duly authorized
to borrow hereunder, and the Loan Documents to which it is a
party have been duly authorized by all requisite corporate (or,
if not a corporation, comparable) action of each Covered Person.
No consent, approval or authorization of, or declaration or
filing with, any Governmental Authority, and no consent of any
other Person, is required in connection with Borrower's
execution, delivery or performance of this Agreement and the
other Loan Documents, except for those already duly obtained or
explicitly contemplated hereunder.
13.3 Due Execution. Every Loan Document to which a
Covered Person is a party has been executed on behalf of such
Covered Person by a legally competent Person duly authorized to
do so.
13.4 Enforceability of Obligations. Each of the Loan
Documents to which a Covered Person is a party constitutes the
legal, valid and binding obligation of such Covered Person,
enforceable against such Covered Person in accordance with its
terms, except to the extent that the enforceability thereof
against such Covered Person may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally or by equitable principles of general
application.
13.5 Burdensome Obligations. No Covered Person is a
party to or bound by any Contract or is subject to any provision
in the Charter Documents of such Covered Person which would, if
performed by such Covered Person, result in a Default or Event of
Default either immediately or upon the elapsing of time.
13.6 Legal Restraints. The execution of any Loan
Document by a Covered Person will not violate or constitute a
default under the Charter Documents of such Covered Person, any
Material Agreement of such Covered Person, or any Material Law,
and will not, except as expressly contemplated or permitted in
this Agreement, result in any Security Interest being imposed on
any of such Covered Person's property. The performance by any
Covered Person of its obligations under any Loan Document to
which it is a party will not violate or constitute a default
under the Charter Documents of such Covered Person, any Material
Agreement of such Covered Person, or any Material Law, and will
not, except as expressly contemplated or permitted in this
Agreement, result in any Security Interest being imposed on any
of such Covered Person's property.
13.7 Labor Disputes. There is no pending or, to
Borrower's knowledge, threatened, strike, work stoppage, material
unfair labor practice claim or other material labor dispute
against or affecting any Covered Person or its employees, which
is reasonably likely to have a Material Adverse Effect.
13.8 No Material Proceedings. There are no Material
Proceedings pending or, to the best knowledge of Borrower,
threatened, other than as described in item 13.8 of the
Disclosure Schedule or in Item 3 of Borrower's 1996 Form 10-K or
in Item 1 of Part II of Borrower's 1997 Form 10-Qs, copies of
which have been furnished to Lender.
13.9 Material Licenses. All Material Licenses have
been obtained or exist for each Covered Person.
13.10 Compliance with Material Laws. Each Covered
Person is in compliance with all Material Laws. Without limiting
the generality of the foregoing:
13.10.1 General Compliance with Environmental
Laws. The operations and employee compensation practices of
every Covered Person comply in all material respects with all
applicable Environmental Laws, the failure to comply with which
is reasonably likely to have a Material Adverse Effect.
13.10.2 Proceedings. None of the operations of
any Covered Person are the subject of any judicial or
administrative complaint, order or proceeding alleging the
violation of any applicable Environmental Laws, which violation
is reasonably likely to have a Material Adverse Effect.
13.10.3 Investigations Regarding Hazardous
Materials. None of the operations of any Covered Person are the
subject of investigation by any Governmental Authority regarding
the improper transportation, storage, disposal, generation or
release into the environment of any Hazardous Material, the
results of which are reasonably likely to have a Material Adverse
Effect.
13.10.4 Notices and Reports Regarding Hazardous
Materials. No notice or report under any Environmental Law
indicating a past or present spill or release into the
environment of any Hazardous Material from any property owned or
operated by a Covered Person has been filed within the
immediately preceding four fiscal years of such Covered Person,
or is required to be filed by any Covered Person, which spill or
release is reasonably likely to result in a Material Adverse
Effect.
13.10.5 Hazardous Materials on Real Property. No
Covered Person, nor to Borrower's knowledge, any other Person,
has at any time transported, stored, disposed of, generated or
released any Hazardous Material on the surface, below the
surface, or within the boundaries of any real property owned or
operated by such Covered Person, which event is reasonably likely
to have a Material Adverse Effect. Borrower has no knowledge of
any Hazardous Material on the surface, below the surface, or
within the boundaries of any real property owned or operated by
such Covered Person, which is reasonably likely to have a
Material Adverse Effect. No property of such Covered Person is
subject to a Security Interest in favor of any Governmental
Authority for any liability under any Environmental Law or
damages arising from or costs incurred by such Governmental
Authority in response to a spill or release of Hazardous Material
into the environment, which is reasonably likely to have a
Material Adverse Effect.
13.11 Initial Financial Statements. The Financial
Statements of Borrower as of June 30, 1997, as delivered to
Lender by Borrower, are complete and correct in all material
respects (subject to normal year-end audit adjustments), have
been prepared in accordance with GAAP, and fairly reflect the
financial condition, results of operations and cash flows of
Borrower as of the date and for the periods stated therein.
13.12 No Change in Condition. Since the date of the
Initial Financial Statements delivered to Lender, there has been
no change which is reasonably likely to have a Material Adverse
Effect.
13.13 No Defaults. No Covered Person has breached or
violated or has defaulted under any Material Agreement, or has
defaulted with respect to any Material Obligation of such Covered
Person. There is no Existing Default.
13.14 Tax Liabilities; Governmental Charges. Each
Covered Person has filed or caused to be filed all tax reports
and returns required to be filed by it with any Governmental
Authority, except where extensions have been properly obtained or
where failure to file is not reasonably likely to have a Material
Adverse Effect. Each Covered Person has paid or made adequate
provision for payment of all Taxes of such Covered Person, except
(i) Taxes which are being diligently contested in good faith by
appropriate proceedings and as to which such Covered Person has
established adequate reserves in conformity with GAAP or (ii)
where failure to pay is not reasonably likely to have a Material
Adverse Effect. No Security Interests for any such Taxes has
been filed and no claims are being asserted with respect to any
such Taxes which, if adversely determined, are reasonably likely
to have a Material Adverse Effect. The federal income tax
liability for each Covered Person has been determined by the
Internal Revenue Service and paid for all fiscal years up to and
including the year ended December 31, 1992, except that the
Borrower continues to carry forward net operating losses from the
fiscal years ended December 31, 1979, through December 31, 1985,
and, accordingly, such fiscal years remain open with respect to,
and only with respect to, such carry forwards. There are no
material unresolved issues concerning any liability of a Covered
Person for any Taxes which, if adversely determined, are
reasonably like to have a Material Adverse Effect.
13.15 Pension Benefit Plans. All Pension Benefit Plans
maintained by each Covered Person or an ERISA Affiliate of such
Covered Person qualify under Section 401 of the Code and are in
compliance in all material respects with the provisions of ERISA.
Except with respect to events or occurrences which do not have
and are not reasonably likely to have a Material Adverse Effect:
13.15.1 Prohibited Transactions. None of such
Pension Benefit Plans has participated in, engaged in or been a
party to any non-exempt prohibited transaction as defined in
ERISA or the Code, and no officer, director or employee of a
Covered Person or of an ERISA Affiliate of such Covered Person
has committed a breach of any of the responsibilities or
obligations imposed upon fiduciaries by Title I of ERISA.
13.15.2 Claims. Other than normal claims for
benefits, there are no claims, pending or threatened, involving
any such Pension Benefit Plan by a current or former employee (or
beneficiary thereof) of such Covered Person or ERISA Affiliate of
such Covered Person, nor is there any reasonable basis to
anticipate any claims involving any such Pension Benefit Plan
which would likely be successfully maintained against such
Covered Person or ERISA Affiliate of such Covered Person.
13.15.3 Reporting and Disclosure Requirements.
There are no violations of any reporting or disclosure
requirements with respect to any such Pension Benefit Plan and
none of such Pension Benefit Plans has violated any applicable
Law, including ERISA and the Code.
13.15.4 Accumulated Funding Deficiency. No such
Pension Benefit Plan has (i) incurred an accumulated funding
deficiency (within the meaning of Section 412(a) of the Code),
whether or not waived; (ii) been a Pension Benefit Plan with
respect to which a Reportable Event (to the extent that the
reporting of such events to the PBGC within thirty days of the
occurrence has not been waived) has occurred and is continuing;
or (iii) been a Pension Benefit Plan with respect to which there
exist conditions or events which have occurred that present a
significant risk of termination of such Pension Benefit Plan by
the PBGC.
13.15.5 Multi-employer Plan. No Covered Person
or ERISA Affiliate of such Covered Person has received notice
that any Multi-employer Plan to which any Covered Person
contributes or is obligated to contribute is in reorganization or
has been terminated within the meaning of Title IV of ERISA, and
no such Multi-employer Plan is reasonably expected to be in
reorganization or to be terminated within the meaning of Title IV
of ERISA.
13.16 Welfare Benefit Plans. No Covered Person or
ERISA Affiliate of such Covered Person maintains a Welfare
Benefit Plan that has a liability which, if enforced or
collected, would have a Material Adverse Effect. Each Covered
Person and ERISA Affiliate of such Covered Person has complied in
all material respects with the applicable requirements of Section
4980B of the Code pertaining to continuation coverage as mandated
by COBRA.
13.17 State of Property. Each Covered Person has good
and marketable or merchantable title to all real and personal
property purported to be owned by it or reflected in the Initial
Financial Statements, except for property sold in the ordinary
course of business after the date of the Initial Financial
Statements and except for any defects in title which are not
reasonably likely to have a Material Adverse Effect. There are
no Security Interests on any of the property purported to be
owned by any Covered Person except Security Interests permitted
under this Agreement.
13.18 Subsidiaries and Affiliates. Borrower has no
Subsidiaries other than the Subsidiaries listed in item 13.18 of
the Disclosure Schedule, it being acknowledged and agreed that
the representation and warranty contained in this Section 13.18
is not required to remain true and correct for purposes of
Sections 11.1.2, 11.2.2 or 12.4 hereof.
13.19 Margin Stock. Borrower is not engaged and will
not engage, principally or as one of its important activities, in
the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation U), and
none of the proceeds of any Revolving Advance will be used to
purchase or carry any such margin stock or to extend credit to
others for the purpose of purchasing or carrying any such margin
stock or for any purpose which violates, or which would be
inconsistent with, the provisions of Regulation U or
Regulation G. None of the transactions contemplated by any
Permitted Acquisition will violate Regulations G, T, U or X of
the FRB.
13.20 Hostile Securities Transactions. No proceeds of
any Revolving Advance will be used to acquire from any Person any
security in a transaction that is hostile from the point of view
of such Person.
13.21 Investment Company Act, Etc. Borrower is not an
investment company registered or required to be registered under
the Investment Company Act of 1940, as amended, or a company
controlled (within the meaning of such Investment Company Act) by
such an investment company or an affiliated person of, or
promoter or principal underwriter for, an investment company, as
such terms are defined in the Investment Company Act of 1940, as
amended. Borrower is not subject to regulation under the Public
Utility Holding Company Act of 1935, the Federal Power Act or the
Interstate Commerce Act.
13.22 Filings. All registration statements, reports,
proxy statements and other documents, if any, required to be
filed by Borrower with the Securities and Exchange Commission
pursuant to the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended, have been filed, and
such filings are complete and accurate in all material respects
and contain no untrue statements of material fact or omit to
state any material facts required to be stated therein or
necessary in order to make the statements therein not misleading
in light of the circumstances in which made.
13.23 Broker's Fees. No broker or finder is entitled
to compensation for services rendered with respect to the loan
transactions contemplated by this Agreement and the other Loan
Documents.
13.24 Full Disclosure. Borrower has disclosed to
Lender all information regarding the business, operations,
property, financial condition, or business prospects of itself
and every Covered Person which is reasonably likely to have a
Material Adverse Effect.
14. Survival of Representations. All representations and
warranties in Section 13, and all representations and warranties
in any certificate delivered by Borrower pursuant hereto, shall
survive execution of each of the Loan Documents and the making of
every Revolving Advance, and may be relied upon by Lender as
being true and correct as of the date when made or deemed made or
reaffirmed until all of the Loan Obligations are fully and
irrevocably paid as contemplated in Section 8.3.
15. Affirmative Covenants. Borrower covenants and agrees
that, until Final Payment (and after any reinstatement as
contemplated in Section 8.4), Borrower shall do, or cause to be
done, the following:
15.1 Use of Proceeds. All proceeds of the Revolving
Loan shall be used solely for working capital and to fund payment
of amounts due from Borrower or any Subsidiary in connection with
Permitted Acquisitions.
15.2 Corporate Existence. Except as a result of a
transaction permitted by Section 16.7, each Covered Person shall
maintain its existence in good standing and shall maintain in
good standing its right to transact business in those states in
which it is now or hereafter doing business, except where the
failure to so qualify is not reasonably likely to have a Material
Adverse Effect. Each Covered Person shall obtain and maintain
all Material Licenses for such Covered Person.
15.3 Maintenance of Property and Leases. Each Covered
Person shall maintain in good condition and working order, and
repair and replace as required, all buildings, equipment,
machinery, fixtures and other real and personal property whose
useful economic life has not elapsed and which is necessary for
the ordinary conduct of the business of such Covered Person, the
failure to maintain which is reasonably likely to have a Material
Adverse Effect. Each Covered Person shall maintain in good
standing and free of defaults all of its leases of buildings,
equipment, machinery, fixtures and other real and personal
property whose useful economic life has not elapsed and which is
necessary for the ordinary conduct of the business of such
Covered Person, the failure to maintain which is reasonably
likely to have a Material Adverse Effect.
15.4 Insurance. Each Covered Person shall at all
times keep insured or cause to be kept insured, with financially
sound and reputable insurers, all property owned by it of a
character usually insured by others carrying on businesses
similar to that of such Covered Person in such manner and to such
extent and covering such risks as such properties are usually
insured, the failure to insure which is reasonably likely to have
a Material Adverse Effect. Each Covered Person shall at all
times carry insurance, with financially sound and reputable
insurers, against liability on account of damage to persons or
property (including product liability insurance and insurance
required under all applicable workers' compensation laws) and
covering all other liabilities common to such Covered Person's
business, in such manner and to such extent as such coverage is
usually carried by others conducting businesses similar to that
of such Covered Person, the failure to insure which would have a
Material Adverse Effect.
15.5 Payment of Taxes and Other Obligations. Each
Covered Person shall promptly pay and discharge or cause to be
paid and discharged, as and when due, all Taxes lawfully assessed
or imposed upon it, and all Taxes lawfully assessed upon any of
its property, or upon the income or profits therefrom, and all
claims of materialmen, mechanics, carriers, warehousemen,
landlords and other like Persons for labor, materials, supplies,
storage or other items or services which if unpaid might be or
become a Security Interest or charge upon any of its property the
failure to pay which is reasonably likely to have a Material
Adverse Effect; provided, however, that a Covered Person may
diligently contest in good faith by appropriate proceedings the
validity of any such Taxes or claims if Borrower has established
adequate reserves therefor in conformity with GAAP on the books
of such Covered Person, and no Security Interest, other than a
Permitted Security Interest, results from such non-payment.
15.6 Compliance With Laws. Each Covered Person shall
comply with all Material Laws. Without limiting the generality
of the foregoing:
15.6.1 Environmental Laws. Each Covered Person
shall comply and shall use commercially reasonable efforts to
ensure compliance by all tenants, subtenants and other occupants
of the property of such Covered Person, if any, with all
Environmental Laws whose violation is reasonably likely to have
a Material Adverse Affect.
15.6.2 Pension Benefit Plans. Each Covered
Person and each ERISA Affiliate of such Covered Person shall at
all times make prompt payments or contributions to meet the
minimum funding standards under ERISA and the Code with respect
to any Pension Benefit Plan maintained by such Covered Person or
ERISA Affiliate of such Covered Person, and shall comply with all
reporting and disclosure requirements and all provisions of the
Code and ERISA applicable to any Pension Benefit Plan maintained
by such Covered Person or ERISA Affiliate of such Covered Person,
if non-compliance therewith is reasonably likely to have a
Material Adverse Affect.
15.7 Discovery and Clean-Up of Hazardous Material.
Upon any Covered Person receiving notice of any violation of
Environmental Laws or any similar notice described in Section
15.9.3, or upon any Covered Person otherwise discovering
Hazardous Material on any property owned or operated by such
Covered Person which is in violation of, or which is reasonably
likely to result in liability under, any Environmental Law which
is reasonably likely to have a Material Adverse Effect, Borrower
shall: (i) promptly take such acts as may be necessary to prevent
danger or harm to the affected property or any person therein as
a result of such Hazardous Material, and (ii) take all necessary
steps to initiate and expeditiously complete all removal,
remedial, response, corrective and other action to eliminate any
such environmental problems, and keep Lender informed of such
actions and the results thereof.
15.8 Termination of Pension Benefit Plan. No Covered
Person or ERISA Affiliate of such Covered Person shall terminate
or amend any Pension Benefit Plan maintained by such Covered
Person or ERISA Affiliate of such Covered Person if such
termination or amendment would result in any liability to such
Covered Person or ERISA Affiliate of such Covered Person under
ERISA which is reasonably likely to have a Material Adverse
Effect or any increase in current liability for the plan year for
which such Covered Person or ERISA Affiliate of such Covered
Person is required to provide security to such Pension Benefit
Plan under the Code which is reasonably likely to have a Material
Adverse Effect.
15.9 Notice to Lender of Material Events. Borrower
shall, promptly upon any Responsible Officer of Borrower
obtaining knowledge or notice thereof, give notice to Lender
(together with copies,if applicable) of (i) any breach of any of
the covenants in Section 15, 16, or 17; (ii) any Default or Event
of Default; (iii) the commencement of any Material Proceeding;
and (iv) any material loss, including loss as a consequence of
condemnation proceedings, of or material damage to any material
part of the assets of a Covered Person, if such loss, damage or
proceeding is reasonably likely to have a Material Adverse
Effect. In addition,
15.9.1 Borrower shall furnish to Lender from time
to time all information which Lender requests with respect to the
status of any Material Proceeding.
15.9.2 Borrower shall furnish to Lender from time
to time all information which Lender requests with respect to any
Pension Benefit Plan established by a Covered Person or ERISA
Affiliate of such Covered Person.
15.9.3 Borrower shall promptly inform Lender of
its receipt of, and deliver to Lender a copy of, any (i) notice
that any violation of any Environmental Law may have been
committed or is about to be committed by any Covered Person,
which violation is reasonably likely to have a Material Adverse
Effect, (ii) notice that any administrative or judicial complaint
or order has been filed or is about to be filed against any
Covered Person alleging violations of any Environmental Law or
requiring such Covered Person to take any action in connection
with the release of any Hazardous Material into the environment,
which event is reasonably likely to have a Material Adverse
Effect, (iii) notice from a Governmental Authority or private
Person alleging that a Covered Person may be liable or
responsible for costs associated with a response to or cleanup of
a release of Hazardous Material into the environment or any
damages caused thereby, which event is reasonably likely to have
a Material Adverse Effect, (iv) notice that a Covered Person is
subject to federal, state or local investigation regarding the
improper transportation, storage, disposal, generation or release
into the environment of any Hazardous Material, which event is
reasonably likely to have a Material Adverse Effect, or
(v) notice that any properties or assets of a Covered Person are
subject to a Security Interest in favor of any Governmental
Authority for any liability under any Environmental Law or
damages arising from or costs incurred by such Governmental
Authority in response to a release of Hazardous Material into the
environment, which event is reasonably likely to have a Material
Adverse Effect.
15.9.4 Borrower shall deliver to Lender notice of
the following events promptly after they occur: (i) the failure
of any Covered Person or ERISA Affiliate of such Covered Person
to make any required installment or any other required payment to
any Pension Benefit Plan in sufficient amount to comply with
ERISA and the Code on or before the due date for such installment
or payment, which event is reasonably likely to have a Material
Adverse Effect; (ii) the occurrence of any Reportable Event, or
a prohibited transaction or accumulated funding deficiency (as
those terms are defined in ERISA), with respect to any Pension
Benefit Plan maintained or contributed to by a Covered Person or
ERISA Affiliate of such Covered Person, which event is reasonably
likely to have a Material Adverse Effect; (iii) receipt by a
Covered Person or ERISA Affiliate of such Covered Person of any
notice from a Multi-employer Plan regarding the imposition of
withdrawal liability, which event is reasonably likely to have a
Material Adverse Effect; and (iv) receipt by a Covered Person or
ERISA Affiliate of such Covered Person of any notice of the
institution, or a Covered Person's expectancy of the institution,
of any proceeding or receipt by such Covered Person or ERISA
Affiliate of such Covered Person of any notice of the taking, or
such Covered Person's expectancy of the taking, of any other
action which may result in the termination of any Pension Benefit
Plan maintained or contributed to by such Covered Person or ERISA
Affiliate of such Covered Person, or the withdrawal or partial
withdrawal by a Covered Person or ERISA Affiliate of such Covered
Person from any Pension Benefit Plan, and the filing or receipt
by a Covered Person or ERISA Affiliate of such Covered Person of
any such notice and filing or receipt of all subsequent reports
or notices under ERISA with or from the IRS, the PBGC, or the DOL
relating to the same, which event is reasonably likely to have a
Material Adverse Effect; and, in addition to such notice, deliver
to Lender a certificate of a Responsible Officer of Borrower,
setting forth details as to such events and the action that the
affected Covered Person or ERISA Affiliate of such Covered Person
proposes to take with respect thereto. For purposes of this
Section, a Covered Person and any ERISA Affiliate of such Covered
Person shall be deemed to know all facts known by the
administrator of any Plan of which such Covered Person or any
ERISA Affiliate of such Covered Person is the plan sponsor.
15.9.5 Borrower shall promptly deliver to Lender
notice of any default or event of default, or the occurrence of
any event which would with the passage of time, giving of notice
or otherwise, constitute a default or event of default with
respect to any of the Permitted Indebtedness in excess of
$5,000,000.
15.9.6 Borrower shall, promptly after becoming
aware thereof, deliver notice to Lender of any pending or
threatened strike, work stoppage, material unfair labor practice
claim or other material labor dispute affecting a Covered Person
which is reasonably likely to have a Material Adverse Effect.
15.9.7 Borrower shall deliver notice to Lender of
any change in the name, state of incorporation, or form of
organization of Borrower or any Guarantor at least 15 days prior
to such change.
15.9.8 Borrower shall, promptly after becoming
aware thereof, deliver notice to Lender of any event that has or
is reasonably likely to have a Material Adverse Effect.
15.9.9 Borrower shall, promptly after becoming
aware thereof, deliver notice to Lender of an actual, alleged, or
potential violation of any Material Law applicable to a Covered
Person.
15.10 Borrowing Officer. Borrower shall keep on file
with Lender at all times an appropriate instrument naming each
Borrowing Officer.
15.11 Accounting System. Each Covered Person shall
maintain a system of accounting established and administered in
accordance with GAAP.
15.12 Financial Statements. Borrower shall deliver to
Lender:
15.12.1 Annual Financial Statements. Within 90
days after the close of each fiscal year of Borrower (unless the
Borrower has timely filed a Form 12b-25 with the Securities and
Exchange Commission with respect to such fiscal year, in which
case such period shall be 105 days after the close of such fiscal
year), year-end consolidated and consolidating Financial
Statements of Borrower and its Subsidiaries, containing an audit
report without qualification (except as set forth therein) with
respect to such consolidated statements by Xxxxxx Xxxxxxxx LLP or
such other independent certified public accounting firm selected
by Borrower and satisfactory to Lender and in each case
accompanied by (a) a Compliance Certificate of the Chief
Financial Officer of Borrower, (b) a certificate of the
independent certified public accounting firm that examined such
consolidated Financial Statements to the effect that they have
reviewed and are familiar with this Agreement and that, in
examining such consolidated Financial Statements, nothing came to
their attention that caused them to believe that an event or
condition that constitutes a Default or Event of Default has
occurred or existed insofar as such conditions or events relate
to accounting matters, except for those, if any, described in
reasonable detail in such certificate, (c) the management letter
and report on internal controls delivered by such independent
certified public accounting firm in connection with their audit,
and (d) if requested by Lender, any summary prepared by such
independent certified public accounting firm of the adjustments
proposed by the members of its audit team. If not available at
the time any other items are delivered hereunder, delivery of the
items described under clause (c) in this Section promptly when
available (notwithstanding delivery subsequent to any other date
herein referenced) shall not constitute a Default or Event of
Default.
15.12.2 Quarterly Financial Statements. Within
45 days after the end of each fiscal quarter of Borrower (unless
Borrower has timely filed a Form 12b-25 with the Securities and
Exchange Commission with respect to such fiscal quarter, in which
case such period shall be 50 days after the close of such fiscal
quarter), unaudited consolidated and consolidating Financial
Statements of Borrower and its Subsidiaries for the most recent
quarter not covered by the latest year-end Financial Statements
required hereunder to be delivered to Lender, in each case
accompanied by a Compliance Certificate of the Chief Financial
Officer of Borrower.
Each Compliance Certificate shall be in the form of
Exhibit 15.12, shall contain detailed calculations of the
financial measurements referred to in Section 17 for the relevant
periods, and shall contain statements by the signing officer to
the effect that, except as explained in reasonable detail in such
Compliance Certificate, (i) the attached Financial Statements are
complete and correct in all material respects (subject, in the
case of Financial Statements other than annual, to normal year-
end audit adjustments) and have been prepared in accordance with
GAAP applied consistently throughout the periods covered thereby
and with prior periods (except as disclosed therein), (ii) there
is no Existing Default, and (iii) in the case of each Compliance
Certificate accompanying an annual Financial Statement, that the
representations and warranties of Borrower herein (other than the
representations and warranties in Section 13.18 and as expressly
otherwise contemplated herein) remain true and correct as of the
date of the Compliance Certificate, or that such representations
and warranties are no longer true and correct, in which case such
Compliance Certificate shall describe the nature of any such
changes. If any Compliance Certificate delivered to Lender
discloses that a Default or Event of Default has occurred that
has not been waived in writing by Lender, such Compliance
Certificate shall state what action Borrower has taken or
proposes to take with respect thereto.
15.13 Other Financial Information. Borrower shall also
deliver the following to Lender:
15.13.1 Stockholder and SEC Reports. Promptly
after their preparation, copies of any and all (i) proxy
statements, financial statements and reports which Borrower makes
available to its stockholders generally, and (ii) reports,
registration statements and prospectuses, if any, filed by
Borrower with any securities exchange or the Securities and
Exchange Commission or any Governmental Authority succeeding to
any of its functions.
15.13.2 Pension Benefit Plan Reports. Upon the
request of Lender, a copy of each annual report or other filing
or notice filed with respect to each Pension Benefit Plan of any
Covered Person or any ERISA Affiliate.
15.13.3 Tax Returns. Upon the request of Lender,
a copy of each federal, state, or local tax return or report
filed by Borrower.
15.13.4 Additional. Upon the request of Lender,
such additional information about the business, operations,
revenues, financial condition, property, or business prospects of
Borrower as Lender may, from time to time, reasonably request.
15.14 Forecasts or Projections. Within the 120 days
following the first day of each fiscal year of Borrower,
projected or forecasted consolidated balance sheets, statements
of income and expense, and statements of cash flows for Borrower
and its Subsidiaries (including any Subsidiary then proposed to
be acquired, organized or created in connection with a Permitted
Acquisition and to continue in existence after consummation
thereof) as of the end of and for each fiscal quarter in such
fiscal year in such reasonable detail as Lender may require.
15.15 Audits by Lender. Lender or Persons authorized
by and acting on behalf of Lender or any Lender may at any time
and from time to time during normal business hours audit the
books and records, and inspect any of the property, of each
Covered Person from time to time upon reasonable prior notice to
such Covered Person, and in the course thereof may make copies or
abstracts of such books and records and discuss the affairs,
finances and books and records of such Covered Person with its
accountants, officers and employees. Borrower shall cause each
Covered Person to cooperate with Lender and such Persons in the
conduct of such audits and shall deliver to Lender any instrument
necessary for Lender to obtain records from any service bureau
maintaining records for such Covered Person. Borrower shall
reimburse Lender for all reasonable costs and expenses actually
incurred by it in conducting each audit; provided, however, that
if an Event of Default has not occurred, such reimbursement for
each such audit shall be limited to $500 per day per person
involved in conducting the audit plus Lender's other reasonable
actual out-of-pocket expenses.
15.16 Access to Officers and Auditors. Each Covered
Person shall permit Lender and Persons authorized by Lender, upon
reasonable prior notice and during normal business hours, to
discuss the affairs, finances and accounts of such Covered Person
with its officers and independent auditors as often as Lender may
reasonably request, and such Covered Person shall direct such
officers and independent auditors to cooperate with Lender and
make full disclosure to Lender of those matters that they may
deem relevant to the continuing ability of Borrower timely to pay
and perform the Loan Obligations. Lender agrees that it will not
disclose to third Persons any information that it obtains about
any Covered Person or its operations or finances that are
designated by Borrower or such Covered Person in writing as
confidential or that Borrower or such Covered Person has advised
Lender in writing constitutes non-public information. Lender
may, however, disclose such information to all of its respective
officers, attorneys, auditors, accountants, bank examiners,
agents and representatives who have a need to know such
information in connection with the administration, interpretation
or enforcement of the Loan Documents or the lending and
collection activity contemplated therein or to the extent
required by Law or a Governmental Authority. Lender shall advise
such persons that such information is to be treated as
confidential. Lender may also disclose such information in any
documents that it files in any legal proceeding to pursue,
enforce or preserve its rights under the Loan Documents to the
extent that Lender's counsel advises in writing that such
disclosure is reasonably necessary. Lender's non-disclosure
obligation shall not apply to any information that (i) is
disclosed to Lender by a third Person not affiliated with or
employed by Borrower who does not have a commensurate duty of
non-disclosure, or (ii) becomes publicly known other than as a
result of disclosure by Lender.
15.17 Further Assurances. Borrower shall execute and
deliver, or cause to be executed and delivered, to Lender such
documents and agreements, and shall take or cause to be taken
such actions, as Lender may from time to time reasonably request
to carry out the terms and conditions of this Agreement and the
other Loan Documents.
16. Negative Covenants.
Borrower covenants and agrees that, until Final Payment
(and after any reinstatement as contemplated in Section 8.4),
Borrower shall not, directly or indirectly, do any of the
following, or permit any Covered Person to do any of the
following:
16.1 Indebtedness. Create, incur, assume, or allow to
exist any Indebtedness that is "Priority Debt" as defined in the
Note Purchase Agreement (whether or not such agreement remains in
effect) unless and only to the extent that (i) there is no
Existing Default, (ii) no Default or Event of Default will occur
or has occurred or is reasonably likely to occur as a consequence
thereof and (iii) the aggregate amount of all such "Priority
Debt" will not as a consequence thereof exceed 10% of Borrower's
"Consolidated Adjusted Net Worth", as defined in the Note
Purchase Agreement (whether or not such agreement remains in
effect), determined as of the end of the immediately preceding
fiscal quarter of Borrower, it being understood that for purposes
hereof "Priority Debt" shall not include any "Indebtedness"
represented by a "Guaranty" (as both such terms are defined under
the Note Purchase Agreement, whether or not such Agreement
remains in effect) from a Guarantor hereunder.
16.2 Prepayments. Voluntarily prepay any Indebtedness
other than (i) the Loan Obligations in accordance with the terms
of the Loan Documents, (ii) trade payables in the ordinary course
of business, (iii) prepayments of Indebtedness with respect to
industrial revenue bonds outstanding on the Execution Date and
(iv) prepayments on the Senior Notes as permitted or required
under the Note Purchase Agreement.
16.3 Security Interests. Create, incur, assume or
allow to exist any Security Interest upon all or any part of its
property, real or personal, now owned or hereafter acquired,
except the following:
16.3.1 Security Interests for taxes, assessments
or governmental charges not delinquent or being diligently
contested in good faith and by appropriate proceedings and for
which adequate book reserves in accordance with GAAP are
maintained.
16.3.2 Security Interests arising out of pledges
and deposits in connection with workers' compensation insurance,
unemployment insurance, old age pensions, or other social
security or retirement benefits legislation.
16.3.3 Security Interests arising out of deposits
or pledges to secure bids, tenders, contracts (other than
contracts for the payment of money), leases, statutory
obligations, surety and appeal bonds, and other obligations of
like nature arising in the ordinary course of business.
16.3.4 Security Interests imposed by any Law,
such as mechanics', workmen's, materialmen's, landlords',
carriers', or other like Security Interests arising in the
ordinary course of business which secure payment of obligations
which are not past due or which are being diligently contested in
good faith by appropriate proceedings and for which adequate book
reserves in accordance with GAAP are maintained.
16.3.5 Security Interests in favor of Lender .
16.3.6 Security Interests that are "Liens" as
defined in the Note Purchase Agreement but permitted thereunder
to be created, incurred, assumed or allowed to exist (whether or
not such agreement remains in effect).
16.4 Acquisitions. Utilize any of the proceeds of any
Revolving Advance to acquire all or a material part of the assets
of a Person, regardless of the form of the transaction, except in
a Permitted Acquisition. A "Permitted Acquisition" is any
acquisition of stock or other equity interest in a Person, or of
all or a material part of the assets of a Person, with respect to
which all of the following requirements have been satisfied:
16.4.1 the Person is engaged in a line of
business substantially the same as conducted by Borrower or any
of its Subsidiaries on the Execution Date or reasonably related
thereto or in furtherance thereof; and
16.4.2 the acquisition is not hostile from the
point of view of such Person; and
16.4.3 either
16.4.3.1 the Person is, or is the parent or
controlling partner or member of, a direct or indirect licensee
or sublicensee of Borrower or any of its then existing
Subsidiaries, provided that such licensee or sublicensee was such
a licensee or sublicensee as of December 31, 1996, and
continuously thereafter; or
16.4.3.2 the Person is a co-partner or co-member
with Borrower or any of its then existing Subsidiaries in a joint
venture, provided that such joint venture existed as of December
31, 1996, and continuously thereafter; and
16.4.4 there is no Existing Default; and
16.4.5 no Default or Event of Default will occur
or is reasonably likely to occur as a consequence of the
acquisition.
16.5 Disposal of Property. Sell, transfer, exchange,
lease, or otherwise dispose of any of its assets, or enter into
any agreement or arrangement with any Person providing for
Borrower to lease or rent property that Borrower has or will sell
or otherwise transfer to such Person (except (i) sales and leases
of assets in the ordinary course of business and (ii) sales,
transfers, exchanges, and leases, rentals or other dispositions
of assets other than in the ordinary course of business but as
permitted under the Note Purchase Agreement [whether or not such
agreement remains in effect]), exclusive of transfers of assets
to Subsidiaries of Borrower not organized under the laws of the
United States or a state of the United States while United States
Assets aggregate more than 70% of Total Assets.
16.6 Restricted Payments. At any time when there is
an Existing Default, directly or indirectly declare or make, or
incur any liability to make, any Restricted Payment, unless and
only to the extent that such a Restricted Payment is permitted
under the Note Purchase Agreement (whether or not such agreement
remains in effect). For purposes of this Section, a "Restricted
Payment" means and includes (i) any cash dividend, (ii) any
acquisition, redemption or retirement of any outstanding stock,
(iii) any retirement or prepayment of debt securities before
their regularly scheduled maturity dates, (iv) any loan or
advance that is made to a Person in such Person's capacity as a
shareholder, and (v) any "Restricted Payment" as defined in the
Note Purchase Agreement (whether or not such agreement remains in
effect).
16.7 Mergers and Consolidations. Merge or consolidate
with or into another Person except for such mergers and
consolidations as are permitted under the Note Purchase Agreement
(whether or not such agreement remains in effect).
16.8 Change of Business. Engage in any business other
than substantially as conducted on the Execution Date by Borrower
or any of its Subsidiaries or a business reasonably related
thereto or in furtherance thereof.
16.9 Transactions With Affiliates. Except for
transactions with another Covered Person, enter into or be a
party to any transaction or arrangement, including the purchase,
sale or exchange of property of any kind or the rendering of any
service material to the operations of the Borrower and the
Subsidiaries taken as a whole, with any Affiliate, or make any
loans or advances to any Affiliate. Borrower and any Covered
Person may, however, engage in such transactions if they are in
the ordinary course of business and pursuant to the reasonable
requirements of its business and are on fair and reasonable terms
substantially as favorable to it as those which it could obtain
in a comparable arm's-length transaction with a non-Affiliate.
16.10 Conflicting Agreements, Etc. Enter into any
agreement, engage in any transaction, acquire or create any
Subsidiary, or transfer assets to any Subsidiary (whether or not
it is actively engaged in a trade or business) that would
immediately or in a reasonably foreseeable time result in a
Default or Event of Default; or enter into any agreement that
would immediately or in a reasonably foreseeable time, if fully
complied with or performed by it, result in a Default or Event of
Default.
16.11 Sale and Leaseback Transactions. Enter into any
agreement or arrangement with any Person providing for Borrower
or a Covered Person to lease or rent property that Borrower or a
Covered Person has or will sell or otherwise transfer to such
Person, except upon terms no less favorable than in an arms-
length transaction in which Borrower or such Covered Person will
receive a cash payment upon such sale or transfer equal to the
fair market value of such property.
16.12 Fiscal Year. Change its fiscal year.
16.13 Transactions Having a Material Adverse Effect on
a Covered Person. Enter into any transaction which has or is
reasonably likely to have a Material Adverse Effect.
17. Financial Covenants.
17.1 Special Definitions. As used in this Section 17
and elsewhere in this Agreement, the following capitalized terms
have the following meanings:
"Adjusted EBITDA" means, for any period of calculation,
EBITDA minus Maintenance Capital Expenditures, both as
accrued in such period.
"Current Assets" means, at any date, current assets as
determined in accordance with GAAP.
"Current Liabilities" means, at any date, current
liabilities as determined in accordance with GAAP but
excluding amounts outstanding under the Revolving Loan.
"EBITDA" means, for any period of calculation, an amount
equal to the sum of (i) net income, (ii) federal, state
and local income tax expense, (iii) interest expense
(including the interest component of payments on Capital
Leases) in such period, (iv) depreciation and
amortization expense and other non-cash charges that
reduced net income during such period, (v) losses on the
sale or other disposition of assets other than in the
ordinary course of business if included in the
calculation of net income, (vi) extraordinary losses if
included in the calculation of net income, and (vii)
Restructuring Charges, minus (a) gains on the sale or
other disposition of assets other than in the ordinary
course of business if included in net income, and
(b) extraordinary gains if included in net income, all as
accrued in such period.
"Fixed Charges" means, for any period of calculation, the
sum of (i) interest expense, (ii) the sum of all
scheduled principal payments on any long-term
Indebtedness of Borrower (including the Revolving Loan
and other current maturities of long term Indebtedness),
(iii) federal, state and local income taxes payable,
(iv) scheduled payments on Capital Leases, and
(v) dividends paid, all as accrued in such period.
"Funded Debt" means, at any date, the sum of (i) the
principal amount of all Indebtedness for borrowed money
of Borrower and its Subsidiaries on a consolidated basis,
(ii) the unamortized capitalized amount of all Capital
Leases of Borrower and its Subsidiaries on a consolidated
basis, (iii) all Restricted Indirect Obligations of
Covered Persons with respect to Indebtedness for borrowed
money of Persons other than Covered Persons or Exempted
Subsidiaries, without duplication of any amount with
respect to the same Indebtedness, and (iv) all Restricted
Indirect Obligations of Covered Persons with respect to
the unamortized capitalized amount of all Capital Leases
of Persons other than Covered Persons or Exempted
Subsidiaries, without duplication of any amount with
respect to the same Capital Leases, all as of such date.
"Maintenance Capital Expenditures" means, for any period
of calculation, all Capital Expenditures during such
period made for the purpose of maintaining existing
capacity (excluding, without limitation, expenditures for
expanding existing businesses, expanding into new
businesses, properties and product lines, cost
reductions, profit improvements, and other expenditures
based on financial return), to the extent they do not
exceed the amount needed to meet the requirements of
Section 15.3 as applied to fixed assets of Borrower and
its Subsidiaries.
"Restricted Indirect Obligations" means all Indirect
Obligations except (i) Indirect Obligations of a Covered
Person undertaken in the ordinary course of business of
such Covered Person to secure bids or contracts or
performance bonds relating to work to be performed by any
Covered Person or any joint venture in which any Covered
Person participates; (ii) all Indirect Obligations of a
Covered Person with respect to any trade indebtedness of
such Covered Person incurred in the ordinary course of
business of such Covered Person, whether payable directly
or by reimbursement in connection with any letter of
credit facility; (iii) all Indirect Obligations of a
Covered Person with respect to Security Interests of
Covered Persons permitted under Section 16.3; and
(iv) all Indirect Obligations of Covered Persons with
respect to Obligations of other Covered Persons or
Exempted Subsidiaries.
"Tangible Assets" means, at any date, all assets as
determined in accordance with GAAP except: (a) deferred
assets; (b) patents, copyrights, trademarks, trade names,
franchises, goodwill, and other similar intangibles; (c)
unamortized debt discount and expenses; and (d) fixed
assets to the extent of any write-up in the book value
thereof resulting from a revaluation.
"Tangible Net Worth" means, at any date: (a) the book
value (net of depreciation, obsolescence, amortization,
valuation and other proper reserves determined in
accordance with GAAP) at which Tangible Assets would be
shown on a balance sheet at such date prepared in
accordance with GAAP; less (b) the amount at which all
liabilities would be shown on such balance sheet,
including as liabilities all reserves for contingencies
and other potential liabilities which would be shown on
such balance sheet or disclosed in the notes thereto.
"Total Capitalization" means, at any date, the sum of
Tangible Net Worth plus all Funded Debt, both as of such
date.
17.2 Minimum Fixed Charge Coverage. The ratio of
Borrower's Adjusted EBITDA to Fixed Charges, calculated at the
end of each fiscal quarter of Borrower for the four consecutive
fiscal quarters then ended, shall not be less than 1.0 to 1.0.
17.3 Minimum Tangible Net Worth. Borrower's Tangible
Net Worth as of the end of each fiscal quarter of Borrower shall
at no time be less than $50,000,000 plus (i) 50% of cumulative
net income (but not any net loss) for such fiscal periods and
(ii) the amount of the net proceeds received in cash by Borrower
in such periods from the issuance of equity securities (other
than in connection with any employee benefit plan or compensatory
arrangement).
17.4 Maximum Funded Debt to EBITDA Ratio. The ratio
of Borrower's Funded Debt as of the end of any fiscal quarter of
Borrower to Borrower's EBITDA for the four consecutive fiscal
quarters then ended shall not be less than 3.5 to 1.0.
17.5 Funded Debt to Total Capitalization. The ratio
of Borrower's Funded Debt to Borrower's Total Capitalization as
of the end of each fiscal quarter of Borrower shall not be
greater than 0.75 to 1.00.
18. Default.
18.1 Events of Default. Any one or more of the
following shall constitute an Event of Default:
18.1.1 Failure to Pay Principal or Interest.
Failure by Borrower to make any principal or interest payment on
the Revolving Loan within three days after the date when due
under the Loan Documents.
18.1.2 Failure to Pay Other Amounts Owed to
Lender. Failure of Borrower to pay any of the Loan Obligations
(other than principal or interest on the Revolving Loan) or any
other amount owed to Lender within five days after notice from
Lender that the same is due.
18.1.3 Failure to Pay Amounts Owed to Other
Persons. Failure of Borrower to make any payments that are due
on Indebtedness of Borrower exceeding $5,000,000 to any one
Person other than Lender, or exceeding $5,000,000 in the
aggregate to Persons other than Lender, which continue unwaived
beyond any applicable grace periods specified in the documents
evidencing such Indebtedness.
18.1.4 Acceleration of Other Indebtedness. Any
Obligation of Borrower (other than the Loan Obligations) for the
payment of borrowed money in an amount over $5,000,000, becomes
or is declared to be due and payable or required to be prepaid
(other than by a regularly scheduled payment or prepayment) prior
to the original maturity thereof.
18.1.5 Representations or Warranties. Any
representation or warranty made or deemed made by Borrower to
Lender hereunder is discovered to have been false in any material
respect when made or deemed made.
18.1.6 Certain Covenants. Failure of Borrower to
comply with the covenants in Section 15.1 or 15.8.
18.1.7 Financial Covenants. Failure of Borrower
to cure a violation of any of the covenants in Section 17 within
20 days after the end of the applicable fiscal quarter of
Borrower.
18.1.8 Other Covenants. Failure of Borrower to
comply with any of the provisions of any of the Loan Documents
that are applicable to it (other than a failure which constitutes
an Event of Default under any of Sections 18.1.1 through 18.1.6)
which is not remedied or waived in writing by Lender within 30
days (or 15 days in the case of failure to deliver Financial
Statements as required under Section 15.12) after notice thereof
from Lender to Borrower.
18.1.9 Default Under Other Agreements. The
occurrence of any default or event of default with respect to any
Obligation of Borrower (other than an Obligation for the payment
of borrowed money) reasonably likely to require monetary payments
from Borrower aggregating $5,000,000 or more, or which has or is
reasonably likely to have a Material Adverse Effect, under any
agreement to which Borrower is a party (other than the Loan
Documents) and which continues unwaived beyond any applicable
grace period provided therein.
18.1.10 Bankruptcy; Insolvency; Etc. Borrower
(i) fails to pay, or admits in writing its inability to pay, its
debts generally as they become due, or otherwise becomes
insolvent (however evidenced); (ii) makes a general assignment
for the benefit of creditors; (iii) files a petition in
bankruptcy, is adjudicated insolvent or bankrupt, petitions or
applies to any tribunal for any receiver or any trustee of
Borrower or any substantial part of its property; (iv) commences
any proceeding relating to Borrower under any reorganization,
arrangement, readjustment of debt, dissolution or liquidation law
or statute of any jurisdiction, whether now or hereafter in
effect; (v) has commenced against it any such proceeding which
remains undismissed for a period of ninety days, or by any act
indicates its consent to, approval of, or acquiescence in any
such proceeding or the appointment of any receiver of or any
trustee for it or any substantial part of its property, or allows
any such receivership or trusteeship to continue undischarged for
a period of 90 days; or (vi) takes any corporate action to
authorize any of the foregoing.
18.1.11 Judgments; Attachment; Etc. Any one or
more judgments or orders is entered against a Covered Person or
any attachment or other levy is made against the property of a
Covered Person with respect to a claim or claims involving in the
aggregate liabilities (not paid or fully covered by insurance,
less the amount of deductibles satisfactory to Lender) greater
than $3,000,000 becomes final and non-appealable and is not fully
discharged within 45 stays thereafter, or if timely appealed is
not fully bonded and collection thereof stayed pending the
appeal.
18.1.12 Pension Benefit Plan Termination, Etc.
Any termination by the PBGC of a Pension Benefit Plan of Borrower
or an ERISA Affiliate of Borrower or the appointment by the
appropriate United States District Court of a trustee to
administer any Pension Benefit Plan of Borrower or an ERISA
Affiliate of Borrower or to liquidate any Pension Benefit Plan of
Borrower or an ERISA Affiliate of Borrower; or any event which
constitutes grounds either for the termination of any Pension
Benefit Plan of Borrower or an ERISA Affiliate of Borrower by
PBGC or for the appointment by the appropriate United States
District Court of a trustee to administer or liquidate any
Pension Benefit Plan of Borrower or an ERISA Affiliate of
Borrower has occurred and is continuing for 30 days after
Borrower has notice of any such event; or any voluntary
termination of any Pension Benefit Plan of Borrower or an ERISA
Affiliate of Borrower which is a defined benefit pension plan as
defined in Section 3(35) of ERISA while such defined benefit
pension plan has an accumulated funding deficiency, unless Lender
has been notified of such intent to voluntarily terminate such
plan and Lender has given its consent and agreed that such event
shall not constitute an Event of Default; or the plan
administrator of any Pension Benefit Plan of Borrower or an ERISA
Affiliate of Borrower applies under Section 412(d) of the Code
for a waiver of the minimum funding standards of Section 412(1)
of the Code and Lender determines that the substantial business
hardship upon which the application for such waiver is based
could subject Borrower or any ERISA Affiliate of Borrower to a
liability in excess of $3,000,000.
18.1.13 Liquidation or Dissolution. Borrower
files a certificate of dissolution under applicable state law or
is liquidated or dissolved, or has commenced against it any
action or proceeding for its liquidation or dissolution which is
not dismissed within 60 days, or takes any corporate action in
furtherance thereof.
18.1.14 Seizure of Assets. All or any material
part of the property of Borrower, is nationalized, expropriated,
seized or otherwise appropriated, or custody or control of such
property or of Borrower is assumed by any Governmental Authority,
unless the same is being contested in good faith by appropriate
proceedings diligently pursued and a stay of enforcement is in
effect.
18.1.15 Racketeering Proceeding. There is filed
against a Covered Person any criminal action, suit or proceeding
under any federal or state racketeering statute (including,
without limitation, the Racketeer Influenced and Corrupt
Organization Act of 1970), which action, suit or proceeding is
not dismissed within 120 days and could result in the
confiscation or forfeiture of property of such Covered Person
that results or is reasonably likely to result in a Material
Adverse Effect.
18.1.16 Loan Documents. Any Loan Document ceases
to be in full force and effect or is terminated, revoked or
declared void or invalid.
18.1.17 Guaranty Default. Any Guarantor denies
any further liability under the Guaranty, or asserts that the
Guaranty is unenforceable or void.
18.1.18 Qualified Audit Report. Any of the
fiscal year-end Financial Statements required under Section
15.12.1 to be delivered to Lender contains an audit report which
is qualified.
18.1.19 Material Adverse Change. There occurs
any event which is reasonably likely to result in Borrower being
unable to make payments of principal or interest as required
hereunder.
18.2 Rights and Remedies Upon an Event of Default.
18.2.1 Cancellation of Commitments. Upon the
occurrence of an Event of Default described in Section 18.1.10,
the Commitments shall be deemed canceled without presentment,
demand or notice of any kind. Upon any other Event of Default,
and at any time thereafter (unless such Event of Default has been
waived by Lender or Lender has accepted a tendered complete cure
thereof), Lender may cancel the Commitments. Such cancellation
may be without demand or notice of any kind, which Borrower
expressly waives.
18.2.2 Acceleration. Upon the occurrence of an
Event of Default described in Section 18.1.10, all of the
outstanding Loan Obligations shall automatically become
immediately due and payable. Upon any other Event of Default,
and at any time thereafter, Lender may declare all of the
outstanding Loan Obligations immediately due and payable. Such
acceleration in either case may be without presentment, demand or
notice of any kind, which Borrower expressly waives.
18.2.3 Right of Set-off. Upon the occurrence of
any Event of Default and at any time and from time to time
thereafter, Lender is hereby authorized, without notice to
Borrower (any such notice being expressly waived by Borrower), to
set off and apply against the Loan Obligations any and all
deposits (general or special, time or demand, provisional or
final) at any time held, or any other Indebtedness at any time
owing by Lender to or for the credit or the account of Borrower,
irrespective of whether or not Lender has made any demand under
the Loan Documents and although such Loan Obligations may be
unmatured. The rights of Lender under this Section are in
addition to other rights and remedies (including, without
limitation, other rights of set-off) which Lender may otherwise
have.
18.2.4 Entry Upon Premises and Access to
Information. Upon the occurrence of any Event of Default and
acceleration of the Loan Obligations as provided herein, and at
any time and from time to time thereafter, Lender may (i) enter
any premises owned or operated by Borrower, and (ii) take
possession of, and make copies and abstracts of, Borrower's
original books and records, obtain access to Borrower's data
processing equipment, computer hardware and software relating to
the Loan Obligations, subject to any proprietary rights of third
Persons, use all of the foregoing and the information contained
therein in any manner Lender deems appropriate in connection with
the exercise of Lender's rights.
18.2.5 Miscellaneous. Upon the occurrence of an
Event of Default and at any time thereafter, Lender may exercise
any other rights and remedies available to Lender under the Loan
Documents or otherwise available to Lender at law or in equity.
18.3 Application of Funds. Any funds received by
Lender with respect to the Loan Obligations after acceleration of
the Loan Obligations as provided herein shall be applied as
follows: (i) first, to reimburse Lender for any amounts due to
Lender under Section 19.7; (ii) second, to reimburse to Lender
all unreimbursed costs and expenses paid or incurred by Lender
that are payable or reimbursable by Borrower hereunder;
(iii) third, to reimburse to Lender all unreimbursed costs and
expenses paid or incurred by Lender (including costs and expenses
incurred by Lender as Lender that are not reimbursable as
provided in the preceding clause) that are payable or
reimbursable by Borrower hereunder; (iv) fourth, to payment of
accrued and unpaid fees due under the Loan Documents and all
other amounts due under the Loan Documents (other than the
Revolving Loan and interest accrued thereon); (v) fifth, to
payment of interest accrued on the Revolving Loan; (vi) sixth, to
payment of the Revolving Loan; and (vii) seventh, to payment of
the other Loan Obligations. Any amounts remaining after the
application of funds and proceeds as provided in this Section
shall be paid to Borrower, or to such other Persons as are
legally entitled thereto.
19. General.
19.1 Lender's Right to Cure. Lender may from time to
time, in its absolute discretion, for Borrower's account and at
Borrower's expense, pay any amount or do any act required of
Borrower under the Loan Documents or requested by Lender to
preserve, protect, maintain or enforce the Loan Obligations and
which Borrower fails to pay or do, including payment of any
judgment against Borrower, insurance premium, Taxes or
assessments, warehouse charge, finishing or processing charge,
landlord's claim, and any other Security Interest. All payments
that Lender makes pursuant to this Section and all out-of-pocket
costs and expenses that Lender pays or incurs in connection with
any action taken by them hereunder shall be a part of the Loan
Obligations. Any payment made or other action taken by Lender
pursuant to this Section shall be without prejudice to any right
to assert an Event of Default hereunder and to pursue Lender's
other rights and remedies with respect thereto.
19.2 Rights Not Exclusive. Every right granted to
Lender hereunder or under any other Revolving Loan Document or
allowed to them at law or in equity shall be deemed cumulative
and may be exercised from time to time.
19.3 Survival of Agreements. All covenants and
agreements made herein and in the other Loan Documents shall
survive the execution and delivery of this Agreement, the
Revolving Note and other Loan Documents and the making of every
Revolving Advance. All agreements, obligations and liabilities
of Borrower under the Loan Documents concerning the payment of
money to Lender, including Borrower's obligations under
Sections 19.6 and 19.7, but excluding the obligation to repay the
Revolving Loan and interest accrued thereon, shall survive the
repayment in full of the Revolving Loan and interest accrued
thereon, the return of the Revolving Note to Borrower, and the
termination or cancellation of the Commitments.
19.4 Sale of Participations. Lender may sell
participations to one or more banks or other entities in all or
a portion of its rights and obligations under this Agreement
provided that the terms of sale satisfy the following
requirements:
19.4.1 Lender's obligations under this Agreement
shall remain unchanged.
19.4.2 Lender shall remain solely responsible to
Borrower for the performance of such obligations.
19.4.3 Lender shall remain the holder of the
Revolving Note.
19.4.4 Borrower and Lender shall continue to deal
solely and directly with each other in connection with Lender's
rights and obligations under this Agreement and with regard to
Revolving Advances and payments to be made under this Agreement
and the Revolving Note. Participation agreements between Lender
and its participants may, however, provide that Lender will
obtain the approval of such participant prior to Lender agreeing
to any amendment or waiver of any provisions of this Agreement
which would (i) extend the maturity of the Revolving Note,
(ii) reduce the interest rate on the Revolving Loan, or
(iii) increase the Commitment.
The sale of any such participations which require Borrower to
file a registration statement with the SEC or under the
securities laws of any state shall not be permitted.
19.5 Assignments to Affiliates. Lender may assign all
or any portion of its interest in the Revolving Loan to its
Affiliates without the acceptance or consent of Borrower, and may
assign all or any portion of its interest in the Revolving Loan
to the Federal Reserve Bank without acceptance or approval of
Borrower.
19.6 Payment of Expenses. Borrower agrees to pay or
reimburse to Lender all of Lender's reasonable out-of-pocket
costs incurred in connection with Lender's due diligence review
before execution of the Loan Documents; the negotiation and
preparation of the commitment letters and the Loan Documents; the
interpretation of any of the Loan Documents; the enforcement of
Lender's rights and remedies under the Loan Documents after a
Default or Event of Default; any amendment of or supplementation
to any of the Loan Documents; and any waiver, consent or
forbearance with respect to any Default or Event of Default.
Borrower further agrees to pay or reimburse to Lender all of
Lender's reasonable out-of-pocket costs incurred in connection
with the enforcement of Lender's rights and remedies under the
Loan Documents after a Default or Event of Default. Out-of-
pocket costs may include but are not limited to the following, to
the extent they are actually paid or incurred; the cost of
searches for Security Interests existing against Borrower;
recording and filing fees; fees for all required appraisals;
environmental consultant fees; litigation costs; and all
attorneys' and paralegals' expenses and reasonable fees.
Attorneys' and paralegals' expenses may include but are not
limited to filing charges; telephone, data transmission,
facsimile and other communication costs; courier and other
delivery charges; and photocopying charges. Litigation costs may
include but are not limited to filing fees, deposition costs,
expert witness fees, expenses of service of process, and other
such costs paid or incurred in any administrative, arbitration,
or court proceedings involving Lender and Borrower, including
proceedings under the Federal Bankruptcy Code. All costs which
Borrower is obligated to pay or reimburse to Lender are Loan
Obligations payable to Lender and are payable on Lender's demand.
19.7 General Indemnity.
19.7.1 Borrower shall indemnify and hold harmless
Lender and its directors, officers, employees, agents, and
representatives (the "Indemnified Parties") for, from and
against, and promptly reimburse the Indemnified Parties for, any
and all claims, damages, liabilities, losses, costs and expenses
(including reasonable attorneys' fees and expenses and amounts
paid in settlement) incurred, paid or sustained by the
Indemnified Parties in connection with, arising out of, based
upon or otherwise involving or resulting from any threatened,
pending or completed action, suit, investigation or other
proceeding by, against or otherwise involving the Indemnified
Parties in any way dealing with, relating to or otherwise
involving this Agreement, any of the other Loan Documents, or any
transaction contemplated hereby or thereby, except to the extent
that they arise from the gross negligence, bad faith or willful
misconduct of any of the Indemnified Parties. Borrower shall
indemnify and hold harmless the Indemnified Parties for, from and
against, and promptly reimburse the Indemnified Parties for, any
and all claims, damages, liabilities, losses, costs and expenses
(including reasonable attorneys' and consultant fees and
expenses, investigation and laboratory fees, removal, remedial,
response and corrective action costs, and amounts paid in
settlement) incurred, paid or sustained by the Indemnified
Parties as a result of the manufacture, storage, transportation,
release or disposal of any Hazardous Material on, from, over or
affecting any of the assets, properties, or operations of a
Covered Person or any predecessor in interest, directly or
indirectly, except to the extent that they arise from the gross
negligence, bad faith or willful misconduct of any of the
Indemnified Parties.
19.7.2 The obligations of Borrower under this
Section 19.7 shall survive the termination or cancellation of the
Commitments, and the payment and satisfaction of all of the Loan
Obligations.
19.7.3 To the extent that any of the indemnities
required from Borrower under this Section are unenforceable
because they violate any Law or public policy, Borrower shall pay
the maximum amount which it is permitted to pay under applicable
Law.
19.8 Revolving Loan Records. The date and amount of
all Revolving Advances and payments of amounts due from Borrower
under the Loan Documents will be recorded in the Lender's records
and the records that Lender normally maintains for such types of
transactions. The failure to record, or any error in recording,
any of the foregoing shall not, however, affect the obligation of
Borrower to repay the Revolving Loan and other amounts payable
under the Loan Documents. Borrower shall have the burden of
proving that Lender's records are not correct. Borrower agrees
that Lender's books and records showing the Loan Obligations and
the transactions pursuant to this Agreement shall be admissible
in any action or proceeding arising therefrom, and shall
constitute prima facie proof thereof, irrespective of whether any
Revolving Loan Obligation is also evidenced by a promissory note
or other instrument. Lender will provide to Borrower a monthly
statement of Revolving Advances, payments, and other transactions
pursuant to this Agreement. Such statements shall be deemed
correct, accurate and binding on Borrower and an account stated
(except for reversals and reapplications of payments as provided
in Section 8.4 and corrections of errors discovered by Lender),
unless Borrower notifies Lender in writing to the contrary within
30 days after such statement is rendered. In the event a timely
written notice of objections is given by Borrower, only the items
to which exception is expressly made will be considered to be
disputed by Borrower.
19.9 Other Security and Guaranties. Lender may,
without notice or demand and without affecting Borrower's
obligations hereunder, from time to time: (a) take from any
Person and hold collateral for the payment of all or any part of
the Loan Obligations and exchange, enforce and release such
collateral or any part thereof; and (b) accept and hold any
endorsement or guaranty of payment of all or any part of the Loan
Obligations and release or substitute any such endorser or
guarantor, or any Person who has given any Security Interest in
any other collateral as security for the payment of all or any
part of the Loan Obligations, or any other Person in any way
obligated to pay all or any part of the Loan Obligations.
20. Miscellaneous.
20.1 Notices. All notices, consents, requests and
demands to or upon the respective parties hereto shall be in
writing, and shall be deemed to have been given or made when
delivered in person to those Persons listed on the signature
pages hereof or two days after being deposited in the United
States mail, postage prepaid, or, in the case of telegraphic
notice, or the overnight courier services, when delivered to the
telegraph company or overnight courier service, or in the case of
telex or telecopy notice, when sent, verification received, in
each case addressed as set forth on the signature pages hereof,
or such other address as either party may designate by notice to
the other in accordance with the terms of this paragraph. No
notice given to or demand made on Borrower by any Lender in any
instance shall entitle Borrower to notice or demand in any other
instance.
20.2 Amendments, Waivers and Consents. Unless
otherwise provided herein, no amendment to or waiver of any
provision of this Agreement, or of any of the other Loan
Documents, nor consent to any departure by Borrower herefrom or
therefrom, shall be effective unless it is in writing and signed
by authorized officers of Borrower and Lender. No notice to or
demand on Borrower in any case shall entitle Borrower to any
other or further notice or demand in similar or other
circumstances. No failure by any Lender to exercise, and no
delay by any Lender in exercising, any right, remedy, power or
privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise by Lender of any right, remedy,
power or privilege hereunder preclude any other exercise thereof,
or the exercise of any other right, remedy, power or privilege.
Each and every right granted to Lender hereunder or under any
other Loan Document or other document delivered hereunder or in
connection with this Agreement or allowed to them at law or in
equity shall be deemed cumulative and may be exercised from time
to time.
20.3 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and
all future holders of the Revolving Note and their respective
successors and assigns, except that Borrower may not assign,
delegate or transfer any of its rights or obligations under this
Agreement without the prior written consent of Lender. With
respect to Borrower's successors and assigns, such successors and
assigns shall include any receiver, trustee or debtor-in-
possession of or for Borrower.
20.4 Severability. Any provision of this Agreement
which is prohibited, unenforceable or not authorized in any
jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition, unenforceability or lack of
authorization without invalidating the remaining provisions
hereof or affecting the validity, enforceability or legality of
such provision in any other jurisdiction unless the
ineffectiveness of such provision would result in such a material
change as to cause completion of the transactions contemplated
hereby to be unreasonable.
20.5 Counterparts. This Agreement may be executed by
the parties hereto on any number of separate counterparts, and
all such counterparts taken together shall constitute one and the
same instrument. It shall not be necessary in making proof of
this Agreement to produce or account for more than one
counterpart signed by the party to be charged.
20.6 Governing Law; No Third Party Rights. This
Agreement, the other Loan Documents and the Revolving Note and
the rights and obligations of the parties hereunder and
thereunder shall be governed by and construed and interpreted in
accordance with the internal laws of the State of Missouri
applicable to contracts made and to be performed wholly within
such state, without regard to choice or conflict of laws
provisions. This Agreement is solely for the benefit of the
parties hereto and their respective successors and assigns, and
no other Person shall have any right, benefit, priority or
interest under, or because of the existence of, this Agreement.
20.7 Counterpart Facsimile Execution. For purposes of
this Agreement, a document (or signature page thereto) signed and
transmitted by facsimile machine or telecopier is to be treated
as an original document. The signature of any Person thereon,
for purposes hereof, is to be considered as an original
signature, and the document transmitted is to be considered to
have the same binding effect as an original signature on an
original document. At the request of any party hereto, any
facsimile or telecopy document is to be re-executed in original
form by the Persons who executed the facsimile or telecopy
document. No party hereto may raise the use of a facsimile
machine or telecopier or the fact that any signature was
transmitted through the use of a facsimile or telecopier machine
as a defense to the enforcement of this Agreement or any
amendment or other document executed in compliance with this
Section.
20.8 No Other Agreements. There are no other
agreements between Lender and Borrower, oral or written,
concerning the subject matter of the Loan Documents, and all
prior agreements concerning the same subject matter, including
the Commitment Letter, are merged into the Loan Documents and
thereby extinguished.
20.9 Incorporation By Reference. All of the terms of
the other Loan Documents are incorporated in and made a part of
this Agreement by this reference.
20.10 Negotiated Transaction. Borrower and Lender
represent one to the other that in the negotiation and drafting
of this Agreement they have been represented by and have relied
upon the advice of counsel of their choice. Borrower and Lender
affirm that their counsel have both had substantial roles in the
drafting and negotiation of this Agreement and, therefore, this
Agreement shall be deemed drafted by both Borrower and Lender,
and the rule of construction to the effect that any ambiguities
are to be resolved against the drafter shall not be employed in
the interpretation of this Agreement.
21. Choice of Forum. SUBJECT ONLY TO THE EXCEPTION IN THE
NEXT SENTENCE, BORROWER HEREBY AGREES TO THE EXCLUSIVE
JURISDICTION OF THE FEDERAL COURTS OF THE EASTERN DISTRICT OF
MISSOURI, AND THE STATE COURTS OF MISSOURI LOCATED IN ST. LOUIS
COUNTY OR THE CITY OF ST. LOUIS, MISSOURI, OTHER THAN IN ANY
PROCEEDING INITIATED BY A THIRD PARTY, AND WAIVES ANY OBJECTION
BASED ON VENUE OR FORUM NON CONVENIENS WITH RESPECT TO ANY ACTION
INSTITUTED THEREIN, AND AGREES THAT ANY DISPUTE CONCERNING THE
RELATIONSHIP BETWEEN LENDER AND BORROWER OR THE CONDUCT OF ANY OF
THEM IN CONNECTION WITH THIS AGREEMENT, ANY OTHER LOAN DOCUMENT
OR OTHERWISE MAY BE HEARD IN THE COURTS DESCRIBED ABOVE.
22. Service of Process. BORROWER HEREBY WAIVES PERSONAL
SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH
SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL (RETURN RECEIPT
REQUESTED) DIRECTED TO BORROWER AT ITS ADDRESS SET FORTH ON THE
SIGNATURE PAGES HEREOF, AND SERVICE SO MADE SHALL BE DEEMED TO BE
COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN SO
DEPOSITED IN THE U.S. MAILS CERTIFIED OR REGISTERED. NOTHING IN
THIS SECTION SHALL AFFECT THE RIGHT OF LENDER TO SERVE LEGAL
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
23. Jury Trial. BORROWER AND LENDER HEREBY WAIVE ANY RIGHT
TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
(1) ARISING UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR
(2) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO OR ANY OF THEM IN RESPECT OF THIS
AGREEMENT OR ANY OTHER Loan DOCUMENT, OR THE TRANSACTIONS RELATED
HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE.
BORROWER AND LENDER AGREE AND CONSENT THAT ANY SUCH CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY AND THAT ANY OF THEM MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY.
24. Statutory Notice. The following notice is given pursuant
to Section 432.045 of the Missouri Revised Statutes; nothing
contained in such notice shall be deemed to limit or modify the
terms of the Loan Documents:
ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND
CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT
INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT
ENFORCEABLE. TO PROTECT YOU (BORROWER) AND US (CREDITOR)
FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS
WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS
WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF
THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE IN
WRITING TO MODIFY IT.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed by appropriate duly authorized officers
as of the date first above written.
INSITUFORM TECHNOLOGIES, INC. NATIONSBANK, N.A.
by its Senior Vice President by its Vice President
------------------------ --------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxx X. Xxxxxxx
------------------------------- --------------------------------
Xxxxxxx X. Xxxxxx Xxxx X. Xxxxxxx
--------------------- ----------------------
Notice Address: Notice Address:
702 Spirit 00 Xxxx Xxxxx 000 Xxxxxx Xxxxxx
------------------------------ --------------------------------
Xxxxxxxxxxxx, XX 00000 Xx. Xxxxx, XX 00000
------------------------------ --------------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxx Xxxxxxx
FAX # 000-000-0000 FAX # 000-000-0000
------------------------- ---------------------------
TEL # 000-000-0000 TEL # 000-000-0000
------------------------- ---------------------------
EXHIBIT 2.1
GLOSSARY AND INDEX OF DEFINED TERMS
Adjusted EBITDA is defined in Section 17.1.
Adjusted LIBO Rate is defined in Section 4.4.
Affected Principal Amount is defined in Section 4.12.
Affiliate - with respect to any Person, (a) any other Person who
is a partner, director or executive officer of such Person; and
(b) any other Person which, directly or indirectly, is in control
of, is controlled by or is under common control with such Person,
and any partner, director or executive officer of such other
Person. For purposes of this Agreement, control of a Person by
another Person shall be deemed to exist if such other Person has
the power, directly or indirectly, either to (i) vote twenty
percent (20%) or more of the securities having the power to vote
in an election of directors of such Person, or (ii) direct the
management of such Person, whether by contract or otherwise and
whether alone or in combination with others.
Agreement is defined on Page 1.
Borrower is defined on Page 1.
Borrowing Officer - each officer of Borrower who is authorized to
submit a request for an Revolving Advance or the issuance of a
Letter of Credit.
Business Day - a day other than a Saturday, Sunday or other day
on which commercial banks are authorized or required to close
under the laws of either the United States or the States of
Missouri.
Capital Expenditure - an expenditure for an asset that must be
depreciated or amortized under GAAP, for goodwill, or for any
asset that under GAAP must be treated as a capital asset,
including payments under Capital Leases. An expenditure for
purposes of this definition includes any deferred or seller
financed portion of the purchase price of an asset and the
original capitalized amount of a Capital Lease.
Capital Lease - any lease that has been or should be capitalized
under GAAP.
Charter Documents - the articles or certificate of incorporation
and bylaws of a corporation; the certificate of limited
partnership and partnership agreement of a limited partnership;
the partnership agreement of a general partnership; the articles
of organization of a limited liability company; or the indenture
of a trust, or comparable documents for other entities.
Cobra - The Consolidated Omnibus Budget Reconciliation Act of
1986.
Code - the Internal Revenue Code of 1986 and all regulations
thereunder of the IRS.
Commitment Fee is defined in Section 5.
Commitment Fee Rate is defined in Section 5, 5.
Commitment Letter - That certain letter dated February 11, 1997
between Borrower and Lender.
Commitments - the Revolving Commitment and the Letter of Credit
Commitment.
Commonly Controlled Entity - a Person which is under common
control with another Person within the meaning of Section 414(b)
or (c) of the Code.
Consolidated Adjusted Net Worth is defined in Section 16.1.
Contract - any contract, note, bond, indenture, deed, mortgage,
deed of trust, security agreement, pledge, hypothecation
agreement, assignment, or other agreement or undertaking, or any
security.
Conversion Date is defined in Section 4.6.
Covered Person is defined in Section 2.3.
Current Assets is defined in Section 17.1.
Current Liabilities is defined in Section 17.1.
Default - any of the events listed in Section 18.1 of this
Agreement, without giving effect to any requirement for the
giving of notice, for the lapse of time, or both, or for the
happening of any other condition, event or act.
Disclosure Schedule - the Disclosure Schedule of Borrower
attached hereto as Exhibit 13.
DOL - the United States Department of Labor.
Dollars - and the sign "$", lawful money of the United States.
EBITDA is defined in Section 17.1.
Effective Date - the date when this Agreement is effective as
provided in Section 1.
Environmental Law - the Resource Conservation and Recovery Act,
the Comprehensive Environmental Response, Compensation and
Liability Act, the Clean Water Act, the Clean Air Act, or any
other Law pertaining to environmental quality or remediation of
Hazardous Material.
ERISA Affiliate - as to any Person, any trade or business
(irrespective of whether incorporated) which is a member of a
group of which such Person is a member and thereafter treated as
a single employer under Section 414(b), (c), (m) or (o) of the
Code or applicable Treasury Regulations.
ERISA - the Employee Retirement Income Security Act of 1974.
Event of Default - any of the events listed in Section 18.1 of
this Agreement as to which any requirement for the giving of
notice, for the lapse of time, or both, or for the happening of
any further condition, event or act has been satisfied.
Execution Date - the date when this Agreement has been executed.
Exempted Subsidiaries - Midsouth Partners and Insituform Linings
Plc.
Existing Default - a Default which has occurred and is
continuing, or an Event of Default which has occurred, and which
has not been waived in writing by Lender.
Final Payment - repayment in full of the Revolving Loans and all
unpaid interest accrued thereon accompanied by the cancellation
or termination of all of the Commitments and expiration of all
outstanding Letters of Credit for which Borrower has not provided
cash collateral satisfactory to Lender as provided herein to
cover the Letter of Credit Exposure with respect thereto.
Financial Statements - the most recent of the Initial Financial
Statements and the financial statements of Borrower that are
furnished to Lender as required in Section 15.12 of this
Agreement; provided, however, that for purposes of calculating
any amount or financial ratio hereunder as of a date or for a
period not entirely covered by the most recent and prior such
financial statements furnished to Lender, the term "Financial
Statements" shall be deemed to include the financial statements
of Borrower that cover such periods as have been filed by
Borrower with the Securities and Exchange Commission.
Fixed Charges is defined in Section 17.1.
FRB - the Board of Governors of the Federal Reserve System and
any successor thereto or to the functions thereof.
Funded Debt is defined in Section 17.1.
GAAP - those generally accepted accounting principles set forth
in Statements of the Financial Accounting Standards Board and in
Opinions of the Accounting Principles Board of the American
Institute of Certified Public Accountants or which have other
substantial authoritative support in the United States and are
applicable in the circumstances, as applied on a consistent
basis.
Governmental Authority - the federal government of the United
States; the government of any foreign country that is recognized
by the United States or is a member of the United Nations; any
state of the United States; any local government or municipality
within the territory or under the jurisdiction of any of the
foregoing; any department, agency, division, or instrumentality
of any of the foregoing; and any court, arbitrator, or board of
arbitrators whose orders or judgements are enforceable by or
within the territory of any of the foregoing.
Guaranty - the guaranty required under Section 10 to be executed
and delivered to Lender.
Guarantor - a Subsidiary of Borrower that has executed and
delivered to Lender either the Guaranty or a joinder to the
Guaranty as required under Section 10.
Hazardous Material - any hazardous, radioactive, toxic, solid or
special waste, material, substance or constituent thereof, or any
other such substance (as defined under any applicable law or
regulation), including Asbestos or asbestos containing material.
"Hazardous Material" does not include materials or products
containing hazardous constituents which are not considered to be
waste under the applicable Environmental Law or which are
considered to be waste but are transported, handled or disposed
of in accordance with the applicable Environmental Law, or
asbestos or asbestos containing material which is not friable.
Indebtedness - as to any Person at any particular date, any
contractual obligation enforceable against such Person (i) to
repay borrowed money; (ii) to pay the deferred purchase price of
property or services; (iii) to make payments or reimbursements
with respect to bank acceptances or to a factor; (iv) to make
payments or reimbursements with respect to letters of credit
whether or not there have been drawings thereunder; (v) with
respect to which there is any Security Interest in any property
of such Person; (vi) to make any payment or contribution to a
Multi-Employer Plan; (vii) that is evidenced by a note, bond,
debenture or similar instrument; (viii) under any conditional
sale agreement or title retention agreement; or (ix) to pay
interest or fees with respect to any of the foregoing.
"Indebtedness" also includes any other Obligation that either
(i) is non-contingent and liquidated in amount or (ii) should
under GAAP be included in liabilities and not just as a footnote
on a balance sheet.
Indemnified Parties is defined in Section 19.7.1.
Indirect Obligation - as to any Person, (a) any guaranty by such
Person of any Obligation of another Person; (b) any Security
Interest in any property of such Person that secures any
Obligation of another Person, (c) any enforceable contractual
requirement that such Person (i) purchase an Obligation of
another Person or any property that is security for such
Obligation, (ii) advance or contribute funds to another Person
for the payment of an Obligation of such other Person or to
maintain the working capital, net worth or solvency of such other
Person as required in any documents evidencing an Obligation of
such other Person, (iii) purchase property, securities or
services from another Person for the purpose of assuring the
beneficiary of any Obligation of such other Person that such
other Person has the ability to timely pay or discharge such
Obligation, (iv) grant a Security Interest in any property of
such Person to secure any Obligation of another Person, or
(v) otherwise assure or hold harmless the beneficiary of any
Obligation of another Person against loss in respect thereof; and
(d) any other contractual requirement enforceable against such
Person that has the same substantive effect as any of the
foregoing. The term "Indirect Obligation" does not, however,
include the indorsement by a Person of instruments for deposit or
collection in the ordinary course of business or the liability of
a general partner of a partnership for Obligations of such
partnership. The amount of any Indirect Obligation of a Person
shall be deemed to be the stated or determinable amount of the
Obligation in respect of which such Indirect Obligation is made
or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by such
Person in good faith.
Initial Financial Statements - the financial statements of
Borrower referred to in Section 13.11.
Interest Period - the period during which a particular Adjusted
LIBO Rate applies to a LIBOR Tranche, as selected by Borrower as
provided in Section 4.2.
Interim Repayment is defined in Section 6.1.
IRS - the Internal Revenue Service.
Law - any statute, rule, regulation, order, judgment, award or
decree of any Governmental Authority.
Lender - NationsBank, N.A.
Lending Office - the office of Lender at 000 Xxxxxx Xxxxxx, Xx.
Xxxxx, Xxxxxxxx, 00000, or such other address as Lender may
designate from time to time by notice to Borrower in accordance
with the terms of Section 20.1.
Letter of Credit - a letter of credit issued by Lender pursuant
to the Letter of Credit Commitment.
Letter of Credit Commitment - the commitment of Lender to issue
letters of credit as provided in Section 3.2.
Letter of Credit Exposure - the undrawn amount of all outstanding
letters of credit issued by Lender for the account of Borrower or
any of its Subsidiaries under the Letter of Credit Commitment
plus all amounts drawn on such letters of credit and not yet
reimbursed to Lender by Borrower.
LIBO Rate is defined in Section 4.4.
LIBOR Increment - is defined in Section 4.5.
LIBOR Tranche - a Tranche on which interest accrues at the
Adjusted LIBO Rate.
Loan Documents - this Agreement, the Revolving Note, the Guaranty
and all other agreements, certificates, documents, instruments
and other writings executed in connection herewith.
Loan Obligations - all of Borrower's Indebtedness owing to Lender
under the Loan Documents, whether as principal, interest, fees or
otherwise, all reimbursement obligations of Borrower to Lender
with respect to the Letter of Credit Exposure, and all other
obligations and liabilities of Borrower to Lender under the Loan
Documents (in each case including all extensions, renewals,
modifications, rearrangements, restructures, replacements and
refinancings of the foregoing, whether or not the same involve
modifications to interest rates or other payment terms), whether
now existing or hereafter created, absolute or contingent, direct
or indirect, joint or several, secured or unsecured, due or not
due, contractual or tortious, liquidated or unliquidated, arising
by operation of law or otherwise, including but not limited to
the obligation of Borrower to repay future advances by Lender
under the Loan Documents, whether or not made pursuant to
commitment and whether or not presently contemplated by Borrower
and Lender in the Loan Documents.
Maintenance Capital Expenditures is defined in Section 17.1.
Material Adverse Effect - with respect to any event or occurrence
of whatever nature (including any adverse determination in any
litigation, arbitration, investigation or proceeding), a material
adverse effect on the business, operations, revenues, financial
condition or property of the Borrower and its Subsidiaries taken
as a whole, without reference to any Restructuring Charges,or the
ability of the Borrower to timely pay or perform the Borrower's
Obligations generally, or the ability of Borrower to pay or
perform any of the Loan Obligations.
Material Agreement - as to any Person, any Contract to which such
Person is a party or by which such Person is bound which, if
violated or breached, would have a Material Adverse Effect.
Material Law - any Law whose violation by a Person would have a
Material Adverse Effect.
Material License - (i) as to any Person, any license, permit or
consent from a Governmental Authority or other Person and any
registration and filing with a Governmental Authority or other
Person which if not obtained, held or made would have a Material
Adverse Effect, and (ii) as to any Person who is a party to this
Agreement or any of the other Loan Documents, any license, permit
or consent from a Governmental Authority or other Person and any
registration or filing with a Governmental Authority or other
Person that is necessary for the execution or performance by such
party, or the validity or enforceability against such party, of
this Agreement or such other Loan Document.
Material Obligation - as to any Person, an Obligation of such
Person which if not fully and timely paid or performed would have
a Material Adverse Effect.
Material Proceeding - any litigation, investigation or other
proceeding by or before any Governmental Authority (i) which
involves any of the Loan Documents or any of the transactions
contemplated thereby, or involves a Covered Person or a Guarantor
as a party or any property of Covered Person or a Guarantor, and
is reasonably likely to have a Material Adverse Effect, or
(ii) in which there has been issued an injunction, writ,
temporary restraining order or any other order of any nature
which purports to restrain or enjoin the making of any Revolving
Advance, the consummation of any other transaction contemplated
by the Loan Documents, or the enforceability of any provision of
any of the Loan Documents.
Maturity - as to any Indebtedness, the time when it becomes
payable in full, whether at a regularly scheduled time, because
of acceleration or otherwise.
Maturity Date - the date specified in Section 6.1.
Multi-employer Plan - a Pension Benefit Plan which is a multi-
employer plan as defined in Section 4001(a)(3) of ERISA.
Note Purchase Agreement - the Note Purchase Agreement dated
February 14, 1997, as amended, among Borrower and other parties
signatory thereto under which Borrower issued certain 7.88%
Senior Notes, Series A, Due February 14, 2007, of $110,000,000
aggregate original principal amount.
Notice of Conversion/Continuation is defined in Section 4.6.
Obligation - as to any Person, any Indebtedness of such Person,
any guaranty by such Person of any Indebtedness of another
Person, and any contractual requirement enforceable against such
Person that does not constitute Indebtedness of such Person or a
guaranty by such Person but which would involve the expenditure
of money by such Person if complied with or enforced.
PBGC - the Pension Benefit Guaranty Corporation.
Pension Benefit Plan - any pension or profit-sharing plan which
is covered by Title I of ERISA and all other benefit plans and in
respect of which a Person or a Commonly Controlled Entity of such
Person as an "employer" as defined in Section 3(5) of ERISA.
Permitted Acquisition is defined in Section 16.4.
Permitted Indebtedness - Indebtedness that is permitted under
Section 16.1.
Person - any individual, partnership, corporation, trust,
unincorporated association, joint venture, limited liability
company, limited liability partnership, Governmental Authority,
or other organization in any form that has the legal capacity to
xxx or be sued. If the context so implies or requires, the term
Person includes Borrower.
Prime Rate is defined in Section 4.3.
Prime Rate Tranche - a Tranche on which interest accrues at the
Prime Rate.
Priority Debt is defined in Section 16.1.
Regulation D, Regulation G, Regulation U, Regulation T, and
Regulation X" - respectively, Regulation D issued by the FRB,
Regulation G issued by the FRB, Regulation U issued by the FRB,
Regulation T issued by the FRB and Regulation X issued by the
FRB.
Remaining Interest Period is defined in Section 4.12.
Reportable Event - a reportable event as defined in Title IV of
ERISA or the regulations thereunder.
Responsible Officer - as to any Person that is not an individual,
partnership or trust, the Chairman of the Board of Directors, the
President, the chief executive officer, the chief operating
officer, the chief financial officer, the Treasurer, any
Assistant to the Treasurer, or any Vice President in charge of a
principal business unit; as to any partnership, any individual
who is a general partner thereof or any individual who has
general management or administrative authority over all or any
principal unit of the partnership's business; and as to any
trust, any individual who is a trustee.
Restricted Indirect Obligations is defined in Section 17.1.
Restricted Payment is defined in Section 16.6.
Restructuring Charges - any and all charges and provisions
related to the relocation of Borrower's corporate headquarters,
engineering and development center from Memphis to metropolitan
St. Louis, including severance costs.
Revolving Advance - an advance to Borrower under the Revolving
Commitment.
Revolving Advance Date is defined in Section 9.1.
Revolving Commitment - the commitment of Lender as stated in
Section 3.1.1 to make Revolving Advances.
Revolving Loan - the from time to time outstanding principal
balance of all Revolving Advances.
Security Interest - as to any item of tangible or intangible
property, any interest therein or right with respect thereto that
secures an Obligation or Indirect Obligation, whether such
interest or right is created under a Contract, or by operation of
law or statute (such as but not limited to a statutory lien for
work or materials), or as a result of a judgment, or which arises
under any form of preferential or title retention agreement or
arrangement (including a conditional sale agreement or a lease)
that has substantially the same economic effect as any of the
foregoing.
Senior Notes - the 7.88% Senior Notes, Series A, Due February 14,
2007 of $110,000,000 aggregate original principal amount that
were issued by Borrower pursuant to the Note Purchase Agreement.
Subsidiary - as to any Person, a corporation with respect to
which more than 50% of the outstanding shares of stock of each
class having ordinary voting power (other than stock having such
power only by reason of the happening of a contingency) is at the
time owned by such Person or by one or more Subsidiaries of such
Person, other than a corporation which has no significant assets
and is not actively engaged in a trade or business.
Tangible Assets is defined in Section 17.1.
Tangible Net Worth is defined in Section 17.1.
Tax - as to any Person, any tax, assessment, fee, or other charge
levied by a Governmental Authority on the income or property of
such Person, including any interest or penalties thereon, and
which is payable by such Person.
Total Assets means the total assets of the Borrower and its
Subsidiaries, as shown on the most recent annual Financial
Statements.
Total Capitalization is defined in Section 17.1.
Tranche - any portion of a Revolving Loan, or an entire Revolving
Loan if applicable, on which interest accrues at a particular
rate as selected by Borrower as provided herein.
UCC - the Uniform Commercial Code as in effect from time to time
in the State of Missouri or such other similar statute as in
effect from time to time in Missouri or any other appropriate
jurisdiction.
United States - when used in a geographical sense, all the states
of the United States of America and the District of Columbia; and
when used in a legal jurisdictional sense, the government of the
country that is the United States of America.
United States Assets means the identifiable United States assets
of the Borrower and its Subsidiaries, as shown on the most recent
annual Financial Statements.
Unused Revolving Commitment is defined in Section 5.
Welfare Benefit Plan - any plan described by Section 3(1) of
ERISA.
1996 Form 10-K means Borrower's Annual Report as Form 10-K for
the year ended December 31, 1996, as amended, filed with the
Securities and Exchange Commission.
1997 Form 10-Qs means Borrower's Quarterly Reports on Form 10-Q
for, respectively, the three months ended March 31, 1997, and the
three months ended June 30, 1997, filed with the Securities and
Exchange Commission.
EXHIBIT 3.1.2
FORM OF REVOLVING NOTE
REVOLVING NOTE
$20,000,000.00 St. Louis, Missouri
August 20, 1997
For value received, Insituform Technologies, Inc.
("Borrower"), promises to pay to the order of the NationsBank,
N.A. ("Lender") the principal sum of $20,000,000.00 or such
lesser outstanding principal amount as has been advanced to
Borrower under the Loan Agreement effective August 20, 1997,
between Borrower and NationsBank, N.A. (as it may be amended,
restated, extended, renewed, replaced, or otherwise modified from
time to time, the "Loan Agreement"), and all unpaid interest
accrued thereon, on September 1, 2000. Borrower further promises
to pay, on such dates as are provided in the Loan Agreement,
interest from the date hereof accrued on the from time to time
outstanding principal balance at the per annum rate or rates as
provided in the Loan Agreement.
All capitalized terms used and not otherwise defined
herein have the meanings given them in the Loan Agreement.
Commencing on the Maturity Date and, if sooner, upon the
occurrence of an Event of Default, all outstanding principal and,
to the extent permitted by law, unpaid interest accrued under
this Note and all other amounts owing hereunder shall bear
interest, payable on demand, at the Default Rate.
All interest payable under this Note shall be computed on
the basis of a year deemed to consist of 360 days and paid for
the actual number of days elapsed and both principal and interest
are payable in Dollars to Lender at the Lending Office.
Payment of this Note is guarantied by the Guarantors as
provided in the Loan Agreement and the Guaranty.
Borrower may prepay the principal amount of this Note to
the extent and upon the conditions provided in the Loan
Agreement.
The date and amount of all disbursements and receipts of
principal and interest with respect to this Note will be recorded
in the records that Lender normally maintains for instruments and
agreements similar to this Note and the other Loan Documents.
The failure to record, or any error in recording, any of the
foregoing does not, however, affect the obligation of Borrower to
pay principal, interest and other amounts as required under the
Loan Documents. Borrower has the burden of proving that Lender's
records are not correct. Borrower agrees that Lender's books and
records showing disbursements and receipts are admissible in any
action or proceeding arising therefrom, and constitute prima
facie proof thereof. Such records are deemed accurate and
binding on Borrower and an account stated, except as expressly
provided otherwise in the Loan Agreement.
The Loan Agreement contains provisions regarding the
acceleration of the maturity hereof upon the occurrence of any
Event of Default, and such provisions are incorporated herein by
this reference.
If any payment required under this Note or the Loan
Agreement is not made when due, or upon any other Event of
Default, Borrower will pay all costs of collection of this Note,
including but not limited to court costs and reasonable attorneys
fees and actual expenses of such attorneys, whether or not
litigation is commenced, including representation of Lender in
connection with any bankruptcy or insolvency proceeding of
Borrower.
Demand for payment, presentment, protest, notice of
protest and nonpayment, notice of dishonor, and all other notices
and demands under this Note and any and all lack of diligence in
the enforcement of this Note are hereby waived by maker,
Guarantors and all others who become parties to this Note and the
same hereby assent to each and every extension or postponement of
the time of payment, at or after demand, or other indulgence, and
hereby waive any and all notice thereof. Every such party by
becoming a party to this Note further waives any and all defenses
which such party may have based on suretyship or impairment of
collateral with respect to this Note.
No amendment, modification or waiver of any provision of
this Note, or consent to any departure by Borrower herefrom, will
be effective unless the same is in writing signed by an
authorized officer of Lender, and then only in the specific
instance and for the specific purpose for which given. No
failure on the part of Lender to exercise, and no delay in
exercising, any right under this Note operates as a waiver
thereof, and no single or partial exercise by Lender of any right
under this Note precludes any other or further exercise thereof,
or the exercise of any other right. Each and every right granted
to Lender under this Note or allowed to it at law or in equity is
deemed cumulative and such remedies may be exercised from time to
time concurrently or consecutively at Lender's option.
All notices required to be given or which may be given in
connection with this Note are to be given in the manner required
for notices under the Loan Agreement.
This Note is to be governed by and construed and
interpreted in accordance with the internal laws of the State of
Missouri applicable to contracts made and to be performed wholly
within such state, without regard to choice or conflicts of law
principles.
INSITUFORM TECHNOLOGIES, INC.
by its
-----------------------------
EXHIBIT 10-A
FORM OF GUARANTY
UNLIMITED GUARANTY
This Unlimited Guaranty (this "Guaranty"), effective
August 20, 1997, (the "Effective Date") is given by each of the
undersigned entities (each a "Guarantor" and collectively the
"Guarantors"), to NATIONSBANK, N.A., a national banking association
("Beneficiary").
To induce, and in consideration of, beneficiary's execution
of the Loan Agreement and Beneficiary's Commitments, and for other
sufficient consideration, the receipt of which is hereby
acknowledged, the Guarantors and Beneficiary hereby agree as
follows:
1. General. Unless the context of this Guaranty
clearly requires otherwise, (i) references to the plural include
the singular and vice versa, (ii) references to any Person include
such Person's successors and assigns but, if applicable, only if
such successors and assigns are permitted by this Guaranty, (iii)
references to one gender include all genders, (iv) "including" is
not limiting, (v) "or" has the inclusive meaning represented by the
phrase "and/or", (vi) the words "hereof", "herein", "hereby",
"hereunder" and similar terms in this Guaranty refer to this
Guaranty as a whole, including its Exhibits, and not to any
particular provision of this Guaranty, (vii) the word "Section" or
"section" and "Page" or "page" refer to a section or page,
respectively, of this Guaranty unless it expressly refers to
something else, (viii) reference to any agreement, document, or
instrument, including this Guaranty, any other Loan Document and
any agreement, document or instrument defined herein, means such
agreement, document, or instrument as it may have been or may be
amended, restated, extended, renewed, replaced, or otherwise
modified and in effect from time to time in accordance with the
terms thereof and, if applicable, the terms hereof, and includes
all attachments thereto and instruments incorporated therein, if
any, and (ix) general and specific references to any Law means such
Law as amended, modified, codified or reenacted, in whole or in
part, and in effect from time to time. Section captions are for
convenience only and do not affect the interpretation or
construction of this Guaranty.
2. Definitions. All capitalized terms not otherwise
defined herein have the meanings given them in that certain Loan
Agreement of even date herewith by and between Insitutform
Technologies, Inc. ("Borrower") and Beneficiary (as it may be
amended, restated, extended, renewed, replaced, or otherwise
modified from time to time, the "Loan Agreement").
3. Acknowledgement of Capacity as a Covered Person
Under the Loan Agreement. Each Guarantor acknowledges that it has
reviewed the Loan Agreement and agrees that it is a "Covered
Person" (as that term is defined in the Loan Agreement and used in
the Loan Agreement and the other Loan Documents). All of the
representations and warranties, covenants, and agreements contained
in the Loan Agreement and the other Loan Documents which are
applicable to a Covered Person are incorporated into this Guaranty
by this reference and each Guarantor, as such a Covered Person,
hereby makes such representations and warranties to, and makes such
covenants and agreements with, Beneficiary. Each Guarantor further
acknowledges and agrees that the failure of a Guarantor to comply
with any terms of the Loan Agreement or the other Loan Documents
applicable to such Guarantor as a Covered Person will result in a
Default under the Loan Agreement and the other Loan Documents,
entitling Beneficiary to all of their remedies thereunder and under
applicable law and in equity.
4. Guaranty.
4.1 Unlimited Guaranty of Payment and Performance.
Guarantors hereby jointly and severally guaranty to Beneficiary,
for the benefit of Beneficiary, the full and prompt payment and
performance of the Loan Obligations and all costs of collection
thereof, including reasonable attorneys' fees and expenses (whether
or not there is litigation), court costs and all costs in
connection with any proceedings under the United States Bankruptcy
Code (collectively, the "Guarantied Obligations"). Each Guarantor
understands and acknowledges that there is no limit on the
Guarantied Obligations.
4.2 Nature of Guaranty. This is a continuing, absolute
and unconditional guaranty of payment and performance and not
merely of collection. Each Guarantor's liability with respect to
the Guarantied Obligations is primary, not secondary. Upon the
occurrence of any Event of Default and at any time thereafter,
Beneficiary may proceed directly against any Guarantor without
first proceeding against Borrower, any other Person liable for the
payment or performance of the Guarantied Obligations, or any
Collateral or other security for the Guarantied Obligations.
Beneficiary will not be required to mitigate damages or take any
other action to reduce, collect or enforce the Guarantied
Obligations. Only upon Final Payment will this Guaranty be
released, subject to being automatically reinstated as provided in
Section 7 herein until Final Payment.
4.3 Place for Performance. All obligations of
Guarantors under this Guaranty are performable and payable at the
Lending Office.
5. No Release of Guarantors. Each Guarantor's
liability under this Guaranty will not be reduced, extinguished,
discharged or released by, and no Guarantor is entitled to raise as
a defense, any:
5.1 invalidity, irregularity or unenforceability of the
Guarantied Obligations, Borrower's Loan Obligations or other
obligations under the Loan Documents to which it is a party, or of
such Guarantor's obligations under the Loan Documents to which it
is a party, including this Guaranty;
5.2 existing or future offset, claim, counterclaim or
defense of Borrower, such Guarantor or any other party against
Beneficiary or against payment of the Loan Obligations or the
Guarantied Obligations (whether such offset, claim, counterclaim or
defense arises in connection with the Loan Obligations or the
Guarantied Obligations or the transactions creating the Loan
Obligations or the Guarantied Obligations or otherwise);
5.3 failure of such Guarantor to be given notice of a
Default or Event of Default by Borrower;
5.4 waivers of Defaults or Events of Default or other
waivers under the Loan Documents;
5.5 extensions of due dates for payments, modifications
of interest rates or other payment terms with respect to the
Guarantied Obligations or any other accommodation, indulgence or
forbearance granted to Borrower;
5.6 reorganization, merger or consolidation of Borrower
or such Guarantor into or with any other Person;
5.7 release of or non-perfection with respect to any or
all of the Collateral or any other security for the Guarantied
Obligations;
5.8 taking or accepting of any other security or
collateral for, or guaranty of, any or all of the Guarantied
Obligations;
5.9 the death of or release of, or settlement or
compromise with, any one or more other Persons who have guarantied,
or are otherwise liable for the payment or performance of, any or
all of the Guarantied Obligations;
5.10 assignment or other transfer of, or granting of a
participation in, any of the Guarantied Obligations or any
Collateral or other security therefor, by Beneficiary;
5.11 other acts or omissions which, in the absence of
this Section 5 would operate so as to reduce, extinguish, discharge
or release such Guarantor's liability under this Guaranty (except
for the full and indefeasible payment of the Guarantied
Obligations, cancellation or termination of the Commitments,
expiration of all Letters of Credit, and termination of any other
commitment to extend credit or make advances to or for the account
of Borrower).
6. Waivers.
6.1 Notice. Each Guarantor hereby waives notice of
(i) acceptance of this Guaranty, (ii) any amendment, restatement or
other modification of any of the Loan Documents (including
modifications to interest rates or other payment terms of the
Guarantied Obligations), (iii) Advances to Borrower by Beneficiary
and fundings of Advances to Borrower by Beneficiary, (iv) the
occurrence of a Default or Event of Default, (v) any matter
referred to in Section 5 of this Guaranty, and (vi) any other
action at any time taken or omitted by Beneficiary, and generally,
all demands and notices of every kind in connection with this
Guaranty and the Loan Documents, except as expressly provided
herein and in the Loan Agreement.
6.2 Right of Contribution, Etc. Each Guarantor hereby
waives any right of contribution, subrogation, reimbursement,
indemnity, or repayment, and any other "claim", as that term is
defined in the United States Bankruptcy Code, which such Guarantor
might now have or hereafter acquire against Borrower or any other
Person liable for the payment or performance of the Loan
Obligations (other than pursuant to the Contribution Agreement of
even date herewith among the Guarantors) that arises from the
existence or performance of such Guarantor's obligations under this
Guaranty; and such Guarantor waives the right to participate in any
existing or future Collateral or other security for the Guarantied
Obligations. Each Guarantor further agrees that such Guarantor
will not enter into any agreement providing, directly or
indirectly, for any contribution, subrogation, reimbursement,
indemnity or repayment by Borrower on account of any payment made
by such Guarantor hereunder, and that any such agreement would be
void. Until Final Payment, no Guarantor has any right of
contribution, subrogation, reimbursement, indemnity or repayment
and no right of recourse to or with respect to any assets or
property of any other guarantor or other Person liable for any of
the Guarantied Obligations (other than pursuant to the Contribution
Agreement of even date herewith among the Guarantors).
6.3 Other. Each Guarantor hereby waives (i) diligence,
presentment, demand for payment, protest or notice, whether of
nonpayment, dishonor, protest or otherwise, (ii) any and all
claims, counterclaims or defenses based upon, related to or arising
out of (a) any matter referred to in Section 5 of this Guaranty,
(b) any issue as to whether any sale or other disposition of any
security for the Guarantied Obligations was conducted in a
commercially reasonable fashion, (c) any election of remedies by
Beneficiary, and (d) a theory that this Guaranty should be strictly
construed against Beneficiary and Beneficiary, and (iv) all other
defenses (except Final Payment) under applicable Law that would,
but for this clause (iv), be available to such Guarantor as a
defense against, or a reduction, extinguishment, discharge or
release of its obligations under, this Guaranty.
7. Reinstatement of Guaranty in Certain Circumstances.
Each Guarantor agrees that, if any or all of a payment made by or
on behalf of Borrower of any Guarantied Obligation is returned by
any Person at any time for any reason, including pursuant to any
settlement, order (whether or not final) of a court of competent
jurisdiction, provision of the United States Bankruptcy Code, other
debtor relief Law or other applicable Law or because of acts or
omissions of Borrower, the Guarantied Obligations will not be
deemed to have been satisfied to the extent of the returned payment
and the obligations of such Guarantor will be deemed to be
reinstated automatically and to continue in full force and effect.
If Borrower ceases to be liable to Beneficiary for any of the Loan
Obligations (other than by reason of Final Payment), then any prior
release or discharge from this Guaranty will be without effect and
this Guaranty and the obligations of each Guarantor hereunder will
be automatically reinstated and continue in full force and effect.
8. Representations and Warranties. Each Guarantor
represents and warrants to Beneficiary as follows:
8.1 Authorization. Each Guarantor is duly authorized
to execute and perform this Guaranty and this Guaranty has been
properly authorized by all requisite corporate, membership, or
partnership action (as the case may be) of such Guarantor. No
consent, approval or authorization of, or declaration or filing
with, any Governmental Authority or any other Person, is required
in connection with such Guarantor's execution, delivery or
performance of this Guaranty, except for those already duly
obtained.
8.2 Due Execution. This Guaranty has been executed on
behalf of each Guarantor by a legally competent Person duly
authorized to do so.
8.3 Enforceability. This Guaranty constitutes the
legal, valid and binding obligation of each Guarantor, enforceable
against such Guarantor in accordance with its terms, except to the
extent that the enforceability thereof against such Guarantor may
be limited by bankruptcy, insolvency, reorganization, moratorium or
similar Laws affecting creditor's rights generally or by equitable
principles of general application.
8.4 Legal Restraints. The execution of this Guaranty
by each Guarantor, and the performance by such Guarantor of its
obligations under this Guaranty, will not violate or constitute a
default under the Charter Documents of such Guarantor, any Material
Agreement, or any Material Law, and will not, except as expressly
contemplated or permitted in this Guaranty, result in any Security
Interest being imposed on any of such Guarantor's property.
8.5 Independent Credit Evaluation. Each Guarantor has
independently, and without reliance on any information supplied by
Beneficiary, taken, and will continue to take, whatever steps such
Guarantor deems necessary to evaluate the financial condition and
affairs of Borrower. Beneficiary has no duty to advise any
Guarantor of information at any time known to Beneficiary regarding
such financial condition or affairs.
8.6 No Representation By Beneficiary or Beneficiary.
Neither Beneficiary has not made any representation, warranty or
statement to any Guarantor to induce such Guarantor to execute this
Guaranty.
9. Survival of Representations. All representations,
warranties, and covenants of each Guarantor contained herein
survive the execution and delivery of this Guaranty, and terminate
only upon the full and indefeasible payment of all of the
Guarantied Obligations, cancellation or termination of all of the
Commitments, expiration of all Letters of Credit, and when
Beneficiary have no other commitment to extend credit or make
advances to or for the account of Borrower.
10. Authorization to Charge Accounts. Each Guarantor
hereby authorizes Beneficiary, if and to the extent any amount
payable by such Guarantor under this Guaranty is not otherwise paid
when due, to charge such amount against any or all of the accounts
of such Guarantor with Beneficiary or any Affiliate of Beneficiary
or any Affiliate of Beneficiary, with such Guarantor remaining
liable for any deficiency.
11. Beneficiary's Offset Rights. Upon the occurrence
of any Event of Default and at any time and from time to time
thereafter, Beneficiary is hereby authorized, without notice to any
Guarantor (any such notice being expressly waived by each
Guarantor), to setoff against the Guarantied Obligations any and
all deposits (general or special, time or demand, provisional or
final) at any time held, or any other Indebtedness at any time
owing by Beneficiary to or for the credit or the account of such
Guarantor, irrespective of whether or not demand has been made
under the Loan Agreement, any Note, or this Guaranty, and to remit
the proceeds of such setoff to Beneficiary for distribution to
Beneficiary and application to the Loan Obligations as provided in
the Loan Agreement.
12. Enforcement. Each Guarantor acknowledges that all
of the Guarantors are liable jointly and severally for the full
amount of the Guarantied Obligations. Suits for the enforcement of
this Guaranty may be brought, at the option of Beneficiary, against
all Guarantors, or successively against each Guarantor, or against
one or more but not against all Guarantors.
13. Attorney's Fees and Other Costs. If Guarantors
fail to pay the Guarantied Obligations as required by this
Guaranty, then Guarantors will pay all costs incurred by
Beneficiary in enforcing this Guaranty, including reasonable
attorneys' fees and expenses (whether or not there is litigation),
court costs and all costs incurred in connection with any
proceedings under the United States Bankruptcy Code.
14. Records. Beneficiary's books and records showing
the account between Beneficiary and Borrower are admissible in
evidence in any action or proceeding with respect to this Guaranty
and constitute prima facie proof of the information therein.
15. Binding Nature of Certain Adjudications. Each
Guarantor will be conclusively bound by the final adjudication in
any action or proceeding, legal or otherwise, involving any
controversy arising under, in connection with, or in any way
related to, any of the Guarantied Obligations, and by a final
judgment, award or decree entered therein, if such Guarantor had
the right, or was given the opportunity, to participate in such
action or proceeding and was given notice of such action or
proceeding in time to exercise such right or avail itself of such
opportunity.
16. Application of Payments. All payments made under
this Guaranty will be allocated among the principal and interest
and other components of the Guarantied Obligations and the other
obligations of a Guarantor hereunder in such order and amount as
Beneficiary may determine in its sole and absolute discretion.
17. Limitation of Liability. Beneficiary will not have
any liability with respect to, and each Guarantor hereby waives,
releases and agrees not to xxx for, (i) any loss or damage
sustained by any Guarantor that may occur as a result of, in
connection with, or that is in any way related to, any act or
failure to act referred to in Section 5 of this Guaranty, or
(ii) any special, indirect or consequential damages suffered by any
Guarantor in connection with any claim related to this Guaranty.
18. Miscellaneous.
18.1 Notices. All notices, consents, requests and
demands to or upon the respective parties hereto must be in
writing, and will be deemed to have been given or made when
delivered in person to those Persons listed on the signature pages
hereof or when deposited in the United States mail, postage
prepaid, or, in the case of telegraphic notice, or the overnight
courier services, when delivered to the telegraph company or
overnight courier service, or in the case of telex or telecopy
notice, when sent, verification received, in each case addressed as
set forth on the signature pages hereof, or to such other address
as either party may designate by notice to the other in accordance
with the terms of this Section. No notice given to or demand made
on any Guarantor by Beneficiary or Beneficiary in any instance
entitles Borrower to notice or demand in any other instance.
18.2 Amendments and Waivers. No amendment to, waiver
of, or departure from full compliance with any provision of this
Guaranty, or consent to any departure by any Guarantor herefrom,
will be effective unless it is in writing and signed by authorized
officers of such Guarantor and Beneficiary; provided, however, that
any such waiver or consent will be effective only in the specific
instance and for the purpose for which given. No failure by
Beneficiary to exercise, and no delay by Beneficiary in exercising,
any right, remedy, power or privilege hereunder will operate as a
waiver thereof, nor will any single or partial exercise by
Beneficiary of any right, remedy, power or privilege hereunder
preclude any other exercise thereof, or the exercise of any other
right, remedy, power or privilege.
18.3 Rights Cumulative. Each of the rights and remedies
of Beneficiary and Beneficiary under this Guaranty is in addition
to all of their other rights and remedies under applicable Law, and
nothing in this Guaranty may be construed as limiting any such
rights or remedies.
18.4 Successors and Assigns. This Guaranty binds
Guarantors and their respective successors and assigns and inures
to the benefit of Beneficiary, and each of its successors,
transferees, participants and assignees. No Guarantor may delegate
or transfer any of its obligations under this Guaranty without the
prior written consent of Beneficiary. With respect to Guarantor's
successors and assigns, such successors and assigns include any
receiver, trustee or debtor-in-possession of or for Guarantor.
18.5 Severability. Any provision of this Guaranty which
is prohibited, unenforceable or not authorized in any jurisdiction
is, as to such jurisdiction, ineffective to the extent of such
prohibition, unenforceability or nonauthorization without
invalidating the remaining provisions hereof or affecting the
validity, enforceability or legality of such provision in any other
jurisdiction.
18.6 Governing Law; No Third Party Rights. This
Guaranty is to be governed by and construed and interpreted in
accordance with the internal Laws of the State of Missouri
applicable to contracts made and to be performed wholly within such
state, without regard to choice or conflicts of law principles.
This Guaranty is solely for the benefit of the parties hereto and
Beneficiary, and their respective successors and assigns, and no
other Person has any right, benefit, priority or interest under, or
because of the existence of, this Guaranty.
18.7 Counterparts. This Guaranty may be executed by the
parties hereto on any number of separate counterparts, and all such
counterparts taken together constitute one and the same instrument.
It is not necessary in making proof of this Guaranty to produce or
account for more than one counterpart signed by the party to be
charged.
18.8 Counterpart Facsimile Execution. For purposes of
this Guaranty, a document (or signature page thereto) signed and
transmitted by facsimile machine or telecopier is to be treated as
an original document. The signature of any Person thereon, for
purposes hereof, is to be considered as an original signature, and
the document transmitted is to be considered to have the same
binding effect as an original signature on an original document.
At the request of any party hereto, any facsimile or telecopy
document is to be re-executed in original form by the Persons who
executed the facsimile or telecopy document. No party hereto may
raise the use of a facsimile machine or telecopier or the fact that
any signature was transmitted through the use of a facsimile or
telecopier machine as a defense to the enforcement of this Guaranty
or any amendment or other document executed in compliance with this
Section.
18.9 Final Expression; No Course of Dealing. This
Guaranty, together with the Loan Agreement, the other Loan
Documents and any other agreement executed in connection herewith
or therewith, is intended by the parties as a final expression of
their agreement and is intended as a complete and exclusive
statement of the terms and conditions thereof. Acceptance of or
acquiescence in a course of performance or course of dealing
rendered or taken under or with respect to this Guaranty, the Loan
Agreement or the other Loan Documents will not be relevant to
determine the meaning of this Guaranty, the Loan Agreement or the
other Loan Documents even though the accepting or acquiescing party
had knowledge of the nature of the performance and opportunity for
objection.
18.10 Negotiated Transaction. Each Guarantor and
Beneficiary each represent to the other that in the negotiation and
drafting of this Guaranty each has been represented by and has
relied upon the advice of counsel of its choice. Each Guarantor
and Beneficiary affirm that its counsel has had a substantial role
in the drafting and negotiation of this Guaranty; therefore, this
Guaranty will be deemed drafted by each of Borrower and
Beneficiary, and the rule of construction to the effect that any
ambiguities are to be resolved against the drafter will not be
employed in the interpretation of this Guaranty.
18.11 Attorney's Fees and Other Costs. If Guarantors fail
to pay the Guarantied Obligations as required by this Guaranty,
then Guarantors will pay all costs incurred by Beneficiary in
enforcing this Guaranty, including reasonable attorneys' fees and
actual attorneys' expenses (whether or not there is litigation),
court costs and all reasonable costs incurred in connection with
any proceedings under the United States Bankruptcy Code.
18.12 Assignment By Beneficiary. To the extent permitted
in the Loan Agreement, Beneficiary may grant a participation
interest in or assign or transfer to another Person any instrument,
document or agreement evidencing any of the Guarantied Obligations
and Beneficiary's rights under this Guaranty.
18.13 Choice of forum. Guarantors hereby agree to the
exclusive jurisdiction of the federal court of the Eastern District
of Missouri and the state courts of Missouri located in St. Louis
County or the City of St. Louis, Missouri, with respect to any
dispute exclusively between Beneficiary and any Guarantor and waive
any objection based on venue or forum non conveniens with respect
to any action instituted therein, and agree that any dispute
exclusively between Beneficiary and any Guarantor concerning the
relationship between any Guarantor and Beneficiary or the conduct
of any of them in connection with this Guaranty or otherwise may be
heard only in the courts described above.
18.14 Service of process. Each Guarantor hereby waives
personal service of any and all process upon it and consents that
all such service of process may be made by registered mail (return
receipt requested) directed to such Guarantor at its address set
forth on the signature page hereof, and service so made will be
deemed to be completed five (5) days after the same has so
deposited in the U.S. Mails, certified or registered; or at
Beneficiary's option, by service upon CT Corporation, which each
Guarantor irrevocably appoints as such Guarantor's agent for the
purpose of accepting service of process within the State of
Missouri. Beneficiary will promptly forward by registered mail any
process so served upon said agent to such Guarantor at its address
on the signature page hereof. Nothing in this Section affects the
right of Beneficiary to serve legal process in any other manner
permitted by Law.
18.15 Waiver of jury trial. Each Guarantor and Beneficiary
hereby waive any right to trial by jury of any claim, demand,
action or cause of action (i) arising under this Guaranty or any
other Loan Document, or (ii) in any way connected with or related
or incidental to the dealings of the parties hereto or either of
them in respect of this Guaranty or any other Loan Document, or the
transactions related hereto or thereto, in each case whether now
existing or hereafter arising, and whether sounding in contract or
tort or otherwise. Each Guarantor and Beneficiary agree and
consent that any such claim, demand, action or cause of action will
be decided by court trial without a jury and that either may file
an original counterpart or a copy of this Guaranty with any court
as written evidence of the consent of the parties hereto to the
waiver of their right to trial by jury.
[remainder of page intentionally left blank]
IN WITNESS WHEREOF, this Guaranty has been duly executed
as of the date first above written.
Xxxxxxxxx, Inc. INA Acquisition Corp.
by its by its
--------------------- --------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
Attn: Attn:
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
Insituform Central, Inc. Insituform Gulf South,
Inc.
by its by its
--------------------- --------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
Insituform Mid-America, Inc. Insituform Midwest, Inc.
by its by its
--------------------- --------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
Insituform Missouri, Inc. Insituform of New England,
Inc.
by its by its
--------------------- --------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
Insituform North, Inc. Insituform North America
Corp.
by its by its
--------------------- --------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
Insituform Plains, Inc. Insituform Rockies, Inc.
by its by its
--------------------- --------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
Insituform Southeast, Inc. Insituform Southwest
By: Insituform Southwest,
Inc., Managing Partner
by its by its
--------------------- -------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
Insituform Texark, Inc. Insituform West, Inc.
by its by its
--------------------- --------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
NuPipe, Inc. United Pipeline Systems
USA, Inc.
by its by its
--------------------- -------------------
--------------------------- -------------------------
Notice address: Notice address:
--------------------------- -------------------------
--------------------------- -------------------------
---------------------- --------------------
FAX # FAX #
---------------------- --------------------
TEL # TEL #
---------------------- --------------------
EXHIBIT 10-B
LIST OF GUARANTOR SUBSIDIARIES AS OF THE EFFECTIVE DATE
Xxxxxxxxx, Inc., a Missouri corporation
INA Acquisition Corp., a Delaware corporation
Insituform Central, Inc., a Delaware corporation
Insituform Gulf South, Inc., a Delaware corporation
Insituform Mid-America, Inc., a Delaware corporation
Insituform Midwest, Inc., a Delaware corporation
Insituform Missouri, Inc., a Delaware corporation
Insituform of New England, Inc., a Massachusetts corporation
Insituform North, Inc., a Delaware corporation
Insituform North America Corp., a Tennessee corporation
Insituform Plains, Inc., a Delaware corporation
Insituform Rockies, Inc., a Delaware corporation
Insituform Southeast, Inc., a Florida corporation
Insituform Southwest, a California partnership
Insituform Texark, Inc., a Delaware corporation
Insituform West, Inc., an Oregon corporation
NuPipe, Inc., an Oregon corporation
United Pipeline Systems USA, Inc., a Delaware corporation
EXHIBIT 11.1.1
DOCUMENTS AND REQUIREMENTS LIST
1. Loan Agreement
2. $20,000,000 Revolving Note payable to the order of Lender
3. Joint and Several Unlimited Guaranty executed by all
Guarantors
4. Contribution Agreement executed by Borrower and all
Guarantors
5. Borrower's Initial Advance Request with Disbursement
Direction
6. Opinion of Counsel for Borrower and Guarantors
satisfactory to Lender and covering the subject matter
described in the Opinion Specification attachment hereto
7. Secretary's Certificate (certifying resolutions, all
Charter Documents, and incumbency of officers authorized
to execute Loan Documents) for Borrower and each Guarantor
8. Good Standing Certificates for Borrower and each Guarantor
from the Secretaries of State of the states of their
organization
9. Initial Financial Statements, including copies of
Borrower's most recently filed Forms 10-K and 10Q
10. Certificates showing Borrower and Guarantors have
insurance as required by Loan Agreement
11. Copies of all consents, licenses and approvals required
for execution of Loan Documents (if any)
Attachment to Documents and Requirements List
Opinion Specification
Legal opinion of corporate and local counsel to Borrower and
Guarantors must be on firm letterhead and together meet these
requirements
1. Address to NationsBank, N.A. at 000 Xxxxxx Xxxxxx, Xx.
Xxxxx, Xxxxxxxx 00000.
2. Refer to Loan Agreement and other Loan Documents and use
the Loan Agreement definitions.
3. Give opinions on the subjects covered in all of the
following example paragraphs
a. [Name of Borrower or Guarantor] is a
[corporation] [limited partnership] [limited
liability company] duly formed, validly existing
and in good standing under the Laws of the State
of [name of state] and is duly qualified and
authorized to do business and is in good
standing as a foreign [corporation] [limited
partnership] [limited liability company] in all
states where the nature and extent of the
business transacted by it or the ownership of
its assets makes such qualification necessary,
except where the failure to so qualify will not
have a Material Adverse Effect.
b. Borrower has all requisite power, authority, and
legal capacity (a) to own, lease and operate its
properties and assets and to carry on its
business as now being conducted and (b) to
execute, deliver and perform the terms of the
Loan Documents to which it is a party. Each
Guarantor has all requisite power, authority,
and legal capacity (a) to own, lease and operate
its properties and assets and to carry on its
business as now being conducted and (b) to
execute, deliver and perform the terms of the
Loan Documents to which it is a party.
c. All action on the part of Borrower required for
the execution, delivery and performance of the
Loan Documents to which it is a party has been
duly taken. All action on the part of each
Guarantor required for the execution, delivery
and performance of the Loan Documents to which
it is a party has been duly taken.
d. The execution, delivery and performance of the
Loan Documents by Borrower will not (a) violate,
be in conflict with, result in the breach of, or
constitute (with due notice or lapse of time, or
both) a default under (i) Borrower's Charter
Documents, or (ii) to our knowledge any
franchise, agreement, indenture, or other
instrument to which Borrower is a party or by
which it or any of its property is bound or
affected or (iii) any Law or other legal
requirement applicable to Borrower, or (b) to
our knowledge result in the creation or
imposition of a Security Interest of any nature
whatsoever upon Borrower's property or assets.
The execution, delivery and performance of the
Loan Documents by each Guarantor will not
(a) violate, be in conflict with, result in the
breach of, or constitute (with due notice or
lapse of time, or both) a default under (i) such
Guarantor's Charter Documents, or (ii) to our
knowledge any franchise or Contract to which
such Guarantor is a party or by which it or any
of its property is bound or affected or
(iii) any Law or other legal requirement
applicable to such Guarantor, or (b) to our
knowledge result in the creation or imposition
of a Security Interest of any nature whatsoever
upon such Guarantor's property or assets.
e. Borrower has duly executed and delivered each of
the Loan Documents to which it is a party and
each such Loan Document constitutes the legal,
valid and binding obligation of Borrower
enforceable against Borrower in accordance with
its terms. Each Guarantor has duly executed and
delivered each of the Loan Documents to which it
is a party and each such Loan Document
constitutes the legal, valid and binding
obligation of such Guarantor enforceable against
such Guarantor in accordance with its terms.
f. Each Person who signed any Loan Document as an
officer of Borrower is duly authorized on behalf
of Borrower to execute and deliver such document
on behalf of Borrower. Each Person who signed
any Loan Document as an officer of a Guarantor
is duly authorized on behalf of such Guarantor
to execute, deliver and perform such document on
behalf of such Guarantor.
g. No consent, approval or other authorization of
or by, or registration or filing with, any
Governmental Authority or other Person is
required in connection with the execution,
delivery and performance by Borrower or a
Guarantor of the Loan Documents to which it is a
party that has not already been obtained and a
copy thereof delivered to Lender.
h. There are no actions, proceedings or
investigations pending or threatened against
Borrower or a Guarantor which, alone or
together, might adversely affect the validity or
enforceability of any of the Loan Documents or
the ability of Borrower or a Guarantor to
perform its obligations thereunder, or, except
as set forth in the Loan Documents, which, is
reasonably likely to have a Material Adverse
Effect.
i. The use of the proceeds of the Aggregate Loans
will not violate Regulations G, T, U or X of the
Federal Reserve Board.
j. If a court were to find that the Loan Documents
are governed by, or are to be construed or
interpreted in accordance with, the governing
law set forth in the Loan Documents, the
provisions of the Loan Documents regarding
interest required to be paid by Borrower will
not violate any Law of such State that limits
the amount of interest that may be charged or
collected on a loan of money or the method by
which such interest is computed.
4. Add appropriate exceptions and limitations, all of which
must be satisfactory to Lender.
5. Signature by a partner of the firm in his individual
name or in the name of the firm.
EXHIBIT 13
DISCLOSURE SCHEDULE OF BORROWER
Item 13.8 of Disclosure Schedule of Borrower;
Additional Proceedings
None
Item 13.18 of Disclosure Schedule; Subsidiaries
None
% of
JURISDICTION EQUITY
NAME OF SUBSIDIARY OF ORGANIZATION OWNED Owner of Equity
Xxxxxxxxx, Inc. Missouri 100% Insituform Mid-America Inc.
Comely Investments Isle of Man; 100% INA Acquisition, Inc.
Limited Delaware
E-Midsouth, Inc. Florida 100% Insituform Southeast, Inc.
Enviroq Services, Inc. Florida 100% Insituform Mid-America,Inc.
GelTech Constructors, Oregon 100% INA Acquisition Corp.
Inc.
X.X. Xxxxxxxxx, Inc. New York 100% Insituform Technologies,
Inc.
INA Acquisition Corp. Delaware 100% Insituform Technologies,Inc.
Insituform Belux, NV/SA Belgium 100% INA Acquisition Corp.
Insituform Central, Inc.Delaware 100% Insituform Mid-America,Inc.
Insituform France S.A. France 66-2/3% Insituform Technologies,Inc.
Insituform Gulf South, Delaware 100% Xxxxxx Industries, Inc.
Inc.
Insituform Holdings (UK)United Kingdom 100% INA Acquisition Corp.
Ltd.
Insituform International,Liberia; Delawre100% INA Acquisition Corp.
Inc.
Insituform InternationalNetherland 100% INA Acquisition Corp.
N.V.; Antilles;
Insituform InternationalDelaware
(Antilles) N.V., Inc.
Insituform Italia SR1. Italy 100% INA Acquisition Corp.
Insituform Japan K.K. Japan 100% INA Acquisition Corp.
Insituform Licensees Netherlands; 100% INA Acquisition Corp.
BV/SA;
Insituform Licensees B.V.Delaware
Insituform Linings PLc United Kingdom 51% Insituform Holdings (UK)Ltd.
Insituform Mar-Tech British Columbia 100% INA Acquisition Corp.
Limited
Insituform Mid-America, Delaware 100% Insituform Technologies,
Inc. Inc.
Insituform Midwest, Inc.Delaware 100% Insituform Technologies,Inc.
Insituform Missouri, Inc.Delaware 100%. Insituform Mid-America,Inc.
Insituform (Netherlands)Netherlands 100% Insituform Licensees BV/SA;
B.V.
Insituform (Netherlands)Delaware Insituform Licensees B.V.
B.V., Inc.
Insituform of New Massachusetts 100% X.X. Xxxxxxxxx, Inc.
England, Inc.
Insituform North, Inc. Delaware 100% Insituform Mid-America,Inc.
Insituform North AmericaTennessee 100% Insituform Technologies,
Corp. Inc.
Insituform Overseas United Kingdom 100% Insituform Holdings (UK)
Limited Ltd.
Insituform (Pipes & United Kingdom 100% Insituform Holdings (UK)
Structures) Limited Ltd.
Insituform Plains, Inc. Delaware 100% Insituform Mid-America,Inc.
Insituform de Puerto Delaware 100% Insituform Mid-America, Xxx.Xxx.
Insituform Rockies, Inc.Delaware 100% Insituform Mid-America,Inc.
Insituform Southeast, Florida 100% Insituform Mid-America, Xxx.Xxx.
Instiuform Southwest California 100% Insituform Southwest, Inc.
(80%)
NuPipe California, Inc.(20%)
Insituform Southwest, Delaware 100% Insituform Technologies,
Inc. Inc.
Insituform Technical United Kingdom 100% Insituform Holdings (UK)
Limited Ltd.
Insituform Technologies,Alberta 100% Insituform Mid-America, LimitedInc.
Insituform Technologies,United Kingdom 100% Insituform Holdings (UK)
Limited Ltd.
Insituform Texark, Inc. Delaware 100% INA Acquisition Corp.
Insituform West, Inc. Oregon 100% INA Acquisition Corp.
Midsouth Partners Tennessee 57-1/2% E-Midsout, Inc. (42-1/2%)
Insituform Southwest, Inc.
(15%)
Xxxxxx Industries, Inc. Delaware 100% Insituform Technologies,Inc.
NuPipe, Inc. Oregon 100% Insituform Technologies,Inc.
NuPipe California, Inc. Delaware 100% NuPipe, Inc.
NuPipe International, Delaware 100% NuPipe, Inc.
Inc.
NuPipe Limited United Kingdom 100% Insituform Technologies,Inc.
NuPipe New England, Inc.Massachusetts 100% X.X. Xxxxxxxxx, Inc.
PALTEM Systems, Inc. Delaware 100% Insituform Mid-America,Inc.
Pipe Rehab Delaware 100% Insituform Technologies,
International, Inc. Inc.
Titeliner NRO Corp. Alberta 100% Insituform Mid-America,Inc.
United Pipelines Argentina 100% Insituform Mid-America,
Argentina S.A. Inc.
United Pipeline de Mexico 55% INA Acquisition Corp.
Mexico S.A. de C.V.
United Pipeline Systems Delaware 100% Insituform Mid-America, U.S.A.,
Inc. Inc.
United Sistema de Chile 60% Insituform Mid-America, Tuberias
Limitada Inc.
/TABLE
EXHIBIT 15.12
FORM OF COMPLIANCE CERTIFICATE
TO: THE BOATMEN'S NATIONAL BANK OF ST. LOUIS
This Compliance Certificate is furnished pursuant to that certain
Loan Agreement executed August 20, 1997 (as the same may be amended,
restated or otherwise modified from time to time, the "Loan Agreement"),
between Insituform Technologies, Inc., as Borrower, and NationsBank, N.A.,
as Lender. Unless otherwise defined herein, capitalized terms used in
this Compliance Certificate have the meanings defined in the Loan
Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected of the Borrower.
2. I have reviewed the terms of the Loan Agreement and the Loan
Documents and I have made, or have caused to be made under my
supervision, a review of the transactions and conditions of
Borrower and each other Covered Person during the accounting
period covered by the attached Financial Statements.
3. The examinations described in paragraph 2 did not disclose, and
I have no knowledge of, the existence of any condition or event
which constitutes a Default or Event of Default as of the date
of this Compliance Certificate; {use for annual certificate: and
(except as described in the Disclosure Addendum attached
hereto), all of the representations and warranties of Borrower
contained in the Loan Agreement would be true and correct if
made on the date hereof.)
4. {Use for annual financial statements: Schedule I attached hereto
contains the Financial Statements for Borrower for the fiscal
year ended , which are complete and correct in all
material respects and have been prepared in accordance with GAAP
applied consistently throughout the period and with prior
periods (except as disclosed therein).)
(Use for quarterly: Schedule I attached hereto contains the
Financial Statements for Borrower for the fiscal quarter ended
, which are complete and correct in all material
respects (subject to normal year-end audit adjustments) and have
been prepared in accordance with GAAP applied consistently
throughout the period and with prior periods (except as
disclosed therein).)
5. Borrower and every other Covered Person is in compliance with
all of the covenants in the Loan Agreement, including the
financial covenants in Section 17, and Schedule II attached
hereto contains calculations based on Borrower's financial
statements and other financial records that show Borrower's
compliance with such financial covenants. The calculations and
the data upon which they are based are believed by me to be
complete and correct.
This Compliance Certificate, together with the Schedules hereto, is
executed and delivered this day of .
----- -------------
Print Name:
Title:
SCHEDULE I TO COMPLIANCE CERTIFICATE
SCHEDULE II TO COMPLIANCE CERTIFICATE
Calculations of Compliance with Financial Covenants for [fiscal
quarter ended] [fiscal year ended] ______________ (Certification Period)
UNLIMITED GUARANTY
This Unlimited Guaranty (this "Guaranty"), effective
August 20, 1997, (the "Effective Date") is given by each of the
undersigned entities (each a "Guarantor" and collectively the
"Guarantors"), to NATIONSBANK, N.A., a national banking
association ("Beneficiary").
To induce, and in consideration of, beneficiary's execution
of the Loan Agreement and Beneficiary's Commitments, and for
other sufficient consideration, the receipt of which is hereby
acknowledged, the Guarantors and Beneficiary hereby agree as
follows:
1. General. Unless the context of this Guaranty clearly
requires otherwise, (i) references to the plural include the
singular and vice versa, (ii) references to any Person include
such Person's successors and assigns but, if applicable, only if
such successors and assigns are permitted by this Guaranty, (iii)
references to one gender include all genders, (iv) "including" is
not limiting, (v) "or" has the inclusive meaning represented by
the phrase "and/or", (vi) the words "hereof", "herein", "hereby",
"hereunder" and similar terms in this Guaranty refer to this
Guaranty as a whole, including its Exhibits, and not to any
particular provision of this Guaranty, (vii) the word "Section"
or "section" and "Page" or "page" refer to a section or page,
respectively, of this Guaranty unless it expressly refers to
something else, (viii) reference to any agreement, document, or
instrument, including this Guaranty, any other Loan Document and
any agreement, document or instrument defined herein, means such
agreement, document, or instrument as it may have been or may be
amended, restated, extended, renewed, replaced, or otherwise
modified and in effect from time to time in accordance with the
terms thereof and, if applicable, the terms hereof, and includes
all attachments thereto and instruments incorporated therein, if
any, and (ix) general and specific references to any Law means
such Law as amended, modified, codified or reenacted, in whole or
in part, and in effect from time to time. Section captions are
for convenience only and do not affect the interpretation or
construction of this Guaranty.
2. Definitions. All capitalized terms not otherwise
defined herein have the meanings given them in that certain Loan
Agreement of even date herewith by and between Insitutform
Technologies, Inc. ("Borrower") and Beneficiary (as it may be
amended, restated, extended, renewed, replaced, or otherwise
modified from time to time, the "Loan Agreement").
3. Acknowledgement of Capacity as a Covered Person Under
the Loan Agreement. Each Guarantor acknowledges that it has
reviewed the Loan Agreement and agrees that it is a "Covered
Person" (as that term is defined in the Loan Agreement and used
in the Loan Agreement and the other Loan Documents). All of the
representations and warranties, covenants, and agreements
contained in the Loan Agreement and the other Loan Documents
which are applicable to a Covered Person are incorporated into
this Guaranty by this reference and each Guarantor, as such a
Covered Person, hereby makes such representations and warranties
to, and makes such covenants and agreements with, Beneficiary.
Each Guarantor further acknowledges and agrees that the failure
of a Guarantor to comply with any terms of the Loan Agreement or
the other Loan Documents applicable to such Guarantor as a
Covered Person will result in a Default under the Loan Agreement
and the other Loan Documents, entitling Beneficiary to all of
their remedies thereunder and under applicable law and in equity.
4. Guaranty.
4.1 Unlimited Guaranty of Payment and Performance.
Guarantors hereby jointly and severally guaranty to Beneficiary,
for the benefit of Beneficiary, the full and prompt payment and
performance of the Loan Obligations and all costs of collection
thereof, including reasonable attorneys' fees and expenses
(whether or not there is litigation), court costs and all costs
in connection with any proceedings under the United States
Bankruptcy Code (collectively, the "Guarantied Obligations").
Each Guarantor understands and acknowledges that there is no
limit on the Guarantied Obligations.
4.2 Nature of Guaranty. This is a continuing, absolute and
unconditional guaranty of payment and performance and not merely
of collection. Each Guarantor's liability with respect to the
Guarantied Obligations is primary, not secondary. Upon the
occurrence of any Event of Default and at any time thereafter,
Beneficiary may proceed directly against any Guarantor without
first proceeding against Borrower, any other Person liable for
the payment or performance of the Guarantied Obligations, or any
Collateral or other security for the Guarantied Obligations.
Beneficiary will not be required to mitigate damages or take any
other action to reduce, collect or enforce the Guarantied
Obligations. Only upon Final Payment will this Guaranty be
released, subject to being automatically reinstated as provided
in Section 7 herein until Final Payment.
4.3 Place for Performance. All obligations of Guarantors
under this Guaranty are performable and payable at the Lending
Office.
5. No Release of Guarantors. Each Guarantor's liability
under this Guaranty will not be reduced, extinguished, discharged
or released by, and no Guarantor is entitled to raise as a
defense, any:
5.1 invalidity, irregularity or unenforceability of the
Guarantied Obligations, Borrower's Loan Obligations or other
obligations under the Loan Documents to which it is a party, or
of such Guarantor's obligations under the Loan Documents to which
it is a party, including this Guaranty;
5.2 existing or future offset, claim, counterclaim or
defense of Borrower, such Guarantor or any other party against
Beneficiary or against payment of the Loan Obligations or the
Guarantied Obligations (whether such offset, claim, counterclaim
or defense arises in connection with the Loan Obligations or the
Guarantied Obligations or the transactions creating the Loan
Obligations or the Guarantied Obligations or otherwise);
5.3 failure of such Guarantor to be given notice of a
Default or Event of Default by Borrower;
5.4 waivers of Defaults or Events of Default or other
waivers under the Loan Documents;
5.5 extensions of due dates for payments, modifications of
interest rates or other payment terms with respect to the
Guarantied Obligations or any other accommodation, indulgence or
forbearance granted to Borrower;
5.6 reorganization, merger or consolidation of Borrower or
such Guarantor into or with any other Person;
5.7 release of or non-perfection with respect to any or all
of the Collateral or any other security for the Guarantied
Obligations;
5.8 taking or accepting of any other security or collateral
for, or guaranty of, any or all of the Guarantied Obligations;
5.9 the death of or release of, or settlement or compromise
with, any one or more other Persons who have guarantied, or are
otherwise liable for the payment or performance of, any or all of
the Guarantied Obligations;
5.10 assignment or other transfer of, or granting of a
participation in, any of the Guarantied Obligations or any
Collateral or other security therefor, by Beneficiary;
5.11 other acts or omissions which, in the absence of this
Section 5 would operate so as to reduce, extinguish, discharge or
release such Guarantor's liability under this Guaranty (except
for the full and indefeasible payment of the Guarantied
Obligations, cancellation or termination of the Commitments,
expiration of all
Letters of Credit, and termination of any other commitment to
extend credit or make advances to or for the account of
Borrower).
6. Waivers.
6.1 Notice. Each Guarantor hereby waives notice of
(i) acceptance of this Guaranty, (ii) any amendment, restatement
or other modification of any of the Loan Documents (including
modifications to interest rates or other payment terms of the
Guarantied Obligations), (iii) Advances to Borrower by
Beneficiary and fundings of Advances to Borrower by Beneficiary,
(iv) the occurrence of a Default or Event of Default, (v) any
matter referred to in Section 5 of this Guaranty, and (vi) any
other action at any time taken or omitted by Beneficiary, and
generally, all demands and notices of every kind in connection
with this Guaranty and the Loan Documents, except as expressly
provided herein and in the Loan Agreement.
6.2 Right of Contribution, Etc. Each Guarantor hereby
waives any right of contribution, subrogation, reimbursement,
indemnity, or repayment, and any other "claim", as that term is
defined in the United States Bankruptcy Code, which such
Guarantor might now have or hereafter acquire against Borrower or
any other Person liable for the payment or performance of the
Loan Obligations (other than pursuant to the Contribution
Agreement of even date herewith among the Guarantors) that arises
from the existence or performance of such Guarantor's obligations
under this Guaranty; and such Guarantor waives the right to
participate in any existing or future Collateral or other
security for the Guarantied Obligations. Each Guarantor further
agrees that such Guarantor will not enter into any agreement
providing, directly or indirectly, for any contribution,
subrogation, reimbursement, indemnity or repayment by Borrower on
account of any payment made by such Guarantor hereunder, and that
any such agreement would be void. Until Final Payment, no
Guarantor has any right of contribution, subrogation,
reimbursement, indemnity or repayment and no right of recourse to
or with respect to any assets or property of any other guarantor
or other Person liable for any of the Guarantied Obligations
(other than pursuant to the Contribution Agreement of even date
herewith among the Guarantors).
6.3 Other. Each Guarantor hereby waives (i) diligence,
presentment, demand for payment, protest or notice, whether of
nonpayment, dishonor, protest or otherwise, (ii) any and all
claims, counterclaims or defenses based upon, related to or
arising out of (a) any matter referred to in Section 5 of this
Guaranty, (b) any issue as to whether any sale or other
disposition of any security for the Guarantied Obligations was
conducted in a commercially reasonable fashion, (c) any election
of remedies by Beneficiary, and (d) a theory that this Guaranty
should be strictly
construed against Beneficiary and Beneficiary, and (iv) all other
defenses (except Final Payment) under applicable Law that would,
but for this clause (iv), be available to such Guarantor as a
defense against, or a reduction, extinguishment, discharge or
release of its obligations under, this Guaranty.
7. Reinstatement of Guaranty in Certain Circumstances.
Each Guarantor agrees that, if any or all of a payment made by or
on behalf of Borrower of any Guarantied Obligation is returned by
any Person at any time for any reason, including pursuant to any
settlement, order (whether or not final) of a court of competent
jurisdiction, provision of the United States Bankruptcy Code,
other debtor relief Law or other applicable Law or because of
acts or omissions of Borrower, the Guarantied Obligations will
not be deemed to have been satisfied to the extent of the
returned payment and the obligations of such Guarantor will be
deemed to be reinstated automatically and to continue in full
force and effect. If Borrower ceases to be liable to Beneficiary
for any of the Loan Obligations (other than by reason of Final
Payment), then any prior release or discharge from this Guaranty
will be without effect and this Guaranty and the obligations of
each Guarantor hereunder will be automatically reinstated and
continue in full force and effect.
8. Representations and Warranties. Each Guarantor
represents and warrants to Beneficiary as follows:
8.1 Authorization. Each Guarantor is duly authorized to
execute and perform this Guaranty and this Guaranty has been
properly authorized by all requisite corporate, membership, or
partnership action (as the case may be) of such Guarantor. No
consent, approval or authorization of, or declaration or filing
with, any Governmental Authority or any other Person, is required
in connection with such Guarantor's execution, delivery or
performance of this Guaranty, except for those already duly
obtained.
8.2 Due Execution. This Guaranty has been executed on
behalf of each Guarantor by a legally competent Person duly
authorized to do so.
8.3 Enforceability. This Guaranty constitutes the legal,
valid and binding obligation of each Guarantor, enforceable
against such Guarantor in accordance with its terms, except to
the extent that the enforceability thereof against such Guarantor
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar Laws affecting creditor's rights generally
or by equitable principles of general application.
8.4 Legal Restraints. The execution of this Guaranty by
each Guarantor, and the performance by such Guarantor of its
obligations under this Guaranty, will not violate or constitute a
default under the Charter Documents of such Guarantor, any
Material Agreement, or any Material Law, and will not, except as
expressly contemplated or permitted in this Guaranty, result in
any Security Interest being imposed on any of such Guarantor's
property.
8.5 Independent Credit Evaluation. Each Guarantor has
independently, and without reliance on any information supplied
by Beneficiary, taken, and will continue to take, whatever steps
such Guarantor deems necessary to evaluate the financial
condition and affairs of Borrower. Beneficiary has no duty to
advise any Guarantor of information at any time known to
Beneficiary regarding such financial condition or affairs.
8.6 No Representation By Beneficiary or Beneficiary.
Neither Beneficiary has not made any representation, warranty or
statement to any Guarantor to induce such Guarantor to execute
this Guaranty.
9. Survival of Representations. All representations,
warranties, and covenants of each Guarantor contained herein
survive the execution and delivery of this Guaranty, and
terminate only upon the full and indefeasible payment of all of
the Guarantied Obligations, cancellation or termination of all of
the Commitments, expiration of all Letters of Credit, and when
Beneficiary have no other commitment to extend credit or make
advances to or for the account of Borrower.
10. Authorization to Charge Accounts. Each Guarantor
hereby authorizes Beneficiary, if and to the extent any amount
payable by such Guarantor under this Guaranty is not otherwise
paid when due, to charge such amount against any or all of the
accounts of such Guarantor with Beneficiary or any Affiliate of
Beneficiary or any Affiliate of Beneficiary, with such Guarantor
remaining liable for any deficiency.
11. Beneficiary's Offset Rights. Upon the occurrence of
any Event of Default and at any time and from time to time
thereafter, Beneficiary is hereby authorized, without notice to
any Guarantor (any such notice being expressly waived by each
Guarantor), to setoff against the Guarantied Obligations any and
all deposits (general or special, time or demand, provisional or
final) at any time held, or any other Indebtedness at any time
owing by Beneficiary to or for the credit or the account of such
Guarantor, irrespective of whether or not demand has been made
under the Loan Agreement, any Note, or this Guaranty, and to
remit the proceeds of such setoff to Beneficiary for distribution
to Beneficiary and application to the Loan Obligations as
provided in the Loan Agreement.
12. Enforcement. Each Guarantor acknowledges that all of
the Guarantors are liable jointly and severally for the full
amount of the Guarantied Obligations. Suits for the enforcement
of this Guaranty may be brought, at the option of Beneficiary,
against all Guarantors, or successively against each Guarantor,
or against one or more but not against all Guarantors.
13. Attorney's Fees and Other Costs. If Guarantors fail to
pay the Guarantied Obligations as required by this Guaranty, then
Guarantors will pay all costs incurred by Beneficiary in
enforcing this Guaranty, including reasonable attorneys' fees and
expenses (whether or not there is litigation), court costs and
all costs incurred in connection with any proceedings under the
United States Bankruptcy Code.
14. Records. Beneficiary's books and records showing the
account between Beneficiary and Borrower are admissible in
evidence in any action or proceeding with respect to this
Guaranty and constitute prima facie proof of the information
therein.
15. Binding Nature of Certain Adjudications. Each
Guarantor will be conclusively bound by the final adjudication in
any action or proceeding, legal or otherwise, involving any
controversy arising under, in connection with, or in any way
related to, any of the Guarantied Obligations, and by a final
judgment, award or decree entered therein, if such Guarantor had
the right, or was given the opportunity, to participate in such
action or proceeding and was given notice of such action or
proceeding in time to exercise such right or avail itself of such
opportunity.
16. Application of Payments. All payments made under this
Guaranty will be allocated among the principal and interest and
other components of the Guarantied Obligations and the other
obligations of a Guarantor hereunder in such order and amount as
Beneficiary may determine in its sole and absolute discretion.
17. Limitation of Liability. Beneficiary will not have any
liability with respect to, and each Guarantor hereby waives,
releases and agrees not to xxx for, (i) any loss or damage
sustained by any Guarantor that may occur as a result of, in
connection with, or that is in any way related to, any act or
failure to act referred to in Section 5 of this Guaranty, or
(ii) any special, indirect or consequential damages suffered by
any Guarantor in connection with any claim related to this
Guaranty.
18. Miscellaneous.
18.1 Notices. All notices, consents, requests and demands
to or upon the respective parties hereto must be in writing, and
will be deemed to have been given or made when delivered in
person to those Persons listed on the signature pages hereof or
when deposited in the United States mail, postage prepaid, or, in
the case of telegraphic notice, or the overnight courier
services, when delivered to the telegraph company or overnight
courier service, or in the case of telex or telecopy notice, when
sent, verification received, in each case addressed as set forth
on the signature pages hereof, or to such other address as either
party may designate by notice to the other in accordance with the
terms of this Section. No notice given to or demand made on any
Guarantor by Beneficiary or Beneficiary in any instance entitles
Borrower to notice or demand in any other instance.
18.2 Amendments and Waivers. No amendment to, waiver of, or
departure from full compliance with any provision of this
Guaranty, or consent to any departure by any Guarantor herefrom,
will be effective unless it is in writing and signed by
authorized officers of such Guarantor and Beneficiary; provided,
however, that any such waiver or consent will be effective only
in the specific instance and for the purpose for which given. No
failure by Beneficiary to exercise, and no delay by Beneficiary
in exercising, any right, remedy, power or privilege hereunder
will operate as a waiver thereof, nor will any single or partial
exercise by Beneficiary of any right, remedy, power or privilege
hereunder preclude any other exercise thereof, or the exercise of
any other right, remedy, power or privilege.
18.3 Rights Cumulative. Each of the rights and remedies of
Beneficiary and Beneficiary under this Guaranty is in addition to
all of their other rights and remedies under applicable Law, and
nothing in this Guaranty may be construed as limiting any such
rights or remedies.
18.4 Successors and Assigns. This Guaranty binds Guarantors
and their respective successors and assigns and inures to the
benefit of Beneficiary, and each of its successors, transferees,
participants and assignees. No Guarantor may delegate or
transfer any of its obligations under this Guaranty without the
prior written consent of Beneficiary. With respect to
Guarantor's successors and assigns, such successors and assigns
include any receiver, trustee or debtor-in-possession of or for
Guarantor.
18.5 Severability. Any provision of this Guaranty which is
prohibited, unenforceable or not authorized in any jurisdiction
is, as to such jurisdiction, ineffective to the extent of such
prohibition, unenforceability or nonauthorization without
invalidating the remaining provisions hereof or affecting the
validity, enforceability or legality of such provision in any
other jurisdiction.
18.6 Governing Law; No Third Party Rights. This Guaranty is
to be governed by and construed and interpreted in accordance
with the internal Laws of the State of Missouri applicable to
contracts made and to be performed wholly within such state,
without regard to choice or conflicts of law principles. This
Guaranty is solely for the benefit of the parties hereto and
Beneficiary, and their respective successors and assigns, and no
other Person has any right, benefit, priority or interest under,
or because of the existence of, this Guaranty.
18.7 Counterparts. This Guaranty may be executed by the
parties hereto on any number of separate counterparts, and all
such counterparts taken together constitute one and the same
instrument. It is not necessary in making proof of this Guaranty
to produce or account for more than one counterpart signed by the
party to be charged.
18.8 Counterpart Facsimile Execution. For purposes of this
Guaranty, a document (or signature page thereto) signed and
transmitted by facsimile machine or telecopier is to be treated
as an original document. The signature of any Person thereon,
for purposes hereof, is to be considered as an original
signature, and the document transmitted is to be considered to
have the same binding effect as an original signature on an
original document. At the request of any party hereto, any
facsimile or telecopy document is to be re-executed in original
form by the Persons who executed the facsimile or telecopy
document. No party hereto may raise the use of a facsimile
machine or telecopier or the fact that any signature was
transmitted through the use of a facsimile or telecopier machine
as a defense to the enforcement of this Guaranty or any amendment
or other document executed in compliance with this Section.
18.9 Final Expression; No Course of Dealing. This Guaranty,
together with the Loan Agreement, the other Loan Documents and
any other agreement executed in connection herewith or therewith,
is intended by the parties as a final expression of their
agreement and is intended as a complete and exclusive statement
of the terms and conditions thereof. Acceptance of or
acquiescence in a course of performance or course of dealing
rendered or taken under or with respect to this Guaranty, the
Loan Agreement or the other Loan Documents will not be relevant
to determine the meaning of this
Guaranty, the Loan Agreement or the other Loan Documents even
though the accepting or acquiescing party had knowledge of the
nature of the performance and opportunity for objection.
18.10 Negotiated Transaction. Each Guarantor and
Beneficiary each represent to the other that in the negotiation
and drafting of this Guaranty each has been represented by and
has relied upon the advice of counsel of its choice. Each
Guarantor and Beneficiary affirm that its counsel has had a
substantial role in the drafting and negotiation of this
Guaranty; therefore, this Guaranty will be deemed drafted by each
of Borrower and Beneficiary, and the rule of construction to the
effect that any ambiguities are to be resolved against the
drafter will not be employed in the interpretation of this
Guaranty.
18.11 Attorney's Fees and Other Costs. If Guarantors fail
to pay the Guarantied Obligations as required by this Guaranty,
then Guarantors will pay all costs incurred by Beneficiary in
enforcing this Guaranty, including reasonable attorneys' fees and
actual attorneys' expenses (whether or not there is litigation),
court costs and all reasonable costs incurred in connection with
any proceedings under the United States Bankruptcy Code.
18.12 Assignment By Beneficiary. To the extent permitted in
the Loan Agreement, Beneficiary may grant a participation
interest in or assign or transfer to another Person any
instrument, document or agreement evidencing any of the
Guarantied Obligations and Beneficiary's rights under this
Guaranty.
18.13 Choice of forum. Guarantors hereby agree to the
exclusive jurisdiction of the federal court of the Eastern
District of Missouri and the state courts of Missouri located in
St. Louis County or the City of St. Louis, Missouri, with respect
to any dispute exclusively between Beneficiary and any Guarantor
and waive any objection based on venue or forum non conveniens
with respect to any action instituted therein, and agree that any
dispute exclusively between Beneficiary and any Guarantor
concerning the relationship between any Guarantor and Beneficiary
or the conduct of any of them in connection with this Guaranty or
otherwise may be heard only in the courts described above.
18.14 Service of process. Each Guarantor hereby waives
personal service of any and all process upon it and consents that
all such service of process may be made by registered mail
(return receipt requested) directed to such Guarantor at its
address set forth on the signature page hereof, and service so
made will be deemed to be completed five (5) days after the same
has so deposited in the U.S. Mails, certified or registered; or
at Beneficiary's option, by service upon CT Corporation, which
each Guarantor irrevocably appoints as such Guarantor's agent for
the
purpose of accepting service of process within the State of
Missouri. Beneficiary will promptly forward by registered mail
any process so served upon said agent to such Guarantor at its
address on the signature page hereof. Nothing in this Section
affects the right of Beneficiary to serve legal process in any
other manner permitted by Law.
18.15 Waiver of jury trial. Each Guarantor and Beneficiary
hereby waive any right to trial by jury of any claim, demand,
action or cause of action (i) arising under this Guaranty or any
other Loan Document, or (ii) in any way connected with or related
or incidental to the dealings of the parties hereto or either of
them in respect of this Guaranty or any other Loan Document, or
the transactions related hereto or thereto, in each case whether
now existing or hereafter arising, and whether sounding in
contract or tort or otherwise. Each Guarantor and Beneficiary
agree and consent that any such claim, demand, action or cause of
action will be decided by court trial without a jury and that
either may file an original counterpart or a copy of this
Guaranty with any court as written evidence of the consent of the
parties hereto to the waiver of their right to trial by jury.
[remainder of page intentionally left blank]
IN WITNESS WHEREOF, this Guaranty has been duly executed as
of the date first above written.
Xxxxxxxxx, Inc. INA Acquisition Corp.
by its Vice President by its Vice President
--------------------- -----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
Insituform Central, Inc. Insituform Gulf South, Inc.
by its Vice President by its Vice President
--------------------- -----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
Insituform Mid-America, Inc. Insituform Midwest, Inc.
by its Vice President by its Vice President
--------------------- -----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
Insituform Missouri, Inc. Insituform of New England,
Inc.
by its Vice President by its Treasurer
--------------------- -----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
Insituform North, Inc. Insituform North America Corp.
by its Vice President by its Vice President
--------------------- -----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
Insituform Plains, Inc. Insituform Rockies, Inc.
by its Vice President by its Vice President
--------------------- -----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
Insituform Southeast, Inc. Insituform Southwest
By: Insituform Southwest, Inc.
Managing Partner
by its Vice President by its Vice President
--------------------- ----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
Insituform Texark, Inc. Insituform West, Inc.
by its Vice President by its Vice President
--------------------- -----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
NuPipe, Inc. United Pipeline Systems
USA, Inc.
by its Vice President by its Vice President
--------------------- -----------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
--------------------------- ----------------------------
Notice address: Notice address:
702 Spirit 00 Xxxx Xxxxx 702 Spirit 00 Xxxx Xxxxx
--------------------------- ----------------------------
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
--------------------------- ----------------------------
Attn: Xxxxxxx X. Xxxxxx Attn: Xxxxxxx X. Xxxxxx
---------------------- -----------------------
FAX # 000-000-0000 FAX # 000-000-0000
---------------------- -----------------------
TEL # 000-000-0000 TEL # 000-000-0000
---------------------- -----------------------
CONTRIBUTION AGREEMENT
This Contribution Agreement ("Agreement") is entered into as
of August 20, 1997, by and among Xxxxxxxxx, Inc., a Missouri
corporation, INA Acquisition Corp., a Delaware corporation,
Insituform Central, Inc., a Delaware corporation, Insituform Gulf
South, Inc., a Delaware corporation, Insituform Mid-America,
Inc., a Delaware corporation, Insituform Midwest, Inc., a
Delaware corporation, Insituform Missouri, Inc., a Delaware
corporation, Insituform of New England, Inc., a Massachusetts
corporation, Insituform North, Inc., a Delaware corporation,
Insituform North America Corp., a Tennessee corporation,
Insituform Plains, Inc., a Delaware corporation, Insituform
Rockies, Inc., a Delaware corporation, Insituform Southeast,
Inc., a Florida corporation, Insituform Southwest, a California
partnership, Insituform Texark, Inc., a Delaware corporation,
Insituform West, Inc., an Oregon corporation, NuPipe, Inc., an
Oregon corporation, and United Pipeline Systems USA, Inc., a
Delaware corporation (each individually a "Contributor", and
collectively the "Contributors") for the benefit of NationsBank,
N.A., a national banking association (the "Beneficiary").
Recitals
--------
A. Insituform Technologies, Inc., a Delaware corporation
("Borrower") and Beneficiary have entered into that certain Loan
Agreement of even date herewith (as it may be amended, restated,
extended, renewed, replaced, or otherwise modified from time to
time, the "Loan Agreement").
B. As a condition, among others, to Beneficiary's
willingness to enter into the Loan Agreement and provide credit
thereunder, Beneficiary has required each of the Contributors to
guaranty the Loan Obligations of Borrower. Each of the
Contributors has executed an Unlimited Guaranty, dated as of even
date herewith (collectively, the "Guaranty"), in which such
Contributor guaranties to Beneficiary the full and prompt payment
and performance of the Loan Obligations and all costs of
collection thereof, including but not limited to reasonable
attorneys' fees and expenses (whether or not there is
litigation), court costs and all costs in connection with any
proceedings under the United States Bankruptcy Code (the
"Guarantied Obligations").
C. Each of the Contributors is engaged in a business
related to the business of each other Contributor. Each
Contributor is a direct or indirect subsidiary of Borrower. Each
of the Contributors will derive direct and indirect economic
benefit from all of the financial accommodations provided by
Beneficiary under the Loan Agreement.
Agreement
---------
In consideration of the foregoing, the mutual agreements
below and other sufficient consideration, the receipt of which is
hereby acknowledged, the parties hereto hereby agree as follows
for the benefit of the Beneficiary:
1. Definitions.
1.1. In General. Capitalized terms used and not otherwise
defined herein have the meanings given them in the Loan
Agreement.
1.2. Special Definitions. As used in this Agreement,
1.2.1. "Insolvency Proceeding" means and includes
(i) any judicial or non-judicial proceeding seeking or
involving the appointment of a receiver, trustee,
conservator, or liquidator for a Contributor or its assets,
(ii) an assignment by a Contributor for the benefit of its
creditors, or a composition or arrangement by a Contributor
with its creditors, or (iii) a voluntary or involuntary
proceeding for liquidation or reorganization of a
Contributor under the Bankruptcy Code; and
1.2.2. "Marshalling Event" means and includes
(i) the liquidation of a Contributor in connection with its
dissolution, (ii) the sale of all or substantially all of
the assets of a Contributor, whether or not in connection
with its dissolution, (iii) the dissolution of a
Contributor, or (iv) any other event or transaction in which
the assets or liabilities of a Contributor are marshalled
other than an Insolvency Proceeding, in each case under this
Section 1.2.2, other than in a transaction not prohibited by
the Loan Agreement.
2. Mutual Contribution Obligations.
2.1. To the extent that any Contributor makes a payment on
any of its Guarantied Obligations (a "Guarantied Obligation
Payment"), then such Contributor (the "Entitled Contributor") is
entitled to contribution and indemnification from, and
reimbursement by, each other Contributor in the amount of the
Contribution Obligation of such other Contributor hereunder.
2.2. The "Contribution Obligation" of a Contributor with
respect to a Guarantied Obligation Payment of an Entitled
Contributor is an amount equal to the greater of
(a) the lesser of (i) such Contributor's Guarantied
Obligation Limit at the time the Guarantied Obligation
Payment is made and (ii) such Contributor's Allocable Share
of the Guarantied Obligation Payment, and
(b) the amount of all proceeds from the Revolving Loans or
the benefit of the Letters of Credit actually received by
such Contributor or applied by Beneficiary or the recipient
thereof directly or indirectly for the benefit of such
Contributor, less the sum of any repayments thereof and any
Guarantied Obligation Payments made by such Contributor
prior to the time the applicable Guarantied Obligation
Payment is made.
2.3. The "Guarantied Obligation Limit" of each Contributor
is the maximum amount of liability which could be asserted and
enforced by Beneficiary against such Contributor with respect to
the Guarantied Obligations as of the time of the applicable
Guarantied Obligation Payment without (i) rendering such
Contributor "insolvent" within the meaning of Section 101(32) of
the Bankruptcy Code, Section 2 of the Uniform Fraudulent Transfer
Act (the "UFTA") or Section 428.014 of the Missouri Revised
Statutes, (ii) leaving such Contributor with unreasonably small
capital, within the meaning of Section 548 of the Bankruptcy
Code, Section 4 of the UFTA or Section 428.024 of the Missouri
Revised Statutes, or (iii) leaving such Contributor unable to pay
its debts as they become due within the meaning of Section 548 of
the Bankruptcy Code, Section 4 of the UFTA or Section 428.024 of
the Missouri Revised Statutes.
2.4. The "Allocable Share" of a Contributor is a fraction,
the numerator of which is such Contributor's Guarantied
Obligation Limit at the time the applicable Guarantied Obligation
Payment is made and the denominator of which is the sum of the
Guarantied Obligation Limit of all of the Contributors as of such
time.
3. Subordination of Intercompany Claims Among Contributors.
3.1. Until Final Payment, and without in any way limiting
any provisions of any Loan Document, the following provisions
apply.
3.1.1. Every claim for contribution, indemnity or
reimbursement arising under Section 2 of this Agreement
(collectively, the "Intercompany Claims"), are hereby
subordinated in right of payment to all of the Guarantied
Obligations of the Contributors, including but not limited
to those which arise after the commencement of an Insolvency
Proceeding with respect to any Contributor, whether or not
allowed or allowable as a claim against such Contributor or
its assets in such Insolvency Proceeding.
3.1.2. No Contributor is entitled to receive any
payments in cash, securities or other property, or by means
of set-off, with respect to any Intercompany Claim.
3.1.3. Each Contributor will immediately pay over to
Beneficiary all amounts received by it in payment of its
Intercompany Claims against other Contributors, including
but not limited to all cash, securities or other property
received in any Insolvency Proceeding or in connection with
any Marshalling Event on account of its Intercompany Claims,
in the precise form in which such amounts are received (with
any endorsements thereon or assignments thereof as may be
required by Beneficiary), for application to the Loan
Obligations in such order and relative amounts as
Beneficiary determines in its sole discretion. In the event
a Contributor fails to make any such endorsement or
assignment to Beneficiary, Beneficiary or any of its
officers or employees is hereby irrevocably authorized to do
so on behalf of such Contributor, as such Contributor's
attorney-in-fact. Until so paid over, such Contributor will
hold such amounts in trust for Beneficiary.
3.1.4. No Contributor will, without the prior
written consent of Beneficiary, (a) make demand for,
accelerate, xxx for or otherwise enforce, or seek to
enforce, any right or remedy with respect to any
Intercompany Claim or any security therefor, by judicial or
administrative action or otherwise, or (b) file or join the
filing of any petition commencing an Insolvency Proceeding
against another Contributor, or otherwise initiate or
participate in the initiation of any similar proceedings for
the benefit of creditors of another Contributor;
3.1.5. If an Insolvency Proceeding is commenced
with respect to a Contributor, or a Marshalling Event occurs
with respect to a Contributor, each other Contributor will
timely file all claims, proofs of claim or other instruments
of similar character necessary to enforce its Intercompany
Claims. If any such other Contributor fails timely to do
so, Beneficiary, or any of its officers or employees, is
hereby irrevocably authorized to do so as attorney-in-fact
for such other Contributor.
3.1.6. Each Contributor hereby appoints
Beneficiary, or any of its officers or employees, as
attorney-in-fact for such Contributor (which appointment is
acknowledged to be coupled with an interest and is,
therefore, irrevocable), with the power but not the duty to
(i) file any claim, proof of claim or other instrument of
similar character in any Insolvency Proceeding with respect
to another Contributor, to vote claims comprising
Intercompany Claims in any such Insolvency Proceeding, and
to accept or reject any plan of partial or complete
liquidation, reorganization, arrangement, composition or
extension in any such Insolvency Proceeding, (ii) demand,
xxx for, collect and receive any moneys, dividends or other
assets in payment of Intercompany Claims and give
acquittance therefor, and (iii) take such other action in
Beneficiary's own name or in the name of any Contributor as
Beneficiary may deem necessary or advantageous for the
enforcement of Intercompany Claims. Each Contributor will
execute and deliver to Beneficiary such additional powers-
of-attorney and other instruments as Beneficiary may deem
necessary to accomplish the foregoing.
3.2. The provisions of Section 3.1 notwithstanding, so long
as no Event of Default has occurred, Intercompany Claims against
a Contributor may be paid in the ordinary course of such
Contributor's business as conducted on the date of this Agreement
to the extent not prohibited by the Loan Agreement or other Loan
Documents. Following the occurrence of an Event of Default, all
such payments will be made directly to Beneficiary for
application to the Loan Obligations.
4. This is a continuing agreement of each Contributor and
Beneficiary may continue, at any time and without notice to any
Contributor, to extend credit or other financial accommodations
and loan monies to Borrower on the faith hereof. If any
Contributor has a waivable right under applicable law or
otherwise to terminate or revoke the provisions of Section 3,
such Contributor hereby irrevocably waives such right. If any
Contributor has any non-waivable right under applicable law or
otherwise to terminate or revoke the provisions of Section 3,
such termination or revocation is not effective until written
notice of such termination or revocation, signed by such
Contributor, is actually received by Beneficiary. Such
termination or revocation will not affect this Agreement in
relation to any of the Guarantied Obligations which arose prior
to receipt thereof or which are created after receipt thereof, if
such Guarantied Obligations were incurred either through
readvances by Beneficiary pursuant to Beneficiary's financing
arrangements with Borrower or for the purpose of protecting any
of the Collateral, including but not limited to all protective
advances, costs, expenses, and attorneys' fees, whenever made,
advanced or incurred by Beneficiary in connection with the Loan
Obligations. If, in reliance on this Agreement, Beneficiary
extends credit or other financial accommodations or loans monies
to or for the benefit of any Contributor, or takes other action
under the Loan Documents after any such termination or revocation
by a Contributor, but prior to the receipt by Beneficiary of
written notice as required above, the rights of Beneficiary are
the same as if such termination or revocation had not occurred.
5. Each Contributor acknowledges that all Advances made by
Beneficiary under the Loan Agreement and other Loan Documents
will be made in reliance upon this Agreement. Each Contributor
expressly waives all notices not specifically required pursuant
to the terms of this Agreement, and each Contributor expressly
waives reliance by Beneficiary upon the subordination and other
agreements herein. Each Contributor acknowledges that no
Contribution Obligation will be diminished or extinguished by,
and that no Contributor is entitled to raise as a defense to any
Contribution Obligation, any:
5.1. invalidity, irregularity or unenforceability of the
Loan Obligations, the Guarantied Obligations, or of any
Contribution Obligation;
5.2. failure of Contributor to be given notice of default
with respect to the Loan Obligations;
5.3. reorganization, merger or consolidation of any Borrower
or Contributor into or with any other Person;
5.4. waiver of Borrower's defaults or extensions of due
dates for payments or other accommodations, indulgences or
forbearance granted to Borrower with respect to the Loan
Obligations or the Loan Documents;
5.5. release of or non-perfection with respect to part or
all of any security for the Loan Obligations;
5.6. taking or accepting of any other security, collateral
or guaranty of payment of any or all of the Loan Obligations;
5.7. release of or settlement or compromise with any one or
more Contributors or by release of or settlement or compromise
with any one or more other Persons who are otherwise liable for
the payment or performance of all or any portion of the Loan
Obligations;
5.8. assignment or other transfer by Beneficiary of any part
of the Loan Obligations or any collateral or security securing
any portion of the Loan Obligations; or
5.9. other acts or omissions which, in the absence of this
Section, would operate so as to impair, diminish or extinguish
any Contributor's liability hereunder, except for full and
irrevocable payment of the Loan Obligations.
6. Except as expressly set forth herein, each Contributor
acknowledges that Beneficiary has made no warranties or
representations with respect to the due execution, legality,
validity, completeness or enforceability of any of the Loan
Documents or the collectibility of the Loan Obligations.
Beneficiary is entitled to manage and supervise its loans to
Borrower in accordance with applicable law and Beneficiary's
usual practices, modified from time to time as Beneficiary deems
appropriate under the circumstances, without regard to the
existence of any rights that any Contributor may now or hereafter
have with respect to other Contributors. Beneficiary will not
have any liability to any Contributor for, and each Contributor
hereby waives any claim which any Contributor may now or
hereafter have against, Beneficiary arising out of any actions
which Beneficiary takes or omits to take with respect to any Loan
Documents or to the collection of the Loan Obligations or the
valuation, use, protection or release of any of the Collateral
(including but not limited to actions with respect to the
creation, perfection or continuation of liens or security
interests in any of the Collateral, actions with respect to any
Default or Event of Default, actions with respect to foreclosure
upon, sale, release, or depreciation of, or failure to realize
upon, any of the Collateral, and actions with respect to the
collection of any claim for all or any part of the Loan
Obligations from any account debtor, guarantor or any other
party).
7. Except as provided herein, no Contributor, as a result of
any Intercompany Claim, has any right of contribution,
reimbursement, repayment, subrogation or indemnity or right of
recourse to or with respect to any assets or property of any
other Contributor until Final Payment.
8. Miscellaneous.
8.1. Nothing set forth in this Agreement impairs the
obligations of Borrower to pay any amounts, as and when the same
becomes due and payable in accordance with the terms of the Loan
Agreement or any of the other Loan Documents.
8.2. Each Contributor will maintain a record of all
disbursements of Loan proceeds to, transfers of Loan proceeds to,
transfers of Loan proceeds by, and repayments of Loan proceeds
by, such Contributor.
8.3. The parties hereto acknowledge that the rights of
contribution, indemnification and reimbursement hereunder
constitute assets in favor of each Contributor to which such
contribution, indemnification and reimbursement is owing.
8.4. Each Contributor agrees and acknowledges that each
Intercompany Claim is payable upon demand, subject to the terms
of this Agreement.
8.5. This Agreement has been delivered in St. Louis,
Missouri and is to be governed by and construed and interpreted
in accordance with the internal laws of the State of Missouri
applicable to contracts made and to be performed wholly within
such state, without regard to choice or conflicts of law
principles.
8.6. Wherever possible, each provision of this Agreement is
to be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is
prohibited by or invalid under such law, such provision is
ineffective to the extent of such prohibition or invalidity
without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
8.7. This Agreement may be executed by the parties hereto on
any number of separate counterparts, and all such counterparts
taken together constitute one and the same instrument. It is not
necessary in making proof of this Agreement to produce or account
for more than one counterpart signed by the party to be charged.
For purposes of this Agreement, a document (or signature page
thereto) signed and transmitted by facsimile machine or
telecopier is to be treated as an original document. The
signature of any Person thereon, for purposes hereof, is to be
considered as an original signature, and the document transmitted
is to be considered to have the same binding effect as an
original signature on an original document. At the request of
any party hereto, any facsimile or telecopy document is to be re-
executed in original form by the Persons who executed the
facsimile or telecopy document. No party hereto may raise the
use of a facsimile machine or telecopier or the fact that any
signature was transmitted through the use of a facsimile or
telecopier machine as a defense to the enforcement of this
Agreement or any amendment or other document executed in
compliance with this Section.
8.8. If one or more Contributors (the "Released
Contributors") is released from the Guaranty by written consent
of Beneficiary, this Agreement will be deemed amended to apply
only to those Contributors which have not been released. In such
event, the calculations described in Section 2 of this Agreement
will be performed as if the Released Contributors were never a
party to this Agreement.
[remainder of page intentionally left blank]
IN WITNESS WHEREOF, this Agreement has been duly executed as
of the date first above written.
Xxxxxxxxx, Inc. INA Acquisition Corp
by its Vice President by its Vice President
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
Insituform Central, Inc. Insituform Gulf South, Inc.
by its Vice President by its Vice President
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
Insituform Mid-America, Inc. Insituform Midwest, Inc.
by its Vice President by its Vice President
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
Insituform Missouri, Inc. Insituform of New England, Inc.
by its Vice President by its Treasurer
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
Insituform North, Inc. Insituform North America Corp.
by its Vice President by its Vice President
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
Insituform Plains, Inc. Insituform Rockies, Inc.
by its Vice President by its Vice President
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
Insituform Southeast, Inc. Insituform Southwest (partnership)
By: Insituform Southwest, Inc.
Managing Partner
by its Vice President by its Vice President
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
Insituform Texark, Inc. Insituform West, Inc.
by its Vice President by its Vice President
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
NuPipe, Inc. United Pipeline Systems USA, Inc.
by its Vice President by its Vice President
-------------------- -------------------------
s/Xxxxxxx X. Xxxxxx s/Xxxxxxx X. Xxxxxx
-------------------------- -------------------------------
Agreed to and accepted as
of the date first written above
NATIONSBANK, N.A.
by its Vice President
----------------------
s/Xxxx X. Xxxxxxx
----------------------------