Exhibit 99(b)(2)
CREDIT AGREEMENT
DATED AS OF FEBRUARY 24, 2004
AMONG
NECTAR MERGER CORPORATION
FTD, INC.,
THE LENDERS LISTED HEREIN,
AS LENDERS,
CREDIT SUISSE FIRST BOSTON,
AS ADMINISTRATIVE AGENT,
UBS SECURITIES LLC
AS SYNDICATION AGENT,
XXXXX FARGO BANK, N.A.,
AS DOCUMENTATION AGENT
AND
CREDIT SUISSE FIRST BOSTON AND UBS SECURITIES LLC,
AS JOINT LEAD ARRANGERS
TABLE OF CONTENTS
Page No.
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SECTION 1. DEFINITIONS....................................................................3
1.1 Certain Defined Terms.............................................................3
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations
Under Agreement..................................................................32
1.3 Other Definitional Provisions and Rules of Construction..........................33
SECTION 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS....................................33
2.1 Commitments; Making of Loans; the Register; Optional Notes.......................33
2.2 Interest on the Loans............................................................40
2.3 Fees.............................................................................44
2.4 Repayments, Prepayments and Reductions in Revolving Loan
Commitments; General Provisions Regarding Payments; Application of
Proceeds of Collateral and Payments Under Guaranties.............................45
2.5 Use of Proceeds..................................................................54
2.6 Special Provisions Governing Eurodollar Rate Loans...............................54
2.7 Increased Costs; Taxes; Capital Adequacy.........................................56
2.8 Statement of Lenders; Obligation of Lenders and Issuing Lenders to
Mitigate.........................................................................60
2.9 Replacement of a Lender..........................................................61
SECTION 3. LETTERS OF CREDIT.............................................................62
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations
Therein..........................................................................62
3.2 Letter of Credit Fees............................................................65
3.3 Drawings and Reimbursement of Amounts Paid Under Letters of Credit;
Cash Collateralization...........................................................66
3.4 Obligations Absolute.............................................................69
3.5 Nature of Issuing Lenders' Duties................................................70
SECTION 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT.....................................70
4.1 Conditions to Term Loans and Initial Revolving Loans and Swing Line
Loans............................................................................70
4.2 Conditions to All Loans..........................................................79
4.3 Conditions to Letters of Credit..................................................80
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SECTION 5. COMPANY'S REPRESENTATIONS AND WARRANTIES......................................80
5.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries.....................................................................80
5.2 Authorization of Borrowing, etc..................................................81
5.3 Financial Condition..............................................................82
5.4 No Material Adverse Change; No Restricted Junior Payments........................83
5.5 Title to Properties; Liens; Real Property; Intellectual Property.................83
5.6 Litigation; Adverse Facts........................................................84
5.7 Payment of Taxes.................................................................84
5.8 Performance of Agreements; Material Contracts....................................84
5.9 Governmental Regulation..........................................................85
5.10 Securities Activities............................................................85
5.11 Employee Benefit Plans...........................................................85
5.12 Certain Fees.....................................................................86
5.13 Environmental Protection.........................................................86
5.14 Employee Matters.................................................................87
5.15 Solvency.........................................................................87
5.16 Matters Relating to Collateral...................................................87
5.17 Disclosure.......................................................................88
5.18 Subordinated Indebtedness........................................................88
5.19 Related Agreements...............................................................88
5.20 Reporting to IRS.................................................................89
5.21 Foreign Assets Control Regulations, etc..........................................89
5.22 Foreign Subsidiaries.............................................................89
SECTION 6. COMPANY'S AFFIRMATIVE COVENANTS...............................................90
6.1 Financial Statements and Other Reports...........................................90
6.2 Existence, etc...................................................................94
6.3 Payment of Taxes and Claims; Tax.................................................95
6.4 Maintenance of Properties; Insurance; Application of Net Insurance/
Condemnation Proceeds............................................................95
6.5 Inspection Rights; Lender Meeting................................................97
6.6 Compliance with Laws, etc........................................................97
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6.7 Environmental Matters............................................................97
6.8 Execution of Subsidiary Guaranty and Personal Property Collateral
Documents After the Closing Date.................................................99
6.9 Matters Relating to Additional Real Property Collateral.........................100
6.10 Escrow of Funds; Payment of XXX.XXX Securities Litigation Settlement............100
6.11 Post Closing Matters............................................................101
SECTION 7. COMPANY'S NEGATIVE COVENANTS.................................................101
7.1 Indebtedness....................................................................101
7.2 Liens and Related Matters.......................................................104
7.3 Investments; Acquisitions.......................................................106
7.4 Contingent Obligations..........................................................108
7.5 Restricted Junior Payments......................................................108
7.6 Financial Covenants.............................................................109
7.7 Restriction on Fundamental Changes; Asset Sales.................................111
7.8 Consolidated Capital Expenditures...............................................113
7.9 Transactions with Shareholders and Affiliates...................................113
7.10 Sales and Lease-Backs...........................................................114
7.11 Conduct of Business.............................................................115
7.12 Amendments or Waivers of Certain Agreements; Amendments of
Documents Relating to Subordinated Indebtedness; Designation of
Designated Senior Indebtedness..................................................115
7.13 Fiscal Year.....................................................................115
SECTION 8. EVENTS OF DEFAULT............................................................115
8.1 Failure to Make Payments When Due...............................................116
8.2 Default in Other Agreements.....................................................116
8.3 Breach of Certain Covenants.....................................................116
8.4 Breach of Warranty..............................................................116
8.5 Other Defaults Under Loan Documents.............................................116
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc............................117
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc..............................117
8.8 Judgments and Attachments.......................................................117
8.9 Dissolution.....................................................................118
8.10 Employee Benefit Plans..........................................................118
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8.11 Change in Control...............................................................118
8.12 Invalidity of Loan Documents; Failure of Security; Repudiation of
Obligations.....................................................................118
8.13 Conduct of Business By Holdings.................................................118
8.14 Failure to Consummate Merger....................................................119
8.15 Amendment of Certain Documents of Holdings......................................119
SECTION 9. ADMINISTRATIVE AGENT.........................................................120
9.1 Appointment.....................................................................120
9.2 Powers and Duties; General Immunity.............................................121
9.3 Independent Investigation by Lenders; No Responsibility For Appraisal of
Creditworthiness................................................................122
9.4 Right to Indemnity..............................................................123
9.5 Successor Administrative Agent and Swing Line Lender............................123
9.6 Collateral Documents and Guaranties.............................................124
9.7 Duties of Other Agents..........................................................125
9.8 Administrative Agent May File Proofs of Claim...................................125
SECTION 10. MISCELLANEOUS................................................................126
10.1 Successors and Assigns; Assignments and Participations in Loans and
Letters of Credit...............................................................126
10.2 Expenses........................................................................130
10.3 Indemnity.......................................................................131
10.4 Set-Off.........................................................................132
10.5 Ratable Sharing.................................................................132
10.6 Amendments and Waivers..........................................................133
10.7 Independence of Covenants.......................................................134
10.8 Notices; Effectiveness of Signatures............................................134
10.9 Survival of Representations, Warranties and Agreements..........................135
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative...........................135
10.11 Marshalling; Payments Set Aside.................................................135
10.12 Severability....................................................................136
10.13 Obligations Several; Independent Nature of Lenders' Rights; Damage
Waiver..........................................................................136
10.14 Release of Security Interest or Guaranty........................................136
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10.15 Applicable Law..................................................................137
10.16 Construction of Agreement; Nature of Relationship...............................137
10.17 Consent to Jurisdiction and Service of Process..................................137
10.18 Waiver of Jury Trial............................................................138
10.19 Confidentiality.................................................................139
10.20 Counterparts; Effectiveness.....................................................140
Signature pages S-1
v
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF REQUEST FOR ISSUANCE
IV FORM OF TERM NOTE
V Intentionally Deleted
VI FORM OF REVOLVING NOTE
VII FORM OF SWING LINE NOTE
VIII FORM OF COMPLIANCE CERTIFICATE
IX FORM OF OPINION OF COMPANY COUNSEL
X FORM OF OPINION OF O'MELVENY & XXXXX LLP
XI FORM OF ASSIGNMENT AGREEMENT
XII FORM OF SOLVENCY CERTIFICATE
XIII FORM OF SUBSIDIARY GUARANTY
XIV FORM OF SECURITY AGREEMENT
XV FORM OF HOLDINGS GUARANTY
XVI FORM OF NOTICE OF PREPAYMENT
XVII FORM OF MORTGAGE
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SCHEDULES
1.1 PUBLIC COMPANY COSTS
2.1 LENDERS' COMMITMENTS AND PRO RATA SHARES
4.1C CORPORATE AND CAPITAL STRUCTURE; OWNERSHIP; MANAGEMENT
4.1K CLOSING DATE ENVIRONMENTAL REPORTS
4.1M CLOSING DATE MORTGAGED PROPERTIES
5.1 SUBSIDIARIES OF COMPANY
5.5B REAL PROPERTY
5.5C INTELLECTUAL PROPERTY
5.6 LITIGATION
5.8 MATERIAL CONTRACTS
5.11 CERTAIN EMPLOYEE BENEFIT PLANS
7.1 CERTAIN EXISTING INDEBTEDNESS
7.2 CERTAIN EXISTING LIENS
7.3 CERTAIN EXISTING INVESTMENTS
7.9 AFFILIATE TRANSACTIONS
vii
NECTAR MERGER CORPORATION
FTD, INC.
CREDIT AGREEMENT
This
CREDIT AGREEMENT is dated as of February 24, 2004 and
entered into by and among NECTAR MERGER CORPORATION, a Delaware corporation
("MERGER SUB"), as borrower prior to the consummation of the Merger (this and
other capitalized terms used herein without definition being used as defined in
subsection 1.1), FTD, INC., a Delaware corporation, as borrower after
consummation of the Merger, THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE
PAGES HEREOF (each individually referred to herein as a "LENDER" and
collectively as "LENDERS"), UBS SECURITIES LLC ("UBSS"), as syndication agent
for Lenders (in such capacity, "SYNDICATION AGENT"), XXXXX FARGO BANK, N.A., as
documentation agent for Lenders (in such capacity, "DOCUMENTATION AGENT"), and
CREDIT SUISSE FIRST BOSTON, acting through its Cayman Islands Branch ("CSFB"),
as administrative agent for Lenders (in such capacity, "ADMINISTRATIVE AGENT").
R E C I T A L S
WHEREAS, Holdings and its direct wholly-owned Subsidiary, Merger
Sub, have been formed by LGP for the purpose of acquiring FTD;
WHEREAS, Holdings has formed, and owns all of the outstanding
shares of capital stock of, Merger Sub;
WHEREAS, on or before the Closing Date, LGP and other investors
will purchase (i) all of the outstanding Holdings Common Stock for consideration
of $40,000,000, consisting of approximately $37,000,000 in cash and
approximately $3,000,000 in Old Management Shares and (ii) all of the
outstanding Holdings Preferred Stock for cash consideration of $155,531,000
(with the consideration paid in connection with the foregoing equity purchases
to be adjusted on a dollar-for-dollar basis by any available cash on hand of FTD
and any existing indebtedness of FTD, each as of the Closing Date, subject to
the requirement that the foregoing equity purchases equal not less than
$180,000,000 and the remaining available cash on hand of Company after
consummation of the Merger is not less than $7,261,497.55);
WHEREAS, on or before the Closing Date, Company will issue and
sell not less than $175,000,000 in aggregate principal amount of Subordinated
Notes;
WHEREAS, on the Closing Date and upon consummation of the Merger
in accordance with the Merger Agreement, (i) all of the outstanding Non-Public
FTD Common Stock shall be cancelled and retired without the payment of any
consideration, (ii) all outstanding Public FTD Common Stock and options to
purchase FTD Common Stock shall be cancelled and retired for consideration of
$421,076,000, consisting of approximately $418,076,000 in cash and the
conversion of approximately $3,000,000 in Old Management Shares to Holdings
Common Stock and (iii) Merger Sub will be merged with and into FTD pursuant to
the Merger Agreement and the Certificate of Merger, with FTD being the surviving
corporation in such merger;
WHEREAS, Lenders, at the request of Company, have agreed to
extend certain credit facilities to Company, the proceeds of which will be used
(i) together with any cash on hand of FTD and the proceeds of the issuance and
sale on or prior to the Closing Date of (a) preferred and common equity
securities of Holdings and (b) the Subordinated Notes, to fund the Merger
Financing Requirements, and (ii) to provide financing for working capital and
other general corporate purposes of Company and its Subsidiaries;
WHEREAS, Company desires to secure all of the Obligations
hereunder and under the other Loan Documents by granting to Administrative
Agent, on behalf of Lenders, a first priority Lien on substantially all of its
real, personal and mixed property, including a pledge of all of the capital
stock of its Domestic Subsidiaries and 66% of the capital stock of its Foreign
Subsidiaries; and
WHEREAS, Holdings and all of the Domestic Subsidiaries of Company
have agreed to guarantee the Obligations hereunder and under the other Loan
Documents and to secure their guaranties by granting to Administrative Agent, on
behalf of Lenders, a first priority Lien on substantially all of their real,
personal and mixed property, including a pledge of all of the capital stock of
their Domestic Subsidiaries and 66% of the capital stock of their Foreign
Subsidiaries:
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, Company, Lenders,
Syndication Agent, Documentation Agent and Administrative Agent agree as
follows:
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SECTION 1. DEFINITIONS
1.1 CERTAIN DEFINED TERMS.
The following terms used in this Agreement shall have the
following meanings:
"ADDITIONAL MORTGAGED PROPERTY" has the meaning set forth in
subsection 6.9.
"ADDITIONAL MORTGAGES" has the meaning set forth in subsection
6.9.
"ADMINISTRATIVE AGENT" has the meaning assigned to that term in
the introduction to this Agreement and also means and includes any successor
Administrative Agent appointed pursuant to subsection 9.5A.
"AFFECTED LENDER" has the meaning assigned to that term in
subsection 2.6C.
"AFFECTED LOANS" has the meaning assigned to that term in
subsection 2.6C.
"AFFILIATE", as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise.
"AGENTS" means Administrative Agent, Syndication Agent, Joint
Lead Arrangers and Documentation Agent.
"AGREEMENT" means this
Credit Agreement dated as of February 24,
2004, as it may be amended, supplemented or otherwise modified from time to
time.
"APPROVED FUND" means a Fund that is administered or managed by
(i) a Lender, (ii) an Affiliate of a Lender or (iii) an entity or an Affiliate
of an entity that administers or manages a Lender.
"ASSET SALE" means the sale by Company or any of its Subsidiaries
to any Person other than Company or any of its wholly-owned Subsidiaries of (i)
any of the stock of any of Company's Subsidiaries, (ii) substantially all of the
assets of any division or line of business of Company or any of its
Subsidiaries, or (iii) any other assets (whether tangible or intangible) of
Company or any of its Subsidiaries (other than (a) inventory sold in the
ordinary course of business, (b) sales, assignments, transfers or dispositions
of accounts in the ordinary course of business for purposes of collection and
(c) any such other assets to the extent that the aggregate value of such assets
sold in any single transaction or related series of transactions is equal to
$250,000 or less.
"ASSIGNMENT AGREEMENT" means an Assignment and Assumption in
substantially the form of EXHIBIT XI annexed hereto.
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"BANKRUPTCY CODE" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any successor statute.
"BASE RATE" means, at any time, the higher of (i) the Prime Rate
or (ii) the rate which is 1/2 of 1% in excess of the Federal Funds Effective
Rate. Any change in the Base Rate due to a change in the Prime Rate or the
Federal Funds Effective Rate shall be effective on the effective date of such
change.
"BASE RATE LOANS" means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection 2.2A.
"BASE RATE MARGIN" means the margin over the Base Rate used in
determining the rate of interest of Base Rate Loans pursuant to subsection 2.2A.
"BUSINESS DAY" means (i) for all purposes other than as covered
by clause (ii) below, any day excluding Saturday, Sunday and any day which is a
legal holiday under the laws of the State of
New York or is a day on which
banking institutions located in such state are authorized or required by law or
other governmental action to close, and (ii) with respect to all notices,
determinations, fundings and payments in connection with the Eurodollar Rate or
any Eurodollar Rate Loans, any day that is a Business Day described in clause
(i) above and that is also a day for trading by and between banks in Dollar
deposits in the London interbank market.
"CAPITAL LEASE", as applied to any Person, means any lease of any
property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"CAPITAL STOCK" means the capital stock or other equity interests
of a Person.
"CASH" means money, currency or a credit balance in a Deposit
Account.
"CASH EQUIVALENTS" means, as at any date of determination: (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, a rating within the
highest two rating categories obtainable from Standard & Poor's ("S&P"), Xxxxx'x
Investors Service, Inc. ("MOODY'S") or any other credit rating agency of
recognized national standing; (iii) commercial paper maturing no more than one
year from the date of creation thereof and having, at the time of the
acquisition thereof, a rating of at least A-2 from S&P or at least P-2 from
Moody's; (iv) demand deposits, time deposits and certificates of deposit or
bankers' acceptances maturing within one year after such date and issued or
accepted by any Lender or by any commercial bank organized under the laws of the
United States of America or any state thereof or the District of Columbia that
(a) is at least "adequately capitalized" (as defined in the regulations of its
primary Federal banking regulator) and (b) has Tier 1 capital (as defined in
such regulations) of not less than $100,000,000; (v) repurchase agreements and
reverse repurchase agreements with any Lender or any Affiliate thereof relating
4
to marketable securities meeting the criteria set forth in clause (i) above,
(vi) shares of any money market mutual fund that (a) has at least 95% of its
assets invested continuously in the types of investments referred to in clauses
(i) through (v) above, (b) has net assets of not less than $500,000,000, and (c)
has the highest rating obtainable from either S&P, Moody's or any other credit
rating agency of recognized national standing, or (vii) with respect to
Investments by any Foreign Subsidiary, any demand deposit account.
"CERTIFICATE OF MERGER" means the Certificate of Merger as filed
with the Delaware Secretary of State on the Closing Date.
"CHANGE IN CONTROL" means:
(a) prior to a Qualified Public Offering, either (i) the
failure by LGP, any of its controlled Affiliates and the Initial LGP Investors
or their controlled Affiliates collectively to own, directly or indirectly, at
least a majority of the outstanding Voting Stock of Holdings or (ii) any
"person" or "group" (within the meaning of the Exchange Act) has the ability by
contract or otherwise to control directly or indirectly Company or Holdings;
(b) from and after a Qualified Public Offering, any "person"
or "group" (within the meaning of the Exchange Act and the rules of the
Securities and Exchange Commission thereunder as in effect on the date hereof),
shall become, or obtain rights to become, the "beneficial owner" (as defined in
the Exchange Act) directly or indirectly, of a greater percentage of the Voting
Stock of Holdings than the percentage of Voting Stock of Holdings beneficially
owned collectively by LGP, any of its controlled Affiliates and the Initial LGP
Investors or their controlled Affiliates;
(c) Holdings shall fail to own directly or indirectly 100% of
the common stock of Company;
(d) Holdings shall fail to have the ability to elect all of
the Governing Body of Company;
(e) the occurrence of a change in the composition of the
Governing Body of Holdings or Company such that a majority of the members of any
such Governing Body are not Continuing Members; or
(f) the occurrence of any "Change of Control" as defined in
the Subordinated Note Indenture.
"CLASS", as applied to Lenders, means each of the following two
classes of Lenders: (i) Lenders having Revolving Loan Exposure and (ii) Lenders
having Term Loan Exposure.
"CLOSING DATE" means the date on which the initial Loans are
made.
"CLOSING DATE MORTGAGED PROPERTY" has the meaning set forth in
subsection 4.1M.
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"CLOSING DATE MORTGAGES" has the meaning set forth in subsection
4.1M.
"COLLATERAL" means, collectively, all of the real, personal and
mixed property (including Capital Stock) in which Liens are purported to be
granted pursuant to the Collateral Documents as security for the Obligations.
"COLLATERAL ACCESS AGREEMENT" means any landlord waiver,
mortgagee waiver, bailee letter or any similar acknowledgement or agreement of
any landlord or mortgagee in respect of any Real Property Asset where any
Collateral is located or any warehouseman or processor in possession of any
inventory of any Loan Party, in form and substance reasonably satisfactory to
Administrative Agent.
"COLLATERAL ACCOUNT" has the meaning assigned to that term in the
Security Agreement.
"COLLATERAL DOCUMENTS" means the Security Agreement, the Foreign
Pledge Agreements, if any, the Control Agreements, the Mortgages and all other
instruments or documents delivered by any Loan Party pursuant to this Agreement
or any of the other Loan Documents in order to grant to Administrative Agent, on
behalf of Lenders, a Lien on any real, personal or mixed property of that Loan
Party as security for the Obligations.
"COMMERCIAL LETTER OF CREDIT" means any letter of credit or
similar instrument issued for the purpose of providing the primary payment
mechanism in connection with the purchase of any materials, goods or services by
Company or any of its Subsidiaries in the ordinary course of business of Company
or such Subsidiary.
"COMMITMENTS" means the commitments of Lenders to make Loans as
set forth in subsection 2.1A and subsection 3.3.
"COMPANY" means, except as provided in Section 5, (i) prior to
the consummation of the Merger, Merger Sub, and (ii) after the consummation of
the Merger, FTD as the surviving corporation in the Merger.
"COMPANY EMPLOYEE BENEFIT PLAN" means any "employee benefit plan"
as defined in Section 3(3) of ERISA which is or was maintained or contributed to
by Company or any of its Subsidiaries.
"COMPANY PENSION PLAN" means any Company Employee Benefit Plan,
other than a Multiemployer Plan, that is subject to Section 412 of the Internal
Revenue Code or Section 302 of ERISA, and, for purposes of subsection 8.10, any
Foreign Plan.
"COMPLIANCE CERTIFICATE" means a certificate substantially in the
form of EXHIBIT VIII annexed hereto.
"CONFIDENTIAL INFORMATION MEMORANDUM" means the Confidential
Information Memorandum dated January 20, 2004 prepared by the Joint Lead
Arrangers, as modified by the Memorandum dated January 30, 2004 prepared by the
Joint Lead Arrangers, relating to the credit facilities evidenced by this
Agreement.
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"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the
sum of the aggregate of all expenditures (whether paid in cash or other
consideration or accrued as a liability and including that portion of Capital
Leases which is capitalized on the consolidated balance sheet of Company and its
Subsidiaries) by Company and its Subsidiaries during that period that, in
conformity with GAAP, are included in "additions to property, plant or
equipment" or comparable items reflected in the consolidated statement of cash
flows of Company and its Subsidiaries. For purposes of this definition, the
purchase price of equipment that is purchased simultaneously with the trade-in
of existing equipment or with insurance proceeds shall be included in
Consolidated Capital Expenditures only to the extent of the gross amount of such
purchase price less the credit granted by the seller of such equipment for the
equipment being traded in at such time or the amount of such proceeds, as the
case may be.
"CONSOLIDATED CASH INTEREST EXPENSE" means, for any period,
Consolidated Interest Expense for such period EXCLUDING, HOWEVER, any interest
expense not payable in Cash (including amortization of discount and amortization
of debt issuance costs).
"CONSOLIDATED CURRENT ASSETS" means, as at any date of
determination, the total assets of Company and its Subsidiaries on a
consolidated basis which may properly be classified as current assets in
conformity with GAAP, EXCLUDING Cash and Cash Equivalents.
"CONSOLIDATED CURRENT LIABILITIES" means, as at any date of
determination, the total liabilities of Company and its Subsidiaries on a
consolidated basis which may properly be classified as current liabilities in
conformity with GAAP, EXCLUDING the current portions of Indebtedness that by its
terms matures more than one year from the date of its creation and Capital
Leases.
"CONSOLIDATED EBITDA" means, for any period, the sum, without
duplication, of the amounts for such period of (i) Consolidated Net Income, (ii)
Consolidated Interest Expense, (iii) provisions for taxes based on income,
(including payments made pursuant to subsection 7.5(iii)(b)), (iv) total
depreciation expense, (v) total amortization expense, (vi) Transaction Costs,
(vii) management fees and other payments paid to LGP permitted by subsection
7.9, (viii) management or employee retention payments under compensation plans
created after the Closing Date in an aggregate amount that does not exceed
$1,000,000 in any Fiscal Year or $4,000,000 in the aggregate, (ix) retention
bonuses approved by the Governing Body of Company or any of its respective
Subsidiaries, as applicable, prior to the Closing Date other than the retention
payments described in clause (viii) above, (x) non-recurring costs set forth in
Schedule 1.1 with respect to public company costs that will not be incurred on a
going forward basis (to the extent applicable to such period), (xi) any
unrealized foreign currency translation or transaction gains or losses in
respect of Indebtedness or other obligations of Company or any Subsidiary
Guarantor owing to Company or any Subsidiary Guarantor, (xii) all extraordinary,
unusual or non-recurring losses, charges or expenses (minus any extraordinary,
unusual or non-recurring gains) (it being understood and agreed that Item 10(e)
of Regulation S-K under the Securities Act shall not constitute a limitation on
any such determination and unusual or non-recurring losses, charges, expenses or
gains shall be determined by Company in good faith), (xiii) other non-cash
items, including, without limitation, non-cash stock compensation paid to
officers, directors and employees (other than any such non-cash item to the
extent it represents an accrual of or reserve for cash expenditures in any
future period) but only, in the case of clauses (ii)-(xiii), to the extent
7
deducted in the calculation of Consolidated Net Income, LESS non-cash items
added in the calculation of Consolidated Net Income (other than any such
non-cash item to the extent it will result in the receipt of cash payments in
any future period), and all of the foregoing as determined on a consolidated
basis for Company and its Subsidiaries in conformity with GAAP.
"CONSOLIDATED EXCESS CASH FLOW" means, for any period, an amount
(if positive) equal to (i) the sum, without duplication, of the amounts for such
period of (a) Consolidated EBITDA and (b) the Consolidated Working Capital
Adjustment MINUS (ii) the sum, without duplication, of the amounts for such
period of (a) voluntary and scheduled repayments of Consolidated Total Debt
(excluding repayments of Revolving Loans except to the extent the Revolving Loan
Commitments are permanently reduced in connection with such repayments), (b)
Consolidated Capital Expenditures (net of any proceeds of any related financings
with respect to such expenditures), (c) Consolidated Cash Interest Expense, (d)
current taxes based on income of Company and its Subsidiaries and paid in cash
with respect to such period, (e) to the extent expensed in a prior Fiscal Year,
the sum of the amount, if any, of retention payments made during such Fiscal
Year and any other special retention payments paid to employees during such
Fiscal Year in an aggregate amount not to exceed $1,000,000, (f) Restricted
Junior Payments during such Fiscal Year permitted by subsection 7.5, (g) any
other cash expenses incurred during such period to the extent added back in
determining Consolidated EBITDA and (f) Cash consideration paid in connection
with Investments permitted pursuant to subsection 7.3(vi) or subsection
7.3(vii).
"CONSOLIDATED FIXED CHARGES" means, for any period, the sum
(without duplication) of the amounts for such period of (i) Consolidated Cash
Interest Expense, (ii) scheduled principal payments in respect of Consolidated
Total Debt, and (iii) current taxes based on income of Company and its
Subsidiaries and paid in cash with respect to such period, all of the foregoing
as determined on a consolidated basis for Company and its Subsidiaries in
conformity with GAAP.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP and capitalized interest) of Company and its Subsidiaries
on a consolidated basis with respect to all outstanding Indebtedness of Company
and its Subsidiaries, including all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance
financing, net costs under Interest Rate Agreements and amounts referred to in
subsection 2.3 payable to Administrative Agent and Lenders that are considered
interest expense in accordance with GAAP, but excluding, however, any such
amounts referred to in subsection 2.3 payable on or before the Closing Date. For
purposes of the foregoing, total interest expense shall be determined after
giving effect to any net payments made or received with respect to Interest Rate
Agreements.
"CONSOLIDATED LEVERAGE RATIO" means, as of the last day of any
Fiscal Quarter, the ratio of (a) Consolidated Total Debt as at such day to (b)
Consolidated EBITDA for the consecutive four Fiscal Quarters ending on such day.
In connection with calculation of the Consolidated Leverage Ratio for any
purpose, if, during the four Fiscal Quarter period ending on the date as of
which such calculation is made, Company has made an acquisition permitted by
subsection 7.3(vi) or subsection 7.3(vii), calculation of Consolidated EBITDA
used in such
8
calculation of the Consolidated Leverage Ratio shall be made as if such
acquisition occurred on the first day of such period on a PRO FORMA basis for
the portion of the period prior to the date such acquisition actually occurred.
"CONSOLIDATED NET INCOME" means, for any period, the net income
(or loss) of Company and its Subsidiaries on a consolidated basis for such
period taken as a single accounting period determined in conformity with GAAP;
PROVIDED that there shall be excluded (i) the income (or loss) of any Person
(other than a Subsidiary of Company) in which any other Person (other than
Company or any of its Subsidiaries) has a joint interest, except to the extent
of the amount of dividends or other distributions actually paid to Company or
any of its Subsidiaries by such Person during such period, (ii) the income (or
loss) of any Person accrued prior to the date it becomes a Subsidiary of Company
or is merged into or consolidated with Company or any of its Subsidiaries or
that Person's assets are acquired by Company or any of its Subsidiaries, (iii)
the income of any Subsidiary of Company to the extent that the declaration or
payment of dividends or similar distributions by that Subsidiary of that income
is not at the time permitted by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary, (iv) any after-tax gains or losses
attributable to asset sales or returned surplus assets of any Pension Plan, and
(v) (to the extent not included in clauses (i) through (iv) above) any net
extraordinary gains or net extraordinary losses.
"CONSOLIDATED SENIOR DEBT" means, as at any date of
determination, Consolidated Total Debt LESS the aggregate principal amount of
all Subordinated Indebtedness of Company and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP.
"CONSOLIDATED SENIOR LEVERAGE RATIO" means, as at the last day of
any Fiscal Quarter, the ratio of (a) Consolidated Senior Debt as at such day, to
(b) Consolidated EBITDA for the consecutive four Fiscal Quarters ending on such
day.
"CONSOLIDATED TOTAL DEBT" means, as at any date of determination,
the sum of (i) the aggregate stated balance sheet amount of all Indebtedness of
Company and its Subsidiaries, determined on a consolidated basis in accordance
with GAAP and (ii) the Letter of Credit Usage.
"CONSOLIDATED WORKING CAPITAL" means, as at any date of
determination, the excess (or deficit) of Consolidated Current Assets over
Consolidated Current Liabilities.
"CONSOLIDATED WORKING CAPITAL ADJUSTMENT" means, for any period
on a consolidated basis, the amount (which may be a negative number) by which
Consolidated Working Capital as of the beginning of such period exceeds (or is
less than) Consolidated Working Capital as of the end of such period.
"CONTINGENT OBLIGATION", as applied to any Person, means any
direct or indirect liability, contingent or otherwise, of that Person (i) with
respect to any Indebtedness, lease, dividend or other obligation of another if
the primary purpose or intent thereof by the Person incurring the Contingent
Obligation is to provide assurance to the obligee of such obligation of another
that such obligation of another will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
obligation will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the
9
account of that Person or as to which that Person is otherwise liable for
reimbursement of drawings, or (iii) under Hedge Agreements. Contingent
Obligations shall include (a) the direct or indirect guaranty, endorsement
(otherwise than for collection or deposit in the ordinary course of business),
co-making, discounting with recourse or sale with recourse by such Person of the
obligation of another, (b) the obligation to make take-or-pay or similar
payments if required regardless of non-performance by any other party or parties
to an agreement, and (c) any liability of such Person for the obligation of
another through any agreement (contingent or otherwise) (1) to purchase,
repurchase or otherwise acquire such obligation or any security therefor, or to
provide funds for the payment or discharge of such obligation (whether in the
form of loans, advances, stock purchases, capital contributions or otherwise) or
(2) to maintain the solvency or any balance sheet item, level of income or
financial condition of another if, in the case of any agreement described under
subclauses (1) or (2) of this sentence, the primary purpose or intent thereof is
as described in the preceding sentence. The amount of any Contingent Obligation
shall be equal to the principal amount of the obligation so guaranteed or
otherwise supported or, if less, the amount to which such Contingent Obligation
is specifically limited or, if not stated, the maximum reasonably anticipated
liability in respect thereof as determined by such Person in good faith.
"CONTINUING MEMBER" means, as of any date of determination any
member of the Governing Body of Holdings or Company who (i) was a member of such
Governing Body on the Closing Date or (ii) was nominated for election or elected
to such Governing Body with the affirmative vote of a majority of the members
who were either members of such Governing Body on the Closing Date or whose
nomination or election was previously so approved.
"CONTRACTUAL OBLIGATION", as applied to any Person, means any
provision of any Security issued by that Person or of any material indenture,
mortgage, deed of trust, contract, undertaking, agreement or other instrument to
which that Person is a party or by which it or any of its properties is bound or
to which it or any of its properties is subject.
"CONTROL AGREEMENT" means an agreement, reasonably satisfactory
in form and substance to Administrative Agent and executed by the financial
institution or securities intermediary at which a Deposit Account or a
Securities Account, as the case may be, is maintained, pursuant to which such
financial institution or securities intermediary confirms and acknowledges
Administrative Agent's security interest in such account, and agrees that the
financial institution or securities intermediary, as the case may be, will
comply with instructions or entitlement orders originated by Administrative
Agent as to disposition of funds in such account, without further consent by
Company or any Subsidiary.
"CSFB" has the meaning assigned to that term in the introduction
to this Agreement.
"CURRENCY AGREEMENT" means any foreign exchange contract,
currency swap agreement, futures contract, option contract, synthetic cap or
other similar agreement or arrangement to which Company or any of its
Subsidiaries is a party.
10
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or
similar account maintained with a Person engaged in the business of banking,
including a savings bank, savings and loan association, credit union or trust
company.
"DIRECT LIABILITY", with respect to any event, means the payment
of money by Company or any of its Subsidiaries with respect to such event.
"DOCUMENTATION AGENT" has the meaning assigned to that term in
the introduction to this Agreement.
"DOLLARS" and the sign "$" mean the lawful money of the United
States of America.
"DOMESTIC SUBSIDIARY" means any Subsidiary of Company that is
incorporated or organized under the laws of the United States of America, any
state thereof or in the District of Columbia.
"ELIGIBLE ASSIGNEE" means (i) any Lender, any Affiliate of any
Lender and any Approved Fund of any Lender; and (ii) (a) a commercial bank
organized under the laws of the United States or any state thereof; (b) a
savings and loan association or savings bank organized under the laws of the
United States or any state thereof; (c) a commercial bank organized under the
laws of any other country or a political subdivision thereof; PROVIDED that (1)
such bank is acting through a branch or agency located in the United States or
(2) such bank is organized under the laws of a country that is a member of the
Organization for Economic Cooperation and Development or a political subdivision
of such country; and (d) any other entity that is an "accredited investor" (as
defined in Regulation D under the Securities Act) that extends credit or buys
loans as one of its businesses including insurance companies, mutual funds,
finance companies and lease financing companies; PROVIDED that neither Company
nor any Affiliate of Company shall be an Eligible Assignee.
"EMPLOYEE BENEFIT PLAN" means any "employee benefit plan" as
defined in Section 3(3) of ERISA which is or was maintained or contributed to by
Company, any of its Subsidiaries or any of their respective ERISA Affiliates.
"ENVIRONMENTAL CLAIM" means any investigation, notice, notice of
violation, claim, action, suit, proceeding, demand, abatement order or other
order or directive (conditional or otherwise), by any Government Authority or
any other Person, arising (i) pursuant to or in connection with any actual or
alleged violation of any Environmental Law, (ii) in connection with any
Hazardous Materials or any actual or alleged Hazardous Materials Activity, or
(iii) in connection with any actual or alleged damage, injury, threat or harm to
health, safety, natural resources or the environment.
"ENVIRONMENTAL LAWS" means any and all current or future
statutes, ordinances, orders, rules, regulations, guidance documents, judgments,
Governmental Authorizations, or any other requirements of any Government
Authority relating to (i) environmental matters, including those relating to any
Hazardous Materials Activity, (ii) the generation, use, storage, transportation
or disposal of Hazardous Materials, or (iii) occupational safety and health,
11
industrial hygiene, land use or the protection of human, plant or animal health
or welfare, in any manner applicable to Company or any of its Subsidiaries or
any Facility.
"EQUITY INVESTORS" means (i) LGP, the Initial LGP Investors, the
Management Investors and other investors reasonably satisfactory to
Administrative Agent and Syndication Agent, all of whom (except for certain
persons who become Management Investors after the Closing Date) collectively
purchased the Holdings Common Stock and the Holdings Preferred Stock on or
before the Closing Date for the purpose of consummating the Merger and (ii) any
Permitted Transferees.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor thereto.
"ERISA AFFILIATE", as applied to any Person, means: (i) any
corporation that is a member of a controlled group of corporations within the
meaning of Section 414(b) of the Internal Revenue Code of which that Person is a
member; (ii) any trade or business (whether or not incorporated) that is a
member of a group of trades or businesses under common control within the
meaning of Section 414(c) of the Internal Revenue Code of which that Person is a
member; and (iii) any member of an affiliated service group within the meaning
of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any
corporation described in clause (i) above or any trade or business described in
clause (ii) above is a member. Any former ERISA Affiliate of a Person or any of
its Subsidiaries shall continue to be considered an ERISA Affiliate of such
Person or such Subsidiary within the meaning of this definition with respect to
the period such entity was an ERISA Affiliate of such Person or such Subsidiary
and with respect to liabilities arising after such period for which such Person
or such Subsidiary could be liable under the Internal Revenue Code or ERISA.
"ERISA EVENT" means (i) a "reportable event" within the meaning
of Section 4043 of ERISA and the regulations issued thereunder with respect to
any Pension Plan (excluding those for which the provision for 30-day notice to
the PBGC has been waived by regulation); (ii) the failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code with respect to any
Pension Plan (whether or not waived in accordance with Section 412(d) of the
Internal Revenue Code) or the failure to make by its due date a required
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (iv) the
withdrawal by Company, any of its Subsidiaries or any of their respective ERISA
Affiliates from any Pension Plan with two or more contributing sponsors or the
termination of any such Pension Plan resulting in liability pursuant to Section
4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (vi) the imposition of liability
on Company, any of its Subsidiaries or any of their respective ERISA Affiliates
pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of Company, any of its
Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
12
any Multiemployer Plan if there is any potential liability therefor, or the
receipt by Company, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
assertion of a material claim (other than routine claims for benefits) against
any Company Employee Benefit Plan other than a Multiemployer Plan or the assets
thereof, or against Company, any of its Subsidiaries or any of their respective
ERISA Affiliates in connection with any Company Employee Benefit Plan; (ix)
receipt from the Internal Revenue Service of notice of the failure of any
Company Pension Plan (or any other Company Employee Benefit Plan intended to be
qualified under Section 401(a) of the Internal Revenue Code) to qualify under
Section 401(a) of the Internal Revenue Code, or the failure of any trust forming
part of any Company Pension Plan to qualify for exemption from taxation under
Section 501(a) of the Internal Revenue Code; or (x) the imposition of a Lien
pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue Code or
pursuant to ERISA with respect to any Pension Plan; PROVIDED that any event
described in the foregoing clauses shall not be an ERISA Event unless it could
reasonably be expected to result in a Direct Liability.
"ESCROW AGENT" means Xxxxx Fargo Bank, N.A.
"ESCROW AGREEMENT" means the Escrow Agreement dated as of
February 24, 2004 among Administrative Agent, Company and Escrow Agent, pursuant
to which at least $7,261,497.55 is deposited with Escrow Agent as provided for
in subsection 6.10 and which provides for release of such funds in connection
with the making of Settlement Payments.
"EURODOLLAR RATE" means, for any Interest Rate Determination
Date, with respect to any Eurodollar Rate Loan for any Interest Period, the rate
per annum obtained by DIVIDING (i) the rate per annum determined by
Administrative Agent at approximately 11:00 a.m. (London time) on the date that
is two Business Days prior to the beginning of such Interest Period by reference
to the British Bankers' Association Interest Settlement Rate for deposits in
Dollars (as set forth by any service selected by Administrative Agent which has
been nominated by the British Bankers' Association as an authorized information
vendor for the purpose of displaying such rates) for a period equal to such
Interest Period; PROVIDED that, to the extent that an interest rate is not
ascertainable pursuant to the foregoing provisions of this definition the
"Eurodollar Rate" shall be the interest rate per annum determined by
Administrative Agent to be the average of the rates per annum at which deposits
in Dollars are offered for such Interest Period to major banks in the London
interbank market in London, England at approximately 11:00 a.m. (London time) on
the date that is two Business Days prior to the beginning of such Interest
Period by (ii) a percentage equal to 100% MINUS the stated maximum rate of all
reserve requirements (including any marginal, emergency, supplemental, special
or other reserves) applicable on such Interest Rate Determination Date to any
member bank of the Federal Reserve System in respect of "Eurocurrency
liabilities" as defined in Regulation D (or any successor category of
liabilities under Regulation D). Each determination by Administrative Agent
pursuant to this definition shall be conclusive absent manifest error.
"EURODOLLAR RATE LOANS" means Loans bearing interest at rates
determined by reference to the Eurodollar Rate as provided in subsection 2.2A.
13
"EURODOLLAR RATE MARGIN" means the margin over the Eurodollar
Rate used in determining the rate of interest of Eurodollar Rate Loans pursuant
to subsection 2.2A.
"EVENT OF DEFAULT" means each of the events set forth in Section
8.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
"EXCHANGE RATE" means, on any date (as determined in the
discretion of Administrative Agent) when an amount expressed in a currency other
than Dollars is to be determined with respect to any Letter of Credit, the
nominal rate of exchange of Administrative Agent in the
New York foreign
exchange market for the sale of such currency in exchange for Dollars at 12:00
noon (
New York time) one Business Day prior to such date, expressed as a number
of units of such currency per one Dollar.
"EXISTING
CREDIT AGREEMENT" means that certain Amended and
Restated
Credit Agreement dated as of September 27, 2002 between FTD, Florists'
Transworld Delivery, Inc. and Xxxxxx Trust and Savings Bank, as Administrative
Agent as amended prior to the Closing Date.
"EXISTING LETTERS OF CREDIT" means those letters of credit set
forth on SCHEDULE 7.4 annexed hereto.
"FACILITIES" means any and all real property (including all
buildings, fixtures or other improvements located thereon) now, hereafter or
heretofore owned, leased, operated or used by Company or any of its Subsidiaries
or any of their respective predecessors or Affiliates.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of
New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by Administrative Agent from three Federal funds
brokers of recognized standing selected by Administrative Agent.
"FINANCIAL PLAN" has the meaning assigned to that term in
subsection 6.1(xii).
"FIRST PRIORITY" means, with respect to any Lien purported to be
created in any Collateral pursuant to any Collateral Document, that (i) such
Lien is perfected and has priority over any other Lien on such Collateral (other
than Liens not prohibited pursuant to subsection 7.2A (excluding Liens described
in clause (v) thereof)) and (ii) such Lien is the only Lien (other than Liens
not prohibited pursuant to subsection 7.2A) to which such Collateral is subject.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
14
"FISCAL YEAR" means the fiscal year of Company and its
Subsidiaries ending on June 30 of each calendar year. For purposes of this
Agreement, any particular Fiscal Year shall be designated by reference to the
calendar year in which such Fiscal Year ends.
"FLOOD HAZARD PROPERTY" means a Closing Date Mortgaged Property
or an Additional Mortgaged Property located in an area designated by the Federal
Emergency Management Agency as having special flood or mud slide hazards.
"FOREIGN PLAN" means any employee benefit plan maintained by
Company or any of its Subsidiaries that is mandated or governed by any law, rule
or regulation of any Government Authority other than the United States of
America, any state thereof or any other political subdivision thereof.
"FOREIGN PLEDGE AGREEMENT" means each pledge agreement or similar
instrument governed by the laws of a country other than the United States,
executed on the Closing Date or from time to time thereafter in accordance with
subsection 6.8 by Company or any Domestic Subsidiary that owns Capital Stock of
one or more Foreign Subsidiaries organized in such country, in form and
substance satisfactory to Administrative Agent, as such Foreign Pledge Agreement
may be amended, supplemented or otherwise modified from time to time.
"FOREIGN SUBSIDIARY" means any Subsidiary of Company that is not
a Domestic Subsidiary.
"FTD" means FTD, Inc., a Delaware corporation; provided that,
after the consummation of the Merger, FTD is referred to herein as Company.
"XXX.XXX" means XXX.XXX Inc., a Delaware corporation.
"XXX.XXX SECURITIES LITIGATION" means the shareholder litigation
entitled "In re XXX.Xxx Inc." filed with the Delaware Court of Chancery, New
Castle County, Consolidated C.A. No. 19458-NC, consolidated on August 4, 2003.
"FTD COMMON STOCK" means the capital stock of FTD outstanding at
any date of determination prior to the Merger.
"FUND" means any Person (other than a natural Person) that is (or
will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of its
business.
"FUNDING AND PAYMENT ACCOUNT" means the account specified in the
payment instructions appearing below Administrative Agent's signature herein or
at the account designated as such in any other written notice delivered by
Administrative Agent to Company and each Lender.
"FUNDING AND PAYMENT OFFICE" means the office of Administrative
Agent located at 00 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such other
office of Administrative Agent as may from time to time hereafter be designated
as such in a written notice delivered by Administrative Agent to Company and
each Lender.
15
"FUNDING DATE" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application
thereof set forth in subsection 1.2, generally accepted accounting principles
set forth in opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, in each case as the same are applicable to the
circumstances as of the date of determination.
"GOVERNING BODY" means the board of directors or other body
having the power to direct or cause the direction of the management and policies
of a Person that is a corporation, partnership, trust or limited liability
company.
"GOVERNMENT AUTHORITY" means any political subdivision or
department thereof, any other governmental or regulatory body, commission,
central bank, board, bureau, organ or instrumentality or any court, in each case
whether federal, state, local or foreign.
"GOVERNMENTAL AUTHORIZATION" means any permit, license,
registration, authorization, plan, directive, consent, order or consent decree
of or from, or notice to, any Government Authority.
"GUARANTIES" means the Holdings Guaranty and the Subsidiary
Guaranty.
"HAZARDOUS MATERIALS" means: (i) any chemical, material or
substance at any time defined as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous materials", "extremely hazardous
waste", "acutely hazardous waste", "radioactive waste", "biohazardous waste",
"pollutant", "toxic pollutant", "contaminant", "restricted hazardous waste",
"infectious waste", "toxic substances", or any other term or expression intended
to define, list or classify substances by reason of properties harmful to
health, safety or the indoor or outdoor environment (including harmful
properties such as ignitability, corrosivity, reactivity, carcinogenicity,
toxicity, reproductive toxicity, "TCLP toxicity" or "EP toxicity" or words of
similar import under any applicable Environmental Laws); (ii) any oil,
petroleum, petroleum fraction or petroleum derived substance; (iii) any drilling
fluids, produced waters and other wastes associated with the exploration,
development or production of crude oil, natural gas or geothermal resources;
(iv) any flammable substances or explosives; (v) any radioactive materials; (vi)
any asbestos-containing materials; (vii) urea formaldehyde foam insulation;
(viii) electrical equipment which contains any oil or dielectric fluid
containing polychlorinated biphenyls; (ix) pesticides; and (x) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any Government Authority or which may or could pose a hazard to the
health and safety of the owners, occupants or any Persons in the vicinity of any
Facility or to the indoor or outdoor environment.
"HAZARDOUS MATERIALS ACTIVITY" means any past, current, proposed
or threatened activity, event or occurrence involving any Hazardous Materials,
including the use, manufacture, possession, storage, holding, presence,
existence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, construction, treatment,
16
abatement, removal, remediation, disposal, disposition or handling of any
Hazardous Materials, and any corrective action or response action with respect
to any of the foregoing.
"HEDGE AGREEMENT" means an Interest Rate Agreement or a Currency
Agreement designed to hedge against fluctuations in interest rates or currency
values, respectively.
"HOLDINGS" means Mercury Man Holdings Corporation, a Delaware
corporation.
"HOLDINGS CERTIFICATE OF DESIGNATIONS" means the provisions of
Holdings' Certificate of Designations, Preferences, Restrictions and Relative,
Participating, Optional and Other Special Rights of the Holdings Senior
Preferred Stock and the Holdings Junior Preferred Stock, and Qualifications,
Limitations and Restrictions thereof relating to the Holdings Preferred Stock,
in the form delivered to Administrative Agent and Lenders prior to their
execution of this Agreement and as such provisions may be amended from time to
time thereafter to the extent permitted under subsection 7.12A.
"HOLDINGS COMMON STOCK" means the common stock of Holdings, par
value $.01 per share.
"HOLDINGS GUARANTY" means the Holdings Guaranty executed and
delivered by Holdings on the Closing Date, substantially in the form of EXHIBIT
XV annexed hereto, as such Holdings Guaranty may thereafter be amended,
supplemented or otherwise modified from time to time.
"HOLDINGS JUNIOR PREFERRED STOCK" means the 12% Junior Redeemable
Exchangeable Cumulative Preferred Stock of Holdings, par value $.01 per share,
with a liquidation preference of $1,000 per share and with the other terms and
conditions set forth in the Holdings Certificate of Designations.
"HOLDINGS PREFERRED STOCK" means the Holdings Junior Preferred
Stock and the Holdings Senior Preferred Stock.
"HOLDINGS SENIOR PREFERRED STOCK" means the 14% Senior Redeemable
Exchangeable Cumulative Preferred Stock of Holdings, par value $.01 per share,
with a liquidation preference of $1,000 per share and with the other terms and
conditions set forth in the Holdings Certificate of Designations.
"INCREMENTAL LOANS" means up to $50,000,000 in aggregate
principal amount of Loans (plus any amounts paid in kind or otherwise accreted
to the original principal amount to satisfy interest obligations) permitted by
subsection 7.1(x) of this Agreement, which shall provide for no offers to
purchase, prepayments, amortization, redemptions or repayments except on a pro
rata basis with, and on the same (or later) dates as required with respect to,
the Term Loans made under this Agreement.
"INDEBTEDNESS", as applied to any Person, means (i) all
indebtedness for borrowed money, (ii) that portion of obligations with respect
to Capital Leases that is properly classified as a liability on a balance sheet
in conformity with GAAP, (iii) notes payable and
17
drafts accepted representing extensions of credit whether or not representing
obligations for borrowed money, (iv) any obligation owed for all or any part of
the deferred purchase price of property or services (excluding any such
obligations incurred under ERISA), which purchase price is (a) due more than six
months from the date of incurrence of the obligation in respect thereof or (b)
evidenced by a note or similar written instrument, (v) Synthetic Lease
Obligations, and (vi) all indebtedness secured by any Lien on any property or
asset owned or held by that Person regardless of whether the indebtedness
secured thereby shall have been assumed by that Person or is nonrecourse to the
credit of that Person. Obligations under Interest Rate Agreements and Currency
Agreements constitute (1) in the case of Hedge Agreements, Contingent
Obligations, and (2) in all other cases, Investments, and in neither case
constitute Indebtedness.
"INDEMNIFIED LIABILITIES" has the meaning assigned to that term
in subsection 10.3.
"INDEMNITEE" has the meaning assigned to that term in subsection
10.3.
"INITIAL LGP INVESTOR" means any co-investor of LGP that
purchased Holdings Common Stock or Holdings Preferred Stock on or before the
Closing Date for the purpose of consummating the Merger; PROVIDED, that LGP may
hold such co-investor's Holdings Common Stock or Holdings Preferred Stock.
"INTELLECTUAL PROPERTY" means all patents, trademarks,
tradenames, copyrights, technology, software, know-how and processes used in or
necessary for the conduct of the business of Company and its Subsidiaries.
"INTEREST PAYMENT DATE" means (i) with respect to any Base Rate
Loan, the last Business Day of each of March, June, September and December of
each year, commencing on the first such date to occur after the Closing Date,
and (ii) with respect to any Eurodollar Rate Loan, the last day of each Interest
Period applicable to such Loan; PROVIDED that in the case of each Interest
Period of longer than three months "Interest Payment Date" shall also include
each date that is three months, or a multiple thereof, after the commencement of
such Interest Period.
"INTEREST PERIOD" has the meaning assigned to that term in
subsection 2.2B.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other similar
agreement or arrangement to which Company or any of its Subsidiaries is a party.
"INTEREST RATE DETERMINATION DATE", with respect to any Interest
Period, means the second Business Day prior to the first day of such Interest
Period.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986,
as amended to the date hereof and from time to time hereafter, and any successor
statute.
"INVESTMENT" means (i) any direct or indirect purchase or other
acquisition by Company or any of its Subsidiaries of, or of a beneficial
interest in, any Securities of any other Person (including any Subsidiary of
Company), (ii) any direct or indirect redemption, retirement,
18
purchase or other acquisition for value, by Company or any Subsidiary of Company
from any Person other than Company or any of its Subsidiaries, of any equity
Securities of such Subsidiary, (iii) any direct or indirect loan, advance (other
than advances to employees for moving, entertainment and travel expenses,
drawing accounts and similar expenditures in the ordinary course of business) or
capital contribution by Company or any of its Subsidiaries to any other Person,
including all indebtedness and accounts receivable from that other Person that
are not current assets or did not arise from sales to that other Person in the
ordinary course of business, or (iv) Interest Rate Agreements or Currency
Agreements not constituting Hedge Agreements; PROVIDED, however, that Investment
shall not include prepaid expenses of any Person incurred and prepaid in the
ordinary course of business. The amount of any Investment shall be the original
cost of such Investment PLUS the cost of all additions thereto, without any
adjustments for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment (other than adjustments for the
repayment of, or the refund of capital with respect to, the original principal
amount of any such Investment).
"IP COLLATERAL" means, collectively, the Intellectual Property
that constitutes Collateral under the Security Agreement.
"ISSUING LENDER", with respect to any Letter of Credit, means the
Revolving Lender that agrees or is otherwise obligated to issue such Letter of
Credit, determined as provided in subsection 3.1B(ii) or, with respect to the
Existing Letters of Credit, Standard Federal Bank N.A.
"JOINT LEAD ARRANGERS" means, collectively, CSFB and UBS
Securities LLC.
"JOINT VENTURE" means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal form.
"LEASEHOLD PROPERTY" means any leasehold interest of any Loan
Party (other than a Foreign Subsidiary) as lessee under any lease of real
property.
"LENDER" and "LENDERS" means the Persons identified as "Lenders"
and listed on the signature pages of this Agreement, together with their
successors and permitted assigns pursuant to subsection 10.1, and the term
"Lenders" shall include Swing Line Lender unless the context otherwise requires;
PROVIDED that the term "Lenders", when used in the context of a particular
Commitment, shall mean Lenders having that Commitment.
"LETTER OF CREDIT" or "LETTERS OF CREDIT" means (i) Commercial
Letters of Credit and Standby Letters of Credit issued or to be issued by
Issuing Lenders for the account of Company pursuant to subsection 3.1 and (ii)
the Existing Letters of Credit.
"LETTER OF CREDIT USAGE" means, as at any date of determination,
the sum of (i) the maximum aggregate amount which is or at any time thereafter
may become available for drawing under all Letters of Credit then outstanding
PLUS (ii) the aggregate amount of all drawings under Letters of Credit honored
by Issuing Lenders and not theretofore reimbursed out of the proceeds of
Revolving Loans pursuant to subsection 3.3B or otherwise reimbursed by Company.
For purposes of this definition, any amount described in clause (i) or (ii) of
the
19
preceding sentence that is denominated in a currency other than Dollars shall be
valued based on the applicable Exchange Rate for such currency as of the
applicable date of determination.
"LIEN" means any lien, mortgage, pledge, assignment, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof, and any
agreement to give any security interest) and any option, trust or other
preferential arrangement having the practical effect of any of the foregoing.
"LGP" means Xxxxxxx Xxxxx & Partners, L.P. and Affiliates
thereof.
"LGP MANAGEMENT AGREEMENT" means that certain Management Services
Agreement, dated as of February 24, 2004, by and among FTD, XXX.XXX, Florists'
Transworld Delivery, Inc., a Michigan corporation, FTD International
Corporation, a Delaware corporation, Value Network Service, Inc., a Delaware
corporation, FTD Holdings Incorporated, a Delaware corporation, Renaissance
Greeting Cards, Inc., a Maine corporation, Flowers USA, Inc., a Connecticut
corporation and Xxxxxxx Xxxxx & Partners, L.P., a Delaware limited partnership.
"LOAN" or "LOANS" means one or more of the Term Loans,
Incremental Loans, Revolving Loans or Swing Line Loans or any combination
thereof.
"LOAN DOCUMENTS" means this Agreement, the Notes, the Letters of
Credit (and any applications for, or reimbursement agreements or other documents
or certificates executed by Company in favor of an Issuing Lender relating to,
the Letters of Credit), the Guaranties, the Collateral Documents, and all
amendments, waivers and consents relating thereto.
"LOAN PARTY" means each of Holdings, Company and any of Company's
Subsidiaries from time to time executing a Loan Document, and "LOAN PARTIES"
means all such Persons, collectively.
"MARGIN STOCK" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System as in
effect from time to time.
"MANAGEMENT CONTRIBUTION AND SUBSCRIPTION AGREEMENTS" means the
Contribution and Subscription Agreements dated as of the Closing Date between
Holdings and those Management Investors exchanging Old Management Shares for
Holdings Common Stock or Holdings Preferred Stock, and/or purchasing Holdings
Common Stock or Holdings Preferred Stock, in each case in the form delivered to
Administrative Agent prior to its execution of this Agreement and as such
agreements may be amended from time to time thereafter to the extent permitted
under subsection 7.12A.
"MANAGEMENT INVESTORS" means members of management of FTD who are
or will be investors in Holdings.
"MATERIAL ADVERSE EFFECT" means (i) a material adverse effect
upon the business, operations, properties, assets, condition (financial or
otherwise) or prospects of Holdings and its Subsidiaries taken as a whole or
(ii) the material impairment of the ability of the Loan Parties, taken as a
whole, to perform, or of Administrative Agent or Lenders to enforce, the
Obligations.
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"MATERIAL CONTRACT" means any contract or other arrangement to
which Company or any of its Subsidiaries is a party (other than the Loan
Documents) for which breach, nonperformance, cancellation or failure to renew
could reasonably be expected to have a Material Adverse Effect.
"MATERIAL LEASEHOLD PROPERTY" means a Leasehold Property
reasonably determined by Administrative Agent to be of material value as
Collateral or of material importance to the business operations of Company or
any of its Subsidiaries.
"MATERIAL SUBSIDIARY" means each Subsidiary of Company now
existing or hereafter acquired or formed by Company that, on a consolidated
basis for such Subsidiary and its Subsidiaries, (i) for the most recent Fiscal
Year accounted for more than 5% of the consolidated revenues of Company and its
Subsidiaries or (ii) as at the end of such Fiscal Year, was the owner of more
than 5% of the consolidated assets of Company and its Subsidiaries.
"MAXIMUM CONSOLIDATED CAPITAL EXPENDITURES AMOUNT" has the
meaning assigned to that term in subsection 7.8.
"MERGER" means the merger of Merger Sub with and into FTD in
accordance with the terms of the Merger Agreement and the Certificate of Merger,
with FTD being the surviving corporation.
"MERGER AGREEMENT" means that certain Agreement and Plan of
Merger by and among FTD, Holdings and Merger Sub, dated as of October 5, 2003,
in the form delivered to Administrative Agent and Lenders prior to their
execution of this Agreement and as such agreement may be amended from time to
time thereafter to the extent permitted under subsection 7.12A.
"MERGER FINANCING REQUIREMENTS" means the aggregate of all
amounts necessary (i) to finance the payment of the consideration payable under
the Merger Agreement in respect of shares of Public FTD Common Stock that are to
be cancelled and retired pursuant to the Merger Agreement (including payments
made to dissenting shareholders of FTD), (ii) to finance the payment of the
consideration payable under the Merger Agreement in respect of the outstanding
options to purchase FTD Common Stock that are to be cancelled pursuant to the
Merger Agreement, (iii) to refinance all Indebtedness and other amounts
outstanding under the Existing
Credit Agreement, (iv) to refinance certain other
Indebtedness of FTD outstanding on the Closing Date and (v) to pay Transaction
Costs.
"MERGER SUB" has the meaning assigned to that term in the
introduction to this Agreement.
"MORTGAGE" means (i) a security instrument (whether designated as
a deed of trust or a mortgage or by any similar title) executed and delivered by
any Loan Party, substantially in the form of EXHIBIT XVII annexed hereto or in
such other form as may be approved by Administrative Agent in its sole
discretion, in each case with such changes thereto as may be recommended by
Administrative Agent's local counsel based on local laws or customary local
mortgage or deed of trust practices, or (ii) at Administrative Agent's option,
in the case of an Additional Mortgaged Property, an amendment to an existing
Mortgage, in form
21
satisfactory to Administrative Agent, adding such Additional Mortgaged Property
to the Real Property Assets encumbered by such existing Mortgage, in either case
as such security instrument or amendment may be amended, supplemented or
otherwise modified from time to time. "MORTGAGES" means all such instruments,
including the Closing Date Mortgages and any Additional Mortgages, collectively.
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan that is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"NET ASSET SALE PROCEEDS", with respect to any Asset Sale, means
Cash payments (including any Cash received by way of deferred payment pursuant
to, or by monetization of, a note receivable or otherwise, but only as and when
so received) received from such Asset Sale, net of any bona fide direct costs
incurred in connection with such Asset Sale, including (i) income taxes
reasonably paid or estimated to be actually payable within two years of the date
of such Asset Sale as a result of any gain recognized in connection with such
Asset Sale, (ii) legal, consulting or other fees incurred or sales or use taxes
paid or payable in connection with such Asset Sale and (iii) payment of the
outstanding principal amount of, premium or penalty, if any, and interest on any
Indebtedness (other than the Loans) that is (a) secured by a Lien on the stock
or assets in question and that is required to be repaid under the terms thereof
as a result of such Asset Sale and (b) actually paid to a Person that is not an
Affiliate of any Loan Party or of any Affiliate of a Loan Party; PROVIDED,
however, that Net Asset Sale proceeds shall not include any Cash payments
received from any Asset Sale by a Foreign Subsidiary unless such proceeds may be
repatriated (by reason of a repayment of an intercompany note or otherwise) to
the United States without (in the reasonable judgment of Company) resulting in a
material tax liability to Company.
"NET INSURANCE/CONDEMNATION PROCEEDS" means any Cash payments or
proceeds received by Company or any of its Domestic Subsidiaries (i) under any
business interruption or casualty insurance policy in respect of a covered loss
thereunder or (ii) as a result of the taking of any assets of Company or any of
its Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, in each case net of any
taxes paid or payable and actual and reasonable documented costs incurred by
Company or any of its Subsidiaries in connection with the adjustment or
settlement of any claims of Company or such Subsidiary in respect thereof, and,
in each case, only to the extent such Cash payments or proceeds, net of the
foregoing documented costs, exceed $1,000,000. For the avoidance of doubt,
Settlement Insurance Proceeds are not Net Insurance/Condemnation Proceeds for
the purposes of this Agreement.
"NET SECURITIES PROCEEDS" means the cash proceeds (net of
underwriting discounts and commissions and other reasonable costs and expenses
associated therewith, including reasonable legal fees and expenses and taxes
paid or payable) from the (i) issuance of Capital Stock of or incurrence of
Indebtedness by Holdings, Company or any of its Subsidiaries; PROVIDED that Net
Securities Proceeds shall not include proceeds received in connection with the
issuance of Capital Stock of Holdings (a) in a Public Offering of Stock
(including preferred stock of Holdings for purposes of this definition) in which
the aggregate gross proceeds to Holdings are less than $50,000,000, or (b) in a
Private Placement of Stock in which the aggregate gross
22
proceeds to Holdings are less than $25,000,000 and (ii) capital contributions
made by a holder of Capital Stock of Holdings. Net Securities Proceeds shall not
include (a) any capital contribution by Holdings, Company or any Subsidiary of
either or (b) the proceeds of the issuance or sale of any Capital Stock of a
Subsidiary of Company, in each case, to Company or another Subsidiary of
Company.
"NET YIELD" has the meaning set forth in subsection 2.2H.
"NON-PUBLIC FTD COMMON STOCK" means all FTD Common Stock owned by
FTD, any of FTD's Subsidiaries and Holdings.
"NON-US LENDER" means a Lender that is organized under the laws
of any jurisdiction other than the United States or any state or other political
subdivision thereof.
"NOTES" means one or more of the Term Notes, Revolving Notes or
Swing Line Note or any combination thereof.
"NOTICE OF BORROWING" means a notice substantially in the form of
EXHIBIT I annexed hereto.
"NOTICE OF CONVERSION/CONTINUATION" means a notice substantially
in the form of EXHIBIT II annexed hereto.
"NOTICE OF PREPAYMENT" means a notice substantially in the form
of EXHIBIT XVI annexed hereto.
"OBLIGATIONS" means all obligations of every nature of each Loan
Party from time to time owed to Administrative Agent, Lenders or any of them
under the Loan Documents, whether for principal, interest, reimbursement of
amounts drawn under Letters of Credit, fees, expenses, indemnification or
otherwise, including post-petition interest on such amounts accruing subsequent
to, and interest that would have accrued but for the commencement of a
proceeding under the Bankruptcy Code (whether or not such interest is allowed as
a claim in such proceeding).
"OFFICER" means the president, chief executive officer, a vice
president, chief financial officer, treasurer, general partner (if an
individual), managing member (if an individual) or other individual appointed by
the Governing Body or the Organizational Documents of a corporation,
partnership, trust or limited liability company to serve in a similar capacity
as the foregoing.
"OFFICER'S CERTIFICATE", as applied to any Person that is a
corporation, partnership, trust or limited liability company, means a
certificate executed on behalf of such Person by one or more Officers of such
Person or one or more Officers of a general partner or a managing member if such
general partner or managing member is a corporation, partnership, trust or
limited liability company.
"OLD MANAGEMENT SHARES" means shares of FTD Common Stock held by
Management Investors.
23
"OPERATING LEASE", as applied to any Person, means any lease
(including leases that may be terminated by the lessee at any time) of any
property (whether real, personal or mixed) that is not a Capital Lease other
than any such lease under which that Person is the lessor.
"ORGANIZATIONAL DOCUMENTS" means the documents (including Bylaws,
if applicable) pursuant to which a Person that is a corporation, partnership,
trust or limited liability company is organized.
"PARTICIPANT" means a purchaser of a participation in the rights
and obligations under this Agreement pursuant to subsection 10.1C.
"PATRIOT ACT" means the Uniting And Strengthening America By
Providing Appropriate Tools Required To Intercept And Obstruct Terrorism (USA
Patriot Act) Act of 2001.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PENSION PLAN" means any Employee Benefit Plan, other than a
Multiemployer Plan, that is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA, and, for purposes of subsection 8.10, any Foreign Plan.
"PERMITTED ENCUMBRANCES" means the following types of Liens
(excluding any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or by ERISA, any such Lien imposed by a Government
Authority in connection with any Foreign Plan, any such Lien relating to or
imposed in connection with any Environmental Claim, and any such Lien expressly
prohibited by any applicable terms of any of the Collateral Documents):
(i) Liens for taxes, fees, assessments or governmental
charges or claims the payment of which is not, at the time,
required by subsection 6.3;
(ii) statutory Liens of landlords, Liens of collecting banks
under the UCC on items in the course of collection, statutory
Liens and rights of set-off of banks, statutory Liens of
carriers, warehousemen, mechanics, repairmen, workmen and
materialmen, and other Liens imposed by law, in each case
incurred in the ordinary course of business (a) for amounts not
yet overdue or (b) for amounts that are overdue and that (in the
case of any such amounts overdue for a period in excess of 10
days) are being contested in good faith by appropriate
proceedings, so long as (1) such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have been
made for any such contested amounts, and (2) in the case of a
Lien with respect to any material portion of the Collateral, such
contest proceedings conclusively operate to stay the sale of any
material portion of the Collateral on account of such Lien;
(iii) Liens incurred or pledges or deposits made in the
ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social
security, or to secure the performance of statutory obligations,
bids, leases, government contracts, trade contracts, and other
similar
24
obligations (exclusive of obligations for the payment of borrowed
money), so long as no foreclosure, sale or similar proceedings
have been commenced with respect to any material portion of the
Collateral on account thereof;
(iv) any attachment or judgment Lien not constituting an Event
of Default under subsection 8.8;
(v) licenses (with respect to Intellectual Property and other
property), leases or subleases granted to third parties in
accordance with any applicable terms of the Collateral Documents
and not interfering in any material respect with the ordinary
conduct of the business of Company or any of its Subsidiaries or
resulting in a material diminution in the value of any Collateral
as security for the Obligations;
(vi) easements, rights-of-way, restrictions, encroachments,
and other minor defects or irregularities in title, in each case
which do not and will not interfere in any material respect with
the ordinary conduct of the business of Company or any of its
Subsidiaries or result in a material diminution in the value of
any Collateral as security for the Obligations;
(vii) any (a) interest or title of a lessor or sublessor under
any lease not prohibited by this Agreement, (b) Lien or
restriction that the interest or title of such lessor or
sublessor may be subject to, or (c) subordination of the interest
of the lessee or sublessee under such lease to any Lien or
restriction referred to in the preceding clause (b), so long as
the holder of such Lien or restriction agrees to recognize the
rights of such lessee or sublessee under such lease;
(viii) Liens arising from filing UCC financing statements
relating solely to leases not prohibited by this Agreement;
(ix) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in
connection with the importation of goods;
(x) any zoning or similar law or right reserved to or vested
in any governmental office or agency to control or regulate the
use of any real property;
(xi) Liens granted pursuant to the Collateral Documents;
(xii) Liens securing obligations (other than obligations
representing Indebtedness for borrowed money) under operating,
reciprocal easement or similar agreements entered into in the
ordinary course of business of Company and its Subsidiaries;
(xiii) Liens incurred in the ordinary course of business on
Securities to secure repurchase and reverse repurchase
obligations in respect of such Securities; and
25
(xiv) exceptions to title disclosed by a title policy,
preliminary title report or certificate of title delivered to and
approved by Administrative Agent other than Liens securing
Indebtedness prohibited by subsection 7.1 or Contingent
Obligations prohibited by subsection 7.4.
"PERMITTED TRANSFEREES" means, with respect to any Person, (i)
any Affiliate of such Person, (ii) the heirs, executors, administrators,
testamentary trustees, legatees or beneficiaries of any such Person or (iii) a
trust, the beneficiaries of which, or a corporation or partnership, the
stockholders or general and limited partners of which, include only such Person
or his or her spouse or lineal descendants, in each case to whom such Person has
transferred the beneficial ownership of any Securities of Holdings (or a parent
entity thereof).
"PERSON" means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments (whether federal,
state or local, domestic or foreign, and including political subdivisions
thereof) and agencies or other administrative or regulatory bodies thereof.
"PLEDGED COLLATERAL" means, collectively, the "Pledged
Collateral" as defined in the Security Agreement and any Foreign Pledge
Agreement.
"POTENTIAL EVENT OF DEFAULT" means a condition or event that,
after notice or lapse of time or both, would constitute an Event of Default.
"PRICING CERTIFICATE" means an Officer's Certificate of Company
certifying the Consolidated Leverage Ratio as at the last day of any Fiscal
Quarter and setting forth the calculation of such Consolidated Leverage Ratio in
reasonable detail, which Officer's Certificate may be delivered to
Administrative Agent at any time on or after the date of delivery by Company of
the Compliance Certificate with respect to the period ending on the last day of
such Fiscal Quarter.
"PRIME RATE" means the rate that CSFB announces from time to time
as its prime lending rate, as in effect from time to time. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. CSFB or any other Lender may make commercial
loans or other loans at rates of interest at, above or below the Prime Rate.
"PRIVATE PLACEMENT OF STOCK" means the closing of an issuance of
Capital Stock by Holdings pursuant an exemption to the registration requirements
under the Securities Act.
"PROCEEDINGS" means any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration.
"PRO RATA SHARE" means (i) with respect to all payments,
computations and other matters relating to the Term Loan Commitment or the Term
Loan of any Lender, the percentage obtained by DIVIDING (x) the Term Loan
Exposure of that Lender BY (y) the aggregate Term Loan Exposure of all Lenders,
(ii) with respect to all payments, computations and other matters
26
relating to the Revolving Loan Commitment or the Revolving Loans of any Lender
or any Letters of Credit issued or participations therein deemed purchased by
any Lender or any assignments of any Swing Line Loans deemed purchased by any
Lender, the percentage obtained by DIVIDING (x) the Revolving Loan Exposure of
that Lender BY (y) the aggregate Revolving Loan Exposure of all Lenders, and
(iii) for all other purposes with respect to each Lender, the percentage
obtained by DIVIDING (x) the sum of the Term Loan Exposure of that Lender PLUS
the Revolving Loan Exposure of that Lender BY (y) the sum of the aggregate Term
Loan Exposure of all Lenders PLUS the aggregate Revolving Loan Exposure of all
Lenders, in any such case as the applicable percentage may be adjusted by
assignments permitted pursuant to subsection 10.1. The initial Pro Rata Share of
each Lender for purposes of each of clauses (i), (ii) and (iii) of the preceding
sentence is set forth opposite the name of that Lender in SCHEDULE 2.1 annexed
hereto.
"PTO" means the United States Patent and Trademark Office or any
successor or substitute office in which filings are necessary or, in the
reasonable opinion of Administrative Agent, desirable in order to create or
perfect Liens on any IP Collateral.
"PUBLIC FTD COMMON STOCK" means all FTD Common Stock except
Non-Public FTD Common Stock.
"PUBLIC OFFERING OF STOCK" means the closing of a firm commitment
underwritten initial public offering pursuant to an effective registration
statement filed under the Securities Act covering the offer and sale of shares
of Holdings' common stock.
"QUALIFIED PUBLIC OFFERING" means the closing of a firm
commitment underwritten initial public offering pursuant to an effective
registration statement filed under the Securities Act covering the offer and
sale of shares of Holdings' common stock (or the common stock of an entity that
directly owns 50% or more of the Voting Stock of Holdings) at a public offering
price (before deduction of underwriters' discounts and commissions) resulting in
aggregate gross proceeds of at least $50,000,000.
"REAL PROPERTY ASSET" means, at any time of determination, any
interest then owned by any Loan Party (other than any Foreign Subsidiary) in any
real property.
"REFUNDED SWING LINE LOANS" has the meaning assigned to that term
in subsection 2.1A(iii).
"REGISTER" has the meaning assigned to that term in subsection
2.1D.
"REGULATION D" means Regulation D of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"REIMBURSEMENT DATE" has the meaning assigned to that term in
subsection 3.3B.
"RELATED AGREEMENTS" means, collectively, the Merger Agreement,
the Certificate of Merger, the Holdings Certificate of Designations, the
Management Contribution and Subscription Agreements, the Stockholders Agreement
and the Subordinated Note Indenture.
27
"RELEASE" means any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping,
leaching or migration of Hazardous Materials into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Materials), including the
movement of any Hazardous Materials through the air, soil, surface water or
groundwater.
"REQUEST FOR ISSUANCE" means a request substantially in the form
of EXHIBIT III annexed hereto.
"REQUISITE CLASS LENDERS" means, at any time of determination (i)
for the Class of Lenders having Revolving Loan Exposure, Lenders having or
holding more than 50% of the aggregate Revolving Loan Exposure of all Lenders
and (ii) for the Class of Lenders having Term Loan Exposure, Lenders having or
holding more than 50% of the aggregate Term Loan Exposure of all Lenders.
"REQUISITE LENDERS" means Lenders having or holding more than 50%
of the sum of the aggregate Term Loan Exposure of all Lenders PLUS the aggregate
Revolving Loan Exposure of all Lenders.
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of stock
of Company or Holdings now or hereafter outstanding, except a dividend payable
solely in shares of that class of stock to the holders of that class, (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of stock
of Company or Holdings now or hereafter outstanding, (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of stock of Company or Holdings now
or hereafter outstanding, and (iv) any payment or prepayment of principal of,
premium, if any, or interest on, or redemption, purchase, retirement, defeasance
(including in-substance or legal defeasance), sinking fund or similar payment
with respect to, any Subordinated Indebtedness. For the avoidance of doubt, the
term "Restricted Junior Payment" does not include payments made pursuant to the
LGP Management Agreement.
"REVOLVING LENDER" means a Lender that has a Revolving Loan
Commitment and/or that has an outstanding Revolving Loan.
"REVOLVING LOAN COMMITMENT" means the commitment of a Revolving
Lender to make Revolving Loans to Company pursuant to subsection 2.1A(ii), and
"REVOLVING LOAN COMMITMENTS" means such commitments of all Revolving Lenders in
the aggregate.
"REVOLVING LOAN COMMITMENT AMOUNT" means, at any date, the
aggregate amount of the Revolving Loan Commitments of all Revolving Lenders.
"REVOLVING LOAN COMMITMENT TERMINATION DATE" means February 24,
2009.
"REVOLVING LOAN COMMITMENT UTILIZATION PERCENTAGE" means the
percentage obtained by DIVIDING (a) the Total Utilization of Revolving Loan
Commitments as at any date of
28
determination MINUS the aggregate principal amount of all outstanding Swing Line
Loans as of such date BY (b) the Revolving Loan Commitments as of such date.
"REVOLVING LOAN EXPOSURE", with respect to any Revolving Lender,
means, as of any date of determination (i) prior to the termination of the
Revolving Loan Commitments, the amount of that Lender's Revolving Loan
Commitment, and (ii) after the termination of the Revolving Loan Commitments,
the sum of (a) the aggregate outstanding principal amount of the Revolving Loans
of that Lender PLUS (b) in the event that Lender is an Issuing Lender, the
aggregate Letter of Credit Usage in respect of all Letters of Credit issued by
that Lender (in each case net of any participations purchased by other Lenders
in such Letters of Credit or in any unreimbursed drawings thereunder) PLUS (c)
the aggregate amount of all participations purchased by that Lender in any
outstanding Letters of Credit or any unreimbursed drawings under any Letters of
Credit PLUS (d) in the case of Swing Line Lender, the aggregate outstanding
principal amount of all Swing Line Loans (net of any assignments thereof deemed
purchased by other Revolving Lenders) PLUS (e) the aggregate amount of all
assignments deemed purchased by that Lender in any outstanding Swing Line Loans.
"REVOLVING LOANS" means the Loans made by Revolving Lenders to
Company pursuant to subsection 2.1A(ii).
"REVOLVING NOTES" means any promissory notes of Company issued
pursuant to subsection 2.1E to evidence the Revolving Loans of any Revolving
Lenders, substantially in the form of EXHIBIT VI annexed hereto, as they may be
amended, supplemented or otherwise modified from time to time.
"SECURITIES" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated, certificated or uncertificated, or otherwise, or in general any
instruments commonly known as "securities" or any certificates of interest,
shares or participations in temporary or interim certificates for the purchase
or acquisition of, or any right to subscribe to, purchase or acquire, any of the
foregoing.
"SECURITIES ACCOUNT" means an account to which a financial asset
is or may be credited in accordance with an agreement under which the Person
maintaining the account undertakes to treat the Person for whom the account is
maintained as entitled to exercise the rights that comprise the financial asset.
"SECURITIES ACT" means the Securities Act of 1933, as amended
from time to time, and any successor statute.
"SECURITY AGREEMENT" means the Security Agreement executed and
delivered on the Closing Date, substantially in the form of EXHIBIT XIV annexed
hereto, as such Security Agreement may thereafter be amended, supplemented or
otherwise modified from time to time.
"SETTLEMENT CONTRIBUTION" has the meaning set forth in subsection
6.10.
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"SETTLEMENT INSURANCE PROCEEDS" means the amount of cash
insurance proceeds and other awards or recoveries received after the Closing
Date by Company in connection with the settlement of the XXX.XXX Securities
Litigation or in connection with the litigation related to the insurance
coverage associated therewith.
"SETTLEMENT PAYMENTS" means cash payments made on or after the
Closing Date to settle the XXX.XXX Securities Litigation.
"SOLVENT", with respect to any Person, means that as of the date
of determination both (i)(a) the then fair saleable value of the property of
such Person is (1) greater than the total amount of liabilities (including
contingent liabilities) of such Person and (2) not less than the amount that
will be required to pay the probable liabilities on such Person's then existing
debts as they become absolute and due considering all financing alternatives and
potential asset sales reasonably available to such Person; (b) such Person's
capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (c) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (ii) such Person is
"solvent" within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
"STANDBY LETTER OF CREDIT" means any standby letter of credit or
similar instrument issued for the purpose of supporting (i) Indebtedness of
Company or any of its Subsidiaries in respect of industrial revenue or
development bonds or financings, (ii) workers' compensation liabilities of
Company or any of its Subsidiaries, (iii) the obligations of third party
insurers of Company or any of its Subsidiaries arising by virtue of the laws of
any jurisdiction requiring third party insurers, (iv) obligations with respect
to Capital Leases or Operating Leases of Company or any of its Subsidiaries, (v)
performance, payment, deposit or surety obligations of Company or any of its
Subsidiaries, in any case if required by law or governmental rule or regulation
or in accordance with custom and practice in the industry and (vi) other lawful
corporate purposes of Company or any of its Subsidiaries; PROVIDED that with
respect to this subclause (vi) the relevant Issuing Lender and Administrative
Agent consent to the issuance of such standby letter of credit.
"STOCKHOLDERS AGREEMENT" means that certain Stockholders
Agreement, dated February 24, 2004, by and among Holdings, Green Equity
Investors IV, L.P., FTD Co-Investment LLC, Xxxxxx X. Xxxxxx, Xxx X. Xxxxxx, Xxx
X. Xxxxxxxxxxx, Xxxxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxxxx, Xxxxxxx X. Xxxxxx,
Xxxxxx X. Xxxxx, Xxxxxxx X. Xxx Xxxxxx, Xxxxxx X. Xxxxx and the other parties
thereto, as such agreement may be amended from time to time thereafter to the
extent permitted under subsection 7.12A.
"SUBORDINATED INDEBTEDNESS" means (i) the Subordinated Notes and
(ii) any Indebtedness of Company incurred from time to time and subordinated in
right of payment to the Obligations.
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"SUBORDINATED NOTE INDENTURE" means the indenture or indentures,
pursuant to which the Subordinated Notes are issued, as such indenture or
indentures may be amended from time to time to the extent permitted under
subsection 7.12B.
"SUBORDINATED NOTES" means the $175,000,000 in aggregate
principal amount of 7.75% Senior Subordinated Notes due 2014 of Company issued
pursuant to the Subordinated Note Indenture, notes on identical terms issued in
exchange therefor and notes issued in addition thereto pursuant to subsection
7.1(xi).
"SUBSIDIARY", with respect to any Person, means any corporation,
partnership, trust, limited liability company, association, Joint Venture or
other business entity of which more than 50% of the total voting power of shares
of stock or other ownership interests entitled (without regard to the occurrence
of any contingency) to vote in the election of the members of the Governing Body
is at the time owned or controlled, directly or indirectly, by that Person or
one or more of the other Subsidiaries of that Person or a combination thereof.
"SUBSIDIARY GUARANTOR" means any Subsidiary of Company that
executes and delivers a counterpart of the Subsidiary Guaranty on the Closing
Date or from time to time thereafter pursuant to subsection 6.8.
"SUBSIDIARY GUARANTY" means the Subsidiary Guaranty executed and
delivered by existing Domestic Subsidiaries of Company on the Closing Date and
to be executed and delivered by additional Subsidiaries of Company from time to
time thereafter in accordance with subsection 6.8, substantially in the form of
EXHIBIT XIII annexed hereto, as such Subsidiary Guaranty may hereafter be
amended, supplemented or otherwise modified from time to time.
"SUPPLEMENTAL COLLATERAL AGENT" has the meaning assigned to that
term in subsection 9.1B.
"SWING LINE FUNDING AND PAYMENT OFFICE" means the office of Swing
Line Lender located at 00 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such other
offices of Swing Line Lender as may from time to time be hereafter designated as
such in a written notice delivered by Swing Line Lender to Company and each
other Lender.
"SWING LINE LENDER" means CSFB, or any Person serving as a
successor Administrative Agent hereunder, in its capacity as Swing Line Lender
hereunder.
"SWING LINE LOAN COMMITMENT" means the commitment of Swing Line
Lender to make Swing Line Loans to Company pursuant to subsection 2.1A(iii).
"SWING LINE LOANS" means the Loans made by Swing Line Lender to
Company pursuant to subsection 2.1A(iii).
"SWING LINE NOTE" means any promissory note of Company issued
pursuant to subsection 2.1E to evidence the Swing Line Loans of Swing Line
Lender, substantially in the form of EXHIBIT VII annexed hereto, as it may be
amended, supplemented or otherwise modified from time to time.
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"SYNDICATION AGENT" has the meaning assigned to that term in the
introduction to this Agreement.
"SYNTHETIC LEASE OBLIGATION" means the monetary obligation of a
Person under (a) a so-called synthetic, off-balance sheet or tax retention
lease, or (b) an agreement for the use or possession of property creating
obligations that do not appear on the balance sheet of such Person but which,
upon the insolvency or bankruptcy of such Person, would be characterized as the
indebtedness of such Person (without regard to accounting treatment).
"TAX" or "TAXES" means any present or future tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature and whatever called,
imposed by a Governmental Authority, on whomsoever and wherever imposed, levied,
collected, withheld or assessed, including interest, penalties, additions to tax
and any similar liabilities with respect thereto; except that, in the case of a
Lender, there shall be excluded (i) taxes that are imposed on the overall net
income or net profits (including franchise taxes imposed in lieu thereof) (a) by
the United States, (b) by any other Government Authority under the laws of which
such Lender is organized or has its principal office or maintains its applicable
lending office, or (c) by any jurisdiction solely as a result of a present or
former connection between such Lender and such jurisdiction (other than any such
connection arising solely from such Lender having executed, delivered or
performed its obligations or received a payment under, or enforced, any of the
Loan Documents), and (ii) any branch profits taxes imposed by the United States
or any similar tax imposed by any other jurisdiction in which such Lender is
located.
"TERM LOAN COMMITMENT" means the commitment of a Lender to make a
Term Loan to Company pursuant to subsection 2.1A(i), and "TERM LOAN COMMITMENTS"
means such commitments of all Lenders in the aggregate.
"TERM LOAN EXPOSURE", with respect to any Lender, means, as of
any date of determination (i) prior to the funding of the Term Loans, the amount
of that Lender's Term Loan Commitment, and (ii), after the funding of the Term
Loans, the outstanding principal amount of the Term Loan of that Lender.
"TERM LOANS" means the Loans made by Lenders to Company pursuant
to subsection 2.1A(i).
"TERM NOTES" means any promissory notes of Company issued
pursuant to subsection 2.1E to evidence the Term Loans of any Lenders,
substantially in the form of EXHIBIT IV annexed hereto, as they may be amended,
supplemented or otherwise modified from time to time.
"TITLE COMPANY" means one or more title insurance companies
reasonably satisfactory to Administrative Agent.
"TOTAL UTILIZATION OF REVOLVING LOAN COMMITMENTS" means, as at
any date of determination, the sum of (i) the aggregate principal amount of all
outstanding Revolving Loans PLUS (ii) the aggregate principal amount of all
outstanding Swing Line Loans PLUS (iii) the Letter of Credit Usage.
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"TRANSACTION COSTS" means the fees, costs and expenses payable by
Company in connection with the transactions contemplated by the Loan Documents
and the Related Agreements.
"UCC" means the Uniform Commercial Code as in effect in any
applicable jurisdiction.
"VOTING STOCK" means (a) with respect to a corporation, the stock
of such corporation the holders of which are ordinarily, in the absence of
contingencies, entitled to elect members of the Governing Body of such
corporation, (b) with respect to a partnership, the partnership units of such
partnership the holders of which are ordinarily, in the absence of
contingencies, entitled to select or remove the general partner or otherwise
direct the management of the partnership, and (c) with respect to a limited
liability company, the membership interests of such limited liability company
the holders of which are ordinarily, in the absence of contingencies, entitled
to elect the Governing Body of the limited liability company.
1.2 ACCOUNTING TERMS; UTILIZATION OF GAAP FOR PURPOSES OF
CALCULATIONS UNDER AGREEMENT.
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Company to Lenders pursuant to clauses (ii), (iii)
and (xii) of subsection 6.1 shall be prepared in accordance with GAAP as in
effect at the time of such preparation (and delivered together with the
reconciliation statements provided for in subsection 6.1(v)). Except as
otherwise expressly provided in this Agreement, calculations in connection with
the definitions, covenants and other provisions of this Agreement shall utilize
GAAP as in effect on the date of determination, applied in a manner consistent
with that used in preparing the financial statements referred to in subsection
5.3. If Company elects to change its accounting practices during the term of
this Agreement, or if at any time any change occurs in GAAP, which change, in
either case, would affect the computation of any financial ratio or requirement
set forth in any Loan Document, and Company, Administrative Agent or Requisite
Lenders shall so request, Administrative Agent, Lenders and Company shall
negotiate in good faith to amend such ratio or requirement to preserve the
original intent thereof in light of such change in accounting practices or GAAP
(subject to the approval of Requisite Lenders), provided that, until so amended,
such ratio or requirement shall continue to be computed in accordance with GAAP
prior to such change therein and Company shall provide to Administrative Agent
and Lenders reconciliation statements provided for in subsection 6.1(v).
1.3 OTHER DEFINITIONAL PROVISIONS AND RULES OF CONSTRUCTION.
A. Any of the terms defined herein may, unless the context
otherwise requires, be used in the singular or the plural, depending on the
reference.
B. References to "Sections" and "subsections" shall be to
Sections and subsections, respectively, of this Agreement unless otherwise
specifically provided. Section and subsection headings in this Agreement are
included herein for convenience of reference only and
33
shall not constitute a part of this Agreement for any other purpose or be given
any substantive effect.
C. The use in any of the Loan Documents of the word
"include" or "including", when following any general statement, term or matter,
shall not be construed to limit such statement, term or matter to the specific
items or matters set forth immediately following such word or to similar items
or matters, whether or not nonlimiting language (such as "without limitation" or
"but not limited to" or words of similar import) is used with reference thereto,
but rather shall be deemed to refer to all other items or matters that fall
within the broadest possible scope of such general statement, term or matter.
SECTION 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 COMMITMENTS; MAKING OF LOANS; THE REGISTER; OPTIONAL NOTES.
A. COMMITMENTS. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of Company
herein set forth, each Lender hereby severally agrees to make the Loans as
described in subsections 2.1A(i) and 2.1A(ii) and Swing Line Lender hereby
agrees to make the Swing Line Loans as described in subsection 2.1A(iii).
(i) TERM LOANS. Each Lender that has a Term Loan Commitment
severally agrees to lend to Company on the Closing Date an amount not
exceeding its Pro Rata Share of the aggregate amount of the Term Loan
Commitments to be used for the purposes identified in subsection 2.5A. The
amount of each Lender's Term Loan Commitment will be set forth in an
allocation letter delivered to such Lender by Administrative Agent and the
aggregate amount of the Term Loan Commitments is $85,000,000; PROVIDED that
the Term Loan Commitments of Lenders shall be adjusted to give effect to
any assignments of the Term Loan Commitments pursuant to subsection 10.1B.
Each Lender's Term Loan Commitment shall expire immediately and without
further action on April 15, 2004 if the Term Loans are not made on or
before that date. Company may make only one borrowing under the Term Loan
Commitments. Amounts borrowed under this subsection 2.1A(i) and
subsequently repaid or prepaid may not be reborrowed.
(ii) REVOLVING LOANS. Each Revolving Lender severally agrees,
subject to the limitations set forth below with respect to the maximum
amount of Revolving Loans permitted to be outstanding from time to time, to
lend to Company from time to time during the period from the Closing Date
to but excluding the Revolving Loan Commitment Termination Date an
aggregate amount not exceeding its Pro Rata Share of the aggregate amount
of the Revolving Loan Commitments to be used for the purposes identified in
subsection 2.5B. The original amount of each Revolving Lender's Revolving
Loan Commitment will be set forth in an allocation letter delivered to such
Lender by Administrative Agent and the aggregate original amount of the
Revolving Loan Commitments is $50,000,000; PROVIDED that the Revolving Loan
Commitments of Revolving Lenders shall be adjusted to give effect to any
assignments of the Revolving Loan Commitments pursuant to subsection 10.1B
and shall be reduced from time to time
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by the amount of any reductions thereto made pursuant to subsection 2.4.
Each Revolving Lender's Revolving Loan Commitment shall expire on the
Revolving Loan Commitment Termination Date and all Revolving Loans and all
other amounts owed hereunder with respect to the Revolving Loans and the
Revolving Loan Commitments shall be paid in full no later than that date;
PROVIDED that each Revolving Lender's Revolving Loan Commitment shall
expire immediately and without further action on April 15, 2004 if the Term
Loans are not made on or before that date. Amounts borrowed under this
subsection 2.1A(ii) may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary notwithstanding, the
Revolving Loans and the Revolving Loan Commitments shall be subject to the
limitation that in no event shall the Total Utilization of Revolving Loan
Commitments at any time exceed the Revolving Loan Commitments then in effect.
(iii) SWING LINE LOANS.
(a) GENERAL PROVISIONS. Swing Line Lender hereby agrees,
subject to the limitations set forth below with respect to the
maximum amount of Swing Line Loans permitted to be outstanding
from time to time, to make a portion of the Revolving Loan
Commitments available to Company from time to time during the
period from the Closing Date to but excluding the Revolving Loan
Commitment Termination Date by making Swing Line Loans to Company
in an aggregate amount not exceeding the amount of the Swing Line
Loan Commitment to be used for the purposes identified in
subsection 2.5B, notwithstanding the fact that such Swing Line
Loans, when aggregated with Swing Line Lender's outstanding
Revolving Loans and Swing Line Lender's Pro Rata Share of the
Letter of Credit Usage then in effect, may exceed Swing Line
Lender's Revolving Loan Commitment. The original amount of the
Swing Line Loan Commitment is $5,000,000; PROVIDED that any
reduction of the Revolving Loan Commitment Amount made pursuant
to subsection 2.4 that reduces the Revolving Loan Commitment
Amount to an amount less than the then current amount of the
Swing Line Loan Commitment shall result in an automatic
corresponding reduction of the amount of the Swing Line Loan
Commitment to the Revolving Loan Commitment Amount, as so
reduced, without any further action on the part of Company,
Administrative Agent or Swing Line Lender. The Swing Line Loan
Commitment shall expire on the Revolving Loan Commitment
Termination Date and all Swing Line Loans and all other amounts
owed hereunder with respect to the Swing Line Loans shall be paid
in full no later than that date; PROVIDED that the Swing Line
Loan Commitment shall expire immediately and without further
action on April 15, 2004 if the Term Loans are not made on or
before that date. Amounts borrowed under this subsection
2.1A(iii) may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary notwithstanding, the
Swing Line Loans and the Swing Line Loan Commitment shall be subject to the
limitation that in no event
35
shall the Total Utilization of Revolving Loan Commitments at any time exceed the
Revolving Loan Commitment Amount then in effect.
(b) SWING LINE LOAN PREPAYMENT WITH PROCEEDS OF
REVOLVING LOANS. With respect to any Swing Line Loans that have
not been voluntarily prepaid by Company pursuant to subsection
2.4B(i), Swing Line Lender may, at any time in its sole and
absolute discretion, deliver to Administrative Agent (with a copy
to Company), no later than 10:00 A.M. (
New York City time) on the
first Business Day in advance of the proposed Funding Date, a
notice requesting Revolving Lenders to make Revolving Loans that
are Base Rate Loans on such Funding Date in an amount equal to
the amount of such Swing Line Loans (the "REFUNDED SWING LINE
LOANS") outstanding on the date such notice is given. Company
hereby authorizes the giving of any such notice and the making of
any such Revolving Loans. Anything contained in this Agreement to
the contrary notwithstanding, (1) the proceeds of such Revolving
Loans made by Revolving Lenders other than Swing Line Lender
shall be immediately delivered by Administrative Agent to Swing
Line Lender (and not to Company) and applied to repay a
corresponding portion of the Refunded Swing Line Loans and (2) on
the day such Revolving Loans are made, Swing Line Lender's Pro
Rata Share of the Refunded Swing Line Loans shall be deemed to be
paid with the proceeds of a Revolving Loan made by Swing Line
Lender, and such portion of the Swing Line Loans deemed to be so
paid shall no longer be outstanding as Swing Line Loans and shall
no longer be due under the Swing Line Note, if any, of Swing Line
Lender but shall instead constitute part of Swing Line Lender's
outstanding Revolving Loans and shall be due under the Revolving
Note, if any, of Swing Line Lender. Company hereby authorizes
Administrative Agent and Swing Line Lender to charge Company's
accounts with Administrative Agent and Swing Line Lender (up to
the amount available in each such account) in order to
immediately pay Swing Line Lender the amount of the Refunded
Swing Line Loans to the extent the proceeds of such Revolving
Loans made by Revolving Lenders, including the Revolving Loan
deemed to be made by Swing Line Lender, are not sufficient to
repay in full the Refunded Swing Line Loans. If any portion of
any such amount paid (or deemed to be paid) to Swing Line Lender
should be recovered by or on behalf of Company from Swing Line
Lender in any bankruptcy proceeding, in any assignment for the
benefit of creditors or otherwise, the loss of the amount so
recovered shall be ratably shared among all Lenders in the manner
contemplated by subsection 10.5.
(c) SWING LINE LOAN ASSIGNMENTS. On the Funding Date of
each Swing Line Loan, each Revolving Lender shall be deemed to,
and hereby agrees to, purchase an assignment of such Swing Line
Loan in an amount equal to its Pro Rata Share. If for any reason
(1) Revolving Loans are not made upon the request of Swing Line
Lender as provided in the immediately preceding paragraph in an
amount sufficient to repay any amounts owed to Swing Line Lender
in respect of any outstanding Swing Line Loans or (2) the
Revolving Loan Commitments are terminated at a time when any
Swing Line Loans are outstanding, upon notice from Swing Line
Lender as provided below, each Revolving Lender shall fund
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the purchase of such assignment in an amount equal to its Pro
Rata Share (calculated, in the case of the foregoing clause (2),
immediately prior to such termination of the Revolving Loan
Commitments) of the unpaid amount of such Swing Line Loans
together with accrued interest thereon. Upon one Business Day's
notice from Swing Line Lender to Administrative Agent, who shall
promptly notify the Revolving Lenders, each Revolving Lender
shall deliver to Administrative Agent for the benefit of Swing
Line Lender such amount in same day funds at the Funding and
Payment Account. Without limiting the effect of the deemed
assignment described in the preceding sentence, in order to
further evidence such assignment (and without prejudice to the
effectiveness of the assignment provisions set forth above), each
Revolving Lender agrees to enter into an Assignment Agreement at
the request of Swing Line Lender in form and substance reasonably
satisfactory to Swing Line Lender. In the event any Revolving
Lender fails to make available to Swing Line Lender any amount as
provided in this paragraph, Swing Line Lender shall be entitled
to recover such amount on demand from such Revolving Lender
together with interest thereon at the rate customarily used by
Swing Line Lender for the correction of errors among banks for
three Business Days and thereafter at the Base Rate. In the event
Swing Line Lender receives a payment of any amount in which other
Revolving Lenders have purchased assignments as provided in this
paragraph, Swing Line Lender shall promptly remit such payment to
Administrative Agent for distribution to each such other
Revolving Lender its Pro Rata Share of such payment.
(d) REVOLVING LENDERS' OBLIGATIONS. Anything contained
herein to the contrary notwithstanding, each Revolving Lender's
obligation to make Revolving Loans for the purpose of repaying
any Refunded Swing Line Loans pursuant to subsection 2.1A(iii)(b)
and each Revolving Lender's obligation to purchase an assignment
of any unpaid Swing Line Loans pursuant to the immediately
preceding paragraph shall be absolute and unconditional and shall
not be affected by any circumstance, including (1) any set-off,
counterclaim, recoupment, defense or other right which such
Revolving Lender may have against Swing Line Lender, Company or
any other Person for any reason whatsoever; (2) the occurrence or
continuation of an Event of Default or a Potential Event of
Default; (3) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or
prospects of Company or any of its Subsidiaries; (4) any breach
of this Agreement or any other Loan Document by any party
thereto; or (5) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing;
PROVIDED that such obligations of each Revolving Lender are
subject to the condition that (x) Swing Line Lender believed in
good faith that all conditions under Section 4 to the making of
the applicable Refunded Swing Line Loans or other unpaid Swing
Line Loans, as the case may be, were satisfied at the time such
Refunded Swing Line Loans or unpaid Swing Line Loans were made or
(y) the satisfaction of any such condition not satisfied had been
waived in accordance with subsection 10.6 prior to or at the time
such Refunded Swing Line Loans or other unpaid Swing Line Loans
were made.
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B. BORROWING MECHANICS. Term Loans or Revolving Loans made
as Base Rate Loans on any Funding Date (other than Revolving Loans made pursuant
to a request by Swing Line Lender pursuant to subsection 2.1A(iii) or Revolving
Loans made pursuant to subsection 3.3B) shall be in an aggregate minimum amount
of $1,000,000 and multiples of $100,000 in excess of that amount. Term Loans or
Revolving Loans made on any Funding Date as Eurodollar Rate Loans with a
particular Interest Period shall be in an aggregate minimum amount of $2,000,000
and multiples of $100,000 in excess of that amount. Swing Line Loans made on any
Funding Date shall be in an aggregate minimum amount of $500,000 and multiples
of $100,000 in excess of that amount. Whenever Company desires that Lenders make
Term Loans or Revolving Loans it shall deliver to Administrative Agent a duly
executed Notice of Borrowing no later than 11:00 A.M. (
New York City time) at
least three Business Days in advance of the proposed Funding Date (in the case
of a Eurodollar Rate Loan) or at least one Business Day in advance of the
proposed Funding Date (in the case of a Base Rate Loan). Whenever Company
desires that Swing Line Lender make a Swing Line Loan, it shall deliver to Swing
Line Lender at the Swing Line Funding and Payment Office a duly executed Notice
of Borrowing no later than 12:00 Noon (
New York City time) on the proposed
Funding Date. Term Loans and Revolving Loans may be continued as or converted
into Base Rate Loans and Eurodollar Rate Loans in the manner provided in
subsection 2.2D. In lieu of delivering a Notice of Borrowing, Company may give
Administrative Agent (or in the case of Swing Line Loans, Swing Line Lender and
Administrative Agent), as applicable, telephonic notice by the required time of
any proposed borrowing under this subsection 2.1B; PROVIDED that such notice
shall be promptly confirmed in writing by delivery of a duly executed Notice of
Borrowing to Administrative Agent (or Swing Line Lender in the case of Swing
Line Loans) on or before the applicable Funding Date.
Neither Administrative Agent nor any Lender (including Swing Line
Lender) shall incur any liability to Company in acting upon any telephonic
notice referred to above that Administrative Agent (or Swing Line Lender, as
applicable) believes in good faith to have been given by an Officer or other
person authorized to borrow on behalf of Company or for otherwise acting in good
faith under this subsection 2.1B or under subsection 2.2D, and upon funding of
Loans by Lenders, and upon conversion or continuation of the applicable basis
for determining the interest rate with respect to any Loans pursuant to
subsection 2.2D, in each case in accordance with this Agreement, pursuant to any
such telephonic notice Company shall have effected Loans or a conversion or
continuation, as the case may be, hereunder.
Company shall notify Administrative Agent (or in the case of
Swing Line Loans, Swing Line Lender and Administrative Agent) prior to the
funding of any Loans in the event that any of the matters to which Company is
required to certify in the applicable Notice of Borrowing is no longer true and
correct as of the applicable Funding Date, and the acceptance by Company of the
proceeds of any Loans shall constitute a re-certification by Company, as of the
applicable Funding Date, as to the matters to which Company is required to
certify in the applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G,
a Notice of Borrowing for a Eurodollar Rate Loan (or telephonic notice in lieu
thereof) shall be irrevocable and Company shall be bound to make a borrowing in
accordance therewith.
38
C. DISBURSEMENT OF FUNDS. All Term Loans and Revolving Loans
under this Agreement shall be made by Lenders simultaneously and proportionately
to their respective Pro Rata Shares, it being understood that neither
Administrative Agent nor any Lender shall be responsible for any default by any
other Lender in that other Lender's obligation to make a Loan requested
hereunder nor shall the Commitment of any Lender to make the particular type of
Loan requested or Pro Rata Share of any Lender be increased or decreased as a
result of a default by any other Lender in that other Lender's obligation to
make a Loan requested hereunder.
Promptly after receipt by Administrative Agent of a Notice of
Borrowing pursuant to subsection 2.1B (or telephonic notice in lieu thereof),
Administrative Agent shall notify each Lender for that type of Loan (other than
Swing Line Lender in the case of a Swing Line Loan borrowing) of the proposed
borrowing. Each such Lender (other than Swing Line Lender) shall make the amount
of its Loan available to Administrative Agent at the Funding and Payment Office
not later than 1:00 P.M. (
New York City time) on the applicable Funding Date in
same day funds in Dollars, at the Funding and Payment Office. Swing Line Lender
shall make the amount of its Loan available directly to Company as provided
below. Except as provided in subsection 2.1A(iii) or subsection 3.3B with
respect to Revolving Loans used to repay Refunded Swing Line Loans or to
reimburse any Issuing Lender for the amount of a drawing under a Letter of
Credit issued by it, upon satisfaction or waiver of the conditions precedent
specified in subsections 4.1 (in the case of Loans made on the Closing Date) and
4.2 (in the case of all Loans), Administrative Agent or Swing Line Lender, as
the case may be, shall make the proceeds of such Loans available to Company on
the applicable Funding Date by causing an amount of same day funds in Dollars
equal to the proceeds of all such Loans received by Administrative Agent from
Lenders or to be disbursed by Swing Line Lender, as applicable, to be credited
to the account designated by Company in the applicable Notice of Borrowing.
Unless Administrative Agent shall have been notified by any
Lender prior to a Funding Date for any Loans that such Lender does not intend to
make available to Administrative Agent the amount of such Lender's Loan
requested on such Funding Date, Administrative Agent may assume that such Lender
has made such amount available to Administrative Agent on such Funding Date and
Administrative Agent may, in its sole discretion, but shall not be obligated to,
make available to Company a corresponding amount on such Funding Date. If such
corresponding amount is not in fact made available to Administrative Agent by
such Lender, Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Lender together with interest thereon,
for each day from such Funding Date until the date such amount is paid to
Administrative Agent, at the customary rate set by Administrative Agent for the
correction of errors among banks for three Business Days and thereafter at the
Base Rate. If such Lender does not pay such corresponding amount forthwith upon
Administrative Agent's demand therefor, Administrative Agent shall promptly
notify Company and Company shall immediately pay such corresponding amount to
Administrative Agent together with interest thereon, for each day from such
Funding Date until the date such amount is paid to Administrative Agent, at the
rate payable under this Agreement for Base Rate Loans. Nothing in this
subsection 2.1C shall be deemed to relieve any Lender from its obligation to
fulfill its Commitments hereunder or to prejudice any rights that Company may
have against any Lender as a result of any default by such Lender hereunder.
39
D. THE REGISTER. Administrative Agent, acting for these
purposes solely as an agent of Company (it being acknowledged that
Administrative Agent, in such capacity, and its officers, directors, employees,
agent and affiliates shall constitute Indemnitees under subsection 10.3), shall
maintain (and make available for inspection by Company and Lenders upon
reasonable prior notice at reasonable times) at its address referred to in
subsection 10.8 a register for the recordation of, and shall record, the names
and addresses of Lenders and the Term Loan Commitment, Revolving Loan
Commitment, Swing Line Loan Commitment, Term Loan, Revolving Loans and Swing
Line Loans of each Lender from time to time (the "REGISTER"). Company,
Administrative Agent and Lenders shall, absent manifest error, deem and treat
the Persons listed as Lenders in the Register as the holders and owners of the
corresponding Commitments and Loans listed therein for all purposes hereof; all
amounts owed with respect to any Commitment or Loan shall be owed to the Lender
listed in the Register as the owner thereof; and any request, authority or
consent of any Person who, at the time of making such request or giving such
authority or consent, is listed in the Register as a Lender shall be conclusive
and binding on any subsequent holder, assignee or transferee of the
corresponding Commitments or Loans. Each Lender shall record on its internal
records the amount of its Loans and Commitments and each payment in respect
hereof, and any such recordation shall be conclusive and binding on Company,
absent manifest error, subject to the entries in the Register, which shall,
absent manifest error, govern in the event of any inconsistency with any
Lender's records. Failure to make any recordation in the Register or in any
Lender's records, or any error in such recordation, shall not affect any Loans
or Commitments or any Obligations in respect of any Loans.
E. OPTIONAL NOTES. If so requested by any Lender by written
notice to Company at least two Business Days prior to the Closing Date or at any
time thereafter, Company shall execute and deliver to such Lender (and/or, if
applicable and if so specified in such notice, to any Person who is an assignee
of such Lender pursuant to subsection 10.1) on the Closing Date (or, if such
notice is delivered after the Closing Date, promptly after Company's receipt of
such notice) a promissory note or promissory notes to evidence such Lender's
Term Loan, Revolving Loans or Swing Line Loans, substantially in the form of
EXHIBIT IV, EXHIBIT VI or EXHIBIT VII annexed hereto, respectively, with
appropriate insertions.
2.2 INTEREST ON THE LOANS.
A. RATE OF INTEREST. Subject to the provisions of
subsections 2.6 and 2.7, each Term Loan and each Revolving Loan shall bear
interest on the unpaid principal amount thereof from the date made through
maturity (whether by acceleration or otherwise) at a rate determined by
reference to the Base Rate or the Eurodollar Rate. Subject to the provisions of
subsection 2.7, each Swing Line Loan shall bear interest on the unpaid principal
amount thereof from the date made through maturity (whether by acceleration or
otherwise) at a rate determined by reference to the Base Rate. The applicable
basis for determining the rate of interest with respect to any Term Loan or any
Revolving Loan shall be selected by Company initially at the time a Notice of
Borrowing is given with respect to such Loan pursuant to subsection 2.1B
(subject to the last sentence of subsection 2.1B), and the basis for determining
the interest rate with respect to any Term Loan or any Revolving Loan may be
changed from time to time pursuant to subsection 2.2D (subject to the last
sentence of subsection 2.1B). If on any day a Term Loan or Revolving Loan is
outstanding with respect to which notice has not been delivered
40
to Administrative Agent in accordance with the terms of this Agreement
specifying the applicable basis for determining the rate of interest, then for
that day that Loan shall bear interest determined by reference to the Base Rate.
(i) Subject to the provisions of subsections 2.2E, 2.2G and
2.7, the Term Loans shall bear interest through maturity as follows:
(a) if a Base Rate Loan, then at the sum of the Base
Rate PLUS the Base Rate Margin set forth in the table below
opposite the applicable Consolidated Leverage Ratio for the
four-Fiscal Quarter period for which the applicable Pricing
Certificate has been delivered pursuant to subsection 6.1(iv); or
(b) if a Eurodollar Rate Loan, then at the sum of the
Eurodollar Rate PLUS the Eurodollar Rate Margin set forth in the
table below opposite the applicable Consolidated Leverage Ratio
for the four-Fiscal Quarter period for which the applicable
Pricing Certificate has been delivered pursuant to subsection
6.1(iv):
Consolidated Eurodollar Rate Base
Leverage Ratio Margin Rate Margin
-------------- --------------- -----------
Greater than
or equal to 4.00:1.00 2.75% 1.75%
Less than 4.00:1.00 2.50% 1.50%
PROVIDED that, for the first six months after the Closing Date, the
applicable margin for Term Loans that are Eurodollar Rate Loans shall be
2.75% per annum and the applicable margin for Term Loans that are Base Rate
Loans shall be 1.75% per annum.
(ii) Subject to the provisions of subsections 2.2E, 2.2G and
2.7, the Revolving Loans shall bear interest through maturity as follows:
(a) if a Base Rate Loan, then at the sum of the Base
Rate PLUS the Base Rate Margin set forth in the table below
opposite the applicable Consolidated Leverage Ratio for the
four-Fiscal Quarter period for which the applicable Pricing
Certificate has been delivered pursuant to subsection 6.1(iv); or
(b) if a Eurodollar Rate Loan, then at the sum of the
Eurodollar Rate PLUS the Eurodollar Rate Margin set forth in the
table below opposite the applicable Consolidated Leverage Ratio
for the four-Fiscal Quarter period for which the applicable
Pricing Certificate has been delivered pursuant to subsection
6.1(iv):
41
Consolidated Eurodollar Rate Base
Leverage Ratio Margin Rate Margin
-------------- --------------- -----------
Greater than
or equal to 4.50:1.00 2.75% 1.75%
Greater than
or equal to 4.00:1.00
but less than 4.50:1.00 2.50% 1.50%
Greater than
or equal to 3.50:1.00
but less than 4.00:1.00 2.25% 1.25%
Greater than
or equal to 3.00:1.00
but less than 3.50:1.00 2.00% 1.00%
Less than 3.00:1.00 1.75% 0.75%
PROVIDED that, for the first six months after the Closing Date, the
applicable margin for Revolving Loans that are Eurodollar Rate Loans shall
be 2.75% per annum and the applicable margin for Revolving Loans that are
Base Rate Loans shall be 1.75% per annum.
(iii) Upon delivery of the Pricing Certificate by Company to
Administrative Agent pursuant to subsection 6.1(iv), the Base Rate Margin
and the Eurodollar Rate Margin for Revolving Loans and Term Loans shall
automatically be adjusted in accordance with such Pricing Certificate, such
adjustment to become effective on the next succeeding Business Day
following the receipt by Administrative Agent of such Pricing Certificate
(subject to the provisions of the foregoing clauses (i) and (ii)); PROVIDED
that, if at any time a Pricing Certificate is not delivered at the time
required pursuant to subsection 6.1(iv), from the time such Pricing
Certificate was required to be delivered until the Business Day next
succeeding delivery of such Pricing Certificate, the applicable margins
shall be the maximum percentage amount for the relevant Loan set forth
above.
(iv) Subject to the provisions of subsections 2.2E, 2.2G and
2.7, the Swing Line Loans shall bear interest through maturity at the sum
of the Base Rate PLUS the applicable Base Rate Margin for Revolving Loans.
42
B. INTEREST PERIODS. In connection with each Eurodollar Rate
Loan, Company may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
"INTEREST PERIOD") to be applicable to such Loan, which Interest Period shall
be, at Company's option, either a one, two, three or six month period; PROVIDED
that:
(i) the initial Interest Period for any Eurodollar Rate Loan
shall commence on the Funding Date in respect of such Loan, in the case of
a Loan initially made as a Eurodollar Rate Loan, or on the date specified
in the applicable Notice of Conversion/Continuation, in the case of a Loan
converted to a Eurodollar Rate Loan;
(ii) in the case of immediately successive Interest Periods
applicable to a Eurodollar Rate Loan continued as such pursuant to a Notice
of Conversion/Continuation, each successive Interest Period shall commence
on the day on which the next preceding Interest Period expires;
(iii) if an Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day; PROVIDED that, if any Interest Period would
otherwise expire on a day that is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such
Interest Period shall expire on the next preceding Business Day;
(iv) 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, subject to clause (v) of this subsection 2.2B, end on the last
Business Day of a calendar month;
(v) no Interest Period with respect to any portion of the
Term Loans shall extend beyond February 28, 2011 and no Interest Period
with respect to any portion of the Revolving Loans shall extend beyond the
Revolving Loan Commitment Termination Date;
(vi) no Interest Period with respect to any type of Term Loans
shall extend beyond a date on which Company is required to make a scheduled
payment of principal of such type of Term Loans, unless the sum of (a) the
aggregate principal amount of such type of Term Loans that are Base Rate
Loans PLUS (b) the aggregate principal amount of such type of Term Loans
that are Eurodollar Rate Loans with Interest Periods expiring on or before
such date equals or exceeds the principal amount required to be paid on
such type of Term Loans on such date;
(vii) there shall be no more than ten Interest Periods
outstanding at any time; and
(viii) in the event Company fails to specify an Interest Period
for any Eurodollar Rate Loan in the applicable Notice of Borrowing or
Notice of Conversion/Continuation, Company shall be deemed to have selected
an Interest Period of one month.
43
C. INTEREST PAYMENTS. Subject to the provisions of
subsection 2.2E, interest on each Loan shall be payable in arrears on and to
each Interest Payment Date applicable to that Loan, upon any prepayment of that
Loan (to the extent accrued on the amount being prepaid) and at maturity
(including final maturity); PROVIDED that in the event any Swing Line Loans or
any Revolving Loans that are Base Rate Loans are prepaid pursuant to subsection
2.4B(i), interest accrued on such Loans through the date of such prepayment
shall be payable on the next succeeding Interest Payment Date applicable to Base
Rate Loans (or, if earlier, at final maturity).
D. CONVERSION OR CONTINUATION. Subject to the provisions of
subsection 2.6, Company shall have the option (i) to convert at any time all or
any part of its outstanding Term Loans or Revolving Loans equal to $2,000,000
and multiples of $100,000 in excess of that amount from Loans bearing interest
at a rate determined by reference to one basis to Loans bearing interest at a
rate determined by reference to an alternative basis or (ii) upon the expiration
of any Interest Period applicable to a Eurodollar Rate Loan, to continue all or
any portion of such Loan equal to $2,000,000 and multiples of $100,000 in excess
of that amount as a Eurodollar Rate Loan; PROVIDED, HOWEVER, that a Eurodollar
Rate Loan may only be converted into a Base Rate Loan on the expiration date of
an Interest Period applicable thereto.
Company shall deliver a duly executed Notice of
Conversion/Continuation to Administrative Agent no later than 11:00 A.M. (
New
York City time) at least one Business Day in advance of the proposed conversion
date (in the case of a conversion to a Base Rate Loan) and at least three
Business Days in advance of the proposed conversion/continuation date (in the
case of a conversion to, or a continuation of, a Eurodollar Rate Loan). In lieu
of delivering a Notice of Conversion/Continuation, Company may give
Administrative Agent telephonic notice by the required time of any proposed
conversion/continuation under this subsection 2.2D; PROVIDED that such notice
shall be promptly confirmed in writing by delivery of a duly executed Notice of
Conversion/Continuation to Administrative Agent on or before the proposed
conversion/continuation date. Administrative Agent shall notify each Lender of
any Loan subject to any Notice of Conversion/Continuation.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G,
a Notice of Conversion/Continuation for conversion to, or continuation of, a
Eurodollar Rate Loan (or telephonic notice in lieu thereof) shall be irrevocable
and Company shall be bound to effect a conversion or continuation in accordance
therewith.
E. DEFAULT RATE. Upon the occurrence and during the
continuance of any Event of Default resulting from the failure to pay when due,
whether at stated maturity, by notice of prepayment, by acceleration or
otherwise, any principal payments on the Loans, any interest payments thereon or
any fees and other amounts due and payable hereunder, the outstanding principal
amount of all Loans and, to the extent permitted by applicable law, such
interest payments and fees and other amounts shall thereafter bear interest
(including post-petition interest in any proceeding under the Bankruptcy Code or
other applicable bankruptcy laws) payable upon demand at a rate that is 2% per
annum in excess of the interest rate otherwise payable under this Agreement with
respect to the applicable Loans (or, in the case of any such fees and other
amounts, at a rate which is 2% per annum in excess of the interest rate
otherwise payable under this Agreement for Base Rate Loans); PROVIDED that, in
the case of Eurodollar Rate Loans, upon the expiration of the Interest Period in
effect at the time any such increase in interest
44
rate is effective such Eurodollar Rate Loans shall thereupon become Base Rate
Loans and shall thereafter bear interest payable upon demand at a rate which is
2% per annum in excess of the interest rate otherwise payable under this
Agreement for Base Rate Loans. Payment or acceptance of the increased rates of
interest provided for in this subsection 2.2E is not a permitted alternative to
timely payment and shall not constitute a waiver of any Event of Default or
otherwise prejudice or limit any rights or remedies of Administrative Agent or
any Lender.
F. COMPUTATION OF INTEREST. Interest on the Loans shall be
computed on the basis of a 360-day year for the actual number of days elapsed in
the period during which it accrues. In computing interest on any Loan, the date
of the making of such Loan or the first day of an Interest Period applicable to
such Loan or, with respect to a Base Rate Loan being converted from a Eurodollar
Rate Loan, the date of conversion of such Eurodollar Rate Loan to such Base Rate
Loan, as the case may be, shall be included, and the date of payment of such
Loan or the expiration date of an Interest Period applicable to such Loan or,
with respect to a Base Rate Loan being converted to a Eurodollar Rate Loan, the
date of conversion of such Base Rate Loan to such Eurodollar Rate Loan, as the
case may be, shall be excluded; PROVIDED that if a Loan is repaid on the same
day on which it is made, one day's interest shall be paid on that Loan.
G. MAXIMUM RATE. Notwithstanding the foregoing provisions of
this subsection 2.2, in no event shall the rate of interest payable by Company
with respect to any Loan exceed the maximum rate of interest permitted to be
charged under applicable law.
H. INTEREST RATE ON INCREMENTAL LOANS. In the event that the
Net Yield applicable to the Incremental Loans is 0.50% per annum or more in
excess of the per annum rate of interest applicable to the Term Loans that are
Eurodollar Rate Loans pursuant to subsection 2.2A, then (x) the per annum rate
of interest for all Term Loans that are Eurodollar Rate Loans shall
automatically be increased to any extent required so that the per annum rate of
interest for all Term Loans that are Eurodollar Rate Loans is equal to the per
annum rate of interest for the Incremental Loans, and (y) the per annum rate of
interest for all Term Loans that are Eurodollar Rate Loans shall automatically
be increased to any extent required so that the per annum rate of interest for
all Term Loans that are Eurodollar Rate Loans is equal to the Net Yield for the
Incremental Loans, in each case without any action or consent of Company,
Administrative Agent or any Lender. In no event will the per annum rate of
interest in respect of Term Loans that are Eurodollar Rate Loans be 0.50% per
annum or more below the per annum rate of interest in respect of the Incremental
Loans. Upon any increase in the rate of interest in respect of the Term Loans
that are Eurodollar Rate Loans pursuant to this subsection 2.2H, the rate of
interest applicable to Term Loans that are Base Rate Loans shall increase by the
number of basis points equal to such basis point increase in the interest in
respect of Term Loans that are Eurodollar Rate Loans. "Net Yield" for purposes
of Loans constituting Incremental Loans shall mean the sum of (a) the per annum
rate of interest applicable to such Loans at the date such Incremental Loans are
incurred plus (b) any original issue discount offered to lenders in respect of
such Incremental Loans amortized equally over the period from the date such
Incremental Loans are incurred to the maturity date applicable to such
Incremental Loans; PROVIDED, that such original issue discount shall not be
amortized over a period of greater than three years.
45
2.3 FEES.
A. COMMITMENT FEES. Company agrees to pay to Administrative
Agent, for distribution to each Revolving Lender in proportion to that Lender's
Pro Rata Share, commitment fees for the period from and including the Closing
Date to and excluding the Revolving Loan Commitment Termination Date equal to
the excess of the Revolving Loan Commitment Amount on each day during such
period over the sum of (i) the aggregate principal amount of outstanding
Revolving Loans (but not any outstanding Swing Line Loans) on such day PLUS (ii)
the Letter of Credit Usage on such day MULTIPLIED BY a rate per annum equal to
the percentage set forth in the table below opposite the Revolving Loan
Commitment Utilization Percentage for such day:
Revolving Loan Commitment Commitment
Utilization Percentage Fee Percentage
------------------------------ ----------------
less than or equal to 33% 0.625%
greater than 33% but less than
or equal to 67% 0.50%
greater than 67% 0.375%
such commitment fees to be calculated on the basis of a 360-day year and the
actual number of days elapsed and to be payable quarterly in arrears on the last
Business Day of each of March, June, September and December of each year,
commencing on the first such date to occur after the Closing Date, and on the
Revolving Loan Commitment Termination Date.
B. OTHER FEES. Company agrees to pay to Administrative Agent
and the Syndication Agent such fees in the amounts and at the times separately
agreed upon between Company, Administrative Agent and the Syndication Agent.
2.4 REPAYMENTS, PREPAYMENTS AND REDUCTIONS IN REVOLVING LOAN
COMMITMENTS; GENERAL PROVISIONS REGARDING PAYMENTS; APPLICATION
OF PROCEEDS OF COLLATERAL AND PAYMENTS UNDER GUARANTIES.
A. SCHEDULED PAYMENTS OF TERM LOANS. Company shall make
principal payments on the Term Loans in installments on the dates and in the
amounts set forth below:
46
DATE SCHEDULED REPAYMENT
----------------------- ------------------------
May 31, 2004 $ 212,500
August 31, 2004 $ 212,500
November 30, 2004 $ 212,500
February 28, 2005 $ 212,500
May 31, 2005 $ 212,500
August 31, 2005 $ 212,500
November 30, 2005 $ 212,500
February 28, 2006 $ 212,500
May 31, 2006 $ 212,500
August 31, 2006 $ 212,500
November 30, 2006 $ 212,500
February 28, 2007 $ 212,500
May 31, 2007 $ 212,500
August 31, 2007 $ 212,500
November 30, 2007 $ 212,500
February 29, 2008 $ 212,500
May 31, 2008 $ 212,500
August 31, 2008 $ 212,500
November 30, 2008 $ 212,500
February 28, 2009 $ 212,500
May 31, 2009 $ 212,500
August 31, 2009 $ 212,500
November 30, 2009 $ 212,500
February 28, 2010 $ 212,500
May 31, 2010 $ 212,500
August 31, 2010 $ 212,500
November 30, 2010 $ 212,500
February 28, 2011 $ 79,262,500
TOTAL $ 85,000,000
; PROVIDED that the scheduled installments of principal of the Term Loan set
forth above shall be reduced in connection with any voluntary or mandatory
prepayments of the Term Loans in accordance with subsection 2.4B(iv); and
PROVIDED, FURTHER that the Term Loans and all other amounts owed hereunder with
respect to the Term Loans shall be paid in full no later than
47
February 28, 2011, and the final installment payable by Company in respect of
the Term Loans on such date shall be in an amount, if such amount is different
from that specified above, sufficient to repay all amounts owing by Company
under this Agreement with respect to the Term Loans.
B. PREPAYMENTS AND REDUCTIONS IN REVOLVING LOAN COMMITMENTS.
(i) VOLUNTARY PREPAYMENTS. Company may, upon delivery of a
Notice of Prepayment to Administrative Agent or upon telephonic notice to
Administrative Agent promptly confirmed in writing by delivery of a Notice
of Prepayment, on or prior to 11:00 A.M. (
New York City time) on the date
of prepayment, at any time and from time to time prepay any Swing Line Loan
on any Business Day in whole or in part in an aggregate minimum amount of
$500,000 and multiples of $100,000 in excess of that amount. Company may,
upon not less than one Business Day's prior written notice by delivery of a
Notice of Prepayment or telephonic notice promptly confirmed in writing by
delivery of a Notice of Prepayment, in the case of Base Rate Loans, and
three Business Days' prior written notice by delivery of a Notice of
Prepayment or telephonic notice promptly confirmed in writing by delivery
of a Notice of Prepayment, in the case of Eurodollar Rate Loans, in each
case given to Administrative Agent by 11:00 A.M. (New York City time) on
the date required (who will promptly notify each Lender whose Loans are to
be prepaid of such prepayment), at any time and from time to time prepay
any Term Loans or Revolving Loans on any Business Day in whole or in part
in an aggregate minimum amount of $1,000,000 and multiples of $100,000 in
excess of that amount; PROVIDED, HOWEVER, that a Eurodollar Rate Loan may
only be prepaid on the expiration of the Interest Period applicable thereto
unless Company compensates Lenders for all breakage costs resulting from
such payment or conversion pursuant to subsection 2.6D. Any written or
telephonic notice of voluntary prepayment delivered pursuant to this
subsection 2.4B(i) shall be irrevocable and once such notice of prepayment
has been given as aforesaid, the principal amount of the Loans specified in
such notice shall become due and payable on the prepayment date specified
therein. Any such voluntary prepayment shall be applied as specified in
subsection 2.4B(iv).
(ii) VOLUNTARY REDUCTIONS OF REVOLVING LOAN COMMITMENTS.
Company may, upon not less than three Business Days' prior written notice
by delivery of a Notice of Prepayment to Administrative Agent or upon
telephonic notice promptly confirmed in writing by the delivery of a Notice
of Prepayment to Administrative Agent or upon such lesser number of days'
prior written or telephonic notice, as determined by Administrative Agent
in its sole discretion, at any time and from time to time, terminate in
whole or permanently reduce in part, without premium or penalty, the
Revolving Loan Commitments in an amount up to the amount by which the
Revolving Loan Commitment Amount exceeds the Total Utilization of Revolving
Loan Commitments at the time of such proposed termination or reduction;
PROVIDED that any such partial reduction of the Revolving Loan Commitment
Amount shall be in an aggregate minimum amount of $3,000,000 and multiples
of $1,000,000 in excess of that amount. Company's notice to Administrative
Agent (who will promptly notify each Revolving Lender of such notice) shall
designate the date (which shall be a Business Day) of such termination or
reduction and the amount of any partial reduction, and such termination or
reduction shall be
48
effective on the date specified in Company's notice and shall reduce the
amount of the Revolving Loan Commitment of each Revolving Lender
proportionately to its Pro Rata Share. Any such voluntary reduction of the
Revolving Loan Commitment Amount shall be applied as specified in
subsection 2.4B(iv). All written or telephonic notices of termination or
reduction of the Revolving Loan Commitments delivered pursuant to this
subsection 2.4B(ii) shall be irrevocable and Company shall be bound to the
termination or reduction of the Revolving Loan Commitments referenced in
such notice.
(iii) MANDATORY PREPAYMENTS AND MANDATORY REDUCTIONS OF
REVOLVING LOAN COMMITMENTS. The Loans shall be prepaid and/or the Revolving
Loan Commitment Amount shall be permanently reduced in the amounts and
under the circumstances set forth below, all such prepayments and/or
reductions to be applied as set forth below or as more specifically
provided in subsection 2.4B(iv) and subsection 2.4D and shall be made after
delivery of the notice required by subsection 2.4B(iii)(f):
(a) PREPAYMENTS AND REDUCTIONS FROM NET ASSET SALE
PROCEEDS. No later than the fifth Business Day following the date
of receipt by Company or any of its Domestic Subsidiaries of any
Net Asset Sale Proceeds in respect of any Asset Sale, Company
shall either (1) prepay the Loans and/or the Revolving Loan
Commitment Amount shall be permanently reduced in an aggregate
amount equal to such Net Asset Sale Proceeds or (2), so long as
no Event of Default shall have occurred and be continuing and to
the extent that aggregate Net Asset Sale Proceeds for the Fiscal
Year in which such proceeds are received do not exceed
$10,000,000 deliver to Administrative Agent an Officer's
Certificate setting forth (x) that portion of such Net Asset Sale
Proceeds that Company or such Subsidiary intends to reinvest in
equipment or other productive assets of the general type used in
the business of Company and its Subsidiaries within 270 days of
such date of receipt and (y) the proposed use of such portion of
the Net Asset Sale Proceeds and such other information with
respect to such reinvestment as Administrative Agent may
reasonably request, and Company shall, or shall cause one or more
of its Subsidiaries to, promptly and diligently apply such
portion to such reinvestment purposes; PROVIDED, HOWEVER, that,
pending such reinvestment, such portion of the Net Asset Sale
Proceeds shall be applied to prepay outstanding Revolving Loans
(without a reduction in Revolving Loan Commitment Amount) to the
full extent thereof. In addition, Company shall, no later than
270 days after receipt of such Net Asset Sale Proceeds that have
not theretofore been applied to the Obligations or that have not
been so reinvested as provided above, make an additional
prepayment of the Loans (and/or the Revolving Loan Commitment
Amount shall be permanently reduced) in the full amount of all
such Net Asset Sale Proceeds.
(b) PREPAYMENTS AND REDUCTIONS FROM NET
INSURANCE/CONDEMNATION PROCEEDS. No later than the fifth Business
Day following the date of receipt by Administrative Agent or by
Company or any of its Domestic Subsidiaries of any Net
Insurance/Condemnation Proceeds that are required to be applied
to prepay the Loans and/or reduce the Revolving Loan Commitment
Amount pursuant to the provisions of subsection 6.4C, Company
shall prepay the Loans and/or the
49
Revolving Loan Commitment Amount shall be permanently reduced in
an aggregate amount equal to the amount of such Net
Insurance/Condemnation Proceeds.
(c) PREPAYMENTS AND REDUCTIONS DUE TO ISSUANCE OF EQUITY
SECURITIES. Not later than the third Business Day following the
date of receipt of the Net Securities Proceeds from the issuance
of any Capital Stock of Company or of Holdings or of any Domestic
Subsidiary of Company, Company shall prepay the Loans and/or the
Revolving Loan Commitment Amount shall be permanently reduced in
an aggregate amount equal to 50% of such Net Securities Proceeds
(other than Net Securities Proceeds resulting from the issuance
of Capital Stock of Holdings (i) to (or a capital contribution
by) one or more Equity Investors or (ii) pursuant to employee and
executive compensation plans); PROVIDED, that no prepayment shall
be required hereunder with respect to the receipt of any Net
Securities Proceeds described in this subsection 2.4B(iii)(c) to
the extent that the Consolidated Leverage Ratio as of the last
day of the Fiscal Quarter immediately preceding the date on which
such Net Securities Proceeds are received is less than 3.50:1.00.
(d) PREPAYMENTS AND REDUCTIONS DUE TO ISSUANCE OF
INDEBTEDNESS. Not later than the third Business Day following the
date of receipt of the Net Securities Proceeds from the issuance
of any Indebtedness of Company, Holdings or any of its Domestic
Subsidiaries after the Closing Date, other than Indebtedness
permitted pursuant to subsection 7.1 (except as provided in
subsection 7.1(x) or (xi)), Company shall prepay the Loans and/or
the Revolving Loan Commitment Amount shall be permanently reduced
in an aggregate amount equal to such Net Securities Proceeds.
(e) PREPAYMENTS AND REDUCTIONS FROM CONSOLIDATED EXCESS
CASH FLOW. In the event that there shall be Consolidated Excess
Cash Flow for any Fiscal Year (commencing with the Fiscal Year
ending June 30, 2005), Company shall, no later than 105 days
after the end of such Fiscal Year, prepay the Loans and/or the
Revolving Loan Commitment Amount shall be permanently reduced in
an aggregate amount equal to 75% of such Consolidated Excess Cash
Flow; PROVIDED that for any Fiscal Year in which the Consolidated
Leverage Ratio as of the last day of such Fiscal Year is less
than 3.50:1.00 and is greater than or equal to 2.50:1.00 the
percentage of Consolidated Excess Cash Flow required to be used
to prepay the Loans and/or permanently reduce the Revolving Loan
Commitments pursuant to this subsection 2.4B(iii)(e) shall be
50%; PROVIDED FURTHER that for any Fiscal Year in which the
Consolidated Leverage Ratio as of the last day of such Fiscal
Year is less than 2.50:1.00 the percentage of Consolidated Excess
Cash Flow required to be used to prepay the Loans and/or
permanently reduce the Revolving Loan Commitments pursuant to
this subsection 2.4B(iii)(e) shall be 25%.
(f) CALCULATIONS OF NET PROCEEDS AMOUNTS; ADDITIONAL
PREPAYMENTS AND REDUCTIONS BASED ON SUBSEQUENT CALCULATIONS.
Company shall provide
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Administrative Agent with not less than three Business Days'
prior written notice by delivery of a Notice of Prepayment or
prior telephonic notice promptly confirmed in writing by the
delivery of a Notice of Prepayment, of any prepayment of the
Loans pursuant to subsections 2.4B(iii)(a)-(e). Such written or
telephonic notice shall be irrevocable and Company shall be bound
to make the mandatory prepayment referenced in such notice on the
date indicated in such notice. Administrative Agent shall
promptly notify each Lender of such prepayment and of the amount
of the prepayment proposed to be applied to such Lender's Loans.
Concurrently with any prepayment of the Loans and/or reduction of
the Revolving Loan Commitment Amount pursuant to subsections
2.4B(iii)(a)-(e), Company shall deliver to Administrative Agent
an Officer's Certificate demonstrating the calculation of the
amount of the applicable Net Asset Sale Proceeds, Net
Insurance/Condemnation Proceeds, Net Securities Proceeds, or
Consolidated Excess Cash Flow, as the case may be, that gave rise
to such prepayment and/or reduction. In the event that Company
shall subsequently determine that the actual amount was greater
than the amount set forth in such Officer's Certificate, Company
shall promptly make an additional prepayment of the Loans
(and/or, if applicable, the Revolving Loan Commitment Amount
shall be permanently reduced) in an amount equal to the amount of
such excess, and Company shall concurrently therewith deliver to
Administrative Agent an Officer's Certificate demonstrating the
derivation of the additional amount resulting in such excess.
(g) PREPAYMENTS DUE TO REDUCTIONS OR RESTRICTIONS OF
REVOLVING LOAN COMMITMENTS. Company shall from time to time
prepay FIRST the Swing Line Loans and SECOND the Revolving Loans
(and, to the extent necessary after such prepayment, cash
collateralize any outstanding Letters of Credit) to the extent
necessary so that the Total Utilization of Revolving Loan
Commitments shall not at any time exceed the Revolving Loan
Commitment Amount then in effect.
(iv) APPLICATION OF PREPAYMENTS.
(a) APPLICATION OF VOLUNTARY PREPAYMENTS BY TYPE OF
LOANS AND ORDER OF MATURITY. Any voluntary prepayments pursuant
to subsection 2.4B(i) shall be applied as specified by Company in
the applicable Notice of Prepayment; PROVIDED that all such
voluntary prepayments shall, irrespective of any application
specified by Company, first be applied in the following priority
to repay any amounts owing to (i) FIRST, Swing Line Lender due to
the failure of any Revolving Lender to (A) fund a Revolving Loan
for the purpose of repaying any Refunded Swing Line Loan pursuant
to subsection 2.1A(iii)(b) or (B) purchase an assignment of an
unpaid Swing Line Loan pursuant to subsection 2.1A(iii)(c), and
(ii) SECOND, Issuing Lenders due to the failure of any Revolving
Lender to (A) fund a Revolving Loan for the purpose of repaying
any unreimbursed amounts of a drawing under a Letter of Credit
pursuant to subsection 3.3B or (B) fund a participation in any
such unreimbursed Letter of Credit drawing pursuant to subsection
3.3C; PROVIDED FURTHER that in the event Company fails to specify
the Loans to which any such prepayment shall be applied, and
funds remain after
51
being applied in accordance with this subsection 2.4B(iv)(a),
such prepayment shall be applied FIRST to repay outstanding Swing
Line Loans to the full extent thereof, SECOND to repay
outstanding Revolving Loans to the full extent thereof, and THIRD
to repay outstanding Term Loans to the full extent thereof. Any
voluntary prepayments of the Term Loans pursuant to subsection
2.4B(i) shall be applied to reduce each remaining scheduled
installment of principal of the Term Loans set forth in
subsection 2.4A on a pro rata basis (in accordance with the
respective outstanding principal amounts thereof).
(b) APPLICATION OF MANDATORY PREPAYMENTS BY TYPE OF
LOANS. Except as provided in subsection 2.4D, any amount required
to be applied as a mandatory prepayment of the Loans and/or a
reduction of the Revolving Loan Commitment Amount pursuant to
subsections 2.4B(iii)(a)-(f) shall be applied FIRST to prepay the
Term Loans to the full extent thereof, SECOND, to the extent of
any remaining portion of such amount, to prepay the Swing Line
Loans to the full extent thereof and to permanently reduce the
Revolving Loan Commitment Amount by the amount of such
prepayment, THIRD, to the extent of any remaining portion of such
amount, to prepay the Revolving Loans to the full extent thereof
and to further permanently reduce the Revolving Loan Commitment
Amount by the amount of such prepayment, FOURTH, to the extent of
any remaining portion of such amount, to further permanently
reduce the Revolving Loan Commitment Amount to the full extent
thereof and FIFTH, to the extent of any remaining portion of such
amount, to cash collateralize any outstanding Letters of Credit.
Any mandatory reduction of the Revolving Loan Commitment Amount
pursuant to this subsection 2.4B shall be in proportion to each
Revolving Lender's Pro Rata Share.
(c) APPLICATION OF MANDATORY PREPAYMENTS OF TERM LOANS
TO THE SCHEDULED INSTALLMENTS OF PRINCIPAL THEREOF. Except as
provided in subsection 2.4D, any mandatory prepayments of the
Term Loans pursuant to subsection 2.4B(iii) shall be applied to
reduce each remaining scheduled installment of principal of the
Terms Loans set forth in subsection 2.4A on a pro rata basis (in
accordance with the respective outstanding principal amounts
thereof).
(d) APPLICATION OF PREPAYMENTS TO BASE RATE LOANS AND
EURODOLLAR RATE LOANS. Considering Term Loans and Revolving Loans
being prepaid separately, any prepayment thereof shall be applied
first to Base Rate Loans to the full extent thereof before
application to Eurodollar Rate Loans, in each case in a manner
that minimizes the amount of any payments required to be made by
Company pursuant to subsection 2.6D.
C. GENERAL PROVISIONS REGARDING PAYMENTS.
(i) MANNER AND TIME OF PAYMENT. All payments by Company of
principal, interest, fees and other Obligations shall be made in Dollars in
same day funds, without defense, setoff or counterclaim, free of any
restriction or condition, and delivered to Administrative Agent not later
than 1:00 P.M. (New York City time) on the date due at
52
the Funding and Payment Account for the account of Lenders; funds received
by Administrative Agent after that time on such due date shall be deemed to
have been paid by Company on the next succeeding Business Day. Company
hereby authorizes Administrative Agent to charge its accounts with
Administrative Agent in order to cause timely payment to be made to
Administrative Agent of all principal, interest, fees and expenses due
hereunder (subject to sufficient funds being available in its accounts for
that purpose).
(ii) APPLICATION OF PAYMENTS TO PRINCIPAL AND INTEREST. Except
as provided in subsection 2.2C, all payments in respect of the principal
amount of any Loan shall include payment of accrued interest on the
principal amount being repaid or prepaid, and all such payments shall be
applied to the payment of interest before application to principal.
(iii) APPORTIONMENT OF PAYMENTS. Aggregate principal and
interest payments in respect of Term Loans and Revolving Loans shall be
apportioned among all outstanding Loans to which such payments relate, in
each case proportionately to Lenders' respective Pro Rata Shares; PROVIDED,
that all payments in respect of Loans shall first be applied in the
following priority to repay any amounts owing to (i) FIRST, Swing Line
Lender due to the failure of any Revolving Lender to (A) fund a Revolving
Loan for the purpose of repaying any Refunded Swing Line Loan pursuant to
subsection 2.1A(iii)(b) or (B) purchase an assignment of an unpaid Swing
Line Loan pursuant to subsection 2.1A(iii)(c), and (ii) SECOND, Issuing
Lenders due to the failure of any Revolving Lender to (A) fund a Revolving
Loan for the purpose of repaying any unreimbursed amounts of a drawing
under a Letter of Credit pursuant to subsection 3.3B or (B) fund a
participation in any such unreimbursed Letter of Credit drawing pursuant to
subsection 3.3C. Administrative Agent shall promptly distribute to each
Lender, at the account specified in the payment instructions set forth
below its name on the appropriate signature page hereof or at such other
account as such Lender may request in subsequent payment instructions
delivered to Administrative Agent by such Lender, its Pro Rata Share of all
such payments received by Administrative Agent and the commitment fees and
letter of credit fees of such Lender, if any, when received by
Administrative Agent pursuant to subsection 2.3 and subsection 3.2.
Notwithstanding the foregoing provisions of this subsection 2.4C(iii), if,
pursuant to the provisions of subsection 2.6C, any Notice of
Conversion/Continuation is withdrawn as to any Affected Lender or if any
Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any
Eurodollar Rate Loans, Administrative Agent shall give effect thereto in
apportioning interest payments received thereafter.
(iv) PAYMENTS ON BUSINESS DAYS. Whenever any payment to be
made hereunder shall be stated to be due on a day that is not a Business
Day, such payment shall be made on the next preceding Business Day.
(v) NOTATION OF PAYMENT. Each Lender agrees that before
disposing of any Note held by it, or any part thereof (other than by
granting participations therein), that Lender will make a notation thereon
of all Loans evidenced by that Note and all principal payments previously
made thereon and of the date to which interest thereon has been
53
paid; PROVIDED that the failure to make (or any error in the making of) a
notation of any Loan made under such Note shall not limit or otherwise
affect the obligations of Company hereunder or under such Note with respect
to any Loan or any payments of principal or interest on such Note.
D. APPLICATION OF PROCEEDS OF COLLATERAL AND PAYMENTS AFTER
EVENT OF DEFAULT.
Upon the occurrence and during the continuation of an Event of
Default, if requested by Requisite Lenders, (a) all payments received by
Administration Agent, whether from Company, from any Subsidiary Guarantor, from
Holdings or otherwise, and (b) all proceeds received by Administrative Agent in
respect of any sale of, collection from, or other realization upon all or any
part of the Collateral under any Collateral Document may, in the discretion of
Administrative Agent, be held by Administrative Agent as Collateral for, and/or
(then or at any time thereafter) applied in full or in part by Administrative
Agent, in each case in the following order of priority:
(i) to the payment of all costs and expenses of such sale,
collection or other realization, all other expenses, liabilities and
advances made or incurred by Administrative Agent in connection therewith,
and all amounts for which Administrative Agent is entitled to compensation
(including the fees described in subsection 2.3), reimbursement and
indemnification under any Loan Document and all advances made by
Administrative Agent thereunder for the account of the applicable Loan
Party, and to the payment of all costs and expenses paid or incurred by
Administrative Agent in connection with the Loan Documents, all in
accordance with subsections 9.4, 10.2 and 10.3 and the other terms of this
Agreement and the Loan Documents;
(ii) thereafter, to the payment of all other Obligations and
obligations of Loan Parties under any Lender Swap Agreement (as defined in
the Subsidiary Guaranty) for the ratable benefit of the holders thereof
(subject to the provisions of subsection 2.4C(ii) and subsection 2.4C(iii)
hereof); and
(iii) thereafter, to the payment to or upon the order of such
Loan Party or to whosoever may be lawfully entitled to receive the same or
as a court of competent jurisdiction may direct.
2.5 USE OF PROCEEDS.
A. TERM LOANS. The proceeds of the Term Loans and the
proceeds of the debt and equity capitalization of Company described in
subsection 4.1P, shall be applied by Company to fund the Merger Financing
Requirements.
B. REVOLVING LOANS; SWING LINE LOANS. The proceeds of any
Revolving Loans and any Swing Line Loans shall be applied by Company for working
capital and other general corporate purposes, which may include the making of
intercompany loans to any of Company's wholly-owned Subsidiaries, in accordance
with subsection 7.1(iv), for their own general corporate purposes.
54
C. MARGIN REGULATIONS. No portion of the proceeds of any
borrowing under this Agreement shall be used by Company or any of its
Subsidiaries in any manner that might cause the borrowing or the application of
such proceeds to violate Regulation U, Regulation T or Regulation X of the Board
of Governors of the Federal Reserve System or any other regulation of such Board
or to violate the Exchange Act, in each case as in effect on the date or dates
of such borrowing and such use of proceeds.
2.6 SPECIAL PROVISIONS GOVERNING EURODOLLAR RATE LOANS.
Notwithstanding any other provision of this Agreement to the
contrary, the following provisions shall govern with respect to Eurodollar Rate
Loans as to the matters covered:
A. DETERMINATION OF APPLICABLE INTEREST RATE. On each
Interest Rate Determination Date, Administrative Agent shall determine in
accordance with the terms of this Agreement (which determination shall, absent
manifest error, be conclusive and binding upon all parties) the interest rate
that shall apply to the Eurodollar Rate Loans for which an interest rate is then
being determined for the applicable Interest Period and shall promptly give
notice thereof (in writing or by telephone confirmed in writing) to Company and
each applicable Lender.
B. INABILITY TO DETERMINE APPLICABLE INTEREST RATE. In the
event that Administrative Agent shall have determined (which determination shall
be conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date that by reason of circumstances affecting the London
interbank market adequate and fair means do not exist for ascertaining the
interest rate applicable to such Loans on the basis provided for in the
definition of Eurodollar Rate, Administrative Agent shall on such date give
notice (by telefacsimile or by telephone confirmed in writing) to Company and
each Lender of such determination, whereupon (i) no Loans may be made as, or
converted to, Eurodollar Rate Loans until such time as Administrative Agent
notifies Company and Lenders that the circumstances giving rise to such notice
no longer exist and (ii) any Notice of Borrowing or Notice of
Conversion/Continuation given by Company with respect to the Loans in respect of
which such determination was made shall be deemed to be for a Base Rate Loan.
C. ILLEGALITY OR IMPRACTICABILITY OF EURODOLLAR RATE LOANS.
In the event that on any date any Lender shall have reasonably determined (which
determination shall be conclusive and binding upon all parties hereto but shall
be made only after consultation with Company and Administrative Agent) that the
making, maintaining or continuation of its Eurodollar Rate Loans (i) has become
unlawful as a result of compliance by such Lender in good faith with any law,
treaty, governmental rule, regulation, guideline or order (or would conflict
with any such treaty, governmental rule, regulation, guideline or order not
having the force of law even though the failure to comply therewith would not be
unlawful) or (ii) has become impracticable, or would cause such Lender material
hardship, as a result of contingencies occurring after the date of this
Agreement which materially and adversely affect the London interbank market or
the position of such Lender in that market, then, and in any such event, such
Lender shall be an "AFFECTED LENDER" and it shall on that day give notice (by
telefacsimile or by telephone confirmed in writing) to Company and
Administrative Agent of such determination. Administrative Agent shall promptly
notify each other Lender of the receipt of such notice.
55
Thereafter (a) the obligation of the Affected Lender to make Loans as, or to
convert Loans to, Eurodollar Rate Loans shall be suspended until such notice
shall be withdrawn by the Affected Lender, (b) to the extent such determination
by the Affected Lender relates to a Eurodollar Rate Loan then being requested by
Company pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, the Affected Lender shall make such Loan as (or convert
such Loan to, as the case may be) a Base Rate Loan, (c) the Affected Lender's
obligation to maintain its outstanding Eurodollar Rate Loans (the "AFFECTED
LOANS") shall be terminated at the earlier to occur of the expiration of the
Interest Period then in effect with respect to the Affected Loans or when
required by law, and (d) the Affected Loans shall automatically convert into
Base Rate Loans on the date of such termination. Notwithstanding the foregoing,
to the extent a determination by an Affected Lender as described above relates
to a Eurodollar Rate Loan then being requested by Company pursuant to a Notice
of Borrowing or a Notice of Conversion/Continuation, Company shall have the
option, subject to the provisions of subsection 2.6D, to rescind such Notice of
Borrowing or Notice of Conversion/Continuation as to all Lenders by giving
notice (by telefacsimile or by telephone confirmed in writing) to Administrative
Agent of such rescission on the date on which the Affected Lender gives notice
of its determination as described above. Administrative Agent shall promptly
notify each other Lender of the receipt of such notice. Except as provided in
the immediately preceding sentence, nothing in this subsection 2.6C shall affect
the obligation of any Lender other than an Affected Lender to make or maintain
Loans as, or to convert Loans to, Eurodollar Rate Loans in accordance with the
terms of this Agreement.
D. COMPENSATION FOR BREAKAGE OR NON-COMMENCEMENT OF INTEREST
PERIODS. Company shall compensate each Lender, upon written request by that
Lender pursuant to subsection 2.8, for all reasonable losses, expenses and
liabilities (including any interest paid by that Lender to lenders of funds
borrowed by it to make or carry its Eurodollar Rate Loans and any loss, expense
or liability sustained by that Lender in connection with the liquidation or
re-employment of such funds) which that Lender may sustain: (i) if for any
reason (other than a default by that Lender) a borrowing of any Eurodollar Rate
Loan does not occur on a date specified therefor in a Notice of Borrowing or a
telephonic request therefor, or a conversion to or continuation of any
Eurodollar Rate Loan does not occur on a date specified therefor in a Notice of
Conversion/Continuation or a telephonic request therefor, (ii) if any prepayment
or other principal payment or any conversion of any of its Eurodollar Rate Loans
(including any prepayment or conversion occasioned by the circumstances
described in subsection 2.6C) occurs on a date prior to the last day of an
Interest Period applicable to that Loan, (iii) if any prepayment of any of its
Eurodollar Rate Loans is not made on any date specified in a Notice of
Prepayment given by Company, or (iv) as a consequence of any other default by
Company in the repayment of its Eurodollar Rate Loans when required by the terms
of this Agreement.
E. BOOKING OF EURODOLLAR RATE LOANS. Any Lender may make,
carry or transfer Eurodollar Rate Loans at, to, or for the account of any of its
branch offices or the office of an Affiliate of that Lender.
F. ASSUMPTIONS CONCERNING FUNDING OF EURODOLLAR RATE LOANS.
Calculation of all amounts payable to a Lender under this subsection 2.6 and
under subsection 2.7A shall be made as though that Lender had funded each of its
Eurodollar Rate Loans through the purchase of a Eurodollar deposit bearing
interest at the rate obtained pursuant to clause (i) of
56
the definition of Eurodollar Rate in an amount equal to the amount of such
Eurodollar Rate Loan and having a maturity comparable to the relevant Interest
Period, whether or not its Eurodollar Rate Loans had been funded in such manner.
G. EURODOLLAR RATE LOANS AFTER DEFAULT. If, after the
occurrence of and during the continuation of a Potential Event of Default or an
Event of Default, Administrative Agent or Requisite Lenders have determined in
its or their sole discretion not to permit the making or continuation of any
Loans as, or the conversion of any Loans to Eurodollar Rate Loans and
Administrative Agent has so notified Company in writing, (i) Company may not
elect to have a Loan be made or maintained as, or converted to, a Eurodollar
Rate Loan after the expiration of any Interest Period then in effect for that
Loan and (ii) subject to the provisions of subsection 2.6D, any Notice of
Borrowing or Notice of Conversion/Continuation given by Company with respect to
a requested borrowing or conversion/continuation that has not yet occurred shall
be deemed to be for a Base Rate Loan or, if the conditions to making a Loan set
forth in subsection 4.2 cannot then be satisfied, to be rescinded by Company.
2.7 INCREASED COSTS; TAXES; CAPITAL ADEQUACY.
A. COMPENSATION FOR INCREASED COSTS. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender (including any Issuing
Lender) shall determine (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto) that any law, treaty
or governmental rule, regulation or order, or any change therein or in the
interpretation, administration or application thereof (including the
introduction of any new law, treaty or governmental rule, regulation or order),
or any determination of a court or other Government Authority, in each case that
becomes effective after the date hereof, or compliance by such Lender with any
guideline, request or directive issued or made after the date hereof by any
central bank or other Government Authority (whether or not having the force of
law):
(i) subjects such Lender to any additional Tax with respect
to this Agreement or any of its obligations hereunder (including with
respect to issuing or maintaining any Letters of Credit or purchasing or
maintaining any participations therein or maintaining any Commitment
hereunder) or any payments to such Lender of principal, interest, fees or
any other amount payable hereunder;
(ii) imposes, modifies or holds applicable any reserve,
special deposit, compulsory loan, insurance charge or similar requirement
against assets held by, or deposits or other liabilities in or for the
account of, or advances or loans by, or other credit extended by, or any
other acquisition of funds by, any office of such Lender (other than any
such reserve or other requirements with respect to Eurodollar Rate Loans
that are reflected in the definition of Eurodollar Rate); or
(iii) imposes any other condition (other than with respect to
Taxes) on or affecting such Lender or its obligations hereunder or the
London interbank market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining its Loans or Commitments or agreeing to
issue, issuing or maintaining
57
any Letter of Credit or agreeing to purchase, purchasing or maintaining any
participation therein or to reduce any amount received or receivable by such
Lender with respect thereto; then, in any such case, Company shall promptly pay
to such Lender, upon receipt of the statement referred to in subsection 2.8A,
such additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder and any Tax incurred or payable by such Lender as a result of the
obligation of Company to pay such additional amounts.
B. TAXES.
(i) PAYMENTS TO BE FREE AND CLEAR. Except as otherwise
provided in this Agreement, all sums payable by Company under this
Agreement and the other Loan Documents shall be paid free and clear of, and
without any deduction or withholding on account of, any Tax imposed,
levied, collected, withheld or assessed by or within the United States of
America or any political subdivision in or of the United States of America
or any other jurisdiction from or to which a payment is made by or on
behalf of Company or by any federation or organization of which the United
States of America or any such jurisdiction is a member at the time of
payment.
(ii) GROSSING-UP OF PAYMENTS. If Company or any other Person
is required by law to make any deduction or withholding on account of any
such Tax from any sum paid or payable by Company to Administrative Agent or
any Lender under any of the Loan Documents:
(a) Company shall notify Administrative Agent of any
such requirement or any change in any such requirement as soon as
Company becomes aware of it;
(b) Company shall pay any such Tax when such Tax is due,
such payment to be made (if the liability to pay is imposed on
Company) for its own account or (if that liability is imposed on
Administrative Agent or such Lender, as the case may be) on
behalf of and in the name of Administrative Agent or such Lender;
(c) the sum payable by Company in respect of which the
relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the
making of that deduction, withholding or payment, Administrative
Agent or such Lender, as the case may be, receives on the due
date a net sum equal to what it would have received had no such
deduction, withholding or payment been required or made; and
(d) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within
30 days after the due date of payment of any Tax which it is
required by clause (b) above to pay, Company shall deliver to
Administrative Agent evidence reasonably satisfactory to the
other
58
affected parties of such deduction, withholding or payment and of
the remittance thereof to the relevant taxing or other authority;
PROVIDED that no such additional amount shall be required to be paid to any
Lender under clause (c) above except to the extent that any change after
the date on which such Lender became a Lender in any such requirement for a
deduction, withholding or payment as is mentioned therein shall result in
an increase in the rate of such deduction, withholding or payment from that
in effect on the date on which such Lender became a Lender, in respect of
payments to such Lender.
(iii) EVIDENCE OF EXEMPTION FROM U.S. WITHHOLDING TAX.
(a) Each Non-US Lender shall deliver to Administrative
Agent and to Company, and Administrative Agent shall deliver to
Company if a payment to Administrative Agent hereunder is treated
as a payment to a Person that is not a "United States person" (as
defined in Section 7701(a)(30) of the Internal Revenue Code), on
or prior to the Closing Date (in the case of each Lender listed
on the signature pages hereof) or on or prior to the date of the
Assignment Agreement pursuant to which it becomes a Lender (in
the case of each other Lender), and at such other times as may be
necessary in the determination of Company or Administrative Agent
(each in the reasonable exercise of its discretion), two original
copies of Internal Revenue Service Form W-8BEN or W-8ECI (or any
successor forms) properly completed and duly executed by such
Lender, or, in the case of a Non-US Lender claiming exemption
from United States federal withholding tax under Section 871(h)
or 881(c) of the Internal Revenue Code with respect to payments
of "portfolio interest", a Form W-8BEN, and a certificate of such
Lender certifying that such Lender is not (i) a "bank" for
purposes of Section 881(c) of the Internal Revenue Code, (ii) a
ten-percent shareholder (within the meaning of Section
871(h)(3)(B) of the Internal Revenue Code) of Company or Holdings
or (iii) a controlled foreign corporation related to Company
(within the meaning of Section 864(d)(4) of the Internal Revenue
Code), in each case together with any other certificate or
statement of exemption required under the Internal Revenue Code
or the regulations issued thereunder to establish that such
Lender is not subject to, or is subject to a reduced rate of,
United States withholding tax with respect to any payments to
such Lender of interest payable under any of the Loan Documents.
(b) Each Non-US Lender, to the extent it does not act or
ceases to act for its own account with respect to any portion of
any sums paid or payable to such Lender under any of the Loan
Documents (for example, in the case of a typical participation by
such Lender), shall deliver to Administrative Agent and to
Company, on or prior to the Closing Date (in the case of each
Lender listed on the signature pages hereof), on or prior to the
date of the Assignment Agreement pursuant to which it becomes a
Lender (in the case of each other Lender), or on such later date
when such Lender ceases to act for its own account with respect
to any portion of any such sums paid or payable, and at such
other times as may be necessary in the determination of Company
or Administrative Agent (each in the
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reasonable exercise of its discretion), (1) two original copies
of the forms or statements required to be provided by such Lender
under subsection 2.7B(iii)(a), properly completed and duly
executed by such Lender, to establish the portion of any such
sums paid or payable with respect to which such Lender acts for
its own account that is not subject to United States withholding
tax, and (2) two original copies of Internal Revenue Service Form
W-8IMY (or any successor forms) properly completed and duly
executed by such Lender, together with any information, if any,
such Lender chooses to transmit with such form, and any other
certificate or statement of exemption required under the Internal
Revenue Code or the regulations issued thereunder, to establish
that such Lender is not acting for its own account with respect
to a portion of any such sums payable to such Lender.
(c) Each Non-US Lender hereby agrees, from time to time
after the initial delivery by such Lender of such forms, whenever
a lapse in time or change in circumstances renders such forms,
certificates or other evidence so delivered obsolete or
inaccurate in any material respect, that such Lender shall
promptly (1) deliver to Administrative Agent and to Company two
original copies of renewals, amendments or additional or
successor forms, properly completed and duly executed by such
Lender, together with any other certificate or statement of
exemption required in order to confirm or establish that such
Lender is not subject to United States withholding tax with
respect to payments to such Lender under the Loan Documents and,
if applicable, that such Lender does not act for its own account
with respect to any portion of such payment, or (2) notify
Administrative Agent and Company of its inability to deliver any
such forms, certificates or other evidence.
(d) Company shall not be required to pay any additional
amount to any Non-US Lender under clause (c) of subsection
2.7B(ii), (1) with respect to any Tax required to be deducted or
withheld on the basis of the information, certificates or
statements of exemption such Lender chooses to transmit with an
Internal Revenue Service Form W-8IMY pursuant to subsection
2.7B(iii)(b)(2) or (2) if such Lender shall have failed to
satisfy the requirements of clause (a), (b) or (c)(1) of this
subsection 2.7B(iii); PROVIDED that (i) notwithstanding anything
to the contrary in subsection 2.7B(iii)(d)(1), Company shall be
required to pay additional amounts with respect to payments
beneficially owned by Participants entitled to the benefits of
subsection 2.7 as though such Participants were Lenders and (ii)
if a Lender shall have satisfied the requirements of subsection
2.7B(iii)(a) on the date such Lender became a Lender, nothing in
this subsection 2.7B(iii)(d) shall relieve Company of its
obligation to pay any amounts pursuant to subsection 2.7B(ii)(c)
in the event that, as a result of any change in any applicable
law, treaty or governmental rule, regulation or order, or any
change in the interpretation, administration or application
thereof, such Lender is no longer properly entitled to deliver
forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender is not subject to
withholding as described in subsection 2.7B(iii)(a).
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(e) Company shall not be required to pay any additional
amount to Lender that is not a Non-U.S. Lender under clause (c)
of subsection 2.7B(ii) if such Lender does not provide prior to
or on the Closing Date (or on or prior to the date it becomes a
party to this Agreement) to Administrative Agent and Company a
properly completed and executed IRS Form W-9 (certifying that
such Lender is not subject to United States backup withholding
tax) or any successor form. Solely for purposes of this
subsection 2.7B(iii)(e), a Lender shall not include a Lender that
may be treated as an exempt recipient based on the indicators
described in Treasury Regulation Section 1.6049-4(c)(l)(ii).
C. CAPITAL ADEQUACY ADJUSTMENT. If any Lender shall have
determined that the adoption, effectiveness, phase-in or applicability after the
date hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any Government Authority charged with the
interpretation or administration thereof, or compliance by any Lender with any
guideline, request or directive regarding capital adequacy (whether or not
having the force of law) of any such Government Authority, has or would have the
effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of, or with reference to,
such Lender's Loans or Commitments or Letters of Credit or participations
therein or other obligations hereunder with respect to the Loans or the Letters
of Credit to a level below that which such Lender or such controlling
corporation could have achieved but for such adoption, effectiveness, phase-in,
applicability, change or compliance (taking into consideration the policies of
such Lender or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt by Company from
such Lender of the statement referred to in subsection 2.8A, Company shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or such controlling corporation for such reduction, increased to the extent
necessary to take into account any Tax incurred or payable by such Lender as a
result of the obligation of Company to pay such additional amounts.
2.8 STATEMENT OF LENDERS; OBLIGATION OF LENDERS AND ISSUING LENDERS
TO MITIGATE.
A. STATEMENTS. Each Lender claiming compensation or
reimbursement pursuant to subsection 2.6D, 2.7 or 2.8B shall deliver to Company
(with a copy to Administrative Agent) a written statement, setting forth in
reasonable detail the basis of the calculation of such compensation or
reimbursement, which statement shall be conclusive and binding upon all parties
hereto absent manifest error. In the event such written statement is given by
such Lender more than 180 days after such Lender has knowledge of the occurrence
or existence of the event or circumstance that entitled such Lender to provide
such written statement, such Lender shall not be entitled to receive any
compensation or reimbursement under subsection 2.6D or 2.7, as the case may be,
in respect of the period ending 180 days preceding the date on which such
written statement is given to Company.
B. MITIGATION. Each Lender and Issuing Lender agrees that,
as promptly as practicable after the officer of such Lender or Issuing Lender
responsible for administering the Loans or Letters of Credit of such Lender or
Issuing Lender, as the case may be, becomes aware of the occurrence of an event
or the existence of a condition that would cause such Lender to
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become an Affected Lender or that would entitle such Lender or Issuing Lender to
receive payments under subsection 2.7, it will use reasonable efforts to make,
issue, fund or maintain the Commitments of such Lender or the Loans or Letters
of Credit of such Lender or Issuing Lender through another lending or letter of
credit office of such Lender or Issuing Lender, if (i) as a result thereof the
circumstances which would cause such Lender to be an Affected Lender would cease
to exist or the additional amounts which would otherwise be required to be paid
to such Lender or Issuing Lender pursuant to subsection 2.7 would be materially
reduced and (ii) as determined by such Lender or Issuing Lender in its sole
discretion, such action would not otherwise be disadvantageous to such Lender or
Issuing Lender; PROVIDED that such Lender or Issuing Lender will not be
obligated to utilize such other lending or letter of credit office pursuant to
this subsection 2.8B unless Company agrees to pay all incremental expenses
incurred by such Lender or Issuing Lender as a result of utilizing such other
lending or letter of credit office as described above.
2.9 REPLACEMENT OF A LENDER.
If Company receives a statement of amounts due pursuant to
subsection 2.8A from a Lender, a Revolving Lender defaults in its obligations to
fund a Revolving Loan pursuant to this Agreement, a Lender (a "NON-CONSENTING
LENDER") refuses to consent to an amendment, modification or waiver of this
Agreement that, pursuant to subsection 10.6, requires consent of 100% of Lenders
or 100% of Lenders with Obligations directly affected or a Lender becomes an
Affected Lender (any such Lender, a "SUBJECT LENDER"), so long as (i) no
Potential Event of Default or Event of Default shall have occurred and be
continuing and Company has obtained a commitment from another Lender or an
Eligible Assignee to purchase at par the Subject Lender's Loans and assume the
Subject Lender's Commitments and all other obligations of the Subject Lender
hereunder, (ii) such Lender is not an Issuing Lender with respect to any Letters
of Credit outstanding (unless all such Letters of Credit are terminated or
arrangements acceptable to such Issuing Lender (such as a "back-to-back" letter
of credit) are made) and (iii), if applicable, the Subject Lender is unwilling
to withdraw the notice delivered to Company pursuant to subsection 2.8 and/or is
unwilling to remedy its default upon 10 days prior written notice to the Subject
Lender and Administrative Agent, Company may require the Subject Lender to
assign all of its Loans and Commitments to such other Lender, Lenders, Eligible
Assignee or Eligible Assignees pursuant to the provisions of subsection 10.1B;
PROVIDED that, prior to or concurrently with such replacement, (1) the Subject
Lender shall have received payment in full of all principal, interest, fees and
other amounts (including all amounts under subsections 2.6D, 2.7 and/or 2.8B (if
applicable)) through such date of replacement and a release from its obligations
under the Loan Documents, (2) all of the requirements for such assignment
contained in subsection 10.1B, excluding payment of the processing fee otherwise
required thereby, but including, without limitation, the consent of
Administrative Agent (if required) and the receipt by Administrative Agent of an
Assignment Agreement executed by the assignee (Administrative Agent being hereby
authorized to execute any Assignment Agreement on behalf of a Subject Lender
relating to the assignment of Loans and/or Commitments of such Subject Lender)
and other supporting documents, have been fulfilled, and (3) in the event such
Subject Lender is a Non-Consenting Lender, each assignee shall consent, at the
time of such assignment, to each matter in respect of which such Subject Lender
was a Non-Consenting Lender and Company also requires each other Subject Lender
that is a Non-Consenting Lender to assign its Loans and Commitments. For the
avoidance of doubt, if a Lender is a Non-Consenting Lender
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solely because it refused to consent to an amendment, modification or waiver
that required the consent of 100% of Lenders with Obligations directly affected
thereby (which amendment, modification or waiver did not accordingly require the
consent of 100% of all Lenders) the Loans and Commitments of such Non-Consenting
Lender that are subject to the assignments required by this subsection 2.9 shall
include only those Loans and Commitments that constitute the Obligations
directly affected by the amendment, modification or waiver to which such
Non-Consenting Lender refused to provide its consent.
SECTION 3. LETTERS OF CREDIT
3.1 ISSUANCE OF LETTERS OF CREDIT AND LENDERS' PURCHASE OF
PARTICIPATIONS THEREIN.
A. LETTERS OF CREDIT. In addition to Company requesting that
Lenders make Loans pursuant to subsection 2.1A, Company may request, in
accordance with the provisions of this subsection 3.1, from time to time during
the period from the Closing Date to but excluding the 30th day prior to the
Revolving Loan Commitment Termination Date, that one or more Revolving Lenders
issue Letters of Credit payable on a sight basis for the account of Company for
the purposes specified in the definitions of Commercial Letters of Credit and
Standby Letters of Credit. Subject to the terms and conditions of this Agreement
and in reliance upon the representations and warranties of Company herein set
forth, any one or more Lenders may, but (except as provided in subsection
3.1B(ii)) shall not be obligated to, issue such Letters of Credit in accordance
with the provisions of this subsection 3.1; PROVIDED that Company shall not
request that any Revolving Lender issue (and no Revolving Lender shall issue):
(i) any Letter of Credit if, after giving effect to such
issuance, the Total Utilization of Revolving Loan Commitments would exceed
the Revolving Loan Commitment Amount then in effect;
(ii) any Letter of Credit if, after giving effect to such
issuance, the Letter of Credit Usage would exceed $15,000,000;
(iii) any Standby Letter of Credit having an expiration date
later than the earlier of (a) ten days prior to the Revolving Loan
Commitment Termination Date and (b) the date which is one year from the
date of issuance of such Standby Letter of Credit; PROVIDED that the
immediately preceding clause (b) shall not prevent any Issuing Lender from
agreeing that a Standby Letter of Credit will automatically be extended for
one or more successive periods not to exceed one year each unless such
Issuing Lender elects not to extend for any such additional period; and
PROVIDED, FURTHER that such Issuing Lender shall elect not to extend such
Standby Letter of Credit if it has knowledge that an Event of Default has
occurred and is continuing (and has not been waived in accordance with
subsection 10.6) at the time such Issuing Lender must elect whether or not
to allow such extension;
(iv) any Standby Letter of Credit issued for the purpose of
supporting (a) trade payables or (b) any Indebtedness constituting
"antecedent debt" (as that term is used in Section 547 of the Bankruptcy
Code);
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(v) any Commercial Letter of Credit having an expiration date
(a) later than the earlier of (1) the date which is 30 days prior to the
Revolving Loan Commitment Termination Date and (2) the date which is 180
days from the date of issuance of such Commercial Letter of Credit or (b)
that is otherwise unacceptable to the applicable Issuing Lender in its
reasonable discretion; or
(vi) any Letter of Credit denominated in a currency other than
Dollars or Canadian dollars that in the reasonable judgment of
Administrative Agent or the applicable Issuing Lender is not readily and
freely available.
B. MECHANICS OF ISSUANCE.
(i) REQUEST FOR ISSUANCE. Whenever Company desires the
issuance of a Letter of Credit, it shall deliver to Administrative Agent a
Request for Issuance no later than 12:00 Noon (New York City time) at least
three Business Days (in the case of Standby Letters of Credit) or five
Business Days (in the case of Commercial Letters of Credit), or in each
case such shorter period as may be agreed to by the Issuing Lender in any
particular instance, in advance of the proposed date of issuance. The
Issuing Lender, in its reasonable discretion, may require changes in the
text of the proposed Letter of Credit or any documents described in or
attached to the Request for Issuance. In furtherance of the provisions of
subsection 10.8, and not in limitation thereof, Company may submit Requests
for Issuance by telefacsimile and Administrative Agent and Issuing Lenders
may rely and act upon any such Request for Issuance without receiving an
original signed copy thereof. No Letter of Credit shall require payment
against a conforming demand for payment to be made thereunder on the same
business day (under the laws of the jurisdiction in which the office of the
Issuing Lender to which such demand for payment is required to be presented
is located) that such demand for payment is presented if such presentation
is made after 10:00 A.M. (in the time zone of such office of the Issuing
Lender) on such business day.
Company shall notify the applicable Issuing Lender (and
Administrative Agent, if Administrative Agent is not such Issuing Lender)
prior to the issuance of any Letter of Credit in the event that any of the
matters to which Company is required to certify in the applicable Request
for Issuance is no longer true and correct as of the proposed date of
issuance of such Letter of Credit, and upon the issuance of any Letter of
Credit Company shall be deemed to have re-certified, as of the date of such
issuance, as to the matters to which Company is required to certify in the
applicable Request for Issuance.
Notwithstanding the foregoing, the Existing Letters of Credit
shall be deemed issued on the Closing Date and shall be subject to the
terms and conditions of this Agreement.
(ii) DETERMINATION OF ISSUING LENDER. Upon receipt by
Administrative Agent of a Request for Issuance pursuant to subsection
3.1B(i) requesting the issuance of a Letter of Credit, in the event
Administrative Agent elects to issue such Letter of Credit, Administrative
Agent shall promptly so notify Company, and Administrative Agent shall be
the Issuing Lender with respect thereto. In the event that Administrative
Agent, in its
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sole discretion, elects not to issue such Letter of Credit, Administrative
Agent shall promptly so notify Company, whereupon Company may request any
other Revolving Lender to issue such Letter of Credit by delivering to such
Revolving Lender a copy of the applicable Request for Issuance. Any
Revolving Lender so requested to issue such Letter of Credit shall promptly
notify Company and Administrative Agent whether or not, in its sole
discretion, it has elected to issue such Letter of Credit, and any such
Revolving Lender that so elects to issue such Letter of Credit shall be the
Issuing Lender with respect thereto. In the event that all other Revolving
Lenders shall have declined to issue such Letter of Credit, notwithstanding
the prior election of Administrative Agent not to issue such Letter of
Credit, Administrative Agent shall be obligated to issue such Letter of
Credit and shall be the Issuing Lender with respect thereto,
notwithstanding the fact that the Letter of Credit Usage with respect to
such Letter of Credit and with respect to all other Letters of Credit
issued by Administrative Agent, when aggregated with Administrative Agent's
outstanding Revolving Loans and Swing Line Loans, may exceed Administrative
Agent's Revolving Loan Commitment then in effect.
(iii) ISSUANCE OF LETTER OF CREDIT. Upon satisfaction or waiver
(in accordance with subsection 10.6) of the conditions set forth in
subsection 4.3, the Issuing Lender shall issue the requested Letter of
Credit in accordance with the Issuing Lender's standard operating
procedures.
(iv) NOTIFICATION TO REVOLVING LENDERS. Upon the issuance of
or amendment to any Standby Letter of Credit the applicable Issuing Lender
shall promptly notify Administrative Agent and Company of such issuance or
amendment in writing. Upon receipt of such notice (or, if Administrative
Agent is the Issuing Lender, together with such notice), Administrative
Agent shall notify each Revolving Lender in writing of such issuance or
amendment and the amount of such Revolving Lender's respective
participation in such Standby Letter of Credit or amendment, and, if so
requested by a Revolving Lender, Administrative Agent shall provide such
Lender with a copy of such Letter of Credit or amendment. In the case of
Commercial Letters of Credit, in the event that Issuing Lender is other
than Administrative Agent, such Issuing Lender will send by facsimile
transmission to Administrative Agent, promptly upon the first Business Day
of each week, a report of its daily aggregate maximum amount available for
drawing under Commercial Letters of Credit for the previous week.
Administrative Agent shall notify each Revolving Lender in writing on a
quarterly basis of the contents thereof.
C. REVOLVING LENDERS' PURCHASE OF PARTICIPATIONS IN LETTERS
OF CREDIT. Immediately upon the issuance of each Letter of Credit, each
Revolving Lender shall be deemed to, and hereby agrees to, have irrevocably
purchased from the Issuing Lender a participation in such Letter of Credit and
any drawings honored thereunder in an amount equal to such Revolving Lender's
Pro Rata Share of the maximum amount that is or at any time may become available
to be drawn thereunder.
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3.2 LETTER OF CREDIT FEES.
Company agrees to pay the following amounts with respect to
Letters of Credit issued hereunder:
(i) with respect to each Standby Letter of Credit, (a) a
fronting fee, payable directly to the applicable Issuing Lender for its own
account, equal to a percentage per annum to be agreed upon by the Issuing
Lender and Company multiplied by the daily amount available to be drawn
under such Standby Letter of Credit and (b) a letter of credit fee, payable
to Administrative Agent for the account of Revolving Lenders, equal to the
applicable Eurodollar Rate Margin for Revolving Loans PLUS, upon the
application of increased interest pursuant to subsection 2.2E, 2% per annum
multiplied by the daily amount available to be drawn under such Standby
Letter of Credit, each such fronting fee or letter of credit fee to be
payable in arrears on and to (but excluding) the last Business Day of each
of March, June, September and December of each year and computed on the
basis of a 360-day year for the actual number of days elapsed;
(ii) with respect to each Commercial Letter of Credit, (a) a
fronting fee, payable directly to the applicable Issuing Lender for its own
account, equal to a percentage per annum to be agreed upon by the Issuing
Lender and Company PLUS, upon the application of increased interest
pursuant to subsection 2.2E, 2% per annum multiplied by the daily amount
available to be drawn under such Commercial Letter of Credit and (b) a
letter of credit fee, payable to Administrative Agent for the account of
Revolving Lenders, equal to the applicable Eurodollar Rate Margin for
Revolving Loans PLUS, upon the application of increased interest pursuant
to subsection 2.2E, 2% per annum multiplied by the daily amount available
to be drawn under such Commercial Letter of Credit, each such fronting fee
or letter of credit fee to be payable in arrears on and to (but excluding)
the last Business Day of each of March, June, September and December of
each year and computed on the basis of a 360-day year for the actual number
of days elapsed; and
(iii) with respect to the issuance, amendment or transfer of
each Letter of Credit and each payment of a drawing made thereunder
(without duplication of the fees payable under clauses (i) and (ii) above),
documentary and processing charges payable directly to the applicable
Issuing Lender for its own account in accordance with such Issuing Lender's
standard schedule for such charges in effect at the time of such issuance,
amendment, transfer or payment, as the case may be.
For purposes of calculating any fees payable under clauses (i) and (ii) of this
subsection 3.2, (1) the daily amount available to be drawn under any Letter of
Credit shall be determined as of the close of business on any date of
determination and (2) any amount described in such clauses that is denominated
in a currency other than Dollars shall be valued based on the applicable
Exchange Rate for such currency as of the applicable date of determination (such
date to be determined at the discretion of Administrative Agent and/or the
applicable Issuing Lender). Promptly upon receipt by Administrative Agent of any
amount described in clause (i)(b) or clause (ii)(b) of this subsection 3.2,
Administrative Agent shall distribute to each Revolving Lender its Pro Rata
Share of such amount.
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3.3 DRAWINGS AND REIMBURSEMENT OF AMOUNTS PAID UNDER LETTERS OF
CREDIT; CASH COLLATERALIZATION.
A. RESPONSIBILITY OF ISSUING LENDER WITH RESPECT TO
DRAWINGS. In determining whether to honor any drawing under any Letter of Credit
by the beneficiary thereof, the Issuing Lender shall be responsible only to
examine the documents delivered under such Letter of Credit with reasonable care
so as to ascertain whether they appear on their face to be in accordance with
the terms and conditions of such Letter of Credit.
B. REIMBURSEMENT BY COMPANY OF AMOUNTS PAID UNDER LETTERS OF
CREDIT. In the event an Issuing Lender has determined to honor a drawing under a
Letter of Credit issued by it, such Issuing Lender shall immediately notify
Company and Administrative Agent, and Company shall reimburse such Issuing
Lender on or before the Business Day immediately following the date on which
such drawing is honored (the "REIMBURSEMENT DATE") in an amount in Dollars
(which amount, in the case of a payment under a Letter of Credit which is
denominated in a currency other than Dollars, shall be calculated by reference
to the applicable Exchange Rate) or, at the option of such Issuing Lender, in
the case of a Letter of Credit denominated in a currency other than Dollars, in
such other currency, and in same day funds equal to the amount of such payment;
PROVIDED that, anything contained in this Agreement to the contrary
notwithstanding, (i) unless Company shall have notified Administrative Agent and
such Issuing Lender prior to 12:00 Noon (New York City time) on the date such
drawing is honored that Company intends to reimburse such Issuing Lender for the
amount of such payment with funds other than the proceeds of Revolving Loans,
Company shall be deemed to have given a timely Notice of Borrowing to
Administrative Agent requesting Revolving Lenders to make Revolving Loans that
are Base Rate Loans on the Reimbursement Date in an amount in Dollars (which
amount, in the case of a payment under a Letter of Credit which is denominated
in a currency other than Dollars, shall be calculated by reference to the
applicable Exchange Rate) equal to the amount of such payment and (ii) subject
to satisfaction or waiver of the conditions specified in subsection 4.2B,
Revolving Lenders shall, on the Reimbursement Date, make Revolving Loans that
are Base Rate Loans in the amount of such payment, the proceeds of which shall
be applied directly by Administrative Agent to reimburse such Issuing Lender for
the amount of such payment; and PROVIDED, FURTHER that if for any reason
proceeds of Revolving Loans are not received by such Issuing Lender on the
Reimbursement Date in an amount equal to the amount of such payment, Company
shall reimburse such Issuing Lender, on demand, in an amount in same day funds
equal to the excess of the amount of such payment over the aggregate amount of
such Revolving Loans, if any, which are so received. Nothing in this subsection
3.3B shall be deemed to relieve any Revolving Lender from its obligation to make
Revolving Loans on the terms and conditions set forth in this Agreement, and
Company shall retain any and all rights it may have against any Revolving Lender
resulting from the failure of such Revolving Lender to make such Revolving Loans
under this subsection 3.3B.
C. PAYMENT BY LENDERS OF UNREIMBURSED AMOUNTS PAID UNDER
LETTERS OF CREDIT.
(i) PAYMENT BY REVOLVING LENDERS. In the event that Company
shall fail for any reason to reimburse any Issuing Lender as provided in
subsection 3.3B in an amount (calculated, in the case of a payment under a
Letter of Credit denominated in a currency
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other than Dollars, by reference to the applicable Exchange Rate) equal to
the amount of any payment by such Issuing Lender under a Letter of Credit
issued by it, such Issuing Lender shall promptly notify Administrative
Agent, who shall notify each other Revolving Lender of the unreimbursed
amount of such honored drawing and of such other Revolving Lender's
respective participation therein based on such Revolving Lender's Pro Rata
Share. Each Revolving Lender (other than such Issuing Lender) shall make
available to Administrative Agent an amount equal to its respective
participation, in Dollars and in same day funds, at the Funding and Payment
Account, not later than 12:00 Noon (New York City time) on the first
Business Day after the date notified by Administrative Agent and
Administrative Agent shall make available to such Issuing Lender in Dollars
in same day funds, at the office of such Issuing Lender on such Business
Day, the aggregate amount of the participation payments so received by
Administrative Agent. In the event that any Revolving Lender fails to make
available to Administrative Agent on such Business Day the amount of such
Revolving Lender's participation in such Letter of Credit as provided in
this subsection 3.3C, such Issuing Lender shall be entitled to recover such
amount on demand from such Revolving Lender together with interest thereon
at the Federal Funds Effective Rate. Nothing in this subsection 3.3C shall
be deemed to prejudice the right of Administrative Agent to recover, for
the benefit of Revolving Lenders, from any Issuing Lender any amounts made
available to such Issuing Lender pursuant to this subsection 3.3C in the
event that it is determined by the final judgment of a court of competent
jurisdiction that the payment with respect to a Letter of Credit by such
Issuing Lender in respect of which such participation payments were made by
Revolving Lenders constituted gross negligence or willful misconduct on the
part of such Issuing Lender.
(ii) DISTRIBUTION TO LENDERS OF REIMBURSEMENTS RECEIVED FROM
COMPANY. In the event any Issuing Lender shall have been reimbursed by
other Revolving Lenders pursuant to subsection 3.3C(i) for all or any
portion of any payment by such Issuing Lender under a Letter of Credit
issued by it, and Administrative Agent or such Issuing Lender thereafter
receives any payments from Company in reimbursement of such payment under
the Letter of Credit, to the extent any such payment is received by such
Issuing Lender, it shall distribute such payment to Administrative Agent,
and Administrative Agent shall distribute to each other Revolving Lender
that has paid all amounts payable by it under subsection 3.3C(i) with
respect to such payment such Revolving Lender's Pro Rata Share of all
payments subsequently received by Administrative Agent or by such Issuing
Lender from Company. Any such distribution shall be made to a Revolving
Lender at the account specified in subsection 2.4C(iii).
D. INTEREST ON AMOUNTS PAID UNDER LETTERS OF CREDIT.
(i) PAYMENT OF INTEREST BY COMPANY. Company agrees to pay to
Administrative Agent, with respect to payments under any Letters of Credit
issued by any Issuing Lender, interest on the amount paid by such Issuing
Lender in respect of each such payment from the date a drawing is honored
to but excluding the date such amount is reimbursed by Company (including
any such reimbursement out of the proceeds of Revolving Loans pursuant to
subsection 3.3B) at a rate equal to (a) for the period from the date such
drawing is honored to but excluding the Reimbursement Date, the rate then
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in effect under this Agreement with respect to Revolving Loans that are
Base Rate Loans and (b) thereafter, a rate which is 2% per annum in excess
of the rate of interest otherwise payable under this Agreement with respect
to Revolving Loans that are Base Rate Loans. Interest payable pursuant to
this subsection 3.3D(i) shall be computed on the basis of a 360-day year
for the actual number of days elapsed in the period during which it accrues
and shall be payable on demand or, if no demand is made, on the date on
which the related drawing under a Letter of Credit is reimbursed in full.
(ii) DISTRIBUTION OF INTEREST PAYMENTS BY ADMINISTRATIVE
AGENT. Promptly upon receipt by Administrative Agent of any payment of
interest pursuant to subsection 3.3D(i) with respect to a payment under a
Letter of Credit, (a) Administrative Agent shall distribute to (x) each
Revolving Lender, out of the interest received by Administrative Agent in
respect of the period from the date such drawing is honored to but
excluding the date on which the applicable Issuing Lender is reimbursed for
the amount of such payment (including any such reimbursement out of the
proceeds of Revolving Loans pursuant to subsection 3.3B), the amount that
such Revolving Lender would have been entitled to receive in respect of the
letter of credit fee that would have been payable in respect of such Letter
of Credit for such period pursuant to subsection 3.2 if no drawing had been
honored under such Letter of Credit and (y) such Issuing Lender the amount,
if any, remaining after payment of the amounts applied pursuant to the
immediately preceding clause (x), and (b) in the event such Issuing Lender
shall have been reimbursed by other Revolving Lenders pursuant to
subsection 3.3C(i) for all or any portion of such payment, Administrative
Agent shall distribute to each Revolving Lender (including such Issuing
Lender) that has paid all amounts payable by it under subsection 3.3C(i)
with respect to such payment such Revolving Lender's Pro Rata Share of any
interest received by Administrative Agent in respect of that portion of
such payment so made by Revolving Lenders for the period from the date on
which such Issuing Lender was so reimbursed to but excluding the date on
which such portion of such payment is reimbursed by Company. Any such
distribution shall be made to a Revolving Lender at the account specified
in subsection 2.4C(iii).
E. CASH COLLATERALIZATION. If Administrative Agent notifies
Company at any time that, due to a fluctuation in the applicable Exchange
Rate or otherwise, the Letter of Credit Usage at such time exceeds 105% of
the sublimit for Letters of Credit specified in subsection 3.1A(ii), then,
within two Business Days after receipt of such notice, Company shall
deposit in the Collateral Account established pursuant to the Security
Agreement an amount equal to the amount by which the Letter of Credit Usage
exceeds such sublimit, which amount shall constitute Collateral and be
subject to the provisions of the Security Agreement. At such time as the
Letter of Credit Usage shall be equal to or less than such sublimit, if no
Event of Default has occurred and is continuing, such amount may, at the
request of Company, be released to Company.
3.4 OBLIGATIONS ABSOLUTE.
The obligation of Company to reimburse each Issuing Lender for
payments under the Letters of Credit issued by it and to repay any Revolving
Loans made by Revolving Lenders pursuant to subsection 3.3B and the obligations
of Revolving Lenders under subsection 3.3C(i)
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shall be unconditional and irrevocable and shall be paid strictly in accordance
with the terms of this Agreement under all circumstances including any of the
following circumstances:
(i) any lack of validity or enforceability of any Letter of
Credit;
(ii) the existence of any claim, set-off, defense or other
right which Company or any Lender may have at any time against a
beneficiary or any transferee of any Letter of Credit (or any Persons for
whom any such transferee may be acting), any Issuing Lender or other
Revolving Lender or any other Person or, in the case of a Revolving Lender,
against Company, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction (including
any underlying transaction between Company or one of its Subsidiaries and
the beneficiary for which any Letter of Credit was procured);
(iii) any draft or other document presented under any Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any respect;
(iv) payment by the applicable Issuing Lender under any Letter
of Credit against presentation of a draft or other document which does not
substantially comply with the terms of such Letter of Credit;
(v) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of
Company or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document
by any party thereto;
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential Event of
Default shall have occurred and be continuing;
PROVIDED, in each case, that payment by the applicable Issuing Lender under the
applicable Letter of Credit shall not have constituted gross negligence or
willful misconduct of such Issuing Lender under the circumstances in question
(as determined by a final judgment of a court of competent jurisdiction).
3.5 NATURE OF ISSUING LENDERS' DUTIES.
As between Company and any Issuing Lender, Company assumes all
risks of the acts and omissions of, or misuse of the Letters of Credit issued by
such Issuing Lender by, the respective beneficiaries of such Letters of Credit.
In furtherance and not in limitation of the foregoing, such Issuing Lender shall
not be responsible for: (i) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in connection
with the application for and issuance of any such Letter of Credit, even if it
should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged; (ii) the validity or
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sufficiency of any instrument transferring or assigning or purporting to
transfer or assign any such Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (iii) failure of the beneficiary of any
such Letter of Credit to comply fully with any conditions required in order to
draw upon such Letter of Credit; (iv) errors, omissions, interruptions or delays
in transmission or delivery of any messages, by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher; (v) errors in interpretation of
technical terms; (vi) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any such Letter of Credit or
of the proceeds thereof; (vii) the misapplication by the beneficiary of any such
Letter of Credit of the proceeds of any drawing under such Letter of Credit; or
(viii) any consequences arising from causes beyond the control of such Issuing
Lender, including any act or omission by a Government Authority, and none of the
above shall affect or impair, or prevent the vesting of, any of such Issuing
Lender's rights or powers hereunder.
In furtherance and extension and not in limitation of the
specific provisions set forth in the first paragraph of this subsection 3.5, any
action taken or omitted by any Issuing Lender under or in connection with the
Letters of Credit issued by it or any documents and certificates delivered
thereunder, if taken or omitted in good faith, shall not put such Issuing Lender
under any resulting liability to Company.
Notwithstanding anything to the contrary contained in this
subsection 3.5, Company shall retain any and all rights it may have against any
Issuing Lender for any liability arising solely out of the gross negligence or
willful misconduct of such Issuing Lender, as determined by a final judgment of
a court of competent jurisdiction.
SECTION 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of
Letters of Credit hereunder are subject to the satisfaction of the following
conditions.
4.1 CONDITIONS TO TERM LOANS AND INITIAL REVOLVING LOANS AND SWING
LINE LOANS.
The obligations of Lenders to make the Term Loans and any
Revolving Loans and Swing Line Loans to be made on the Closing Date are, in
addition to the conditions precedent specified in subsection 4.2, subject to
prior or concurrent satisfaction of the following conditions (it being
acknowledged and understood that the following conditions need only be satisfied
by Holdings and Merger Sub, to the extent applicable, prior to the consummation
of the Merger in order for the Term Loans to be made on the Closing Date and
that the remaining Loan Parties (including FTD after consummation of the Merger)
shall satisfy the following conditions, to the extent applicable, concurrently
with or immediately upon consummation of the Merger):
A. LOAN PARTY DOCUMENTS. On or before the Closing Date,
prior to the consummation of the Merger, Holdings and Merger Sub shall, and upon
consummation of the Merger, FTD shall, and shall cause each other Loan Party to,
deliver to Lenders (or to Administrative Agent with sufficient originally
executed copies, where appropriate, for each
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Lender) the following with respect to Holdings, Merger Sub, FTD or such Loan
Party, as the case may be, each, unless otherwise noted, dated the Closing Date:
(i) Copies of the Organizational Documents of such Person,
certified by the Secretary of State of its jurisdiction of organization or,
if such document is of a type that may not be so certified, certified by
the secretary or similar officer of the applicable Loan Party, together
with a good standing certificate from the Secretary of State of its
jurisdiction of organization and each other state in which such Person is
qualified to do business and, to the extent generally available, a
certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing authority
of each of such jurisdictions, each dated a recent date prior to the
Closing Date;
(ii) Resolutions of the Governing Body of such Person
approving and authorizing the execution, delivery and performance of the
Loan Documents to which it is a party, certified as of the Closing Date by
the secretary or similar officer of such Person as being in full force and
effect without modification or amendment;
(iii) Signature and incumbency certificates of the officers of
such Person executing the Loan Documents to which it is a party;
(iv) Executed originals of the Loan Documents to which such
Person is a party; and
(v) Such other documents as Administrative Agent may
reasonably request.
B. FEES. Merger Sub shall have paid to Administrative Agent,
for distribution (as appropriate) to Administrative Agent, the Syndication Agent
and Lenders, the fees payable on the Closing Date referred to in subsection 2.3.
C. CORPORATE AND CAPITAL STRUCTURE; OWNERSHIP.
(i) CORPORATE STRUCTURE. The corporate organizational
structure of Holdings and its Subsidiaries, both before and after giving
effect to the Merger, shall be as set forth on SCHEDULE 4.1C annexed
hereto.
(ii) CAPITAL STRUCTURE AND OWNERSHIP. The capital structure
and ownership of Holdings and Company, both before and after giving effect
to the Merger, shall be as set forth on SCHEDULE 4.1C annexed hereto.
(iii) MANAGEMENT; EMPLOYMENT CONTRACTS. The management
structure of Company after giving effect to the Merger, shall be as set
forth on SCHEDULE 4.1C annexed hereto.
(iv) OWNERSHIP OF COMPANY. Upon consummation of the Merger,
the Equity Investors shall directly or indirectly control Holdings.
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D. REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF
AGREEMENTS. Prior to the consummation of the Merger, Merger Sub shall, and upon
consummation of the Merger, FTD shall, have delivered to Administrative Agent an
Officer's Certificate, in form and substance reasonably satisfactory to
Administrative Agent, to the effect that the representations and warranties in
Section 5 are true, correct and complete in all material respects on and as of
the Closing Date to the same extent as though made on and as of that date (or,
to the extent such representations and warranties specifically relate to an
earlier date, that such representations and warranties were true, correct and
complete in all material respects on and as of such earlier date) and that
Company shall have performed in all material respects all agreements and
satisfied all conditions which this Agreement provides shall be performed or
satisfied by it on or before the Closing Date except as otherwise disclosed to
and agreed to in writing by Administrative Agent; PROVIDED that, if a
representation and warranty, covenant or condition is qualified as to
materiality, with respect to such representation and warranty, covenant or
condition the applicable materiality qualifier set forth in this subsection 4.1D
shall be disregarded for purposes of this condition.
E. FINANCIAL STATEMENTS; PRO FORMA BALANCE SHEET. On or
before the Closing Date, Lenders shall have received from Merger Sub (i) audited
financial statements of FTD and its Subsidiaries for Fiscal Years 2001, 2002 and
2003, consisting of balance sheets and the related consolidated statements of
income, stockholders' equity and cash flows for such Fiscal Years, (ii)
unaudited financial statements of FTD and its Subsidiaries as at December 31,
2003, consisting of a balance sheet and the related consolidated statements of
income, stockholders' equity and cash flows for the 6-month period ending on
such date, all in reasonable detail and certified by the chief financial officer
of FTD that they fairly present the financial condition of FTD and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments, and (iii) pro forma consolidated balance
sheets of FTD and its Subsidiaries as of January 31, 2004, prepared in
accordance with GAAP and reflecting the consummation of the Merger, the related
financings and the other transactions contemplated by the Loan Documents and the
Related Agreements, which pro forma financial statements shall be in form and
substance reasonably satisfactory to Administrative Agent.
F. OPINIONS OF COUNSEL TO LOAN PARTIES. Lenders shall have
received originally executed copies of one or more favorable written opinions of
Xxxxxx & Xxxxxxx LLP, special counsel for Holdings and Merger Sub and such other
counsel, acceptable to Administrative Agent and its counsel, in form and
substance reasonably satisfactory to Administrative Agent and its counsel, dated
as of the Closing Date and setting forth substantially the matters in the
opinions designated in EXHIBIT IX annexed hereto and as to such other matters as
Administrative Agent acting on behalf of Lenders may reasonably request (this
Credit Agreement constituting a written request by Company to such counsel to
deliver such opinions to Lenders).
G. OPINION OF ADMINISTRATIVE AGENT'S COUNSEL. Lenders shall
have received originally executed copies of a favorable written opinion of
O'Melveny & Xxxxx LLP, counsel to Administrative Agent, dated as of the Closing
Date, substantially in the form of EXHIBIT X annexed hereto.
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H. OPINIONS OF COUNSEL DELIVERED UNDER RELATED AGREEMENTS.
Administrative Agent shall have received copies of each of the opinions of
counsel delivered to the parties under the Related Agreements, together with a
letter from each such counsel authorizing Lenders to rely upon such opinion to
the same extent as though it were addressed to Lenders.
I. EVIDENCE OF INSURANCE. Administrative Agent shall have
received a certificate from FTD's insurance broker or other evidence
satisfactory to it that all insurance required to be maintained pursuant to
subsection 6.4 is in full force and effect and that Administrative Agent on
behalf of Lenders has been named as additional insured and/or loss payee
thereunder to the extent required under subsection 6.4.
J. NECESSARY GOVERNMENTAL AUTHORIZATIONS AND CONSENTS;
EXPIRATION OF WAITING PERIODS, ETC. Prior to the consummation of the Merger,
Merger Sub shall, and upon consummation of the Merger, FTD shall, have obtained
all Governmental Authorizations and all consents of other Persons, in each case
that are necessary or advisable in connection with the Merger, the other
transactions contemplated by the Loan Documents and the Related Agreements and
the continued operation of the business conducted by FTD and its Subsidiaries in
substantially the same manner as conducted prior to the Closing Date. Each such
Governmental Authorization and consent shall be in full force and effect, except
in a case where the failure to obtain or maintain a Governmental Authorization
or consent, either individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. All applicable waiting periods
shall have expired without any action being taken or threatened by any competent
authority that would restrain, prevent or otherwise impose adverse conditions on
the Merger or the financing thereof. No action, request for stay, petition for
review or rehearing, reconsideration, or appeal with respect to any of the
foregoing shall be pending, and the time for any applicable Government Authority
to take action to set aside its consent on its own motion shall have expired.
K. ENVIRONMENTAL REPORTS. Administrative Agent shall have
received reports and other information, in form, scope and substance
satisfactory to Administrative Agent, regarding environmental matters relating
to FTD and its Subsidiaries and the Facilities, which reports shall include a
Phase I environmental assessment for each of the Facilities listed in SCHEDULE
4.1K annexed hereto (collectively, the "PHASE I REPORT") that (a) conforms to
the ASTM Standard Practice for Environmental Site Assessments: Phase I
Environmental Site Assessment Process, E 1527, (b) was conducted no more than
six months prior to the Closing Date by one or more environmental consulting
firms reasonably satisfactory to Administrative Agent and (c) is accompanied by
or includes an estimate of the reasonable worst-case cost of investigating and
remediating any Hazardous Materials Activity identified in such Phase I
environmental assessments as giving rise to an actual or potential material
violation of any Environmental Law or as presenting a material risk of giving
rise to a material Environmental Claim.
L. SECURITY INTERESTS IN PERSONAL AND MIXED PROPERTY. To the
extent not otherwise satisfied pursuant to subsection 4.1M, Administrative Agent
shall have received evidence satisfactory to it that Holdings, FTD and
Subsidiary Guarantors shall have taken or caused to be taken all such actions,
executed and delivered or caused to be executed and
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delivered all such agreements, documents and instruments (other than the items
to be delivered pursuant to subsection 6.11), and made or caused to be made all
such filings and recordings (other than the filing or recording of items
described in clauses (ii), (iii) and (iv) below) that may be necessary or, in
the opinion of Administrative Agent, desirable in order to create in favor of
Administrative Agent, for the benefit of Lenders, a valid and (upon such filing
and recording) perfected First Priority security interest in the entire personal
and mixed property Collateral. Such actions shall include the following:
(i) STOCK CERTIFICATES AND INSTRUMENTS. Delivery to
Administrative Agent of (a) certificates (which certificates shall be
accompanied by irrevocable undated stock powers, duly endorsed in blank and
otherwise satisfactory in form and substance to Administrative Agent)
representing all Capital Stock pledged pursuant to the Security Agreement
(65% of the outstanding Capital Stock in the case of Foreign Subsidiaries)
and (b) all promissory notes or other instruments (duly endorsed, where
appropriate, in a manner satisfactory to Administrative Agent) evidencing
any Collateral;
(ii) LIEN SEARCHES AND UCC TERMINATION STATEMENTS. Delivery to
Administrative Agent of (a) the results of a recent search, by a Person
satisfactory to Administrative Agent, of all effective UCC financing
statements and fixture filings and all judgment and tax lien filings which
may have been made with respect to any personal or mixed property of any
Loan Party, together with copies of all such filings disclosed by such
search, to the extent requested by Administrative Agent, and (b) UCC
termination statements duly executed (if necessary) by all applicable
Persons for filing in all applicable jurisdictions as may be necessary to
terminate any effective UCC financing statements or fixture filings
disclosed in such search (other than any such financing statements or
fixture filings in respect of Liens permitted to remain outstanding
pursuant to the terms of this Agreement).
(iii) UCC FINANCING STATEMENTS AND FIXTURE FILINGS. Delivery to
Administrative Agent of UCC financing statements and, where appropriate,
fixture filings, duly executed by each applicable Loan Party (if required)
with respect to all personal and mixed property Collateral of such Loan
Party, for filing in all jurisdictions as may be necessary or, in the
opinion of Administrative Agent, desirable to perfect the security
interests created in such Collateral pursuant to the Collateral Documents;
(iv) PTO COVER SHEETS, ETC. Delivery to Administrative Agent
of all cover sheets or other documents or instruments required to be filed
with the PTO in order to create or perfect Liens in respect of any IP
Collateral together with releases of all security interests duly executed
(if necessary) by all applicable Persons for filing in all applicable
jurisdictions as may be necessary to terminate any effective PTO filings in
respect of IP Collateral (other than any such PTO filings in respect of
Liens permitted to remain outstanding pursuant to the terms of this
Agreement); and
(v) OPINIONS OF LOCAL COUNSEL. Delivery to Administrative
Agent of an opinion of counsel (which counsel shall be reasonably
satisfactory to Administrative Agent) under the laws of each jurisdiction
in which any Loan Party or any personal or mixed property Collateral is
located with respect to the creation and perfection of the
75
security interests in favor of Administrative Agent in such Collateral and
such other matters governed by the laws of such jurisdiction regarding such
security interests as Administrative Agent may reasonably request, in each
case in form and substance reasonably satisfactory to Administrative Agent.
M. CLOSING DATE MORTGAGES; CLOSING DATE MORTGAGE POLICIES;
ETC. Administrative Agent shall have received from FTD and each applicable
Subsidiary Guarantor:
(i) CLOSING DATE MORTGAGES. Fully executed and notarized
Mortgages (each a "CLOSING DATE MORTGAGE" and, collectively, the "CLOSING
DATE MORTGAGES"), in proper form for recording in all appropriate places in
all applicable jurisdictions, encumbering each Real Property Asset listed
in SCHEDULE 4.1M annexed hereto (each a "CLOSING DATE MORTGAGED PROPERTY"
and, collectively, the "CLOSING DATE MORTGAGED PROPERTIES"), it being
agreed that no Closing Date Mortgage will encumber any Leasehold Property
as of the Closing Date and no Leasehold Property is a Closing Date
Mortgaged Property;
(ii) OPINIONS OF LOCAL COUNSEL. An opinion of counsel (which
counsel shall be reasonably satisfactory to Administrative Agent) in each
state in which a Closing Date Mortgaged Property is located with respect to
the enforceability of the form(s) of Closing Date Mortgages to be recorded
in such state and such other matters as Administrative Agent may reasonably
request, in each case in form and substance reasonably satisfactory to
Administrative Agent;
(iii) TITLE INSURANCE. (a) ALTA mortgagee title insurance
policies or unconditional commitments therefor (the "CLOSING DATE MORTGAGE
POLICIES") issued by the Title Company with respect to the Closing Date
Mortgaged Properties listed in SCHEDULE 4.1M annexed hereto, in amounts not
less than the respective amounts designated therein with respect to any
particular Closing Date Mortgaged Properties, insuring fee simple title to
each such Closing Date Mortgaged Property vested in such Loan Party and
assuring Administrative Agent that the applicable Closing Date Mortgages
create valid and enforceable First Priority mortgage Liens on the
respective Closing Date Mortgaged Properties encumbered thereby, subject
only to a standard survey exception, which Closing Date Mortgage Policies
(1) shall include an endorsement for mechanics' liens, for future advances
under this Agreement and for any other matters reasonably requested by
Administrative Agent and (2) shall provide for affirmative insurance and
such reinsurance as Administrative Agent may reasonably request, all of the
foregoing in form and substance reasonably satisfactory to Administrative
Agent; and (b) evidence satisfactory to Administrative Agent that such Loan
Party has (i) delivered to the Title Company all certificates and
affidavits required by the Title Company in connection with the issuance of
the Closing Date Mortgage Policies and (ii) paid to the Title Company or to
the appropriate Governmental Authorities all expenses and premiums of the
Title Company in connection with the issuance of the Closing Date Mortgage
Policies and all recording and stamp taxes (including mortgage recording
and intangible taxes) payable in connection with recording the Closing Date
Mortgages in the appropriate real estate records;
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(iv) TITLE REPORTS. With respect to each Closing Date
Mortgaged Property listed in SCHEDULE 4.1M annexed hereto, a title report
issued by the Title Company with respect thereto, dated not more than 30
days prior to the Closing Date and satisfactory in form and substance to
Administrative Agent;
(v) COPIES OF DOCUMENTS RELATING TO TITLE EXCEPTIONS. Copies
of all recorded documents listed as exceptions to title or otherwise
referred to in the Closing Date Mortgage Policies or in the title reports
delivered pursuant to subsection 4.1M(iv); and
(vi) MATTERS RELATING TO FLOOD HAZARD PROPERTIES. (a)
Evidence, which may be in the form of a letter from an insurance broker or
a municipal engineer, as to whether (1) any Closing Date Mortgaged Property
is a Flood Hazard Property and (2) the community in which any such Flood
Hazard Property is located is participating in the National Flood Insurance
Program, (b) if there are any such Flood Hazard Properties, such Loan
Party's written acknowledgement of receipt of written notification from
Administrative Agent (1) as to the existence of each such Flood Hazard
Property and (2) as to whether the community in which each such Flood
Hazard Property is located is participating in the National Flood Insurance
Program, and (c) in the event any such Flood Hazard Property is located in
a community that participates in the National Flood Insurance Program,
evidence that Company has obtained flood insurance in respect of such Flood
Hazard Property to the extent required under the applicable regulations of
the Board of Governors of the Federal Reserve System.
N. MATTERS RELATING TO EXISTING INDEBTEDNESS OF COMPANY AND
ITS SUBSIDIARIES.
(i) TERMINATION OF EXISTING
CREDIT AGREEMENT AND RELATED
LIENS. On the Closing Date, FTD and its Subsidiaries shall have (a) repaid
in full all Indebtedness outstanding under the Existing
Credit Agreement,
(b) terminated any commitments to lend or make other extensions of credit
thereunder and (c) delivered to Administrative Agent all documents or
instruments necessary to release all Liens securing Indebtedness or other
obligations of Company and its Subsidiaries thereunder.
(ii) EXISTING INDEBTEDNESS TO REMAIN OUTSTANDING.
Administrative Agent shall have received an Officer's Certificate of FTD
stating that, after giving effect to the transactions described in this
subsection 4.1N, the Loan Parties shall have no Indebtedness (other than
Indebtedness under the Loan Documents and the Subordinated Notes).
O. SOLVENCY ASSURANCES. On the Closing Date, Administrative
Agent and Lenders shall have received an Officer's Certificate of FTD dated the
Closing Date, substantially in the form of EXHIBIT XII annexed hereto and with
appropriate attachments, in each case demonstrating that, after giving effect to
the consummation of the Merger and the other transactions contemplated by the
Loan Documents, FTD and each Subsidiary Guarantor on a consolidated basis will
be Solvent.
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P. PROCEEDS OF DEBT AND EQUITY CAPITALIZATION OF HOLDINGS
AND COMPANY.
(i) EQUITY CAPITALIZATION OF HOLDINGS. On or before the
Closing Date, (1) the Equity Investors shall have purchased (a) all of the
outstanding Holdings Common Stock (excluding the Holdings Common Stock
which will be exchanged in connection with the Old Management Shares) for
consideration of approximately $37,000,000 in cash and (b) all of the
outstanding Holdings Preferred Stock for cash consideration of
approximately $155,531,000 and (2) the Management Investors shall have
exchanged Old Management Shares for approximately $3,000,000 of Holdings
Common Stock; PROVIDED that the amounts of the foregoing equity purchases
may be adjusted to account for any cash on hand of FTD as of the Closing
Date that will be used to fund a portion of the Merger Financing
Requirements and any existing indebtedness of FTD, so long as the amount of
Holdings Common Stock and Holdings Preferred Stock purchased for cash
consideration is not less than $180,000,000 in the aggregate and the
remaining cash on hand of Company after consummation of the Merger is not
less than $7,261,497.55.
(ii) DEBT AND EQUITY CAPITALIZATION OF MERGER SUB. On or
before the Closing Date, (a) Holdings shall have contributed to Merger Sub,
as common equity, all of the Cash consideration received by Holdings from
the sale of Holdings Common Stock and Holdings Preferred Stock and (b)
Merger Sub shall have issued and sold not less than $175,000,000 in
aggregate principal amount of Subordinated Notes.
(iii) USE OF PROCEEDS BY COMPANY. Merger Sub shall have
provided evidence satisfactory to Administrative Agent that the proceeds of
the debt and equity capitalization of Merger Sub described in the
immediately preceding clause and any cash on hand of FTD that will be used
to fund a portion of the Merger Financing Requirements have been
irrevocably committed, prior to the application of the proceeds of the Term
Loans, to the payment of a portion of the Merger Financing Requirements.
Q. RELATED AGREEMENTS
(i) FORM OF SUBORDINATED NOTE INDENTURE. The Subordinated
Note Indenture shall be satisfactory in form and substance to
Administrative Agent.
(ii) APPROVAL OF CERTAIN RELATED AGREEMENTS. Any amendments to
the Merger Agreement, the Certificate of Merger, the Management
Contribution and Subscription Agreements or the Stockholders Agreement in
any respect determined by Administrative Agent to be material shall each be
satisfactory in form and substance to Administrative Agent.
(iii) RELATED AGREEMENTS IN FULL FORCE AND EFFECT.
Administrative Agent shall have received a fully executed or conformed copy
of each Related Agreement and any documents executed in connection
therewith, and each Related Agreement shall be in full force and effect and
no provision thereof shall have been modified or waived in any respect
determined by Administrative Agent to be material, in each case without the
written consent of Administrative Agent and Syndication Agent with such
consent not to
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be unreasonably withheld and the provisions of each Related Agreement shall
be in compliance in all material respects with applicable laws and
regulations.
R. CONSUMMATION OF MERGER.
(i) All conditions to Merger set forth in Sections 8.1, 8.2
and 8.3 of the Merger Agreement (other than the making of the Term Loans on
the Closing Date) shall have been satisfied or the fulfillment of any such
conditions shall have been waived with the written consent of
Administrative Agent and Syndication Agent;
(ii) on the Closing Date, the Merger shall have become
effective in accordance with the terms of the Merger Agreement, the
Certificate of Merger and the laws of the State of Delaware;
(iii) the aggregate consideration paid (i) in respect of the
Public FTD Common Stock that is to be cancelled and retired in connection
with the Merger, (ii) in respect of all options to purchase FTD Common
Stock that are being cancelled in connection with the Merger and (iii) to
any holders of FTD Common Stock that are or may be dissenting shareholders,
shall not exceed $421,076,000, with approximately $418,076,000 of such
consideration to be paid in cash and approximately $3,000,000 to be paid
through the conversion of Old Management Shares into Holdings Common Stock;
(iv) Transaction Costs shall not exceed $35,000,000; PROVIDED
that additional Transaction Costs may be incurred to the extent funded by
the Equity Investors through the purchase of Holdings Common Stock or
Holdings Preferred Stock, and Administrative Agent shall have received
evidence to its satisfaction to such effect;
(v) upon consummation of the Merger, all outstanding Capital
Stock of FTD and all options to purchase FTD Common Stock shall cease to
exist and Holdings shall own 100% of the outstanding Capital Stock of
Company;
(vi) after consummation of the Merger and payment of all
costs, fees and expenses related thereto, the Company shall have
$7,261,497.55 of cash available to be placed in escrow in accordance with
subsection 6.10; and
(vii) Administrative Agent shall have received an Officer's
Certificate of FTD to the effect set forth in clauses (i)-(vi) above and an
Officer's Certificate of Merger Sub stating that Merger Sub will proceed to
consummate the Merger immediately upon the making of the initial Loans.
S. PATRIOT ACT COMPLIANCE. Administrative Agent and
Syndication Agent shall have received all documentation and other information
required by bank regulatory authorities under the applicable "know your
customer" and anti-money laundering rules and regulations, including without
limitation the Patriot Act.
T. COMPLETION OF PROCEEDINGS. All corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Administrative Agent, acting on behalf of
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Lenders, and its counsel shall be satisfactory in form and substance to
Administrative Agent and such counsel, and Administrative Agent and such counsel
shall have received all such counterpart originals or certified copies of such
documents as Administrative Agent may reasonably request.
4.2 CONDITIONS TO ALL LOANS.
The obligations of each Lender to make its Loans on each Funding
Date are subject to the following further conditions precedent:
A. Administrative Agent shall have received before that
Funding Date, in accordance with the provisions of subsection 2.1B, an
originally executed Notice of Borrowing, in each case signed by a duly
authorized Officer of Company (it being understood that Merger Sub shall deliver
such Notice of Borrowing on the Closing Date with respect to the Term Loans to
be borrowed on the Closing Date).
B. As of that Funding Date:
(i) The representations and warranties contained herein and
in the other Loan Documents shall be true, correct and complete in all
material respects on and as of that Funding Date to the same extent as
though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in
which case such representations and warranties shall have been true,
correct and complete in all material respects on and as of such earlier
date; PROVIDED, that, if a representation and warranty is qualified as to
materiality, with respect to such representation and warranty, the
materiality qualifier set forth above shall be disregarded for purposes of
this condition;
(ii) No event shall have occurred and be continuing or would
result from the consummation of the borrowing contemplated by such Notice
of Borrowing that would constitute an Event of Default or a Potential Event
of Default;
(iii) Each Loan Party shall have performed in all material
respects all agreements and satisfied all conditions which this Agreement
provides shall be performed or satisfied by it on or before that Funding
Date;
(iv) No order, judgment or decree of any arbitrator or
Government Authority shall purport to enjoin or restrain such Lender from
making the Loans to be made by it on that Funding Date; and
(v) Company shall have delivered such other certificates or
documents that Administrative Agent shall reasonably request, in form and
substance satisfactory to Administrative Agent.
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4.3 CONDITIONS TO LETTERS OF CREDIT.
The issuance of any Letter of Credit hereunder (whether or not
the applicable Issuing Lender is obligated to issue such Letter of Credit) is
subject to the following conditions precedent:
A. On or before the date of issuance of the initial Letter
of Credit pursuant to this Agreement, the initial Loans shall have been made.
B. On or before the date of issuance of such Letter of
Credit, Administrative Agent shall have received, in accordance with the
provisions of subsection 3.1B(i), an originally executed Request for Issuance
(or a facsimile copy thereof) in each case signed by a duly authorized Officer
of Company, together with all other information specified in subsection 3.1B(i)
and such other documents or information as the applicable Issuing Lender may
reasonably require in connection with the issuance of such Letter of Credit.
C. On the date of issuance of such Letter of Credit, all
conditions precedent described in subsection 4.2B shall be satisfied to the same
extent as if the issuance of such Letter of Credit were the making of a Loan and
the date of issuance of such Letter of Credit were a Funding Date.
SECTION 5. COMPANY'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to
make the Loans, to induce Issuing Lenders to issue Letters of Credit and to
induce Revolving Lenders to purchase participations therein, Company (for
purposes of this Section 5, references to Company or Holdings and its
Subsidiaries shall not include FTD and its Subsidiaries prior to the
consummation of the Merger, but shall include FTD and its Subsidiaries, upon
consummation of the Merger) represents and warrants to each Lender:
5.1 ORGANIZATION, POWERS, QUALIFICATION, GOOD STANDING, BUSINESS AND
SUBSIDIARIES.
A. ORGANIZATION AND POWERS. Each of Holdings and its
Subsidiaries is a corporation, partnership, trust or limited liability company
duly organized, validly existing and in good standing under the laws of its
jurisdiction of organization as specified in SCHEDULE 5.1 annexed hereto. Each
of Holdings and its Subsidiaries has all requisite power and authority to own
and operate its properties, to carry on its business as now conducted and as
proposed to be conducted, to enter into the Loan Documents and the Related
Documents to which it is a party and to carry out the transactions contemplated
thereby.
B. QUALIFICATION AND GOOD STANDING. Each of Holdings and its
Subsidiaries is qualified to do business and in good standing in every
jurisdiction where its assets are located and wherever necessary to carry out
its business and operations, except in jurisdictions where the failure to be so
qualified or in good standing has not had and could not reasonably be expected
to result in a Material Adverse Effect.
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C. CONDUCT OF BUSINESS. Holdings and its Subsidiaries are
engaged only in the businesses permitted to be engaged in pursuant to
subsections 7.11 and 8.13.
D. SUBSIDIARIES. All of the Subsidiaries of Company as of
the Closing Date and their jurisdictions of organization are identified in
SCHEDULE 5.1 annexed hereto, as said SCHEDULE 5.1 may be supplemented from time
to time pursuant to the provisions of subsection 6.1(xv). The Capital Stock of
each of the Subsidiaries of Company identified in SCHEDULE 5.1 annexed hereto
(as so supplemented) is duly authorized, validly issued, fully paid and
nonassessable and none of such Capital Stock constitutes Margin Stock. Each of
the Subsidiaries of Company identified in SCHEDULE 5.1 annexed hereto (as so
supplemented) is a corporation, partnership, trust or limited liability company
duly organized, validly existing and in good standing under the laws of its
respective jurisdiction of organization set forth therein, has all requisite
power and authority to own and operate its properties and to carry on its
business as now conducted and as proposed to be conducted, and is qualified to
do business and in good standing in every jurisdiction where its assets are
located and wherever necessary to carry out its business and operations, in each
case except where failure to be so qualified or in good standing or a lack of
such power and authority has not had and could not reasonably be expected to
result in a Material Adverse Effect. SCHEDULE 5.1 annexed hereto (as so
supplemented) correctly sets forth, as of the Closing Date, the ownership
interest of Company and each of its Subsidiaries in each of the Subsidiaries of
Company identified therein.
5.2 AUTHORIZATION OF BORROWING, ETC.
A. AUTHORIZATION OF BORROWING. The execution, delivery and
performance of the Loan Documents and the Related Agreements have been duly
authorized by all necessary action on the part of each Loan Party that is a
party thereto.
B. NO CONFLICT. Except as disclosed in the Related
Agreements, the execution, delivery and performance by Loan Parties of the Loan
Documents and the Related Agreements to which they are parties and the
consummation of the transactions contemplated by the Loan Documents and the
Related Agreements do not and will not (i) violate any provision of any law or
any governmental rule or regulation applicable to Holdings or any of its
Subsidiaries, the Organizational Documents of Holdings or any of its
Subsidiaries or any order, judgment or decree of any court or other Government
Authority binding on Holdings or any of its Subsidiaries, (ii) conflict with,
result in a breach of or constitute (with due notice or lapse of time or both) a
default under any Contractual Obligation of Holdings or any of its Subsidiaries,
(iii) result in or require the creation or imposition of any Lien upon any of
the properties or assets of Holdings or any of its Subsidiaries (other than any
Liens created under any of the Loan Documents in favor of Administrative Agent
on behalf of Lenders), or (iv) require any approval of stockholders or any
approval or consent of any Person under any Contractual Obligation of Holdings
or any of its Subsidiaries, except for such approvals or consents which will be
obtained on or before the Closing Date and disclosed in writing to Lenders and
except, in each case, to the extent such violation, conflict, Lien or failure to
obtain such approval or consent could not reasonably be expected to result in a
Material Adverse Effect.
C. GOVERNMENTAL CONSENTS. The execution, delivery and
performance by Loan Parties of the Loan Documents and the Related Agreements to
which they are parties and
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the consummation of the transactions contemplated by the Loan Documents and the
Related Agreements do not and will not require any Governmental Authorization,
except as have been obtained and as of the Closing Date, any thereof which the
failure to obtain or make could not reasonably be expected to have a Material
Adverse Effect.
D. BINDING OBLIGATION. Each of the Loan Documents and the
Related Agreements has been duly executed and delivered by each Person that is a
party thereto and is the legally valid and binding obligation of such Person,
enforceable against such Person in accordance with its respective terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or limiting creditors' rights generally or by equitable
principles relating to enforceability.
E. VALID ISSUANCE OF HOLDINGS COMMON STOCK, HOLDINGS
PREFERRED STOCK AND SUBORDINATED NOTES.
(i) HOLDINGS COMMON STOCK AND HOLDINGS PREFERRED STOCK. The
Holdings Common Stock and Holdings Preferred Stock to be sold on or before
the Closing Date, when issued and delivered, will be duly and validly
issued, fully paid and nonassessable. No stockholder of Holdings has or
will have any preemptive rights to subscribe for any additional equity
Securities of Holdings. The issuance and sale of such Holdings Common Stock
and Holdings Preferred Stock, upon such issuance and sale, will either (a)
have been registered or qualified under applicable federal and state
securities laws or (b) be exempt therefrom.
(ii) SUBORDINATED NOTES. Company has the corporate power and
authority to issue the Subordinated Notes. The Subordinated Notes are
legally valid and binding obligations of Company, enforceable against
Company in accordance with their respective terms, except as may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting credits' rights generally or by equitable
principles relating to enforceability. The subordination provisions of the
Subordinated Notes are enforceable against the holders thereof and this
Agreement is and will be within the definition of "Designated Senior
Indebtedness" included in such subordination provisions and the Loans and
all other monetary Obligations hereunder are and will be within the
definition of "Senior Indebtedness" included in such subordination
provisions. The Subordinated Notes, when issued and sold, were exempt from
registration or qualification under applicable federal and state securities
laws.
5.3 FINANCIAL CONDITION.
Company has heretofore delivered to Lenders, at Lenders' request,
the financial statements and information for the period ended December 31, 2003.
All such statements other than pro forma financial statements were prepared in
conformity with GAAP and fairly present, in all material respects, the financial
position (on a consolidated basis) of the entities described in such financial
statements as at the respective dates thereof and the results of operations and
cash flows (on a consolidated basis) of the entities described therein for each
of the periods then ended, subject, in the case of any such unaudited financial
statements, to changes resulting from audit and normal year-end adjustments.
Neither Company nor any of its Subsidiaries has (and
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will not have following the funding of the initial Loans) any Contingent
Obligation, contingent liability or liability for taxes, long-term lease or
unusual forward or long-term commitment that, as of the Closing Date, is not
reflected in the foregoing financial statements or the notes thereto and, as of
any Funding Date subsequent to the Closing Date, is not reflected in the most
recent financial statements delivered to Lenders pursuant to subsection 6.1 or
the notes thereto and that, in any such case, is material in relation to the
business, operations, properties, assets, condition (financial or otherwise) or
prospects of Company or any of its Subsidiaries.
5.4 NO MATERIAL ADVERSE CHANGE; NO RESTRICTED JUNIOR PAYMENTS.
Since June 30, 2003, no event or change has occurred that has
resulted in or evidences, either in any case or in the aggregate, a Material
Adverse Effect. Neither Company nor any of its Subsidiaries has directly or
indirectly declared, ordered, paid or made, or set apart any sum or property
for, any Restricted Junior Payment or agreed to do so except as permitted by
subsection 7.5.
5.5 TITLE TO PROPERTIES; LIENS; REAL PROPERTY; INTELLECTUAL PROPERTY.
A. TITLE TO PROPERTIES; LIENS. Company and its Subsidiaries
have (i) good, sufficient and legal title to (in the case of fee interests in
real property), (ii) valid leasehold interests in (in the case of leasehold
interests in real or personal property), or (iii) good title to (in the case of
all other personal property), all of their respective properties and assets
reflected in the financial statements referred to in subsection 5.3 or in the
most recent financial statements delivered pursuant to subsection 6.1, in each
case except for assets disposed of since the date of such financial statements
in the ordinary course of business or as otherwise permitted under subsection
7.7 and except for such defects that individually or in the aggregate would not
have a Material Adverse Effect. Except as permitted by this Agreement, all such
properties and assets are free and clear of Liens.
B. REAL PROPERTY. As of the Closing Date, SCHEDULE 5.5B
annexed hereto contains a true, accurate and complete list of (i) all fee
interests in any Real Property Assets and (ii) all leases, subleases or
assignments of leases (together with all amendments, modifications, supplements,
renewals or extensions of any thereof) affecting each Real Property Asset,
regardless of whether a Loan Party is the landlord or tenant (whether directly
or as an assignee or successor in interest) under such lease, sublease or
assignment. Except as specified in SCHEDULE 5.5B annexed hereto, each agreement
listed in clause (ii) of the immediately preceding sentence is in full force and
effect and Company does not have knowledge of any default that has occurred and
is continuing thereunder, and each such agreement constitutes the legally valid
and binding obligation of each applicable Loan Party, enforceable against such
Loan Party in accordance with its terms, except as enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles.
C. INTELLECTUAL PROPERTY. As of the Closing Date, Company
and its Subsidiaries own or have the right to use, all Intellectual Property
used in the conduct of their business, except where the failure to own or have
such right to use in the aggregate could not reasonably be expected to result in
a Material Adverse Effect. No claim has been asserted
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against Company or any of its Subsidiaries and is pending by any Person
challenging or questioning such use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does Company
know of any valid basis for any such claim, except for such claims that in the
aggregate could not reasonably be expected to result in a Material Adverse
Effect. The use of such Intellectual Property by Company and its Subsidiaries
does not infringe on the rights of any Person, except for such claims and
infringements that, in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect. All material federal and state and all material
foreign registrations of and applications for Intellectual Property, and all
material unregistered Intellectual Property that is not readily available in the
marketplace, that are owned or licensed by Company or any of its Subsidiaries on
the Closing Date are described on SCHEDULE 5.5C annexed hereto.
5.6 LITIGATION; ADVERSE FACTS.
Except as set forth in SCHEDULE 5.6 annexed hereto, there are no
Proceedings (whether or not purportedly on behalf of Company or any of its
Subsidiaries) at law or in equity, or before or by any court or other Government
Authority (including any Environmental Claims) that are pending or, to the
knowledge of Company, threatened against or affecting Company or any of its
Subsidiaries or any property of Company or any of its Subsidiaries and that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. Neither Company nor any of its Subsidiaries (i) is in
violation of any applicable laws (including Environmental Laws) that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect, or (ii) is subject to or in default with respect to any
final judgments, writs, injunctions, decrees, rules or regulations of any court
or other Government Authority that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.
5.7 PAYMENT OF TAXES.
Except to the extent permitted by subsection 6.3 and except as
would not reasonably be expected to result in a Material Adverse Effect, all tax
returns and reports of Holdings and its Subsidiaries required to be filed by any
of them have been timely filed, and all taxes shown on such tax returns to be
due and payable and all assessments, fees and other governmental charges upon
Holdings and its Subsidiaries and upon their respective properties, assets,
income, businesses and franchises that are due and payable have been paid when
due and payable. As of the date hereof, Company knows of no proposed tax
assessment against Holdings or any of its Subsidiaries that is not being
actively contested by Holdings or such Subsidiary in good faith and by
appropriate proceedings; PROVIDED that such reserves or other appropriate
provisions, if any, as shall be required in conformity with GAAP shall have been
made or provided therefor.
5.8 PERFORMANCE OF AGREEMENTS; MATERIAL CONTRACTS.
A. Neither Holdings nor any of its Subsidiaries is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists that, with the giving of notice or the lapse of time or both,
would constitute such a default, except where the
85
consequences, direct or indirect, of such default or defaults, if any, could not
reasonably be expected to result in a Material Adverse Effect.
B. SCHEDULE 5.8 contains a true, correct and complete list
of all the Material Contracts in effect on the Closing Date. Except as described
on SCHEDULE 5.8, all such Material Contracts are in full force and effect and no
material defaults by Company or any of its Subsidiaries currently exist
thereunder.
5.9 GOVERNMENTAL REGULATION.
Neither Company nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act or the Investment Company Act of 1940 or
under any other federal or state statute or regulation which may limit its
ability to incur Indebtedness.
5.10 SECURITIES ACTIVITIES.
A. Neither Company nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock.
B. Following application of the proceeds of each Loan, not
more than 25% of the value of the assets (either of Company only or of Company
and its Subsidiaries on a consolidated basis) subject to the provisions of
subsection 7.2 or 7.7 or subject to any restriction contained in any agreement
or instrument, between Company and any Lender or any Affiliate of any Lender,
relating to Indebtedness and within the scope of subsection 8.2, will be Margin
Stock.
5.11 EMPLOYEE BENEFIT PLANS.
A. Company and each of its Subsidiaries are in compliance in
all material respects with all applicable provisions and requirements of ERISA
and the regulations and published interpretations thereunder with respect to
each Employee Benefit Plan, and have performed all their obligations in all
material respects under each Employee Benefit Plan. Each Company Employee
Benefit Plan that is intended to qualify under Section 401(a) of the Internal
Revenue Code is so qualified.
B. No ERISA Event has occurred or is reasonably expected to
occur.
C. Except to the extent required under Section 4980B of the
Internal Revenue Code or except as set forth in SCHEDULE 5.11 annexed hereto, no
Employee Benefit Plan provides health or welfare benefits (through the purchase
of insurance or otherwise) for any retired or former employee of Company or any
of its Subsidiaries.
D. As of the most recent valuation date for any Pension
Plan, the amount of unfunded benefit liabilities (as defined in Section
4001(a)(18) of ERISA), individually or in the aggregate for all Pension Plans
(excluding for purposes of such computation any Pension Plans
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with respect to which assets exceed benefit liabilities), which could reasonable
be expected to result in a Direct Liability does not exceed $1,500,000.
E. As of the most recent valuation date for each
Multiemployer Plan for which the actuarial report is available, the potential
liability of Company and its Subsidiaries for a complete withdrawal from such
Multiemployer Plan (within the meaning of Section 4203 of ERISA), when
aggregated with such potential liability for a complete withdrawal from all
Multiemployer Plans, based on information available pursuant to Section 4221(e)
of ERISA, does not exceed $1,500,000.
F. As of the date hereof, Company and its Subsidiaries have
made full payment when due of all required contributions to any Foreign Plan.
5.12 CERTAIN FEES.
No broker's or finder's fee or commission will be payable with
respect to this Agreement or any of the transactions contemplated hereby,
except, such as are included in Transaction Costs (which Transaction Costs
include fees and expenses of Xxxxxxx, Xxxxx & Co.), and Company hereby
indemnifies Lenders against, and agrees that it will hold Lenders harmless from,
any claim, demand or liability for any such broker's or finder's fees alleged to
have been incurred in connection herewith or therewith and any expenses
(including reasonable fees, expenses and disbursements of counsel) arising in
connection with any such claim, demand or liability.
5.13 ENVIRONMENTAL PROTECTION.
(i) neither Company nor any of its Subsidiaries nor any of
their respective Facilities or operations are subject to any outstanding
written order, consent decree or settlement agreement with any Person
relating to (a) any Environmental Law, (b) any Environmental Claim, or (c)
any Hazardous Materials Activity in each case that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse
Effect;
(ii) as of the Closing Date, neither Company nor any of its
Subsidiaries has received any letter or written request for information
under Section 104 of the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. Section 9604) or any comparable
state law;
(iii) there are and, to Company's knowledge, have been no
conditions, occurrences, or Hazardous Materials Activities that could
reasonably be expected to form the basis of an Environmental Claim against
Company or any of its Subsidiaries that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect;
(iv) as of the Closing Date neither Company nor any of its
Subsidiaries nor, to Company's knowledge, any predecessor of Company or any
of its Subsidiaries has filed any notice under any Environmental Law
indicating past or present treatment of Hazardous Materials at any
Facility, and none of Company's or any of its Subsidiaries'
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operations involves the generation, transportation, treatment, storage or
disposal of hazardous waste, as defined under 40 C.F.R. Parts 260-270 or
any state equivalent; and
(v) compliance with all current or reasonably foreseeable
future requirements pursuant to or under Environmental Laws would not,
individually or in the aggregate, be reasonably expected to result in a
Material Adverse Effect.
5.14 EMPLOYEE MATTERS.
There is no strike or work stoppage in existence or threatened
involving Company or any of its Subsidiaries that could reasonably be expected
to result in a Material Adverse Effect.
5.15 SOLVENCY.
The Loan Parties, on a consolidated basis, are, and, upon the
incurrence of any Obligations by any Loan Party on any date on which this
representation is made, will be, Solvent.
5.16 MATTERS RELATING TO COLLATERAL.
A. CREATION, PERFECTION AND PRIORITY OF LIENS. The execution
and delivery of the Collateral Documents by Loan Parties, together with (i) the
actions taken to date pursuant to subsections 4.1L, 4.1M, 6.8 and 6.9 and (ii)
the delivery to Administrative Agent of any Pledged Collateral not delivered to
Administrative Agent at the time of execution and delivery of the applicable
Collateral Document (all of which Pledged Collateral has been so delivered) are
effective to create in favor of Administrative Agent for the benefit of Lenders,
as security for the respective Secured Obligations (as defined in the applicable
Collateral Document in respect of any Collateral), a valid First Priority Lien
on all of the Collateral, and all filings and other actions necessary or
desirable to perfect and maintain the perfection and First Priority status of
such Liens have been duly made or taken and remain in full force and effect,
other than the filing of any UCC financing statements and PTO filings delivered
to Administrative Agent for filing (but not yet filed) and the periodic filing
of UCC continuation statements in respect of UCC financing statements filed by
or on behalf of Administrative Agent.
B. GOVERNMENTAL AUTHORIZATIONS. No authorization, approval
or other action by, and no notice to or filing with, any Government Authority is
required for either (i) the pledge or grant by any Loan Party of the Liens
purported to be created in favor of Administrative Agent pursuant to any of the
Collateral Documents or (ii) the exercise by Administrative Agent of any rights
or remedies in respect of any Collateral (whether specifically granted or
created pursuant to any of the Collateral Documents or created or provided for
by applicable law), except for filings or recordings contemplated by subsection
5.16A and except as may be required, in connection with the disposition of any
Pledged Collateral, by laws generally affecting the offering and sale of
securities.
C. ABSENCE OF THIRD-PARTY FILINGS. Except such as may have
been filed in favor of Administrative Agent as contemplated by subsection 5.16A
and to evidence permitted lease obligations and other Liens permitted pursuant
to subsection 7.2, (i) no effective UCC
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financing statement, fixture filing or other instrument similar in effect
covering all or any part of the Collateral is on file in any filing or recording
office and (ii) no effective filing covering all or any part of the IP
Collateral is on file in the PTO (to Company's knowledge) or in the United
States Copyright Office.
D. MARGIN REGULATIONS. The pledge of the Pledged Collateral
pursuant to the Collateral Documents does not violate Regulation T, U or X of
the Board of Governors of the Federal Reserve System.
E. INFORMATION REGARDING COLLATERAL. All information
supplied to Administrative Agent by or on behalf of any Loan Party with respect
to the Collateral is accurate and complete in all material respects.
5.17 DISCLOSURE.
All factual information (taken as a whole) furnished by or on
behalf of Holdings or any of its Subsidiaries to Administrative Agent or any
Lender in writing on or before the Closing Date (including any such information
contained in the Confidential Information Memorandum or in any Loan Document or
Related Agreement or in any other document, certificate or written statement
furnished to Lenders by or on behalf of Holdings or any of its Subsidiaries) for
use in connection with the transactions contemplated by this Agreement is true
and correct in all material respects and does not omit to state a material fact
necessary in order to make the statements contained herein and therein, taken as
a whole, not misleading at such time in light of the circumstances in which the
same were made, it being understood that for purposes of this subsection 5.17,
such factual information does not include projections and pro forma financial
information. Any projections and pro forma financial information contained in
such materials or delivered pursuant to this Agreement from time to time are or
will be based upon good faith estimates and assumptions believed by Company to
be reasonable at the time made, it being recognized by Lenders that such
projections as to future events are not to be viewed as facts and that actual
results during the period or periods covered by any such projections may differ
from the projected results.
5.18 SUBORDINATED INDEBTEDNESS.
The Obligations constitute senior indebtedness that is entitled
to the benefits of the subordination provisions, if any, of all Indebtedness of
Company and the Subsidiary Guarantors.
5.19 RELATED AGREEMENTS.
A. DELIVERY OF RELATED AGREEMENTS. Company has delivered to
Lenders complete and correct copies of each Related Agreement and of all
exhibits and schedules thereto.
B. SELLER'S WARRANTIES. Except to the extent otherwise set
forth herein or in the schedules hereto, each of the representations and
warranties given by FTD to Holdings and Merger Sub in the Merger Agreement is
true and correct in all material respects as of the date hereof (or as of any
earlier date to which such representation and warranty specifically relates) and
will be true and correct in all material respects as of the Closing Date (or as
of such earlier
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date, as the case may be), in each case subject to the qualifications set forth
in the disclosure letter delivered by FTD in connection with the Merger
Agreement.
C. WARRANTIES OF COMPANY. Subject to the qualifications set
forth therein, each of the representations and warranties given by Holdings and
Merger Sub to FTD in the Merger Agreement is true and correct in all material
respects as of the date hereof and will be true and correct in all material
respects as of the Closing Date.
D. SURVIVAL. Notwithstanding anything in the Merger
Agreement to the contrary, the representations and warranties of Company set
forth in subsections 5.19B and 5.19C shall, solely for purposes of this
Agreement, survive the Closing Date for the benefit of Lenders.
5.20 REPORTING TO IRS.
Company does not intend to treat the Loans and related
transactions as being a "reportable transaction" (within the meaning of Treasury
Regulation Section 1.6011-4). In the event Company determines to take any action
inconsistent with such intention, it will promptly notify Administrative Agent
thereof.
Company acknowledges that one or more Lenders may treat their
Loans as part of a transaction that is subject to Treasury Regulation Section
1.6011-4 or Section 301.6112-1, and Administrative Agent and such Lender or
Lenders, as applicable, may file such IRS forms or maintain such lists and other
records as they may determine is required by such Treasury Regulations.
5.21 FOREIGN ASSETS CONTROL REGULATIONS, ETC.
Neither the making of the Loans to, or issuance of a Letter of
Credit on behalf of, Company nor its use of the proceeds thereof will violate
the Trading with the Enemy Act, as amended, or any of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended) or any enabling legislation or executive order relating
thereto. Without limiting the foregoing, neither Company nor any of its
Subsidiaries or Affiliates (a) is or will become a Person whose property or
interests in property are blocked pursuant to Section 1 of Executive Order 13224
of September 23, 2001 Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079
(2001)) or (b) engages or will engage in any dealings or transactions, or be
otherwise associated, with any such Person. Company and its Subsidiaries and
Affiliates are in compliance, in all material respects, with the Uniting And
Strengthening America By Providing Appropriate Tools Required To Intercept And
Obstruct Terrorism (USA Patriot Act of 2001).
5.22 FOREIGN SUBSIDIARIES.
Neither Florists' Transworld Delivery Association of Canada
Limited nor Florists' Transworld Delivery de Mexico, S. de X.X. de C.V., as of
the Closing Date, is a Material Subsidiary.
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SECTION 6. COMPANY'S AFFIRMATIVE COVENANTS
Company covenants and agrees that, so long as any of the
Commitments hereunder shall remain in effect and until payment in full of all of
the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, Company shall perform, and shall cause each of its Subsidiaries to
perform, all covenants in this Section 6.
6.1 FINANCIAL STATEMENTS AND OTHER REPORTS.
Company will maintain, and cause each of its Subsidiaries to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
conformity with GAAP. Company will deliver to Administrative Agent, which will
distribute to each Lender:
(i) EVENTS OF DEFAULT, ETC.: promptly upon any officer of
Company obtaining knowledge (a) of any condition or event that constitutes
an Event of Default or Potential Event of Default, or becoming aware that
any Lender has given any written notice (other than to Administrative
Agent) or taken any other action with respect to a claimed Event of Default
or Potential Event of Default, (b) that any Person has given any notice to
Company or any of its Subsidiaries or taken any other action with respect
to a claimed default or event or condition of the type referred to in
subsection 8.2, (c) of any condition or event that would be required to be
disclosed in a current report filed by Company with the Securities and
Exchange Commission on Form 8-K if Company were required to file such
reports under the Exchange Act, or (d) of the occurrence of any event or
change that has caused or evidences, either in any case or in the
aggregate, a Material Adverse Effect, an Officer's Certificate specifying
the nature and period of existence of such condition, event or change, or
specifying the notice given or action taken by any such Person and the
nature of such claimed Event of Default, Potential Event of Default,
default, event or condition, and what action Company has taken, is taking
and proposes to take with respect thereto;
(ii) QUARTERLY FINANCIALS: as soon as available and in any
event within 50 days after the end of each of the first three Fiscal
Quarters of each Fiscal Year, (a) (i) the consolidated balance sheet of
Company and its Subsidiaries as at the end of such Fiscal Quarter, (ii) the
related consolidated statement of income of Company and its Subsidiaries
for such Fiscal Quarter and for the period from the beginning of the then
current Fiscal Year to the end of such Fiscal Quarter and (iii) the related
consolidated statements of stockholders' equity and cash flows of Company
and its Subsidiaries for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter, setting forth in each case
in comparative form the corresponding figures for the corresponding periods
of the previous Fiscal Year, all in reasonable detail and certified by the
chief financial officer of Company that they fairly present, in all
material respects, the financial condition of Company and its Subsidiaries
as at the dates indicated and the results of their operations and their
cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments, and (b) a narrative report
describing the operations of Company and its Subsidiaries for such Fiscal
Quarter and for
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the period from the beginning of the then current Fiscal Year to the end of
such Fiscal Quarter;
(iii) YEAR-END FINANCIALS: as soon as available and in any
event within 105 days after the end of each Fiscal Year, (a) the
consolidated balance sheet of Company and its Subsidiaries as at the end of
such Fiscal Year and the related consolidated statements of income,
stockholders' equity and cash flows of Company and its Subsidiaries for
such Fiscal Year, setting forth in each case in comparative form the
corresponding figures for the previous Fiscal Year, all in reasonable
detail and certified by the chief financial officer of Company that they
fairly present, in all material respects, the financial condition of
Company and its Subsidiaries as at the dates indicated and the results of
their operations and their cash flows for the periods indicated, (b) a
narrative report describing the operations of Company and its Subsidiaries
for such Fiscal Year, and (c) in the case of such consolidated financial
statements, a report thereon of Ernst & Young LLP or other independent
certified public accountants of recognized national standing selected by
Company and satisfactory to Administrative Agent, which report shall be
unqualified, shall express no doubts, assumptions or qualifications
concerning the ability of Company and its Subsidiaries to continue as a
going concern, and shall state that such consolidated financial statements
fairly present, in all material respects, the consolidated financial
position of Company and its Subsidiaries as at the dates indicated and the
results of their operations and their cash flows for the periods indicated
in conformity with GAAP applied on a basis consistent with prior years
(except as otherwise disclosed in such financial statements) and that the
examination by such accountants in connection with such consolidated
financial statements has been made in accordance with generally accepted
auditing standards;
(iv) PRICING AND COMPLIANCE CERTIFICATES: together with each
delivery of financial statements pursuant to subdivisions (ii) and (iii)
above, (a) an Officer's Certificate of Company stating that the signers
have reviewed the terms of this Agreement and have made, or caused to be
made under their supervision, a review in reasonable detail of the
transactions and condition of Company and its Subsidiaries during the
accounting period covered by such financial statements and that such review
has not disclosed the existence during or at the end of such accounting
period, and that the signers do not have knowledge of the existence as at
the date of such Officer's Certificate, of any condition or event that
constitutes an Event of Default or Potential Event of Default, or, if any
such condition or event existed or exists, specifying the nature and period
of existence thereof and what action Company has taken, is taking and
proposes to take with respect thereto; and (b) a Compliance Certificate
demonstrating in reasonable detail compliance during and at the end of the
applicable accounting periods with the restrictions contained in Section 7,
in each case to the extent compliance with such restrictions is required to
be tested at the end of the applicable accounting period; in addition, on
or before the 50th day following the end of each Fiscal Quarter, a Pricing
Certificate demonstrating in reasonable detail the calculation of the
Consolidated Leverage Ratio as of the end of the four-Fiscal Quarter period
then ended;
(v) RECONCILIATION STATEMENTS: if, as a result of any change
in accounting principles and policies from those used in the preparation of
the audited financial
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statements referred to in subsection 5.3, the consolidated financial
statements of Company and its Subsidiaries delivered pursuant to
subdivisions (ii), (iii) or (xii) of this subsection 6.1 will differ in any
material respect from the consolidated financial statements that would have
been delivered pursuant to such subdivisions had no such change in
accounting principles and policies been made, then (a) together with the
first delivery of financial statements pursuant to subdivision (ii), (iii)
or (xii) of this subsection 6.1 following such change, consolidated
financial statements of Company and its Subsidiaries for (y) the current
Fiscal Year to the effective date of such change and (z) the two full
Fiscal Years immediately preceding the Fiscal Year in which such change is
made, in each case prepared on a pro forma basis as if such change had been
in effect during such periods, and (b) together with each delivery of
financial statements pursuant to subdivision (ii), (iii) or (xii) of this
subsection 6.1 following such change, if required pursuant to subsection
1.2, a written statement of the chief accounting officer or chief financial
officer of Company setting forth the differences (including any differences
that would affect any calculations relating to the financial covenants set
forth in subsection 7.6) which would have resulted if such financial
statements had been prepared without giving effect to such change;
(vi) ACCOUNTANTS' CERTIFICATION: together with each delivery
of consolidated financial statements pursuant to subdivision (iii) above, a
written statement by the independent certified public accountants giving
the report thereon (a) stating that their audit examination has included a
review of the terms of this Agreement and the other Loan Documents as they
relate to accounting matters, (b) stating whether, in connection with their
audit examination, any condition or event that constitutes an Event of
Default or Potential Event of Default has come to their attention and, if
such a condition or event has come to their attention, specifying the
nature and period of existence thereof; PROVIDED that such accountants
shall not be liable by reason of any failure to obtain knowledge of any
such Event of Default or Potential Event of Default that would not be
disclosed in the course of their audit examination, and (c) stating that
based on their audit examination nothing has come to their attention that
causes them to believe either or both that the information contained in the
certificates delivered therewith pursuant to subdivision (iv) above is not
correct or that the matters set forth in the Compliance Certificates
delivered therewith pursuant to clause (b) of subdivision (iv) above for
the applicable Fiscal Year are not stated in accordance with the terms of
this Agreement;
(vii) ACCOUNTANTS' REPORTS: promptly upon receipt thereof
(unless restricted by applicable professional standards), copies of all
reports submitted to Company by independent certified public accountants in
connection with each annual, interim or special audit of the financial
statements of Company and its Subsidiaries made by such accountants,
including any comment letter submitted by such accountants to management in
connection with their annual audit;
(viii) SEC FILINGS AND PRESS RELEASES: promptly upon their
becoming available, copies of (a) all financial statements, reports,
notices and proxy statements sent or made available generally by Company to
its security holders or by any Subsidiary of Company to its security
holders other than Company or another Subsidiary of Company, (b) all
regular and periodic reports and all registration statements (other than on
Form S-8 or a
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similar form) and prospectuses, if any, filed by Company or any of its
Subsidiaries with any securities exchange or with the Securities and
Exchange Commission or any governmental or private regulatory authority,
and (c) all press releases and other statements made available generally by
Company or any of its Subsidiaries to the public concerning material
developments in the business of Company or any of its Subsidiaries;
(ix) LITIGATION OR OTHER PROCEEDINGS: promptly upon any
Officer of Company obtaining knowledge of (1) the institution of, or
non-frivolous threat of, any Proceeding against or affecting Company or any
of its Subsidiaries or any property of Company or any of its Subsidiaries
not previously disclosed in writing by Company to Lenders or (2) any
material development in any Proceeding that, in any case:
(x) if adversely determined, has a reasonable
possibility after giving effect to the coverage and
policy limits of insurance policies issued to Company and
its Subsidiaries of giving rise to a Material Adverse
Effect; or
(y) seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain
relief as a result of, the transactions contemplated
hereby;
written notice thereof together with such other information as may be
reasonably available to Company to enable Lenders and their counsel to
evaluate such matters;
(x) ERISA EVENTS: promptly upon becoming aware of the
occurrence of or forthcoming occurrence of any ERISA Event, a written
notice specifying the nature thereof, what action Company, any of its
Subsidiaries or any of their respective ERISA Affiliates has taken, is
taking or proposes to take with respect thereto and, when known, any action
taken or threatened by the Internal Revenue Service, the Department of
Labor or the PBGC with respect thereto;
(xi) ERISA NOTICES: with reasonable promptness, copies of (a)
all written notices received by Company, any of its Subsidiaries or any of
their respective ERISA Affiliates from a Multiemployer Plan sponsor
concerning an ERISA Event; and (b) copies of such other documents or
governmental reports or filings relating to any Employee Benefit Plan as
Administrative Agent shall reasonably request;
(xii) FINANCIAL PLANS: as soon as practicable and in any event
no later than 90 days after the beginning of each Fiscal Year, a
consolidated plan and financial forecast for such Fiscal Year (the
"FINANCIAL PLAN" for such Fiscal Year), including (a) forecasted
consolidated balance sheets and forecasted consolidated statements of
income and cash flows of Company and its Subsidiaries for each such Fiscal
Year, together with PRO FORMA Compliance Certificates for each such Fiscal
Year and an explanation of the assumptions on which such forecasts are
based, (b) forecasted consolidated statements of income and cash flows of
Company and its Subsidiaries for each quarter of such Fiscal Year, and (c)
such other information and projections as any Lender may reasonably
request;
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(xiii) INSURANCE: as soon as practicable after any material
change in insurance coverage maintained by Company and its Subsidiaries
notice thereof to Administrative Agent specifying the changes and reasons
therefor;
(xiv) GOVERNING BODY: with reasonable promptness, written
notice of any change in the Governing Body of Company;
(xv) NEW SUBSIDIARIES: promptly upon any Person becoming a
Subsidiary of Company, a written notice setting forth with respect to such
Person (a) the date on which such Person became a Subsidiary of Company and
(b) all of the data required to be set forth in SCHEDULE 5.1 annexed hereto
with respect to all Subsidiaries of Company (it being understood that such
written notice shall be deemed to supplement SCHEDULE 5.1 annexed hereto
for all purposes of this Agreement);
(xvi) GOOD STANDING CERTIFICATES: together with each delivery
of financial statements pursuant to subdivision (iii) above or upon request
of Administrative Agent, good standing certificates as to each Loan Party
from its jurisdiction of organization;
(xvii) NOTICES FROM HOLDERS OF SUBORDINATED INDEBTEDNESS:
promptly, upon receipt, copies of all notices from holders of Subordinated
Indebtedness or a trustee, agent or other representative of such a holder;
(xviii) PATRIOT ACT, ETC.: with reasonable promptness,
information to confirm compliance with the representations contained in
subsection 5.21 reasonably requested by any Lender through Administrative
Agent; and
(xix) OTHER INFORMATION: with reasonable promptness, such other
information and data with respect to Company or any of its Subsidiaries as
from time to time may be reasonably requested by any Lender through
Administrative Agent.
Company and its Subsidiaries shall be deemed to have delivered reports
referred to in clauses (ii), (iii) and (viii) of this subsection 6.1 when (A)
such reports or other information have been posted on the Internet website of
the Securities and Exchange Commission (xxxx://xxx.xxx.xxx) or on its own
Internet website as previously identified to Administrative Agent and Lenders,
and (B) Company and its Subsidiaries have notified Administrative Agent and
Lenders by electronic mail of such posting; PROVIDED that if Administrative
Agent or any Lender request such information to be delivered in hard copies,
Company and/or any of its Subsidiaries, as applicable, shall furnish to
Administrative Agent or Lender, as applicable, such information accordingly.
6.2 EXISTENCE, ETC.
Except as permitted under subsection 7.7, Company will, and will
cause each of its Subsidiaries to, at all times preserve and keep in full force
and effect its existence in the jurisdiction of organization specified on
SCHEDULE 5.1 and all rights and franchises material to its business; PROVIDED,
HOWEVER that neither Company nor any of its Subsidiaries shall be required to
preserve any such right or franchise if the Governing Body of Company or such
Subsidiary shall determine that the preservation thereof is no longer desirable
in the conduct of the business of
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Company or such Subsidiary, as the case may be, and that the loss thereof is not
disadvantageous in any material respect to Company, such Subsidiary or Lenders.
6.3 PAYMENT OF TAXES AND CLAIMS; TAX.
A. Except as would not reasonably be expected to result in a
Material Adverse Effect, Holdings will, and will cause each of its Subsidiaries
to, pay all taxes, assessments and other governmental charges imposed upon it or
any of its properties or assets or in respect of any of its income, businesses
or franchises before any penalty accrues thereon, and all claims (including
claims for labor, services, materials and supplies) for sums that have become
due and payable and that by law have or may become a Lien upon any of its
properties or assets, prior to the time when any penalty or fine shall be
incurred with respect thereto; PROVIDED that no such tax, assessment, charge or
claim need be paid if it is being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted, so long as (i) such
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor and (ii) in the case of a
tax, assessment, charge or claim which has or may become a Lien against any of
the Collateral, such proceedings conclusively operate to stay the sale of any
portion of the Collateral to satisfy such charge or claim.
B. Holdings will not, nor will it permit any of its
Subsidiaries to, file or consent to the filing of any consolidated income tax
return with any Person (other than Holdings or any of its Subsidiaries or a
corporation that directly owns 50% or more of the Voting Stock of Holdings).
6.4 MAINTENANCE OF PROPERTIES; INSURANCE; APPLICATION OF NET
INSURANCE/ CONDEMNATION PROCEEDS.
A. MAINTENANCE OF PROPERTIES. Company will, and will cause
each of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear excepted, all material
properties necessary for and used in the business of Company and its
Subsidiaries (including all Intellectual Property) and from time to time will
make or cause to be made all appropriate repairs, renewals and replacements
thereof, except where the failure to do so could not reasonably be expected to
result in a Material Adverse Effect.
B. INSURANCE. Company will maintain or cause to be
maintained, with financially sound and reputable insurers, such public liability
insurance, third party property damage insurance, business interruption
insurance and casualty insurance with respect to liabilities, losses or damage
in respect of the assets, properties and businesses of Company and its
Subsidiaries as may customarily be carried or maintained under similar
circumstances by corporations of established reputation engaged in similar
businesses, in each case in such amounts (giving effect to self-insurance), with
such deductibles, covering such risks and otherwise on such terms and conditions
as shall be customary for corporations similarly situated in the industry.
Without limiting the generality of the foregoing, Company will maintain or cause
to be maintained (i) flood insurance with respect to each Flood Hazard Property
that is located in a community that participates in the National Flood Insurance
Program, in each case in compliance with any applicable regulations of the Board
of Governors of the Federal Reserve
96
System, and (ii) replacement value casualty insurance on the Collateral under
such policies of insurance, with such insurance companies, in such amounts, with
such deductibles, and covering such risks as are at all times satisfactory to
Administrative Agent in its commercially reasonable judgment. Each such policy
of insurance shall (a) name Administrative Agent for the benefit of Lenders as
an additional insured thereunder as its interests may appear and (b) in the case
of each business interruption and casualty insurance policy, contain a loss
payable clause or endorsement, satisfactory in form and substance to
Administrative Agent, that names Administrative Agent for the benefit of Lenders
as the loss payee thereunder for any covered loss in excess of $1,000,000 and
provides for at least 30 days prior written notice to Administrative Agent of
any modification or cancellation of such policy.
C. APPLICATION OF NET INSURANCE/CONDEMNATION PROCEEDS.
(i) BUSINESS INTERRUPTION INSURANCE. Upon receipt by Company
or any of its Subsidiaries of any business interruption insurance proceeds
constituting Net Insurance/Condemnation Proceeds, (a) so long as no Event
of Default shall have occurred and be continuing, Company or such
Subsidiary may retain and apply such Net Insurance/Condemnation Proceeds
for working capital purposes, and (b) if an Event of Default shall have
occurred and be continuing, Company shall apply an amount equal to such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or the Revolving
Loan Commitment Amount shall be reduced) as provided in subsection 2.4B;
(ii) NET INSURANCE/CONDEMNATION PROCEEDS RECEIVED BY COMPANY.
Upon receipt by Company or any of its Subsidiaries of any Net
Insurance/Condemnation Proceeds other than from business interruption
insurance, (a) so long as no Event of Default shall have occurred and be
continuing, Company shall, or shall cause one or more of its Subsidiaries
to, promptly and diligently apply such Net Insurance/Condemnation Proceeds
to pay or reimburse the costs of repairing, restoring or replacing the
assets in respect of which such Net Insurance/Condemnation Proceeds were
received or, to the extent not so applied, to prepay the Loans (and/or the
Revolving Loan Commitment Amount shall be reduced) as provided in
subsection 2.4B, and (b) if an Event of Default shall have occurred and be
continuing, Company shall apply an amount equal to such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or the Revolving
Loan Commitment Amount shall be reduced) as provided in subsection 2.4B.
(iii) NET INSURANCE/CONDEMNATION PROCEEDS RECEIVED BY
ADMINISTRATIVE AGENT. Upon receipt by Administrative Agent of any Net
Insurance/Condemnation Proceeds as loss payee, (a) if and to the extent
Company would have been required to apply such Net Insurance/Condemnation
Proceeds (if it had received them directly) to prepay the Loans and/or
reduce the Revolving Loan Commitment Amount, Administrative Agent shall,
and Company hereby authorizes Administrative Agent to, apply such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or the Revolving
Loan Commitment Amount shall be reduced) as provided in subsection 2.4B,
and (b) to the extent the foregoing clause (a) does not apply,
Administrative Agent shall deliver such Net Insurance/Condemnation Proceeds
to Company, and Company shall, or shall cause one or more of its
Subsidiaries to, promptly apply such Net Insurance/Condemnation Proceeds to
the costs of repairing, restoring, or replacing the
97
assets in respect of which such Net Insurance/Condemnation Proceeds were
received; PROVIDED, HOWEVER that if at any time Administrative Agent
reasonably determines (i) with respect to Net Insurance/Condemnation
Proceeds described in subsection 6.4C(ii) in excess of $1,000,000 or (ii)
with respect to Net Insurance/Condemnation Proceeds described in this
subsection 6.4C(iii), (A) that Company or any Subsidiary is not proceeding
diligently with the applicable repair, restoration or replacement or (B)
that the applicable repair, restoration or replacement cannot be completed
with such Net Insurance/Condemnation Proceeds, together with funds
otherwise available to Company for such purpose, or that the applicable
repair, restoration or replacement cannot be completed within 270 days
after the receipt by Administrative Agent or Company or any of its
Subsidiaries, as applicable, of such Net Insurance/Condemnation Proceeds,
Company shall apply such Net Insurance/ Condemnation Proceeds to prepay the
Loans (and/or the Revolving Loan Commitment Amount shall be reduced) as
provided in subsection 2.4B.
6.5 INSPECTION RIGHTS; LENDER MEETING.
A. INSPECTION RIGHTS. Company shall, and shall cause each of
its Subsidiaries to, permit any authorized representatives designated by any
Lender to visit and inspect any of the properties of Company or of any of its
Subsidiaries, to inspect, copy and take extracts from its and their financial
and accounting records, and to discuss its and their affairs, finances and
accounts with its and their officers and independent public accountants
(provided that Company may, if it so chooses, be present at or participate in
any such discussion), all upon reasonable notice and at such reasonable times
during normal business hours and, upon reasonable notice, as often as may
reasonably be requested or at any time or from time to time following the
occurrence and during the continuance of an Event of Default.
B. LENDER MEETING. Company will, upon the request of
Administrative Agent or Requisite Lenders, participate in a meeting of
Administrative Agent and Lenders once during each Fiscal Year to be held at
Company's principal offices (or at such other location as may be agreed to by
Company and Administrative Agent) at such time as may be agreed to by Company
and Administrative Agent.
6.6 COMPLIANCE WITH LAWS, ETC.
Company shall comply, and shall cause each of its Subsidiaries
and all other Persons on or occupying any Facilities to comply, with the
requirements of all applicable laws, rules, regulations and orders of any
Government Authority (including all Environmental Laws), noncompliance with
which could reasonably be expected to result in, individually or in the
aggregate, a Material Adverse Effect.
6.7 ENVIRONMENTAL MATTERS.
A. ENVIRONMENTAL DISCLOSURE. Company will deliver to
Administrative Agent and Lenders:
(i) ENVIRONMENTAL AUDITS AND REPORTS. As soon as practicable
following receipt thereof, copies of all environmental audits,
investigations, analyses and reports of
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any kind or character, whether prepared by personnel of Company or any of
its Subsidiaries or by independent consultants, governmental authorities or
any other Persons, with respect to significant environmental matters at any
Facility that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect or with respect to any
Environmental Claims that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect;
(ii) NOTICE OF CERTAIN RELEASES, REMEDIAL ACTIONS, ETC.
Promptly upon the occurrence thereof, written notice describing in
reasonable detail (a) any Release required to be reported to any federal,
state or local governmental or regulatory agency under any applicable
Environmental Laws, (b) any remedial action taken by Company or any other
Person in response to (1) any Hazardous Materials Activities the existence
of which could reasonably be expected to result in one or more
Environmental Claims having, individually or in the aggregate, a Material
Adverse Effect, or (2) any Environmental Claims that, individually or in
the aggregate, could reasonably be expected to result in a Material Adverse
Effect, and (c) Company's discovery of any occurrence or condition on any
real property adjoining or in the vicinity of any Facility that could cause
such Facility or any part thereof to be subject to any material
restrictions on the ownership, occupancy, transferability or use thereof
under any Environmental Laws.
(iii) WRITTEN COMMUNICATIONS REGARDING ENVIRONMENTAL CLAIMS,
RELEASES, ETC. As soon as practicable following the sending or receipt
thereof by Company or any of its Subsidiaries, a copy of any and all
written communications with respect to (a) any Environmental Claims that,
individually or in the aggregate, could reasonably be expected to result in
a Material Adverse Effect, (b) any Release required to be reported to any
federal, state or local governmental or regulatory agency, and (c) any
request for information from any governmental agency that suggests such
agency is investigating whether Company or any of its Subsidiaries may be
potentially responsible for any Hazardous Materials Activity.
(iv) NOTICE OF CERTAIN PROPOSED ACTIONS HAVING ENVIRONMENTAL
IMPACT. Prompt written notice describing in reasonable detail (a) any
proposed acquisition of stock, assets, or property by Company or any of its
Subsidiaries that could reasonably be expected to (1) expose Company or any
of its Subsidiaries to, or result in, Environmental Claims that could
reasonably be expected to result in, individually or in the aggregate, a
Material Adverse Effect or (2) affect the ability of Company or any of its
Subsidiaries to maintain in full force and effect all material Governmental
Authorizations required under any Environmental Laws for their respective
operations and (b) any proposed action to be taken by Company or any of its
Subsidiaries to commence manufacturing or other industrial operations or to
modify current operations in a manner that could reasonably be expected to
subject Company or any of its Subsidiaries to any material additional
obligations or requirements under any Environmental Laws that could
reasonably be expected to result in, individually or in the aggregate, a
Material Adverse Effect.
B. COMPANY'S ACTIONS REGARDING HAZARDOUS MATERIALS
ACTIVITIES. Company shall, in compliance with all applicable Environmental Laws,
promptly undertake, and shall cause each of its Subsidiaries promptly to
undertake, any and all investigations, studies,
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sampling, testing, abatement, cleanup, removal, remediation or other response
actions necessary to remove, remediate, clean up or xxxxx any Hazardous
Materials Activity on, under or about any Facility that is in violation of any
Environmental Laws or that presents a material risk of giving rise to an
Environmental Claim
6.8 EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY COLLATERAL
DOCUMENTS AFTER THE CLOSING DATE.
A. EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY
COLLATERAL DOCUMENTS. In the event that any Person becomes a Domestic Subsidiary
of Company after the date hereof, Company will promptly notify Administrative
Agent of that fact and cause such Domestic Subsidiary to execute and deliver to
Administrative Agent a counterpart of the Subsidiary Guaranty and Security
Agreement and to take all such further actions and execute all such further
documents and instruments (including actions, documents and instruments
comparable to those described in subsection 4.1L) as may be necessary or, in the
opinion of Administrative Agent, desirable to create in favor of Administrative
Agent, for the benefit of Lenders, a valid and perfected First Priority Lien on
all of the personal and mixed property assets of such Domestic Subsidiary
described in the applicable forms of Collateral Documents. In addition, as
provided in the Security Agreement, Company shall, or shall cause the Subsidiary
that owns the Capital Stock of such Person, to execute and deliver to
Administrative Agent a supplement to the Security Agreement and to deliver to
Administrative Agent all certificates representing such Capital Stock of such
Person (accompanied by irrevocable undated stock powers, duly endorsed in
blank).
B. FOREIGN SUBSIDIARIES. In the event that any Foreign
Subsidiary of Company becomes a Material Subsidiary (whether or not such Foreign
Subsidiary was a Subsidiary of Company on the date hereof) after the date
hereof, Company will promptly notify Administrative Agent of that fact and, if
such Subsidiary is directly owned by Company or a Domestic Subsidiary, cause
such Subsidiary to execute and deliver to Administrative Agent such documents
and instruments and take such further actions (including actions, documents and
instruments comparable to those described in subsection 4.1L and the execution
and delivery of any Foreign Pledge Agreements) as may be necessary, or in the
reasonable opinion of Administrative Agent, desirable to create in favor of
Administrative Agent, for the benefit of Lenders, a valid and perfected First
Priority Lien on 66% of the capital stock of such Foreign Subsidiary.
C. SUBSIDIARY ORGANIZATIONAL DOCUMENTS, LEGAL OPINIONS, ETC.
Company shall deliver to Administrative Agent, together with such Loan
Documents, (i) certified copies of such Subsidiary's Organizational Documents,
together with, if such Subsidiary is a Domestic Subsidiary, a good standing
certificate from the Secretary of State of the jurisdiction of its organization
and each other state in which such Person is qualified to do business and, to
the extent generally available, a certificate or other evidence of good standing
as to payment of any applicable franchise or similar taxes from the appropriate
taxing authority of each of such jurisdictions, each to be dated a recent date
prior to their delivery to Administrative Agent, (ii) a certificate executed by
the secretary or similar officer of such Subsidiary as to (a) the fact that the
attached resolutions of the Governing Body of such Subsidiary approving and
authorizing the execution, delivery and performance of such Loan Documents are
in full force and effect and
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have not been modified or amended and (b) the incumbency and signatures of the
officers of such Subsidiary executing such Loan Documents, (iii) an executed
supplement to the Security Agreement evidencing the pledge of the Capital Stock
of such Subsidiary by Company or a Subsidiary of Company that owns such Capital
Stock, accompanied by certificate evidencing such Capital Stock, together with
an irrevocable undated stock powers duly endorsed in blank and satisfactory in
form and substance to Administrative Agent, and (iv) a favorable opinion of
counsel to such Subsidiary, in form and substance satisfactory to Administrative
Agent and its counsel, as to (a) the due organization and good standing of such
Subsidiary, (b) the due authorization, execution and delivery by such Subsidiary
of such Loan Documents, (c) the enforceability of such Loan Documents against
such Subsidiary and (d) such other matters (including matters relating to the
creation and perfection of Liens in any Collateral pursuant to such Loan
Documents) as Administrative Agent may reasonably request, all of the foregoing
to be satisfactory in form and substance to Administrative Agent and its
counsel.
6.9 MATTERS RELATING TO ADDITIONAL REAL PROPERTY COLLATERAL.
A. ADDITIONAL MORTGAGES, ETC. From and after the Closing
Date, in the event that (i) Company or any Subsidiary Guarantor acquires any fee
interest in real property or any Material Leasehold Property (which may include
a renewal of any lease on existing Leasehold Property) or (ii) at the time any
Person becomes a Subsidiary Guarantor, such Person owns or holds any fee
interest in real property with a value in excess of $500,000 or any Leasehold
Property, in the case of clause (ii) above excluding any such Real Property
Asset the encumbrancing of which requires the consent of any applicable lessor
or then-existing senior lienholder, where Company and its Subsidiaries have
attempted in good faith, but are unable, to obtain such lessor's or senior
lienholder's consent (any such non-excluded Real Property Asset described in the
foregoing clause (i) or (ii) being an "ADDITIONAL MORTGAGED PROPERTY"), Company
or such Subsidiary Guarantor shall deliver to Administrative Agent, as soon as
practicable after such Person acquires such Additional Mortgaged Property or
becomes a Subsidiary Guarantor, as the case may be, a fully executed and
notarized Mortgage (an "ADDITIONAL MORTGAGE"), in proper form for recording in
all appropriate places in all applicable jurisdictions, encumbering the interest
of such Loan Party in such Additional Mortgaged Property; and such opinions,
appraisal, documents, title insurance, environmental reports that may be
reasonably required by Administrative Agent.
B. REAL ESTATE APPRAISALS. Company shall, and shall cause
each of its Subsidiaries to, permit an independent real estate appraiser
reasonably satisfactory to Administrative Agent, upon reasonable notice, to
visit and inspect any Additional Mortgaged Property for the purpose of preparing
an appraisal of such Additional Mortgaged Property satisfying the requirements
of any applicable laws and regulations (in each case to the extent required
under such laws and regulations as determined by Administrative Agent in its
discretion).
6.10 ESCROW OF FUNDS; PAYMENT OF XXX.XXX SECURITIES LITIGATION
SETTLEMENT. Within five Business Days of the Closing Date, Company shall deposit
$7,261,497.55 with the Escrow Agent pursuant to the Escrow Agreement (the
"SETTLEMENT CONTRIBUTION"). The Escrow Agreement will provide that the
Settlement Contribution will be used to make any required Settlement Payments
when due to the extent such Settlement
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Payments are not made by an insurer, either because no insurance coverage is
available, such coverage is not sufficient or a determination as to whether such
coverage exists is being made and will also provide that any excess funds
remaining with the Escrow Agent that are not required to make Settlement
Payments in full shall be returned to Company.
6.11 POST CLOSING MATTERS.
To the extent not delivered on or prior to the Closing Date,
Company shall use, and shall cause each of its Subsidiaries to use, as
applicable, commercially reasonable efforts to deliver within 60 days after the
Closing Date (i) executed Collateral Access Agreements in favor of
Administrative Agent for those inventory and equipment locations listed on
SCHEDULE 4 to the Security Agreement for which it is indicated on such schedule
that a Collateral Access Agreement is required to be obtained and (ii) executed
consents to assignment in favor of Administrative Agent with respect to those
Assigned Agreements (as defined in the Security Agreement) listed on SCHEDULE 15
to the Security Agreement for which it is indicated on such schedule that a
consent is required to be obtained. Within 30 days after the Closing Date
Company shall deliver to Administrative Agent a report describing the efforts
that have been made to obtain the Collateral Access Agreements and consents
referred to in clauses (i) and (ii) of the preceding sentence. Such report shall
be updated no earlier than 50 days after the Closing Date and no later than 60
days after the Closing Date with further updates thereafter to be delivered upon
the reasonable request of Administrative Agent.
SECTION 7. COMPANY'S NEGATIVE COVENANTS
Company covenants and agrees that, so long as any of the
Commitments hereunder shall remain in effect and until payment in full of all of
the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, Company shall perform, and shall cause each of its Subsidiaries to
perform, all covenants in this Section 7.
7.1 INDEBTEDNESS.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create, incur, assume or guaranty, or otherwise
become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(i) each Loan Party may become and remain liable with respect
to the Obligations;
(ii) Company and its Subsidiaries may become and remain liable
with respect to Contingent Obligations permitted by subsection 7.4 and,
upon any matured obligations actually arising pursuant thereto, the
Indebtedness corresponding to the Contingent Obligations so extinguished;
(iii) Company and its Domestic Subsidiaries may become and
remain liable with respect to Indebtedness in respect of Capital Leases
aggregating, together with Indebtedness of Company and its Subsidiaries
secured by Liens permitted by subsection 7.2A(ii), not in excess of
$15,000,000 at any one time;
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(iv) Company may become and remain liable with respect to
Indebtedness to any Subsidiary Guarantor, and any wholly-owned Subsidiary
of Company may become and remain liable with respect to Indebtedness to
Company or any Subsidiary Guarantor; PROVIDED that (a) a Lien on all such
intercompany Indebtedness shall have been granted to Administrative Agent
for the benefit of Lenders; (b) if such intercompany Indebtedness is
evidenced by a promissory note or other instrument, such promissory note or
instrument shall have been pledged to Administrative Agent pursuant to the
Security Agreement; and (c) no wholly-owned Foreign Subsidiary may become
and remain liable to Company or a Subsidiary Guarantor in an amount in
excess of $10,000,000; PROVIDED that any such Indebtedness of a
wholly-owned Foreign Subsidiary to Company or a Subsidiary Guarantor shall
be evidenced by a promissory note or other instrument and such promissory
note or other instrument shall be pledged to Administrative Agent;
(v) Company and its Subsidiaries, as applicable, may remain
liable with respect to Indebtedness described in SCHEDULE 7.1 annexed
hereto and any refinancings, refundings, renewals or extensions thereof
that in any case do not increase the principal or commitment amount
thereof;
(vi) Company may remain liable with respect to Indebtedness
evidenced by the Subordinated Notes issued initially on or prior to the
Closing Date in connection with funding a portion of the Merger Financing
Requirements in an aggregate principal amount not to exceed $175,000,000;
(vii) Company or a Domestic Subsidiary of Company may become
and remain liable with respect to Indebtedness of any Person assumed in
connection with any acquisition of such Person permitted under subsection
7.3 and a Person that becomes a direct or indirect wholly-owned Subsidiary
of Company as a result of any acquisition permitted under subsection 7.3
may remain liable with respect to Indebtedness existing on the date of such
acquisition; PROVIDED that such Indebtedness is not created in anticipation
of such acquisition;
(viii) Any Foreign Subsidiary may become and remain liable with
respect to Indebtedness of a Person assumed in connection with any
acquisition of a Person permitted under subsection 7.3 and a Person that
becomes a direct or indirect wholly-owned Foreign Subsidiary of Company as
a result of any acquisition permitted under subsection 7.3 may remain
liable with respect to Indebtedness existing on the date of such
acquisition; PROVIDED that such Indebtedness is not created in anticipation
of such acquisition; PROVIDED further that the aggregate amount of such
Indebtedness shall not exceed $10,000,000 at any one time;
(ix) Company and its Subsidiaries may become and remain liable
with respect to other Indebtedness in an aggregate principal amount not to
exceed $10,000,000 at any time outstanding; PROVIDED that no more than
$3,000,000 of such Indebtedness may be Indebtedness of Company's Domestic
Subsidiaries;
(x) Company may become and remain liable with respect to
Incremental Loans; PROVIDED that Company causes an opinion of counsel in
form and substance
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reasonably satisfactory to Administrative Agent to be delivered to
Administrative Agent to the effect that the incurrence and performance of
the terms of such Incremental Loans do not conflict with or violate the
terms of this Agreement or the Subordinated Note Indenture at or prior to
the date such Incremental Loans were incurred; PROVIDED FURTHER that (A)
after giving effect to the incurrence of the Incremental Loans, Company and
its Subsidiaries shall be in pro forma compliance with the provisions of
Section 7 of this Agreement and no Event of Default shall have occurred and
be continuing or shall be caused thereby, (B) the proceeds of the
Incremental Loans are used either (i) to prepay the Swing Line Loans, Term
Loans and/or Revolving Loans and/or permanently reduce the Revolving Loan
Commitments in accordance subsection 2.4B(iii)(e), or (ii) to finance the
consummation of an acquisition permitted by subsection 7.3(vi) or
subsection 7.3(vii) and (C) the Incremental Loans shall be incurred not
more than one time during the term of this Agreement and no later than
February 28, 2005 and on terms to be agreed upon by Company, Administrative
Agent and the lenders of such Incremental Loans (which may be Lenders
and/or other Eligible Assignees), and the Incremental Loans may be incurred
and conforming amendments made to this Agreement and the other Loan
Documents to reflect such Incremental Loans and the terms thereof without
the consent of any Lender not a lender of such Incremental Loans,
including, without limitation, conforming amendments: (w) to provide for
the Incremental Loans to share ratably in the benefits of this Agreement
and the other Loan Documents (including the accrued interest in respect
thereof) with the other Loans made under this Agreement, (x) to Sections 1
and 2 to provide, among other things, for the Incremental Loans to share
ratably with the Term Loans in the application of prepayments, (y) to
provide an amortization schedule for the Incremental Loans, and (z) to
include appropriately Lenders of Incremental Loans in any determination of
Lenders, Requisite Lenders and Pro Rata Share, it being understood that no
Lender or Agent is committed or obligated to participate in such
Incremental Loans unless it agrees to do so in the document or agreement
implementing such Incremental Loans; notwithstanding anything in this
Agreement expressed or implied to the contrary (including, without
limitation in subsection 10.6), nothing herein shall be construed to
require consent from Lenders that are not lenders of such Incremental Loans
to the incurrence of the Incremental Loans in compliance with this
subsection 7.1(x), and this subsection 7.1(x) shall supersede any
provisions in subsection 10.6 to the contrary; and
(xi) Company may become and remain liable with respect to
Indebtedness evidenced by additional Subordinated Notes in excess of the
$175,000,000 of Subordinated Notes issued in connection with funding a
portion of the Merger Financing Requirements in an aggregate principal
amount not to exceed $100,000,000; PROVIDED that (A) after giving effect to
the incurrence of Indebtedness in respect of such additional Subordinated
Notes, Company and its Subsidiaries shall be in pro forma compliance with
the provisions of Section 7 of this Agreement and no Event of Default shall
have occurred and be continuing or shall be caused thereby and (B) the
proceeds of such additional Subordinated Notes are used either (i) to
prepay the Loans and/or permanently reduce the Revolving Loan Commitments
in accordance with subsection 2.4B(iii)(e), or (ii) to finance the
consummation of an acquisition permitted by subsection 7.3(vi) or
subsection 7.3(vii).
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7.2 LIENS AND RELATED MATTERS.
A. PROHIBITION ON LIENS. Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly, create, incur, assume
or permit to exist any Lien on or with respect to any property or asset of any
kind (including any document or instrument in respect of goods or accounts
receivable) of Company or any of its Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the UCC or under any similar recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens on any asset existing at the time of acquisition of
such asset by Company or a Subsidiary, or Liens to secure the payment of
all or any part of the purchase price of an asset upon the acquisition of
such asset by Company or a Subsidiary or to secure any Indebtedness
permitted hereby incurred by Company or a Subsidiary at the time of or
within ninety days after the acquisition of such asset, which Indebtedness
is incurred for the purpose of financing all or any part of the purchase
price thereof; PROVIDED, HOWEVER, that the Lien shall apply only to the
asset so acquired and proceeds thereof; and PROVIDED FURTHER, that all such
Liens do not in the aggregate secure Indebtedness that, together with the
aggregate amount of all Capital Leases entered into pursuant to subsection
7.1(iii), exceeds $15,000,000 at any time;
(iii) Liens on assets of a Person that becomes a direct or
indirect Subsidiary of Company after the date of this Agreement, PROVIDED,
however, that such Liens exist at the time such Person becomes a Subsidiary
and are not created in anticipation thereof and, in any event, do not in
the aggregate secure Indebtedness in excess of $2,500,000 at any time;
(iv) Liens described in SCHEDULE 7.2 annexed hereto;
(v) Other Liens securing Indebtedness in an aggregate amount
not to exceed $2,000,000 at any time outstanding; and
(vi) Liens securing Indebtedness replacing or renewing the
Indebtedness secured by Liens described in clauses (ii), (iii) and (iv) of
this subsection 7.2A; PROVIDED that such Liens encumber the same property
encumbered by the original Liens and no other property and the principal or
commitment amount of Indebtedness secured thereby does not increase.
B. NO FURTHER NEGATIVE PLEDGES. Neither Company nor any of
its Domestic Subsidiaries shall enter into any agreement (other than the
Subordinated Note Indenture or any agreement prohibiting only the creation of
Liens securing Subordinated Indebtedness) prohibiting the creation or assumption
of any Lien upon any of its properties or assets, whether now owned or hereafter
acquired, except (i) with respect to specific property encumbered to secure
payment of particular Indebtedness or to be sold pursuant to an executed
agreement with respect to an Asset Sale; (ii) this Agreement and the other Loan
Documents; (iii) any covenant in
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documents creating Liens permitted by Section 7.2A prohibiting further liens on
the assets encumbered thereby; and (iv) any other agreement that does not
restrict Liens created pursuant to the Loan Documents on assets of Company or
its Domestic Subsidiaries securing the Obligations or any Interest Rate
Agreement and does not require the granting of any Lien securing any other
Indebtedness or other obligation by virtue of the granting of Liens on or pledge
of assets of Company or its Domestic Subsidiaries to secure the Obligations or
any Interest Rate Agreement.
C. NO RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS TO COMPANY OR
OTHER SUBSIDIARIES. Company will not, and will not permit any of its
Subsidiaries to, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any such Subsidiary to (i) pay dividends or make any other distributions on
any of such Subsidiary's Capital Stock owned by Company or any other Subsidiary
of Company, (ii) repay or prepay any Indebtedness owed by such Subsidiary to
Company or any other Subsidiary of Company, (iii) make loans or advances to
Company or any other Subsidiary of Company, or (iv) transfer any of its property
or assets to Company or any other Subsidiary of Company, except as provided (a)
in any of the Loan Documents, (b) in an agreement with respect to an Asset Sale
(or a sale not prohibited hereby that does not constitute an Asset Sale), (c) in
any agreement in existence at the time any Person becomes a Subsidiary after the
Closing Date that apply only to property of such Person, including restrictions
under any acquired Indebtedness of such Person not incurred in violation of this
Agreement (including any equity interest) relating to the property, assets or
business of the Person acquired by Company or any of its Subsidiaries, which
restriction in each case existed at the time of acquisition, were not put into
place in connection with or in anticipation of such acquisition and are not
applicable to any Person other than the Person acquired, or to any property,
assets or business, other than the property, assets or business so acquired, (d)
in leases or licenses of, or mortgages and other agreements relating to Liens,
which Liens constitute Permitted Encumbrances, on, specified property or assets
limiting or prohibiting transfers of such property or assets (including, without
limitation, non-assignment clauses, the absence of consent to assignment
clauses, due-on-sale clauses and clauses prohibiting junior Liens), (e) the
Subordinated Note Indenture, (f) Joint Venture agreements and other similar
agreements relating to the disposition or distribution of assets, (g) in any
agreement that amends, refinances or replaces any agreement containing
restrictions permitted under the preceding clauses (a) through (f); PROVIDED
that the terms and conditions of such agreement, as they relate to any such
restrictions, are no less favorable to Company or such Subsidiaries, as
applicable, than those under the agreement so amended, refinanced or replaced,
and (h) restrictions contained in Indebtedness not incurred in violation hereof
by a Foreign Subsidiary; provided that such restrictions relate only to one or
more Foreign Subsidiaries.
D. HOLDINGS CAPITAL STOCK. To the extent 50% or more of the
Voting Stock of Holdings is held by a holding company, no Liens shall be
created, incurred, assumed or permitted to exist with respect to such Voting
Stock.
7.3 INVESTMENTS; ACQUISITIONS.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, make or own any Investment in any Person, including
any Joint Venture, or acquire, by purchase or otherwise, all or substantially
all the business, property or fixed assets of, or
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Capital Stock or other ownership interest of any Person, or any division or line
of business of any Person except:
(i) Company and its Subsidiaries may make and own Investments
in Cash and Cash Equivalents;
(ii) Company and its wholly-owned Domestic Subsidiaries may
make and own additional equity Investments in their respective wholly-owned
Domestic Subsidiaries;
(iii) Company and its Subsidiaries may make intercompany loans
to the extent permitted under subsection 7.1(iv);
(iv) Company and its Subsidiaries may make Consolidated
Capital Expenditures permitted by subsection 7.8;
(v) Company and its Subsidiaries may continue to own the
Investments owned by them and described in SCHEDULE 7.3 annexed hereto;
(vi) Company and its Domestic Subsidiaries may acquire assets
(including Capital Stock and including Capital Stock of Subsidiaries formed
in connection with any such acquisition) having a fair market value not in
excess of $15,000,000 in any one Fiscal Year and $40,000,000 in the
aggregate and continue to own such assets after the acquisition thereof;
PROVIDED that (a) Company shall, and shall cause its Domestic Subsidiaries
to, comply with the requirements of subsections 6.8 and 6.9 with respect to
each such acquisition that results in a Person becoming a Subsidiary, (b)
Company shall be in pro forma compliance with all financial covenants after
giving effect to such acquisition and (c) no Event of Default shall have
occurred and be continuing prior to such acquisition or result from such
acquisition;
(vii) any Foreign Subsidiary of Company may acquire assets
(including Capital Stock and including Capital Stock of Subsidiaries formed
in connection with any such acquisition) having a fair market value not in
excess of $7,500,000 in any one Fiscal Year and $20,000,000 in the
aggregate and continue to own such assets after the acquisition thereof;
PROVIDED that (a) Company shall cause such Foreign Subsidiary to comply
with the requirements of subsection 6.8 with respect to each such
acquisition that results in a Person becoming a Subsidiary, (b) Company
shall be in pro forma compliance with all financial covenants after giving
effect to such acquisition and (c) no Event of Default have occurred and be
continuing prior to such acquisition or result from such acquisition;
(viii) Company and its wholly-owned Domestic Subsidiaries may
make additional Investments in their respective Foreign Subsidiaries;
PROVIDED that the amount of all such Investments does not exceed $5,000,000
(plus the amount of all loans or advances permitted under subsection
7.1(iv)) in the aggregate for all such Investments since the Closing Date,
including all Contingent Obligations of Company pursuant to subsections
7.4(viii) and (ix);
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(ix) Company and its Domestic Subsidiaries may make and own
other Investments in an aggregate amount not to exceed at any time
$5,000,000;
(x) Company may acquire and hold obligations of one or more
officers or other employees of Company or its Subsidiaries in connection
with (i) such officers' or employees' acquisition of shares of Holdings'
common stock (or the common stock of a parent entity of Holdings that
directly owns 50% or more of the Voting Stock of Holdings) so long as no
cash is actually advanced by Company or any of its Subsidiaries to such
officers or employees in connection with the acquisition of any such
obligations or (ii) in connection with the payment of income taxes on
employee-owned stock of Holdings, Company or its Subsidiaries (in an
aggregate amount during any Fiscal Year not in excess of $1,000,000);
(xi) Company and its Subsidiaries may receive and hold
promissory notes and other non-cash consideration received in connection
with any Asset Sale permitted by subsection 7.7;
(xii) Company and its Subsidiaries may acquire Securities in
connection with the satisfaction or enforcement of Indebtedness or claims
due or owing to Company or any of its Subsidiaries, including Securities
received in connection with the bankruptcy, insolvency or reorganization of
the Person obligated on such Indebtedness or claim, or as security for any
such Indebtedness or claim;
(xiii) Company and its Subsidiaries may make loans (financing
equipment sold by Company and its Subsidiaries) or equipment leases to
customers doing business with Company and its Subsidiaries in an aggregate
principal amount not to exceed (i) $20,000,000 at any time on or prior to
June 30, 2006, (ii) $30,000,000 at any time after June 30, 2006 but on or
prior to June 30, 2007 and (iii) $40,000,000 at any time after June 30,
2007 (with the principal amount of such leases to be deemed to be equal to
the discounted present value, at a market rate of interest, of the
remaining rental payments plus any residual value of the leased equipment
as shown on Company's financial statements); provided that, Company or such
Subsidiary has filed appropriate UCC financing statements to protect its
interest in all such financed equipment to the extent such equipment has,
at the time of such transaction, a fair market value in excess of $10,000;
and
(xiv) Company and its Subsidiaries may make loans to customers
doing business with Company and its Subsidiaries in settlement of accounts
receivable owing to Company or any of its Subsidiaries from such customer
in an aggregate principal amount not to exceed $7,500,000 at any one time.
7.4 CONTINGENT OBLIGATIONS.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create or become or remain liable with respect to
any Contingent Obligation, except:
(i) Subsidiaries of Company may become and remain liable with
respect to Contingent Obligations in respect of the Subsidiary Guaranty;
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(ii) Company may become and remain liable with respect to
Contingent Obligations in respect of Letters of Credit;
(iii) Hedge Agreements with respect to Indebtedness;
(iv) Company and its Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
connection with Asset Sales or other sales of assets;
(v) Company and its Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of any obligation of
Company or any of its Domestic Subsidiaries not prohibited under this
Agreement;
(vi) Company and its Subsidiaries, as applicable, may remain
liable with respect to Contingent Obligations described in SCHEDULE 7.4
annexed hereto;
(vii) Subsidiary Guarantors may become and remain liable with
respect to Contingent Obligations arising under their subordinated
guaranties of the Subordinated Notes;
(viii) Company (subject to subsection 7.3(viii)) and Company's
Foreign Subsidiaries may become and remain liable with respect to
Contingent Obligations in respect of any obligation of another Foreign
Subsidiary of Company not prohibited under this Agreement; and
(ix) Company and its Subsidiaries may become and remain liable
with respect to other Contingent Obligations in an aggregate amount not to
exceed $1,000,000.
7.5 RESTRICTED JUNIOR PAYMENTS.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, declare, order, pay, make or set apart any sum for
any Restricted Junior Payment; PROVIDED that (i) Company may make regularly
scheduled payments of interest in respect of any Subordinated Indebtedness in
accordance with the terms of, and only to the extent required by, and subject to
the subordination provisions contained in, the indenture or other agreement
pursuant to which such Subordinated Indebtedness was issued, as such indenture
or other agreement may be amended from time to time to the extent not prohibited
under subsection 7.12B, (ii) Company may make all payments necessary in
connection with the Merger, (iii) so long as no Event of Default shall have
occurred and be continuing or shall be caused thereby, Company may make
Restricted Junior Payments to Holdings (a) in an aggregate amount not to exceed
(1) $250,000 in any Fiscal Year prior to a Qualified Public Offering or (2)
$2,000,000 in any Fiscal Year after a Qualified Public Offering, to the extent
necessary to permit Holdings to pay general administrative costs and expenses,
(b) to the extent necessary to permit Holdings (or an Affiliate of Holdings) to
discharge the consolidated, combined or other group tax liabilities of Holdings
and its Subsidiaries, in each case so long as Holdings (or an Affiliate of
Holdings) applies the amount of any such Restricted Junior Payment for such
purpose, (c) for repurchases of Capital Stock from employees of Company or any
of its Subsidiaries, FTD-member florists, distributors or directors (or their
heirs or estates) of Holdings, Company or any Subsidiary of
109
Company upon the death, disability or termination of employment (or termination
of membership or distribution, in the case of a FTD-member florist or
distributor); PROVIDED that such repurchases are made with the proceeds of such
Restricted Junior Payments within three Business Days of the payment of such
Restricted Junior Payments, and (d) to make payments of cash, in lieu of the
issuance of fractional shares upon the exercise of warrants or upon the
conversion or exchange of, or issuance of Capital Stock in lieu of cash
dividends on any Capital Stock of Holdings, provided that the aggregate amount
of Restricted Junior Payments made after the Closing Date pursuant to this
clause (d) and clause (c) above shall not exceed $7,500,000, (iv) Company may
make one or more Restricted Junior Payments to Holdings equal in the aggregate
to the lesser of (a) the Settlement Insurance Proceeds and (b) the difference
between (1) the sum of the Settlement Insurance Proceeds and the Settlement
Contribution and (2) the amount of Settlement Payments, (v) Company may purchase
Capital Stock of Holdings in a purchase deemed to occur upon the exercise of
stock options, warrants or other convertible securities to the extent such
Capital Stock represents a portion of the exercise price thereof, and (vi)
Company may purchase or redeem the Subordinated Notes using the proceeds from a
Public Offering of Stock to the extent the gross proceeds from such Public
Offering of Stock aggregate no less than $50,000,000 and are not otherwise
required to be applied as a mandatory prepayment pursuant to subsection
2.4B(iii)(c), PROVIDED that (a) the Consolidated Senior Leverage Ratio
(calculated to give pro forma effect to any mandatory prepayment that will be
made using the proceeds from such Public Offering of Stock) as of the last day
of the Fiscal Quarter immediately preceding the date such proceeds are received
is less than 1.50:1.00, (b) the excess of the Revolving Loan Commitment Amount
over the Total Utilization of Revolving Loan Commitments on the day immediately
preceding the closing of such Public Offering of Stock is at least $15,000,000
and (c) Administrative Agent shall have received an Officer's Certificate
setting forth the calculation of Consolidated Senior Leverage Ratio required by
the foregoing clause (a) and setting forth the availability of Revolving Loans
as required by the foregoing clause (b).
7.6 FINANCIAL COVENANTS.
A. MINIMUM INTEREST COVERAGE RATIO. Company shall not permit
the ratio of (i) Consolidated EBITDA to (ii) Consolidated Interest Expense for
any four-Fiscal Quarter period ending on the dates set forth below to be less
than the correlative ratio indicated:
MINIMUM INTEREST
PERIOD ENDING COVERAGE RATIO
------------- ----------------
March 31, 2004 2.10:1.00
June 30, 2004 2.10:1.00
September 30, 2004 2.10:1.00
December 31, 2004 2.10:1.00
March 31, 2005 2.10:1.00
June 30, 2005 2.20:1.00
September 30, 2005 2.20:1.00
December 31, 2005 2.20:1.00
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March 31, 2006 2.20:1.00
June 30, 2006 2.30:1.00
September 30, 2006 2.30:1.00
December 31, 2006 2.30:1.00
March 31, 2007 2.30:1.00
June 30, 2007 2.50:1.00
September 30, 2007 2.50:1.00
December 31, 2007 2.50:1.00
March 31, 2008 2.50:1.00
June 30, 2008 2.75:1.00
September 30, 2008 2.75:1.00
December 31, 2008 2.75:1.00
March 31, 2009 2.75:1.00
June 30, 2009 and the last day of each Fiscal
Quarter thereafter 3.00:1.00
B. MINIMUM FIXED CHARGE COVERAGE RATIO. Company shall not
permit the ratio of (i) Consolidated EBITDA to (ii) Consolidated Fixed Charges
for any four-Fiscal Quarter period ending on any of the dates set forth below to
be less than the correlative ratio indicated:
MINIMUM FIXED
PERIOD ENDING CHARGE COVERAGE RATIO
------------- ---------------------
March 31, 2004 1.40:1.00
June 30, 2004 1.40:1.00
September 30, 2004 1.45:1.00
December 31, 2004 1.45:1.00
March 31, 2005 and the last day of each Fiscal
Quarter thereafter 1.50:1.00
C. MAXIMUM LEVERAGE RATIO. Company shall not permit the
Consolidated Leverage Ratio as of the last day of each Fiscal Quarter ending on
the dates set forth below to exceed the correlative ratio indicated:
PERIOD ENDING MAXIMUM LEVERAGE RATIO
------------- ----------------------
March 31, 2004 6.00:1.00
June 30, 2004 5.90:1.00
September 30, 2004 5.90:1.00
December 31, 2004 5.75:1.00
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March 31, 2005 5.75:1.00
June 30, 2005 5.50:1.00
September 30, 2005 5.50:1.00
December 31, 2005 5.50:1.00
March 31, 2006 5.50:1.00
June 30, 2006 4.85:1.00
September 30, 2006 4.85:1.00
December 31, 2006 4.85:1.00
March 31, 2007 4.85:1.00
June 30, 2007 4.25:1.00
September 30, 2007 4.25:1.00
December 31, 2007 4.25:1.00
March 31, 2008 4.25:1.00
June 30, 2008 3.75:1.00
September 30, 2008 3.75:1.00
December 31, 2008 3.75:1.00
March 31, 2009 3.75:1.00
June 30, 2009 and the last day of each Fiscal
Quarter thereafter 3.25:1.00
7.7 RESTRICTION ON FUNDAMENTAL CHANGES; ASSET SALES.
Company shall not, and shall not permit any of its Subsidiaries
to, alter the corporate, capital or legal structure of Company or any of its
Subsidiaries, or enter into any transaction of merger or consolidation, or
liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets (including its
notes or receivables and Capital Stock of a Subsidiary, whether newly issued or
outstanding), whether now owned or hereafter acquired, except:
(i) any Subsidiary of Company may be merged with or into
Company or any wholly-owned Subsidiary Guarantor, or be liquidated, wound
up or dissolved, or all or any part of its business, property or assets may
be conveyed, sold, leased, transferred or otherwise disposed of, in one
transaction or a series of transactions, to Company or any wholly-owned
Subsidiary Guarantor (or, in the case of a Foreign Subsidiary, to another
Foreign Subsidiary); PROVIDED that, in the case of such a merger, Company
or such wholly-owned Subsidiary Guarantor shall be the continuing or
surviving Person;
(ii) Company and its Subsidiaries may sell, lease or otherwise
dispose of assets in transactions that do not constitute Asset Sales;
PROVIDED that the consideration received for such assets shall be in an
amount at least equal to the fair market value thereof;
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(iii) Company and its Subsidiaries may dispose of obsolete,
worn out or surplus property in the ordinary course of business;
(iv) Company and its Subsidiaries may make Asset Sales of
assets having a fair market value not in excess of $10,000,000 in any
Fiscal Year; PROVIDED that (a) the consideration received for such assets
shall be in an amount at least equal to the fair market value thereof; (b)
75% of the consideration received shall be cash; and (c) the proceeds of
such Asset Sales shall be applied as required by subsection 2.4B(iii)(a) or
subsection 2.4D;
(v) in order to resolve disputes that occur in the ordinary
course of business, Company and its Subsidiaries may discount or otherwise
compromise for less than the face value thereof, notes or accounts
receivable;
(vi) Company or a Subsidiary may sell or dispose of shares of
Capital Stock of any of its Subsidiaries in order to qualify members of the
Governing Body of the Subsidiary if required by applicable law;
(vii) the Merger may occur in accordance with the terms and
conditions of the Merger Agreement;
(viii) any Person may be merged with or into Company or any
Subsidiary if the acquisition of the Capital Stock of such Person by
Company or such Subsidiary would have been permitted pursuant to subsection
7.3; PROVIDED that (a) in the case of Company, Company shall be the
continuing or surviving Person, (b) if a Subsidiary is not the surviving or
continuing Person, the surviving Person becomes a Subsidiary and complies
with the provisions of subsection 6.8 and subsection 6.9 and (c) no
Potential Event of Default or Event of Default shall have occurred or be
continuing after giving effect thereto;
(ix) Company or a Subsidiary may, in the ordinary course of
business, liquidate Cash Equivalents;
(x) Company and its Subsidiaries may sell or grant licenses
to use Intellectual Property to the extent such licenses do not prohibit
the licensor from using such Intellectual Property;
(xi) Company and its Subsidiaries may sell and lease back
property in a transaction permitted by subsection 7.10; and
(xii) Company and its Subsidiaries may settle accounts
receivable owing to Company or any of its Subsidiaries in connection with
the making of loans permitted by subsection 7.3(xiv).
7.8 CONSOLIDATED CAPITAL EXPENDITURES.
Company shall not, and shall not permit its Subsidiaries to, make
or incur Consolidated Capital Expenditures, in any Fiscal Year indicated below,
in an aggregate amount
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in excess of the corresponding amount (the "MAXIMUM CONSOLIDATED CAPITAL
EXPENDITURES AMOUNT") set forth below opposite such Fiscal Year; PROVIDED that
the Maximum Consolidated Capital Expenditures Amount for any Fiscal Year shall
be increased by an amount equal to the excess, if any, of the Maximum
Consolidated Capital Expenditures Amount for the previous Fiscal Year (without
giving effect to any adjustment in accordance with this proviso) over the actual
amount of Consolidated Capital Expenditures for such previous Fiscal Year;
PROVIDED, FURTHER that in no event shall the amount of such increase exceed 50%
of the Maximum Consolidated Capital Expenditures Amount for such previous Fiscal
Year (prior to any adjustment in accordance with this proviso):
MAXIMUM CONSOLIDATED
FISCAL YEAR ENDING CAPITAL EXPENDITURES
------------------ --------------------
June 30, 2004 $ 8,000,000
June 30, 2005 $ 9,000,000
June 30, 2006 $ 9,500,000
June 30, 2007 $ 9,500,000
June 30, 2008 $ 10,000,000
June 30, 2009 and each Fiscal Year thereafter $ 10,000,000
7.9 TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, enter into or permit to exist any transaction
(including the purchase, sale, lease or exchange of any property or the
rendering of any service) with any holder of 5% or more of any class of equity
Securities of Company or with any Affiliate of Company or of any such holder,
(A) in the case of any agreement or arrangement pursuant to which any Loan Party
is obligated to pay any amounts to LGP (including any of its Affiliates other
than Holdings), without the prior written consent of Administrative Agent,
Syndication Agent and Requisite Lenders, and (B) in all other cases, on terms
that are less favorable to Company or that Subsidiary, as the case may be, than
those that might be obtained at the time from Persons who are not such a holder
or Affiliate; provided that the foregoing restriction shall not apply to (i) any
transaction between Company and any of its wholly-owned Subsidiaries or between
any of its wholly-owned Subsidiaries, (ii) reasonable and customary fees paid to
members of the Governing Bodies of Company and its Subsidiaries, (iii) the
execution and delivery of the LGP Management Agreement, the Management
Contribution and Subscription Agreements and the Stockholders Agreement, (iv)
payments to LGP for the reimbursement of expenses pursuant to the LGP Management
Agreement as in effect on the Closing Date, (v) so long as no Event of Default
shall have occurred and be continuing or shall be caused thereby, (A) payments
of amounts (other than as referred to in subclause (iv)) due to LGP pursuant to
the LGP Management Agreement as in effect on the Closing Date; and (B)
transactions contemplated by the Management Contribution and Subscription
Agreements and the Stockholders Agreement, as in effect on the Closing Date, on
terms and subject to the conditions set forth therein, (vi) the transactions
contemplated by this Agreement and the Related Agreements to occur on the
Closing Date, (vii) indemnification payments to officers or directors of Loan
Parties, (viii) arrangements with Interflora, Inc., (ix) payments or loans to
employees which are approved by a majority of the Governing Body of
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Company or are made pursuant to agreements, arrangements or plans approved by a
majority of the Governing Body of Company, (x) any transaction as in effect as
of the date hereof and set forth on Schedule 7.9, (xi) employment agreements of
senior management of Company as in effect as of the date hereof or otherwise
approved by the Governing Body of Company and (xii) any Restricted Junior
Payment permitted by subsection 7.5.
7.10 SALES AND LEASE-BACKS.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, become or remain liable as lessee or as a guarantor
or other surety with respect to any lease, whether an Operating Lease or a
Capital Lease, of any property (whether real, personal or mixed), whether now
owned or hereafter acquired, (i) that Company or any of its Subsidiaries has
sold or transferred or is to sell or transfer to any other Person (other than
Company or any of its Subsidiaries) or (ii) that Company or any of its
Subsidiaries intends to use for substantially the same purpose as any other
property that has been or is to be sold or transferred by Company or any of its
Subsidiaries to any Person (other than Company or any of its Subsidiaries) in
connection with such lease; PROVIDED that (a) Company and its Subsidiaries may
become and remain liable as lessee, guarantor or other surety with respect to
any such lease if and to the extent that Company or any of its Subsidiaries
would be permitted to enter into, and remain liable under, such lease to the
extent that the transaction would be permitted under subsection 7.1, assuming
the sale and lease back transaction constituted Indebtedness in a principal
amount equal to the gross proceeds of the sale and (b) so long as no Event of
Default has occurred and is continuing or shall be caused thereby, Florists'
Transworld Delivery, Inc. may sell, and become and remain liable as lessee with
respect to a lease for, its headquarters located at 0000 Xxxxxxxxx Xxxxx,
Xxxxxxx Xxxxx, Xxxxxxxx, so long as the Net Asset Sale Proceeds resulting
therefrom are applied to prepay the Loans and/or reduce permanently the
Revolving Loan Commitment Amount in an amount equal to such proceeds.
7.11 CONDUCT OF BUSINESS.
From and after the Closing Date, Company shall not, and shall not
permit any of its Subsidiaries to, engage in any business other than (i) the
businesses engaged in by Company and its Subsidiaries on the Closing Date and
similar or related businesses and (ii) such other lines of business as may be
consented to by Requisite Lenders.
7.12 AMENDMENTS OR WAIVERS OF CERTAIN AGREEMENTS; AMENDMENTS OF
DOCUMENTS RELATING TO SUBORDINATED INDEBTEDNESS; DESIGNATION OF
DESIGNATED SENIOR INDEBTEDNESS.
A. AMENDMENTS OR WAIVERS OF CERTAIN AGREEMENTS. Neither
Company nor any of its Subsidiaries will agree to any material amendment to, or
waive any of its material rights under, any Related Agreement (other than any
agreement evidencing or governing any Subordinated Indebtedness) after the
Closing Date without in each case obtaining the prior written consent of
Requisite Lenders to such amendment or waiver.
B. AMENDMENTS OF DOCUMENTS RELATING TO SUBORDINATED
INDEBTEDNESS. Company shall not, and shall not permit any of its Subsidiaries
to, amend or otherwise change
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the terms of any Subordinated Indebtedness, or make any payment consistent with
an amendment thereof or change thereto, if the effect of such amendment or
change is to increase the interest rate on such Subordinated Indebtedness,
change (to earlier dates) any dates upon which payments of principal or interest
are due thereon, change any event of default or condition to an event of default
with respect thereto (other than to eliminate or waive any such event of default
or increase any grace period related thereto), change the redemption, prepayment
or defeasance provisions thereof, change the subordination provisions thereof
(or of any guaranty thereof), or change any collateral therefor (other than to
release such collateral), or if the effect of such amendment or change, together
with all other amendments or changes made, is to increase materially the
obligations of the obligor thereunder or to confer any additional rights on the
holders of such Subordinated Indebtedness (or a trustee or other representative
on their behalf) which would be adverse to Company or Lenders.
C. DESIGNATION OF "DESIGNATED SENIOR INDEBTEDNESS." Company
shall not designate any Indebtedness as "Designated Senior Indebtedness" (as
defined in the Subordinated Note Indenture) for purposes of the Subordinated
Note Indenture without the prior written consent of Requisite Lenders.
7.13 FISCAL YEAR.
Company shall not change its Fiscal Year-end from June 30.
SECTION 8. EVENTS OF DEFAULT
If any of the following conditions or events ("EVENTS OF
DEFAULT") shall occur:
8.1 FAILURE TO MAKE PAYMENTS WHEN DUE.
Failure by Company to pay any installment of principal of any
Loan when due, whether at stated maturity, by acceleration, by notice of
voluntary prepayment, by mandatory prepayment or otherwise; failure by Company
to pay when due any amount payable to an Issuing Lender in reimbursement of any
drawing under a Letter of Credit; or failure by Company to pay any interest on
any Loan or any fee or any other amount due under this Agreement within five
days after the date due; or
8.2 DEFAULT IN OTHER AGREEMENTS.
(i) Failure of Holdings, Company or any of its Subsidiaries
to pay when due any principal of or interest on or any other amount payable
in respect of one or more items of Indebtedness (other than Indebtedness
referred to in subsection 8.1) or Contingent Obligations in an individual
principal amount of $2,500,000 or more or with an aggregate principal
amount of $5,000,000 or more, in each case beyond the end of any grace
period provided therefor; or
(ii) breach or default by Holdings, Company or any of its
Subsidiaries with respect to any other material term of (a) one or more
items of Indebtedness or Contingent Obligations in the individual or
aggregate principal amounts referred to in clause (i) above or (b) any loan
agreement, mortgage, indenture or other agreement relating to such
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item(s) of Indebtedness or Contingent Obligation(s), if the effect of such
breach or default is to cause, or to permit the holder or holders of that
Indebtedness or Contingent Obligation(s) (or a trustee on behalf of such
holder or holders) to cause, that Indebtedness or Contingent Obligation(s)
to become or be declared due and payable prior to its stated maturity or
the stated maturity of any underlying obligation, as the case may be (in
each case only after the requisite giving or receiving of notice, lapse of
time, both, or otherwise and provided such breach or default has not been
waived); or
8.3 BREACH OF CERTAIN COVENANTS.
Failure of Company to perform or comply with any term or
condition contained in subsection 2.5 or 6.2 or Section 7 of this Agreement; or
8.4 BREACH OF WARRANTY.
Any representation, warranty, certification or other statement
made by Company or any of its Subsidiaries in any Loan Document or in any
statement or certificate at any time given by Company or any of its Subsidiaries
in writing pursuant hereto or thereto or in connection herewith or therewith
shall be false in any material respect on the date as of which made; or
8.5 OTHER DEFAULTS UNDER LOAN DOCUMENTS.
Any Loan Party shall default in the performance of or compliance
with any term contained in this Agreement or any of the other Loan Documents,
other than any such term referred to in any other subsection of this Section 8,
and such default shall not have been remedied or waived within 30 days after the
earlier of (i) an Officer of Company or such Loan Party becoming aware of such
default or (ii) receipt by Company and such Loan Party of notice from
Administrative Agent or any Lender of such default; or
8.6 INVOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(i) A court having jurisdiction in the premises shall enter a
decree or order for relief in respect of Holdings, Company or any of its
Material Subsidiaries in an involuntary case under the Bankruptcy Code or
under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, which decree or order is not stayed; or any other
similar relief shall be granted under any applicable federal or state law;
or
(ii) an involuntary case shall be commenced against Holdings,
Company or any of its Material Subsidiaries under the Bankruptcy Code or
under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect; or a decree or order of a court having jurisdiction in
the premises for the appointment of a receiver, liquidator, sequestrator,
trustee, custodian or other officer having similar powers over Holdings,
Company or any of its Material Subsidiaries, or over all or a substantial
part of its property, shall have been entered; or there shall have occurred
the involuntary appointment of an interim receiver, trustee or other
custodian of Holdings, Company or any of its Material Subsidiaries for all
or a substantial part of its property; or a warrant of attachment,
execution or similar process shall have been issued against any substantial
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part of the property of Holdings, Company or any of its Material
Subsidiaries, and any such event described in this clause (ii) shall
continue for 60 days unless dismissed, bonded or discharged; or
8.7 VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(i) Holdings, Company or any of its Material Subsidiaries
shall have an order for relief entered with respect to it or commence a
voluntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, or shall
consent to the entry of an order for relief in an involuntary case, or to
the conversion of an involuntary case to a voluntary case, under any such
law, or shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial part of its
property; or Holdings, Company or any of its Material Subsidiaries shall
make any assignment for the benefit of creditors; or
(ii) Holdings, Company or any of its Material Subsidiaries
shall be unable, or shall fail generally, or shall admit in writing its
inability, to pay its debts as such debts become due; or the Governing Body
of Holdings, Company or any of its Material Subsidiaries (or any committee
thereof) shall adopt any resolution or otherwise authorize any action to
approve any of the actions referred to in clause (i) above or this clause
(ii); or
8.8 JUDGMENTS AND ATTACHMENTS.
Any money judgment, writ or warrant of attachment or similar
process involving in the aggregate at any time an amount in excess of
$5,000,000, excluding amounts covered by insurance as to which a solvent and
unaffiliated insurance company has acknowledged coverage, shall be entered or
filed against Company or any of its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of 60 days (or in any event later than five days prior to the date of any
proposed sale thereunder); or
8.9 DISSOLUTION.
Any order, judgment or decree shall be entered against Holdings,
Company or any of its Material Subsidiaries decreeing the dissolution or split
up of Holdings, Company or that Material Subsidiary and such order shall remain
undischarged or unstayed for a period in excess of 30 days; or
8.10 EMPLOYEE BENEFIT PLANS.
There shall occur one or more ERISA Events or similar events in
respect of any Foreign Plans, that individually or in the aggregate result in or
might reasonably be expected to result in a Direct Liability of Company or any
of its Subsidiaries in excess of $1,000,000 during the term of this Agreement;
or there shall exist an amount of unfunded benefit liabilities (as defined in
Section 4001(a)(18) of ERISA) and unfunded liabilities in respect of Foreign
Plans, individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which assets
exceed benefit liabilities), which could reasonably be expected to result in a
Direct Liability in excess of $1,500,000; or
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8.11 CHANGE IN CONTROL.
A Change in Control shall have occurred; or
8.12 INVALIDITY OF LOAN DOCUMENTS; FAILURE OF SECURITY; REPUDIATION OF
OBLIGATIONS.
At any time after the execution and delivery thereof, (i) any
Loan Document or any provision thereof, for any reason other than the
satisfaction in full of all Obligations, shall cease to be in full force and
effect (other than in accordance with its terms) in any material respect or
shall be declared to be null and void, (ii) Administrative Agent shall not have
or shall cease to have a valid and perfected First Priority Lien in any
Collateral purported to be covered by the Collateral Documents, in each case for
any reason other than the failure of Administrative Agent or any Lender to take
any action within its control, or (iii) any Loan Party shall contest the
validity or enforceability of any Loan Document or any provision thereof in
writing or deny in writing that it has any further liability, including with
respect to future advances by Lenders, under any Loan Document or any provision
thereof to which it is a party; or
8.13 CONDUCT OF BUSINESS BY HOLDINGS.
Holdings shall (i) engage in any business other than entering
into and performing its obligations under and in accordance with the Loan
Documents and Related Agreements to which it is a party or (ii) own any assets
other than (a) the capital stock of Company and (b) Cash and Cash Equivalents in
an amount not to exceed $250,000 prior to a Qualified Public Offering and
$2,000,000 after a Qualified Public Offering at any one time for the purpose of
paying general operating expenses of Holdings or (iii) have any Indebtedness or
other liability in respect of Indebtedness or any material contractual
obligation other than its obligations under the Holdings Guaranty or any of the
Related Agreements; or
8.14 FAILURE TO CONSUMMATE MERGER
The Merger shall not be consummated in accordance with this
Agreement and the applicable Related Agreements substantially concurrently with
the making of the initial Loans, or the Merger shall be unwound, reversed or
otherwise rescinded in whole or in part for any reason; or
8.15 AMENDMENT OF CERTAIN DOCUMENTS OF HOLDINGS.
Holdings shall agree to any material amendment to, or waive any
of its material rights under, or otherwise change any material terms of, any of
the Merger Agreement or the Holdings Certificate of Designations, in each case
as in effect on the Closing Date, in a manner adverse to Holdings or any of its
Subsidiaries or to Lenders without the prior written consent of Administrative
Agent and Requisite Lenders:
THEN (i) upon the occurrence of any Event of Default described in
subsection 8.6 or 8.7, each of (a) the unpaid principal amount of and accrued
interest on the Loans, (b) an amount equal to the maximum amount that may at any
time be drawn under all Letters of Credit then outstanding (whether or not any
beneficiary under any such Letter of Credit shall have
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presented, or shall be entitled at such time to present, the drafts or other
documents or certificates required to draw under such Letter of Credit), and (c)
all other Obligations shall automatically become immediately due and payable,
without presentment, demand, protest or other requirements of any kind, all of
which are hereby expressly waived by Company, and the obligation of each Lender
to make any Loan, the obligation of Administrative Agent to issue any Letter of
Credit and the right of any Lender to issue any Letter of Credit hereunder shall
thereupon terminate, and (ii) upon the occurrence and during the continuation of
any other Event of Default, Administrative Agent shall, upon the written request
or with the written consent of Requisite Lenders, by written notice to Company,
declare all or any portion of the amounts described in clauses (a) through (c)
above to be, and the same shall forthwith become, immediately due and payable,
and the obligation of each Lender to make any Loan, the obligation of
Administrative Agent to issue any Letter of Credit and the right of any Lender
to issue any Letter of Credit hereunder shall thereupon terminate; PROVIDED that
the foregoing shall not affect in any way the obligations of Revolving Lenders
under subsection 3.3C(i) or the obligations of Revolving Lenders to purchase
assignments of any unpaid Swing Line Loans as provided in subsection 2.1A(iii).
Any amounts described in clause (b) above, when received by
Administrative Agent, shall be held by Administrative Agent pursuant to the
terms of the Security Agreement and shall be applied as therein provided.
SECTION 9. ADMINISTRATIVE AGENT
9.1 APPOINTMENT.
A. APPOINTMENT OF ADMINISTRATIVE AGENT. CSFB is hereby
appointed Administrative Agent hereunder and under the other Loan Documents.
Each Lender hereby authorizes Administrative Agent to act as its agent in
accordance with the terms of this Agreement and the other Loan Documents.
Administrative Agent agrees to act upon the express conditions contained in this
Agreement and the other Loan Documents, as applicable. The provisions of this
Section 9 are solely for the benefit of Administrative Agent and Lenders and no
Loan Party shall have rights as a third party beneficiary of any of the
provisions thereof. In performing its functions and duties under this Agreement,
Administrative Agent (other than as provided in subsection 2.1D) shall act
solely as an agent of Lenders and does not assume and shall not be deemed to
have assumed any obligation towards or relationship of agency or trust with or
for Company or any other Loan Party.
B. APPOINTMENT OF SUPPLEMENTAL COLLATERAL AGENTS. It is the
purpose of this Agreement and the other Loan Documents that there shall be no
violation of any law of any jurisdiction denying or restricting the right of
banking corporations or associations to transact business as agent or trustee in
such jurisdiction. It is recognized that in case of litigation under this
Agreement or any of the other Loan Documents, and in particular in case of the
enforcement of any of the Loan Documents, or in case Administrative Agent deems
that by reason of any present or future law of any jurisdiction it may not
exercise any of the rights, powers or remedies granted herein or in any of the
other Loan Documents or take any other action which may be desirable or
necessary in connection therewith, it may be necessary that Administrative Agent
appoint an additional individual or institution as a separate trustee,
co-trustee, collateral agent or
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collateral co-agent (any such additional individual or institution being
referred to herein individually as a "SUPPLEMENTAL COLLATERAL AGENT" and
collectively as "SUPPLEMENTAL COLLATERAL AGENTS").
In the event that Administrative Agent appoints a Supplemental
Collateral Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to
Administrative Agent with respect to such Collateral shall be exercisable by and
vest in such Supplemental Collateral Agent to the extent, and only to the
extent, necessary to enable such Supplemental Collateral Agent to exercise such
rights, powers and privileges with respect to such Collateral and to perform
such duties with respect to such Collateral, and every covenant and obligation
contained in the Loan Documents and necessary to the exercise or performance
thereof by such Supplemental Collateral Agent shall run to and be enforceable by
either Administrative Agent or such Supplemental Collateral Agent, and (ii) the
provisions of this Section 9 and of subsections 10.2 and 10.3 that refer to
Administrative Agent shall inure to the benefit of such Supplemental Collateral
Agent and all references therein to Administrative Agent shall be deemed to be
references to Administrative Agent and/or such Supplemental Collateral Agent, as
the context may require.
Should any instrument in writing from Company or any other Loan
Party be required by any Supplemental Collateral Agent so appointed by
Administrative Agent for more fully and certainly vesting in and confirming to
him or it such rights, powers, privileges and duties, Company shall, or shall
cause such Loan Party to, execute, acknowledge and deliver any and all such
instruments promptly upon request by Administrative Agent. In case any
Supplemental Collateral Agent, or a successor thereto, shall die, become
incapable of acting, resign or be removed, all the rights, powers, privileges
and duties of such Supplemental Collateral Agent, to the extent permitted by
law, shall vest in and be exercised by Administrative Agent until the
appointment of a new Supplemental Collateral Agent.
C. CONTROL. Each Lender and Administrative Agent hereby
appoint each other Lender as agent for the purpose of perfecting Administrative
Agent's security interest in assets that, in accordance with the UCC, can be
perfected by possession or control.
9.2 POWERS AND DUTIES; GENERAL IMMUNITY.
X. XXXXXX; DUTIES SPECIFIED. Each Lender irrevocably
authorizes Administrative Agent to take such action on such Lender's behalf and
to exercise such powers, rights and remedies hereunder and under the other Loan
Documents as are specifically delegated or granted to Administrative Agent by
the terms hereof and thereof, together with such powers, rights and remedies as
are reasonably incidental thereto. Administrative Agent shall have only those
duties and responsibilities that are expressly specified in this Agreement and
the other Loan Documents. Administrative Agent may exercise such powers, rights
and remedies and perform such duties by or through its agents or employees.
Administrative Agent shall not have, by reason of this Agreement or any of the
other Loan Documents, a fiduciary relationship in respect of any Lender or
Company; and nothing in this Agreement or any of the other Loan Documents,
expressed or implied, is intended to or shall be so construed as to impose upon
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Administrative Agent any obligations in respect of this Agreement or any of the
other Loan Documents except as expressly set forth herein or therein.
B. NO RESPONSIBILITY FOR CERTAIN MATTERS. No Agent shall be
responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or any
other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by such Agent to Lenders or by or on
behalf of Company to such Agent or any Lender in connection with the Loan
Documents and the transactions contemplated thereby or for the financial
condition or business affairs of Company or any other Person liable for the
payment of any Obligations, nor shall such Agent be required to ascertain or
inquire as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreements contained in any of the Loan Documents or as
to the use of the proceeds of the Loans or the use of the Letters of Credit or
as to the existence or possible existence of any Event of Default or Potential
Event of Default. Anything contained in this Agreement to the contrary
notwithstanding, Administrative Agent shall not have any liability arising from
confirmations of the amount of outstanding Loans or the Letter of Credit Usage
or the component amounts thereof.
C. EXCULPATORY PROVISIONS. No Agent or any of its officers,
directors, employees or agents shall be liable to Lenders for any action taken
or omitted by such Agent under or in connection with any of the Loan Documents
except to the extent caused by such Agent's gross negligence or willful
misconduct. An Agent shall be entitled to refrain from any act or the taking of
any action (including the failure to take an action) in connection with this
Agreement or any of the other Loan Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from Requisite
Lenders (or such other Lenders as may be required to give such instructions
under subsection 10.6) and, upon receipt of such instructions from Requisite
Lenders (or such other Lenders, as the case may be), such Agent shall be
entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions.
Without prejudice to the generality of the foregoing, (i) each Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for Company and its Subsidiaries), accountants,
experts and other professional advisors selected by it; and (ii) no Lender shall
have any right of action whatsoever against an Agent as a result of such Agent
acting or (where so instructed) refraining from acting under this Agreement or
any of the other Loan Documents in accordance with the instructions of Requisite
Lenders (or such other Lenders as may be required to give such instructions
under subsection 10.6).
D. AGENTS ENTITLED TO ACT AS LENDER. The agency hereby
created shall in no way impair or affect any of the rights and powers of, or
impose any duties or obligations upon, an Agent in its individual capacity as a
Lender hereunder. With respect to its participation in the Loans and the Letters
of Credit, an Agent shall have the same rights and powers hereunder as any other
Lender and may exercise the same as though it were not performing the duties and
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functions delegated to it hereunder, and the term "Lender" or "Lenders" or any
similar term shall, unless the context clearly otherwise indicates, include each
Agent in its individual capacity. An Agent and its Affiliates may accept
deposits from, lend money to, acquire equity interests in and generally engage
in any kind of commercial banking, investment banking, trust, financial advisory
or other business with Company or any of its Affiliates as if it were not
performing the duties specified herein, and may accept fees and other
consideration from Company for services in connection with this Agreement and
otherwise without having to account for the same to Lenders.
9.3 INDEPENDENT INVESTIGATION BY LENDERS; NO RESPONSIBILITY FOR
APPRAISAL OF CREDITWORTHINESS.
Each Lender agrees that it has made its own independent
investigation of the financial condition and affairs of Company and its
Subsidiaries in connection with the making of the Loans and the issuance of
Letters of Credit hereunder and that it has made and shall continue to make its
own appraisal of the creditworthiness of Company and its Subsidiaries. No Agent
shall have any duty or responsibility, either initially or on a continuing
basis, to make any such investigation or any such appraisal on behalf of Lenders
or to provide any Lender with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or at
any time or times thereafter, and no Agent shall have any responsibility with
respect to the accuracy of or the completeness of any information provided to
Lenders.
9.4 RIGHT TO INDEMNITY.
Each Lender, in proportion to its Pro Rata Share, severally
agrees to indemnify each Agent and its officers, directors, employees, agents,
attorneys, professional advisors and Affiliates to the extent that any such
Person shall not have been reimbursed by Company, for and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including counsel fees and disbursements and fees and
disbursements of any financial advisor engaged by Agents) or disbursements of
any kind or nature whatsoever which may be imposed on, incurred by or asserted
against an Agent or such other Persons in exercising the powers, rights and
remedies of an Agent or performing duties of an Agent hereunder or under the
other Loan Documents or otherwise in its capacity as Agent in any way relating
to or arising out of this Agreement or the other Loan Documents; PROVIDED that
no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of an Agent resulting solely from such Agent's gross negligence or
willful misconduct as determined by a final judgment of a court of competent
jurisdiction. If any indemnity furnished to an Agent or any other such Person
for any purpose shall, in the opinion of such Agent, be insufficient or become
impaired, such Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished.
9.5 SUCCESSOR ADMINISTRATIVE AGENT AND SWING LINE LENDER.
A. SUCCESSOR ADMINISTRATIVE AGENT. Any Agent may resign at
any time by giving 30 days' prior written notice thereof to Lenders and Company.
Upon any such notice of resignation, Requisite Lenders shall have the right,
upon five Business Days' notice to, and, so
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long as no Event of Default has occurred and is continuing, the consent of,
Company (which consent shall not be unreasonably withheld), to appoint a
successor Administrative Agent. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, that
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent and the retiring Administrative Agent shall be discharged from its duties
and obligations under this Agreement. After any retiring Agent's resignation
hereunder as an Agent, the provisions of this Section 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was an
Agent under this Agreement.
B. SUCCESSOR SWING LINE LENDER. Any resignation of
Administrative Agent pursuant to subsection 9.5A shall also constitute the
resignation of CSFB or its successor as Swing Line Lender, and any successor
Administrative Agent appointed pursuant to subsection 9.5A shall, upon its
acceptance of such appointment, become the successor Swing Line Lender for all
purposes hereunder. In such event (i) Company shall prepay any outstanding Swing
Line Loans made by the retiring Administrative Agent in its capacity as Swing
Line Lender, (ii) upon such prepayment, the retiring Administrative Agent and
Swing Line Lender shall surrender any Swing Line Note held by it to Company for
cancellation, and (iii) if so requested by the successor Administrative Agent
and Swing Line Lender in accordance with subsection 2.1E, Company shall issue a
Swing Line Note to the successor Administrative Agent and Swing Line Lender
substantially in the form of EXHIBIT VII annexed hereto, in the principal amount
of the Swing Line Loan Commitment then in effect and with other appropriate
insertions.
9.6 COLLATERAL DOCUMENTS AND GUARANTIES.
Each Lender hereby further authorizes Administrative Agent, on
behalf of and for the benefit of Lenders, to enter into each Collateral Document
as secured party and to be the agent for and representative of Lenders under
each Guaranty, and each Lender agrees to be bound by the terms of each
Collateral Document and Guaranty; PROVIDED that Administrative Agent shall not
(i) enter into or consent to any material amendment, modification, termination
or waiver of any provision contained in any Collateral Document or Guaranty or
(ii) release any Collateral (except as otherwise expressly permitted or required
pursuant to the terms of this Agreement or the applicable Collateral Document),
in each case without the prior consent of Requisite Lenders (or, if required
pursuant to subsection 10.6, all Lenders); PROVIDED FURTHER, HOWEVER, that,
without further written consent or authorization from Lenders, Administrative
Agent may execute any documents or instruments necessary to (a) release any Lien
encumbering any item of Collateral that is the subject of a sale or other
disposition of assets permitted by this Agreement or to which Requisite Lenders
have otherwise consented, (b) release any Subsidiary Guarantor from the
Subsidiary Guaranty if all of the Capital Stock of such Subsidiary Guarantor is
sold to any Person (other than an Affiliate of Company) pursuant to a sale or
other disposition permitted hereunder or to which Requisite Lenders have
otherwise consented or (c) subordinate the Liens of Administrative Agent, on
behalf of Lenders, to any Liens permitted by subsection 7.2; PROVIDED that, in
the case of a sale of such item of Collateral or stock referred to in
subdivision (a) or (b), the requirements of subsection 10.14 are satisfied.
Anything contained in any of the Loan Documents to the contrary notwithstanding,
Company, Administrative Agent and each Lender hereby agree that (1) no Lender
shall have any right individually to realize upon any of the Collateral under
any Collateral Document or to enforce any Guaranty, it being
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understood and agreed that all powers, rights and remedies under the Collateral
Documents and the Guaranties may be exercised solely by Administrative Agent for
the benefit of Lenders in accordance with the terms thereof, and (2) in the
event of a foreclosure by Administrative Agent on any of the Collateral pursuant
to a public or private sale, Administrative Agent or any Lender may be the
purchaser of any or all of such Collateral at any such sale and Administrative
Agent, as agent for and representative of Lenders (but not any Lender or Lenders
in its or their respective individual capacities unless Requisite Lenders shall
otherwise agree in writing) shall be entitled, for the purpose of bidding and
making settlement or payment of the purchase price for all or any portion of the
Collateral sold at any such public sale, to use and apply any of the Obligations
as a credit on account of the purchase price for any collateral payable by
Administrative Agent at such sale.
Without derogating from any other authority granted to
Administrative Agent herein or in the Collateral Documents or any other document
relating thereto, each Lender hereby specifically (i) authorizes Administrative
Agent to enter into pledge agreements pursuant to this subsection 9.6 with
respect to the Capital Stock of all existing and future first-tier Foreign
Subsidiaries, which pledge agreements may be governed by the laws of each of the
jurisdictions of formation of such Foreign Subsidiaries, as agent on behalf of
each of Lenders, with the effect that Lenders each become a secured party
thereunder and (ii) appoints Administrative Agent as its attorney-in-fact
granting it the powers to execute each such pledge agreement in its name and on
its behalf, with the effect that Lenders each become a secured party thereunder.
With respect to each such pledge agreement, Administrative Agent has the power
to sub-delegate to third parties its powers as attorney-in-fact of each Lender.
9.7 DUTIES OF OTHER AGENTS.
To the extent any other Lender is identified in this Agreement as
a "co-agent", documentation agent or syndication agent, such Lender shall not
have any right, power, obligation, liability, responsibility or duty under this
Agreement other than those applicable to all Lenders as such. Without limiting
the foregoing, none of such Lenders shall have or be deemed to have a fiduciary
relationship with any Lender.
9.8 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to Holdings, Company or any of the
Subsidiaries of Holdings or Company, Administrative Agent (irrespective of
whether the principal of any Loan shall then be due and payable as herein
expressed or by declaration or otherwise and irrespective of whether
Administrative Agent shall have made any demand on Company) shall be entitled
and empowered, by intervention in such proceeding or otherwise
(i) to file and prove a claim for the whole amount of
principal and interest owing and unpaid in respect of the Loans and any
other Obligations that are owing and unpaid and to file such other papers
or documents as may be necessary or advisable in order to have the claims
of Lenders and Agents (including any claim for the reasonable compensation,
expenses, disbursements and advances of Lenders and Agents and their
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agents and counsel and all other amounts due Lenders and Agents under
subsections 2.3 and 10.2) allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to Administrative Agent and, in the event that
Administrative Agent shall consent to the making of such payments directly to
Lenders, to pay to Administrative Agent any amount due for the reasonable
compensation, expenses, disbursements and advances of Agents and their agents
and counsel, and any other amounts due Agents under subsections 2.3 and 10.2.
Nothing herein contained shall be deemed to authorize
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lenders or to authorize
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
SECTION 10. MISCELLANEOUS
10.1 SUCCESSORS AND ASSIGNS; ASSIGNMENTS AND PARTICIPATIONS IN LOANS
AND LETTERS OF CREDIT.
A. GENERAL. This Agreement shall be binding upon the parties
hereto and their respective successors and assigns and shall inure to the
benefit of the parties hereto and the successors and assigns of Lenders (it
being understood that Lenders' rights of assignment are subject to the further
provisions of this subsection 10.1). Neither Company's rights or obligations
hereunder nor any interest therein may be assigned or delegated by Company
without the prior written consent of all Lenders (and any attempted assignment
or transfer by Company without such consent shall be null and void). No sale,
assignment or transfer or participation of any Letter of Credit or any
participation therein may be made separately from a sale, assignment, transfer
or participation of a corresponding interest in the Revolving Loan Commitment
and the Revolving Loans of the Revolving Lender effecting such sale, assignment,
transfer or participation. Anything contained herein to the contrary
notwithstanding, except as provided in subsection 2.1A(iii) and subsection 10.5,
the Swing Line Loan Commitment and the Swing Line Loans of Swing Line Lender may
not be sold, assigned or transferred as described below to any Person other than
a successor Administrative Agent and Swing Line Lender to the extent
contemplated by subsection 9.5. Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby and, to the extent
expressly contemplated hereby, the Affiliates of each of Administrative Agent
and Lenders and Indemnitees) any legal or equitable right, remedy or claim under
or by reason of this Agreement.
B. ASSIGNMENTS.
(i) AMOUNTS AND TERMS OF ASSIGNMENTS. Any Lender may assign
to one or more Eligible Assignees all or any portion of its rights and
obligations under this
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Agreement; PROVIDED that (a), except (1) in the case of an assignment of
the entire remaining amount of the assigning Lender's rights and
obligations under this Agreement or (2) in the case of an assignment to a
Lender or an Affiliate of a Lender or an Approved Fund of a Lender, the
aggregate amount of the Revolving Loan Exposure or Term Loan Exposure, as
the case may be, of the assigning Lender and the assignee subject to each
such assignment shall not be less than $1,000,000, (b) each partial
assignment shall be made as an assignment of a proportionate part of all
the assigning Lender's rights and obligations under this Agreement with
respect to the Loans or Commitments assigned and any assignment of all or
any portion of a Revolving Loan Commitment, Revolving Loans or Letter of
Credit participations shall be made only as an assignment of the same
proportionate part of the assigning Lender's Revolving Loan Commitment,
Revolving Loans and Letter of Credit participations, (c) the parties to
each assignment shall (A) electronically execute and deliver to
Administrative Agent an Assignment Agreement via an electronic settlement
system acceptable to Administrative Agent or (B) manually execute and
deliver to Administrative Agent an Assignment Agreement, together with a
processing and recordation fee of $3,500, and the Eligible Assignee, if it
shall not already be a party to this Agreement, shall deliver to
Administrative Agent information reasonably requested by Administrative
Agent, including an administrative questionnaire and such forms,
certificates or other evidence, if any, with respect to United States
federal income tax withholding matters as the assignee under such
Assignment Agreement may be required to deliver to Administrative Agent
pursuant to subsection 2.7B(iii) and with respect to information requested
under the Patriot Act, and (d) Administrative Agent, if no Event of Default
has occurred and is continuing, Company, and, in the case of the assignment
of Revolving Loans or Revolving Loan Commitments, CSFB, if CSFB is an
Issuing Lender, shall have consented thereto (which consents shall not be
unreasonably withheld or delayed); PROVIDED that, (I) with respect to the
Term Loans, no consent of Company or Administrative Agent shall be required
in the case of any assignment to a Lender, any Affiliate of a Lender or any
Approved Fund of a Lender, (II) with respect to the Revolving Loans or any
Revolving Loan Commitment, no consent of Company shall be required in the
case of any assignment to a Lender, any Affiliate of a Lender or any
Approved Fund of a Lender and (III) no consent of Company shall be required
in connection with any assignment relating to the primary allocation or
syndication of the Term Loans or Revolving Loans by CSFB. Upon acceptance
and recording by Administrative Agent pursuant to clause (ii) below, from
and after the effective date specified in such Assignment Agreement, (y)
the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment Agreement, shall have the rights and obligations of a Lender
hereunder and shall be deemed to have made all of the agreements of a
Lender contained in the Loan Documents arising out of or otherwise related
to such rights and obligations and (z) the assigning Lender thereunder
shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment Agreement, relinquish its rights
(other than any rights which survive the termination of this Agreement
under subsection 10.9B) and be released from its obligations under this
Agreement (and, in the case of an Assignment Agreement covering all or the
remaining portion of an assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto; PROVIDED
that, anything
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contained in any of the Loan Documents to the contrary notwithstanding, if
such Lender is an Issuing Lender such Lender shall continue to have all
rights and obligations of an Issuing Lender until the cancellation or
expiration of any Letters of Credit issued by it and the reimbursement of
any amounts drawn thereunder). The assigning Lender shall, upon the
effectiveness of such assignment or as promptly thereafter as practicable,
surrender its Notes, if any, to Administrative Agent for cancellation, and
thereupon new Notes shall, if so requested by the assignee and/or the
assigning Lender in accordance with subsection 2.1E, be issued to the
assignee and/or to the assigning Lender, substantially in the form of
EXHIBIT IV or EXHIBIT VI annexed hereto, as the case may be, with
appropriate insertions, to reflect the new Commitments and/or outstanding
Revolving Loans and/or outstanding Term Loans, as the case may be, of the
assignee and/or the assigning Lender. Other than as provided in subsection
2.1A(iii) and subsection 10.5, any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection 10.1B shall be treated for purposes of this Agreement as a sale
by such Lender of a participation in such rights and obligations in
accordance with subsection 10.1C.
(ii) ACCEPTANCE BY ADMINISTRATIVE AGENT; RECORDATION IN
REGISTER. Upon its receipt of an Assignment Agreement executed by an
assigning Lender and an assignee representing that it is an Eligible
Assignee, together with the processing and recordation fee referred to in
subsection 10.1B(i) and any forms, certificates or other evidence with
respect to United States federal income tax withholding matters that such
assignee may be required to deliver to Administrative Agent pursuant to
subsection 2.7B(iii), Administrative Agent shall, if Administrative Agent
and Company have consented to the assignment evidenced thereby (in each
case to the extent such consent is required pursuant to subsection
10.1B(i)), (a) accept such Assignment Agreement by executing a counterpart
thereof as provided therein (which acceptance shall evidence any required
consent of Administrative Agent to such assignment) and (b) record the
information contained therein in the Register. Administrative Agent shall
maintain a copy of each Assignment Agreement delivered to and accepted by
it as provided in this subsection 10.1B(ii). No assignment shall be
effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this clause (ii). Notwithstanding the foregoing, in
the case of an assignment to an Eligible Assignee, which is, immediately
prior to such assignment, an Affiliate of the assigning Lender or an
Approved Fund with respect to the assigning Lender, such assignment shall
be effective between such assigning Lender and its Affiliate or Approved
Fund (as the case may be) immediately without compliance with the
conditions for assignment under this subsection 10.1B, but shall not be
effective with respect to Company, Administrative Agent, any Issuing Lender
or any Lender, and Company, Administrative Agent, each Issuing Lender and
each Lender shall be entitled to deal solely and directly with such
assigning Lender under any such assignment, in each case, until the
conditions for assignment under this subsection 10.1B have been complied
with.
(iii) DEEMED CONSENT BY COMPANY. If the consent of Company to
an assignment or to an Eligible Assignee is required hereunder (including a
consent to an assignment which does not meet the minimum assignment
thresholds specified in subsection 10.1B(i)), Company shall be deemed to
have given its consent five Business
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Days after the date notice thereof has been delivered by the assigning
Lender (through Administrative Agent) unless such consent is expressly
refused by Company prior to such fifth Business Day.
(iv) SPECIAL PURPOSE FUNDING VEHICLES. Notwithstanding
anything to the contrary contained herein, any Lender (a "GRANTING LENDER")
may grant to a special purpose funding vehicle (a "SPC"), identified as
such in writing from time to time by the Granting Lender to Administrative
Agent and Company, the option to provide to Company all or any part of any
Loan that such Granting Lender would otherwise be obligated to make to
Company pursuant to this Agreement; PROVIDED THAT (i) nothing herein shall
constitute a commitment by any SPC to make any Loan, and (ii) if an SPC
elects not to exercise such option or otherwise fails to provide all or any
part of such Loan, the Granting Lender shall be obligated to make such Loan
pursuant to the terms hereof. The making of a Loan by an SPC hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and
as if, such Loan were made by such Granting Lender. Each party hereto
hereby agrees that no SPC shall be liable for any indemnity or similar
payment obligation under this Agreement (all liability for which shall
remain with the Granting Lender). In furtherance of the foregoing, each
party hereto hereby agrees (which agreement shall survive the termination
of this Agreement) that, prior to the date that is one year and one day
after the payment in full of all outstanding commercial paper or other
senior indebtedness of any SPC, it will not institute against, or join any
other person in instituting against, such SPC any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under
the laws of the United States or any state thereof. In addition,
notwithstanding anything to the contrary contained in this subsection
10.1B(iv), any SPC may (i) with notice to, but without the prior written
consent of, Company and Administrative Agent and without paying any
processing fee therefor, assign all or a portion of its interests in any
Loans to the Granting Lender or to any financial institutions (consented to
by Company and Administrative Agent) providing liquidity and/or credit
support to or for the account of such SPC to support the funding or
maintenance of Loans and (ii) disclose on a confidential basis any
non-public information relating to its Loans to any rating agency,
commercial paper dealer or provider of any surety, guarantee or credit or
liquidity enhancement to such SPC. This subsection 10.1B(iv) may not be
amended without the written consent of the SPC. A SPC shall not be entitled
to the benefits of subsection 2.7 unless it complies with subsection
2.7B(iii) as though it were a Lender.
C. PARTICIPATIONS. Any Lender may, without the consent of,
or notice to, Company or Administrative Agent, sell participations to one or
more Persons (other than a natural Person or Company or any of its Affiliates)
in all or a portion of such Lender's rights and/or obligations under this
Agreement; PROVIDED that (i) such Lender's obligations under this Agreement
shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (iii) Company,
Administrative Agent and Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; PROVIDED that such agreement or instrument may
provide that such
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Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver directly affecting (i) the extension of the scheduled
final maturity date of any Loan allocated to such participation or (ii) a
reduction of the principal amount of or the rate of interest payable on any Loan
allocated to such participation. Subject to the further provisions of this
subsection 10.1C, Company agrees that each Participant shall be entitled to the
benefits of subsections 2.6D and 2.7 to the same extent as if it were a Lender
and had acquired its interest by assignment pursuant to subsection 10.1B. To the
extent permitted by law, each Participant also shall be entitled to the benefits
of subsection 10.4 as though it were a Lender, provided such Participant agrees
to be subject to subsection 10.5 as though it were a Lender. A Participant shall
not be entitled to receive any greater payment under subsections 2.6D and 2.7
than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant unless the sale of the participation
to such Participant is made with Company's prior written consent. A Participant
shall not be entitled to the benefits of subsection 2.7 unless Company is
notified of the participation sold to such Participant and such Participant
agrees, for the benefit of Company, to comply with subsection 2.7B(iii) as
though it were a Lender.
D. PLEDGES AND ASSIGNMENTS. Any Lender may at any time
pledge or assign a security interest in all or any portion of its Loans, and the
other Obligations owed to such Lender, to secure obligations of such Lender,
including without limitation any pledge or assignment to secure obligations to
any Federal Reserve Bank; PROVIDED that (i) no Lender shall be relieved of any
of its obligations hereunder as a result of any such assignment or pledge and
(ii) in no event shall any assignee or pledgee be considered to be a "Lender" or
be entitled to require the assigning Lender to take or omit to take any action
hereunder.
E. INFORMATION. Each Lender may furnish any information
concerning Holdings, Company or any of Company's Subsidiaries in the possession
of that Lender from time to time to assignees and participants (including
prospective assignees and participants), subject to subsection 10.19.
F. AGREEMENTS OF LENDERS. Each Lender listed on the
signature pages hereof hereby severally agrees, and each Lender that becomes a
party hereto pursuant to an Assignment Agreement shall be deemed to severally
agree, (i) that it is an Eligible Assignee described in clause (ii) of the
definition thereof; (ii) that it has experience and expertise in the making of
or purchasing loans such as the Loans; and (iii) that it will make or purchase
its Loans for its own account in the ordinary course of its business and without
a present view to distribution of such Loans within the meaning of the
Securities Act or the Exchange Act or other federal securities laws (it being
understood that, subject to the provisions of this subsection 10.1, the
disposition of such Loans or any interests therein shall at all times remain
within its exclusive control). Each Lender that becomes a party hereto pursuant
to an Assignment Agreement shall also be deemed to represent that such
Assignment Agreement constitutes a legal, valid and binding obligation of such
Lender, enforceable against such Lender in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally and by general principles of equity.
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10.2 EXPENSES.
Whether or not the transactions contemplated hereby shall be
consummated, Company agrees to pay promptly (i) all reasonable costs and
expenses of negotiation, preparation and execution of the Loan Documents and any
consents, amendments, waivers or other modifications thereto; (ii) all costs and
expenses of furnishing all opinions by counsel for Company (including any
opinions reasonably requested by Administrative Agent or Lenders as to any legal
matters arising hereunder) and of Company's performance of and compliance with
all agreements and conditions on its part to be performed or complied with under
this Agreement and the other Loan Documents including with respect to confirming
compliance with environmental, insurance and solvency requirements; (iii) all
reasonable fees, expenses and disbursements of counsel to Administrative Agent
in connection with the negotiation, preparation, execution and administration of
the Loan Documents and any consents, amendments, waivers or other modifications
thereto and any other documents or matters requested by Company; (iv) all costs
and expenses of creating and perfecting Liens in favor of Administrative Agent
on behalf of Lenders pursuant to any Collateral Document, including filing and
recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums, and reasonable fees, expenses and disbursements of
counsel to Administrative Agent and of counsel providing any opinions that
Administrative Agent or Requisite Lenders may request in respect of the
Collateral Documents or the Liens created pursuant thereto; (v) all costs and
expenses (including the reasonable fees, expenses and disbursements of any
auditors, accountants or appraisers and any environmental or other consultants,
advisors and agents employed or retained by Administrative Agent or its counsel)
of obtaining and reviewing any environmental audits or reports provided for
under subsection 4.1K or 6.9A; (vi) all costs and expenses incurred by
Administrative Agent in connection with the custody or preservation of any of
the Collateral; (vii) all other costs and expenses incurred by Administrative
Agent in connection with the primary syndication of the Commitments; (viii) all
costs and expenses, including reasonable attorneys' fees and fees, costs and
expenses of accountants, advisors and consultants, incurred by Administrative
Agent and its counsel relating to efforts to (a) evaluate or assess any Loan
Party, its business or financial condition and (b) protect, evaluate, assess or
dispose of any of the Collateral; and (ix) all costs and expenses, including
reasonable attorneys' fees, fees, costs and expenses of accountants, advisors
and consultants and costs of settlement, incurred by Administrative Agent and
Lenders in enforcing any Obligations of or in collecting any payments due from
any Loan Party hereunder or under the other Loan Documents (including in
connection with the sale of, collection from, or other realization upon any of
the Collateral or the enforcement of the Loan Documents) or in connection with
any refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or pursuant to any insolvency or
bankruptcy proceedings.
10.3 INDEMNITY.
In addition to the payment of expenses pursuant to subsection
10.2, whether or not the transactions contemplated hereby shall be consummated,
Company agrees to defend (subject to Indemnitees' selection of counsel),
indemnify, pay and hold harmless Agents and Lenders (including Issuing Lenders),
and the officers, directors, employees, agents, trustees, advisors and
Affiliates of Agents and Lenders (collectively called the "INDEMNITEES"), from
and against any and all Indemnified Liabilities (as hereinafter defined);
PROVIDED that Company shall
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not have any obligation to any Indemnitee hereunder with respect to any
Indemnified Liabilities to the extent such Indemnified Liabilities arise solely
from the gross negligence or willful misconduct of that Indemnitee as determined
by a final judgment of a court of competent jurisdiction.
As used herein, "INDEMNIFIED LIABILITIES" means, collectively,
any and all liabilities, obligations, losses, damages (including natural
resource damages), penalties, actions, judgments, suits, claims (including
Environmental Claims), costs (including the costs of any investigation, study,
sampling, testing, abatement, cleanup, removal, remediation or other response
action necessary to remove, remediate, clean up or xxxxx any Hazardous Materials
Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened by any Person, whether or not any such Indemnitee shall
be designated as a party or a potential party thereto, and any fees or expenses
incurred by Indemnitees in enforcing this indemnity), whether direct, indirect
or consequential and whether based on any federal, state or foreign laws,
statutes, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and Environmental Laws), on common law or
equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of (i) this Agreement, the other Loan Documents or the Related
Agreements or the transactions contemplated hereby or thereby (including
Lenders' agreement to make the Loans hereunder or the use or intended use of the
proceeds thereof or the issuance of Letters of Credit hereunder or the use or
intended use of any thereof, the failure of an Issuing Lender to honor a drawing
under a Letter of Credit as a result of any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto Government Authority or
any enforcement of any of the Loan Documents (including any sale of, collection
from, or other realization upon any of the Collateral or the enforcement of the
Guaranties)), (ii) the statements contained in the commitment letter delivered
by Administrative Agent, Syndication Agent and UBS AG, Cayman Islands Branch, to
Holdings with respect thereto, or (iii) any Environmental Claim or any Hazardous
Materials Activity relating to or arising from, directly or indirectly, any past
or present activity, operation, land ownership, or practice of Company or any of
its Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay and
hold harmless set forth in this subsection 10.3 may be unenforceable in whole or
in part because they are violative of any law or public policy, Company shall
contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them.
10.4 SET-OFF.
In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence of any Event of Default each Lender is hereby authorized by Company
at any time or from time to time, without notice to Company or to any other
Person, any such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all deposits (general or special, time or
demand, provisional or final, including Indebtedness evidenced by certificates
of deposit, whether matured or unmatured, but not including trust accounts) and
any other Indebtedness at any time held or owing by that
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Lender or any Affiliate of that Lender to or for the credit or the account of
Company and each other Loan Party against and on account of the Obligations of
Company or any other Loan Party to that Lender (or any Affiliate of that Lender)
or to any other Lender (or any Affiliate of any other Lender) under this
Agreement, the Letters of Credit and participations therein and the other Loan
Documents, including all claims of any nature or description arising out of or
connected with this Agreement, the Letters of Credit and participations therein
or any other Loan Document, irrespective of whether or not (i) that Lender shall
have made any demand hereunder or (ii) the principal of or the interest on the
Loans or any amounts in respect of the Letters of Credit or any other amounts
due hereunder shall have become due and payable pursuant to Section 8 and
although said obligations and liabilities, or any of them, may be contingent or
unmatured.
10.5 RATABLE SHARING.
Lenders hereby agree among themselves that if any of them shall,
whether by voluntary or mandatory payment (other than a voluntary prepayment of
Loans made and applied in accordance with the terms of this Agreement), by
realization upon security, through the exercise of any right of set-off or
banker's lien, by counterclaim or cross action or by the enforcement of any
right under the Loan Documents or otherwise, or as adequate protection of a
deposit treated as cash collateral under the Bankruptcy Code, receive payment or
reduction of a proportion of the aggregate amount of principal, interest,
amounts payable in respect of Letters of Credit, fees and other amounts then due
and owing to that Lender hereunder or under the other Loan Documents
(collectively, the "AGGREGATE AMOUNTS DUE" to such Lender) that is greater than
the proportion received by any other Lender in respect of the Aggregate Amounts
Due to such other Lender, then the Lender receiving such proportionately greater
payment shall, unless such proportionately greater payment is required by the
terms of this Agreement, (i) notify Administrative Agent and each other Lender
of the receipt of such payment and (ii) apply a portion of such payment to
purchase assignments (which it shall be deemed to have purchased from each
seller of an assignment simultaneously upon the receipt by such seller of its
portion of such payment) of the Aggregate Amounts Due to the other Lenders so
that all such recoveries of Aggregate Amounts Due shall be shared by all Lenders
in proportion to the Aggregate Amounts Due to them; PROVIDED that if all or part
of such proportionately greater payment received by such purchasing Lender is
thereafter recovered from such Lender upon the bankruptcy or reorganization of
Company or otherwise, those purchases shall be rescinded and the purchase prices
paid for such assignments shall be returned to such purchasing Lender ratably to
the extent of such recovery, but without interest. Company expressly consents to
the foregoing arrangement and agrees that any purchaser of an assignment so
purchased may exercise any and all rights of a Lender as to such assignment as
fully as if that Lender had complied with the provisions of subsection 10.1B
with respect to such assignment. In order to further evidence such assignment
(and without prejudice to the effectiveness of the assignment provisions set
forth above), each purchasing Lender and each selling Lender agree to enter into
an Assignment Agreement at the request of a selling Lender or a purchasing
Lender, as the case may be, in form and substance reasonably satisfactory to
each such Lender.
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10.6 AMENDMENTS AND WAIVERS.
No amendment, modification, termination or waiver of any
provision of this Agreement or of the Notes, and no consent to any departure by
Company therefrom, shall in any event be effective without the written
concurrence of Requisite Lenders; PROVIDED that no such amendment, modification,
termination, waiver or consent shall, without the consent of (a) each Lender
with Obligations directly affected (whose consent shall be sufficient for any
such amendment, modification, termination or waiver without the consent of
Requisite Lenders) (1) reduce the principal amount of any Loan, (2) postpone the
scheduled final maturity date or the date of any scheduled installment of
principal of any Loan, (3) postpone the date on which any interest or any fees
are payable, (4) decrease the interest rate borne by any Loan (other than any
waiver of any increase in the interest rate applicable to any of the Loans
pursuant to subsection 2.2E) or the amount of any fees payable hereunder (other
than any waiver of any increase in the fees applicable to Letters of Credit
pursuant to subsection 3.2 following the application of increased interest
pursuant to subsection 2.2E) excluding any change in the manner in which any
financial ratio used in determining any interest rate or fee is calculated that
would result in a reduction of any such rate or fee, (5) reduce the amount or
postpone the due date of any amount payable in respect of any Letter of Credit,
(6) extend the expiration date of any Letter of Credit beyond the Revolving Loan
Commitment Termination Date or extend the Revolving Loan Commitment Termination
Date or (7) change in any manner the obligations of Revolving Lenders relating
to the purchase of participations in Letters of Credit; (b) each Lender, (1)
change in any manner the definition of "Class" or the definition of "Pro Rata
Share" or the definition of "Requisite Class Lenders" or the definition of
"Requisite Lenders" (except for any changes resulting solely from an increase in
the aggregate amount of the Commitments approved by Requisite Lenders), (2)
change in any manner any provision of this Agreement that, by its terms,
expressly requires the approval or concurrence of all Lenders, (3) increase the
maximum duration of Interest Periods permitted hereunder, (4) release any Lien
granted in favor of Administrative Agent with respect to all or substantially
all of the Collateral or release Holdings from its obligations under the
Holdings Guaranty or release all or substantially all of the Subsidiary
Guarantors from their obligations under the Subsidiary Guaranty, in each case
other than in accordance with the terms of the Loan Documents, or (5) change in
any manner or waive the provisions contained in subsection 8.1, subsection 10.5
or this subsection 10.6. In addition, (i) no amendment, modification,
termination or waiver of any provision of any Note shall be effective without
the written concurrence of the Lender which is the holder of that Note; (ii) no
amendment, modification, termination or waiver of any provision of subsection
2.1A(iii) or of any other provision of this Agreement relating to the Swing Line
Loan Commitment or the Swing Line Loans shall be effective without the written
concurrence of Swing Line Lender; (iii) no amendment, modification, termination
or waiver of any provision of Section 3 shall be effective without the written
concurrence of Administrative Agent and, with respect to the purchase of
participations in Letters of Credit, without the written concurrence of each
Issuing Lender that has issued an outstanding Letter of Credit or has not been
reimbursed for a payment under a Letter of Credit; (iv) no amendment,
modification, termination or waiver of any provision of Section 9 or of any
other provision of this Agreement which, by its terms, expressly requires the
approval or concurrence of Administrative Agent shall be effective without the
written concurrence of Administrative Agent; (v) no amendment, modification,
termination or waiver of any provision of subsection 2.4 that has the effect of
changing any interim scheduled payments, voluntary or mandatory prepayments, or
Commitment reductions applicable to a Class
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in a manner that disproportionately disadvantages such Class relative to any
other Class shall be effective without the written concurrence of Requisite
Class Lenders of such affected Class (it being understood and agreed that any
amendment, modification, termination or waiver of any such provision which only
postpones or reduces any interim scheduled payment, voluntary or mandatory
prepayment, or Commitment reduction from those set forth in subsection 2.4 with
respect to one Class but not any other Class shall be deemed to
disproportionately disadvantage such one Class but not to disproportionately
disadvantage any such other Class for purposes of this clause (v)) and (vi) no
amount of a Commitment of a Lender shall be increased without the consent of
such Lender. Administrative Agent may, but shall have no obligation to, with the
concurrence of any Lender, execute amendments, modifications, waivers or
consents on behalf of that Lender. Any waiver or consent shall be effective only
in the specific instance and for the specific purpose for which it was given. No
notice to or demand on Company in any case shall entitle Company to any other or
further notice or demand in similar or other circumstances. Any amendment,
modification, termination, waiver or consent effected in accordance with this
subsection 10.6 shall be binding upon each Lender at the time outstanding, each
future Lender and, if signed by Company, on Company.
Notwithstanding anything in this subsection 10.6 to the contrary,
this Agreement and the other Loan Documents may be amended (or amended and
restated) with the written approval of Administrative Agent, Company and the
lenders of the Incremental Loans to implement the Incremental Loans pursuant to
and in accordance with subsection 7.1(ix).
10.7 INDEPENDENCE OF COVENANTS.
All covenants hereunder shall be given independent effect so that
if a particular action or condition is not permitted by any of such covenants,
the fact that it would be permitted by an exception to, or would otherwise be
within the limitations of, another covenant shall not avoid the occurrence of an
Event of Default or Potential Event of Default if such action is taken or
condition exists.
10.8 NOTICES; EFFECTIVENESS OF SIGNATURES.
Unless otherwise specifically provided herein, any notice or
other communication herein required or permitted to be given shall be in writing
and may be personally served, or sent by telefacsimile or United States mail or
courier service and shall be deemed to have been given when delivered in person
or by courier service, upon receipt of telefacsimile in complete and legible
form, or three Business Days after depositing it in the United States mail with
postage prepaid and properly addressed; PROVIDED that notices to Administrative
Agent, Swing Line Lender and any Issuing Lender shall not be effective until
received. For the purposes hereof, the address of each party hereto shall be as
set forth under such party's name on the signature pages hereof or (i) as to
Company and Administrative Agent, such other address as shall be designated by
such Person in a written notice delivered to the other parties hereto and (ii)
as to each other party, such other address as shall be designated by such party
in a written notice delivered to Administrative Agent. Electronic mail and
Internet and intranet websites may be used to distribute routine communications,
such as financial statements and other information as provided in subsection
6.1; PROVIDED, HOWEVER, that no signature with respect to any notice,
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request, agreement, waiver, amendment or other document or any notice that is
intended to have binding effect may be sent by electronic mail.
Loan Documents and notices under the Loan Documents may be
transmitted and/or signed by telefacsimile. The effectiveness of any such
documents and signatures shall, subject to applicable law, have the same force
and effect as an original copy with manual signatures and shall be binding on
all Loan Parties, Agents and Lenders. Administrative Agent may also require that
any such documents and signature be confirmed by a manually-signed copy thereof;
PROVIDED, HOWEVER, that the failure to request or deliver any such
manually-signed copy shall not affect the effectiveness of any facsimile
document or signature.
10.9 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
A. All representations, warranties and agreements made
herein shall survive the execution and delivery of this Agreement and the making
of the Loans and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by
law to the contrary, the agreements of Company set forth in subsections 2.6D,
2.7, 10.2, 10.3, 10.17 and 10.18 and the agreements of Lenders set forth in
subsections 9.2C, 9.4, 10.5 and 10.18 shall survive the payment of the Loans,
the cancellation or expiration of the Letters of Credit and the reimbursement of
any amounts drawn thereunder, and the termination of this Agreement.
10.10 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of an Agent or any Lender in the
exercise of any power, right or privilege hereunder or under any other Loan
Document shall impair such power, right or privilege or be construed to be a
waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 MARSHALLING; PAYMENTS SET ASIDE.
Neither any Agent nor any Lender shall be under any obligation to
marshal any assets in favor of Company or any other party or against or in
payment of any or all of the Obligations. To the extent that Company makes a
payment or payments to Administrative Agent or Lenders (or to Administrative
Agent for the benefit of Lenders), or Agents or Lenders enforce any security
interests or exercise their rights of setoff, and such payment or payments or
the proceeds of such enforcement or setoff or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, any other state or federal law, common law or any equitable
cause, then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, rights and remedies therefor
or related thereto, shall be revived and continued in full force and effect as
if such payment or payments had not been made or such enforcement or setoff had
not occurred.
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10.12 SEVERABILITY.
In case any provision in or obligation under this Agreement or
the Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS;
DAMAGE WAIVER.
The obligations of Lenders hereunder are several and no Lender
shall be responsible for the obligations or Commitments of any other Lender
hereunder. Nothing contained herein or in any other Loan Document, and no action
taken by Lenders pursuant hereto or thereto, shall be deemed to constitute
Lenders, or Lenders and Company, as a partnership, an association, a Joint
Venture or any other kind of entity. The amounts payable at any time hereunder
to each Lender shall be a separate and independent debt, and, subject to
subsection 9.6, each Lender shall be entitled to protect and enforce its rights
arising out of this Agreement and it shall not be necessary for any other Lender
to be joined as an additional party in any proceeding for such purpose.
To the extent permitted by law, Company shall not assert, and
hereby waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with or as a result of this
Agreement (including, without limitation, subsection 2.1C hereof), any other
Loan Document, any transaction contemplated by the Loan Documents, any Loan or
the use of proceeds thereof.
10.14 RELEASE OF SECURITY INTEREST OR GUARANTY.
Upon the proposed sale or other disposition of any Collateral
that is permitted by this Agreement or to which Requisite Lenders have otherwise
consented, or the sale or other disposition of all of the Capital Stock of a
Subsidiary Guarantor to any Person (other than an Affiliate of Company)
permitted by this Agreement or to which Requisite Lenders have otherwise
consented, for which a Loan Party desires to obtain a security interest release
or a release of any Guaranty from Administrative Agent, such Loan Party shall
deliver an Officer's Certificate (i) stating that the Collateral or the Capital
Stock subject to such disposition is being sold or otherwise disposed of in
compliance with the terms hereof and (ii) specifying the Collateral or Capital
Stock being sold or otherwise disposed of in the proposed transaction. Upon the
receipt of such Officer's Certificate, Administrative Agent shall, at such Loan
Party's expense, so long as Administrative Agent (a) has no reason to believe
that the facts stated in such Officer's Certificate are not true and correct and
(b), if the sale or other disposition of such item of Collateral or Capital
Stock constitutes an Asset Sale, shall have received evidence satisfactory to it
that arrangements satisfactory to it have been made for delivery of the Net
Asset Sale Proceeds if and as required by subsection 2.4, execute and deliver
such releases of its security interest in such Collateral or such Subsidiary
Guaranty, as may be reasonably requested by such Loan Party.
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10.15 APPLICABLE LAW.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES THAT WOULD REQUIRE APPLICATION OF ANOTHER LAW.
10.16 CONSTRUCTION OF AGREEMENT; NATURE OF RELATIONSHIP.
Each of the parties hereto acknowledges that (i) it has been
represented by counsel in the negotiation and documentation of the terms of this
Agreement, (ii) it has had full and fair opportunity to review and revise the
terms of this Agreement, (iii) this Agreement has been drafted jointly by all of
the parties hereto, and (iv) neither Administrative Agent nor any Lender or
other Agent has any fiduciary relationship with or duty to Company arising out
of or in connection with this Agreement or any of the other Loan Documents, and
the relationship between Administrative Agent, the other Agents and Lenders, on
one hand, and Company, on the other hand, in connection herewith or therewith is
solely that of debtor and creditor. Accordingly, each of the parties hereto
acknowledges and agrees that the terms of this Agreement shall not be construed
against or in favor of another party.
10.17 CONSENT TO JURISDICTION AND SERVICE OF PROCESS.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST COMPANY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
HEREUNDER OR THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY EXECUTING
AND DELIVERING THIS AGREEMENT, COMPANY, FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE
JURISDICTION AND VENUE OF SUCH COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING
IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO COMPANY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH
SUBSECTION 10.8;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS
SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER COMPANY IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT;
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(V) AGREES THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST COMPANY
IN THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 10.17
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE
FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION
5-1402 OR OTHERWISE.
10.18 WAIVER OF JURY TRIAL.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER
IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN
ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL
AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION 10.18 AND EXECUTED BY EACH OF
THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A
WRITTEN CONSENT TO A TRIAL BY THE COURT.
10.19 CONFIDENTIALITY.
Each Lender shall hold all non-public information obtained
pursuant to the requirements of this Agreement that has been identified in
writing as confidential by Company in accordance with such Lender's customary
procedures for handling confidential information of this nature, it being
understood and agreed by Company that in any event a Lender may
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make disclosures (a) to its Affiliates and to its own and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such information and
instructed to keep such information confidential), (b) to the extent requested
by any Government Authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement that is entitled to receive such information, (e) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder,
(f) subject to an agreement containing provisions substantially the same as
those of this subsection 10.19, to (i) any Eligible Assignee of or participant
in, or any prospective Eligible Assignee of or Participant in, any of its rights
or obligations under this Agreement or (ii) any direct or indirect contractual
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of Company, (g) with the consent of Company,
(h) to the extent such information (i) becomes publicly available other than as
a result of a breach of this subsection 10.19 or (ii) becomes available to
Administrative Agent or any Lender on a nonconfidential basis from a source
other than Company or (i) to the National Association of Insurance Commissioners
or any other similar organization or any nationally recognized rating agency
that requires access to information about a Lender's or its Affiliates'
investment portfolio in connection with ratings issued with respect to such
Lender or its Affiliates; PROVIDED that, unless specifically prohibited by
applicable law or court order, each Lender shall notify Company of any request
by any Government Authority or representative thereof (other than any such
request in connection with any examination of the financial condition of such
Lender by such Government Authority) for disclosure of any such non-public
information prior to disclosure of such information; and PROVIDED, FURTHER that
in no event shall any Lender be obligated or required to return any materials
furnished by Company or any of its Subsidiaries. In addition, Administrative
Agent and Lenders may disclose the existence of this Agreement and information
about this Agreement to market data collectors, similar service providers to the
lending industry, and service providers to Administrative Agent and Lenders.
Notwithstanding anything herein to the contrary, information
required to be treated as confidential by reason of the foregoing shall not
include, and Administrative Agent and each Lender (and their representatives or
other agents) may disclose to any and all Persons, without limitation of any
kind, any information with respect to United States federal income tax treatment
and United States federal income tax structure (within the meaning of Treasury
Regulation Section 1.6011-4) of the transactions contemplated hereby and all
materials of any kind (including opinions or other tax analyses) that are
provided to Administrative Agent or such Lender relating to such tax treatment
and tax structure.
10.20 COUNTERPARTS; EFFECTIVENESS.
This Agreement and any amendments, waivers, consents or
supplements hereto or in connection herewith may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document. This
140
Agreement shall become effective upon the execution of a counterpart hereof by
each of the parties hereto.
[Remainder of page intentionally left blank]
141
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
MERGER SUB:
NECTAR MERGER CORPORATION
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxx
----------------------------------
Title: Vice President, Secretary and
--------------------------------
Treasurer
--------------------------------
Notice Address:
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
---------------------
Facsimile: (000) 000-0000
---------------------
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FTD, INC.:
FTD shall have no obligations hereunder until completion of the Merger.
Prior to that time, the obligations of Company pursuant to this Agreement and
the other Loan Documents shall be solely those of Merger Sub. Upon consummation
of the Merger, FTD shall assume, and hereby assumes, all the obligations and
other liabilities of Merger Sub under this Agreement and all references to
Company contained in this Agreement and the other Loan Documents shall be deemed
to refer to FTD.
FTD, INC.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name Xxxxxx X. Xxxxxx
-----------------------------------------
Title: Chairman of the Board and Chief
--------------------------------------
Executive Officer
--------------------------------------
Notice Address:
0000 Xxxxxxxxx Xxxxx
Xxxxxxx Xxxxx, XxXxxx Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxx
---------------------------
Facsimile: (000) 000-0000
---------------------------
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LENDERS:
CREDIT SUISSE FIRST BOSTON, acting through its
Cayman Islands Branch, individually and as
Administrative Agent
By: /s/ Xxxxxx Xxxx
-------------------------------------------
Name: Xxxxxx Xxxx
-------------------------------------------
Title: Director
-------------------------------------------
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
-------------------------------------------
Title: Associate
-------------------------------------------
Notice Address:
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Agency Department Manager
Facsimile: (000) 000-0000
Payment Instructions:
Bank of New York
ABA 000000000
A/C Name: CSFB Agency Cayman Account
A/C Number: 8900492627
Reference:
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UBS SECURITIES LLC, as Syndication Agent
By: /s/ Xxxxx X. Xxxx
-------------------------------------------
Name: Xxxxx X. Xxxx
-------------------------------------------
Title: Managing Director
-------------------------------------------
By: /s/ Xxxxxx X. Xxxxxx XX
-------------------------------------------
Name: Xxxxxx X. Xxxxxx XX
-------------------------------------------
Title: Director
-------------------------------------------
Notice Address:
UBS Securities LLC
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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UBS LOAN FINANCE LLC, as a Lender
By: /s/ Xxxxxxx X. Saint
-------------------------------------------
Name: Xxxxxxx X. Saint
-------------------------------------------
Title: Associate Director
-------------------------------------------
By: /s/ Xxxxxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxxxxx X. Xxxxxx
-------------------------------------------
Title: Associate Director
-------------------------------------------
Notice Address:
UBS Loan Finance LLC
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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XXXXX FARGO BANK, N.A., as Documentation
Agent and as a Lender
By: /s/ Xxxxx Xxxxxxx
-------------------------------------------
Name: Xxxxx Xxxxxxx
-------------------------------------------
Title: Senior Vice President
-------------------------------------------
Notice Address:
000 X. Xxxxx Xxxxxx, 0xx Xx.
-------------------------------------------
Xxx Xxxxxxx, XX 00000
-------------------------------------------
-------------------------------------------
-------------------------------------------
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XXXXXX TRUST AND SAVINGS BANK, as a Lender
By: /s/ Xxxxxxxx Xxxxxxx
-------------------------------------------
Name: Xxxxxxxx Xxxxxxx
-------------------------------------------
Title: Vice President
-------------------------------------------
Notice Address:
Xxxxxx Trust and Savings Bank
-------------------------------------------
000 Xxxx Xxxxxx Xxxxxx, 00X
-------------------------------------------
Xxxxxxx, XX 00000
-------------------------------------------
Attn: Xxxxx Xxxxxxx
-------------------------------------------
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Mizuho Corporate Bank, LTD., as a Lender
By: /s/ Xxxxxxx Xxxxxxxx
-------------------------------------------
Name: Xxxxxxx Xxxxxxxx
-------------------------------------------
Title: Deputy General Manager
-------------------------------------------
Notice Address:
1251 Avenue of the Americas
-------------------------------------------
Xxx Xxxx, Xxx Xxxx 00000
-------------------------------------------
-------------------------------------------
-------------------------------------------
S-8
CITLENDING SERVICES CORPORATION,
as a Lender
By: /s/ Xxxx X. Xxxxxx, XX
-------------------------------------------
Name: Xxxx X. Xxxxxx, XX
-------------------------------------------
Title: Vice President
-------------------------------------------
Notice Address:
c/o CIT Group Inc.
Business Credit/Corporate Finance Group
0 XXX Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx X. Xxxx, Assistant Vice
President
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
with a copy to:
c/o CIT Group Inc.
Corporate Legal Department
0 XXX Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxx X. Xxxxxx, XX.
Vice President & Assistant Chief Counsel
Telecopier No.: (000) 000-0000 or
(000) 000-0000
Telephone No.: (000) 000-0000
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XXXXXXX XXXXX CAPITAL, A DIVISION OF
XXXXXXX XXXXX BUSINESS FINANCIAL
SERVICES INC., as a Lender
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxx
-------------------------------------------
Title: Vice President
-------------------------------------------
Notice Address:
000 Xxxxx XxXxxxx Xxxxxx
-------------------------------------------
Xxxxxxx, XX 00000
-------------------------------------------
-------------------------------------------
-------------------------------------------
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GENERAL ELECTRIC CAPITAL CORPORATION,
as a Lender
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------------
Name: Xxxxxx X. Xxxxxxx
-------------------------------------------
Title: Duly Authorized Signatory
-------------------------------------------
Notice Address:
Bank Loan Group
-------------------------------------------
GE Corporate Financial Services
-------------------------------------------
201 Xxxxxxx 7
-------------------------------------------
X.X. Xxx 0000
-------------------------------------------
Xxxxxxx, XX 00000-0000
-------------------------------------------
Attn: Xxxxxx X. xxx Xxxxx
-------------------------------------------
S-11
STANDARD FEDERAL BANK, N.A., as a Lender
By: /s/ Xxxxxxx Xxxxxx
-------------------------------------------
Name: Xxxxxxx Xxxxxx
-------------------------------------------
Title: First Vice President
-------------------------------------------
Notice Address:
0000 Xxxx Xxx Xxxxxx Xxxx
-------------------------------------------
Commercial Banking (Mail Code 0900-290)
-------------------------------------------
Xxxx, Xxxxxxxx 00000
-------------------------------------------
-------------------------------------------
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