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CREDIT AGREEMENT
by and among
PRODUCTION RESOURCE GROUP, L.L.C.,
THE LENDERS PARTY HERETO,
AND
THE BANK OF NEW YORK, AS AGENT
with
BNY CAPITAL MARKETS, INC., AS ARRANGER
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$130,000,000
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Dated as of July 31, 1997
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CREDIT AGREEMENT, dated as of July 31, 1997, by and among PRODUCTION
RESOURCE GROUP, L.L.C., a Delaware limited liability company (the "Borrower"),
the lenders party hereto (together with their respective assigns, the "Lenders",
each a "Lender"), and THE BANK OF NEW YORK, as agent for the Lenders (in such
capacity, the "Agent").
1. DEFINITIONS AND PRINCIPLES OF CONSTRUCTION
1.1. Definitions
As used in this Agreement, terms defined in the preamble have
the meanings therein indicated, and the following terms have the following
meanings:
"ABR Advances": the Revolving Credit Loans (or any portions
thereof), at such time as they (or such portions) are made and/or being
maintained at a rate of interest based upon the Alternate Base Rate.
"Accountants": Ernst & Young LLP (or any successor thereto),
or such other firm of certified public accountants of recognized national
standing selected by the Borrower and reasonably satisfactory to the Agent.
"Accumulated Funding Deficiency": as defined in Section 302 of
ERISA.
"Acquisition": with respect to any Person, the purchase or
other acquisition by such Person, by any means whatsoever (including through a
merger, dividend or otherwise and whether in a single transaction or in a series
of related transactions), of (i) any Capital Stock of any other Person if,
immediately thereafter, such other Person would be either a Subsidiary of such
Person or otherwise under the control of such Person, (ii) any business, going
concern or division or segment of any other Person, or (iii) any Property of any
other Person other than in the ordinary course of business, provided, however,
that no acquisition of all or substantially all of the assets of such other
Person shall be deemed to be in the ordinary course of business.
"Acquisition Cost": with respect to any Acquisition by any
Person, the sum of (i) all cash consideration paid or agreed to be paid by such
Person to make such Acquisition (inclusive of all fees in connection therewith,
including without limitation payments by such Person of the seller's
professional fees and expenses and other out-of-pocket expenses in connection
therewith), plus (ii) the fair market value of all non-cash consideration paid
by such Person in connection therewith, plus (iii) an amount equal to the
principal or stated amount of all liabilities assumed or incurred by such Person
in connection therewith. The principal or stated amount of any liability assumed
or incurred by a Person in connection with an Acquisition which is a contingent
liability shall be an amount equal to the stated amount of such liability or, if
the same is not stated, the maximum reasonably anticipated amount payable by
such Person in respect thereof as determined by such Person in good faith.
"Advance": an ABR Advance or a Eurodollar Advance, as the case
may be.
"Affected Advance": as defined in Section 3.9.
"Affected Principal Amount": in the event that (i) the
Borrower shall fail for any reason to borrow a Revolving Credit Loan in respect
of which it shall have requested a Eurodollar Advance or convert an Advance to a
Eurodollar Advance after it shall have notified the Agent of its intent to do
so, an amount equal to the principal amount of such Eurodollar Advance; (ii) a
Eurodollar Advance shall terminate for any reason prior to the last day of the
Interest Period applicable thereto, an amount equal to the principal amount of
such Eurodollar Advance; and (iii) the Borrower shall prepay or repay all or any
part of the principal amount of a Eurodollar Advance prior to the last day of
the Interest Period applicable thereto, an amount equal to the principal amount
of such Advance so prepaid or repaid.
"Affiliate": as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person. For purposes of this definition, control of a Person
shall mean the power, direct or indirect, (i) to vote 5% or more of the
securities or other interests having ordinary voting power for the election of
directors or other managing Persons thereof or (ii) to direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.
"Aggregate Commitment Amount": at any time, the sum at such
time of the Commitment Amounts of all Lenders.
"Aggregate Credit Exposure": at any time, the sum at such time
of the outstanding principal balance of the Revolving Credit Loans of all
Lenders.
"Agreement": this Credit Agreement, as the same may be
amended, supplemented or otherwise modified from time to time.
"Alternate Base Rate": on any date, a rate of interest per
annum equal to the higher of (i) the Federal Funds Rate in effect on such date
plus 1/2 of 1% or (ii) the BNY Rate in effect on such date.
"Applicable Fee Percentage": with respect to the Commitment
Fee, at all times during which the applicable Pricing Level set forth below is
in effect, the appropriate applicable percentages corresponding to the Leverage
Ratio in effect as set forth below next to such Pricing Level and under the
applicable column:
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Pricing Applicable
Level Leverage Ratio Fee Percentage
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I Greater than or equal to 3.00:1.00 0.375%
II Greater than or equal to 2.50:1.00 but 0.375%
less than 3.00:1.00
III Greater than or equal to 2.00:1.00 but 0.375%
less than 2.50:1.00
IV Greater than or equal to 1.50:1.00 but 0.375%
less than 2.00:1.00
V Less than 1.50:1.00 0.250%
Changes in the Applicable Fee Percentage resulting from a change in a Pricing
Level shall become effective upon the due date (the 45th day after the end of
the first three fiscal quarters or the 90th day after the end of the last fiscal
quarter) of delivery by the Borrower to the Agent of a Compliance Certificate
pursuant to Section 7.1(c) evidencing a change in the Leverage Ratio which would
affect the Pricing Level. If the Borrower shall fail to deliver a Compliance
Certificate within 45 days after the end of each of the first three fiscal
quarters (or 90 days after the end of the last fiscal quarter) as required by
Section 7.1(c), Pricing Level I shall apply from and including the 46th day (the
91st day in the case of the last quarter) after the end of such fiscal quarter
to the date of the delivery by the Borrower to the Agent of a Compliance
Certificate demonstrating that a different Pricing Level is applicable, which
different Pricing Level shall apply from the date of delivery of such Compliance
Certificate. Notwithstanding the foregoing, no reduction in the Applicable Fee
Percentage shall become effective if an Event of Default shall have occurred and
be continuing.
"Applicable Lending Office": in respect of any Lender, (i) in
the case of such Lender's ABR Advances, its Domestic Lending Office and (ii) in
the case of such Lender's Eurodollar Advances, its Eurodollar Lending Office.
"Applicable Margin": with respect to the unpaid principal
balance of ABR Advances and Eurodollar Advances, in each case at all times
during which the applicable Pricing Level set forth below is in effect, the
appropriate applicable percentages corresponding to the Leverage Ratio in effect
as set forth below next to such Pricing Level and under the applicable column:
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Applicable Applicable Margin
Pricing Margin for ABR for
Level Leverage Ratio Advances Eurodollar Advances
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I Greater than or equal to 1.125% 2.250%
3.00:1.00
II Greater than or equal to 0.750% 1.875%
2.50:1.00 but less than
3.00:1.00
III Greater than or equal to 0.500% 1.625%
2.00:1.00 but less than
2.50:1.00
IV Greater than or equal to 0.250% 1.375%
1.50:1.00 but less than
2.00:1.00
V Less than 1.50:1.00 0.000% 1.125%
Changes in the Applicable Margin resulting from a change in the Pricing Level
shall become effective upon the due date (the 45th day after the end of the
first three fiscal quarters or the 90th day after the end of the last fiscal
quarter) of delivery by the Borrower to the Agent of a Compliance Certificate
pursuant to Section 7.1(c) evidencing a change in the Leverage Ratio which would
affect the Pricing Level. If the Borrower shall fail to deliver a Compliance
Certificate within 45 days after the end of each of the first three fiscal
quarters (or 90 days after the end of the last fiscal quarter) as required by
Section 7.1(c), Pricing Level I shall apply from and including the 46th day (the
91st day in the case of the last quarter) after the end of such fiscal quarter
to the date of the delivery by the Borrower to the Agent of a Compliance
Certificate demonstrating that a different Pricing Level is applicable, which
different Pricing Level shall apply from the date of delivery of such Compliance
Certificate. Notwithstanding the foregoing, no reduction in the Applicable
Margin shall become effective if an Event of Default shall have occurred and be
continuing.
"Approved Bank": any bank whose (or whose parent company's)
unsecured non-credit supported short-term commercial paper rating from (i)
Standard & Poor's is at least A-1 or the equivalent thereof or (ii) Xxxxx'x is
at least P-1 or the equivalent thereof.
"Assignment and Acceptance Agreement": an assignment and
acceptance agreement executed by an assignor and an assignee, substantially in
the form of Exhibit H.
"Assignment Fee": as defined in Section 11.7(b).
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"Authorized Signatory": as to (i) any Person which is a
corporation, the chairman of the board, the president, any vice president, the
chief financial officer or any other officer (acceptable to the Agent) thereof
and (ii) any Person which is not a corporation, a general partner, Managing
Person or other appropriate appointed officer (acceptable to the Agent) thereof.
"Available Commitment Amount": at any time, an amount equal to
the Aggregate Commitment Amount at such time minus the Aggregate Credit Exposure
at such time.
"Bash Acquisition": shall mean the acquisition evidenced by an
acquisition agreement, dated July 3, 1997 by and among Bash Theatrical Lighting,
Inc., Bash Theatrical Lighting Inc. - West Coast, Bash Lighting Services, Inc.,
Bash Lighting Services Mid-Atlantic, Inc., Bash Exposition Services, Inc.,
Xxxxxx Xxxxx, Xxxxxx Xxxxxx and the Borrower.
"Benefited Lender": as defined in Section 11.11(a).
"BNY": The Bank of New York.
"BNY Capital Markets": BNY Capital Markets, Inc.
"BNY Rate": a rate of interest per annum equal to the rate of
interest publicly announced in New York City by BNY from time to time as its
prime commercial lending rate, such rate to be adjusted automatically (without
notice) on the effective date of any change in such publicly announced rate.
"Borrowing Date": any Business Day on which the Lenders make
Revolving Credit Loans to the Borrower.
"Borrowing Request": a request for Revolving Credit Loans in
the form of Exhibit C.
"Business Day": for all purposes other than as set forth in
clause (ii) below, (i) any day other than a Saturday, a Sunday or a day on which
commercial banks located in New York City are authorized or required by law or
other governmental action to close, and (ii) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
Eurodollar Advances, any day which is a Business Day described in clause (i)
above and which is also a day on which eurodollar funding between banks may be
carried on in London, England.
"Capital Expenditures": with respect to any Person for any
period, the aggregate of all expenditures incurred by such Person during such
period which, in accordance with GAAP, are required to be included in "Additions
to Property, Plant or Equipment" or similar items reflected on the balance sheet
of such Person or are required to be included in increases in
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deferred production costs, provided, however, that "Capital Expenditures" shall
not include (i) Capital Lease Obligations, or (ii) expenditures of proceeds of
insurance settlements in respect of lost, destroyed or damaged assets, equipment
or other property to the extent such expenditures are made to replace or repair
such lost, destroyed or damaged assets, equipment or other property within six
months of the receipt of such proceeds or (iii) Acquisition Costs incurred in
connection with Permitted Acquisitions.
"Capital Lease Obligations": with respect to any Person,
obligations of such Person with respect to leases which are required to be
capitalized for financial reporting purposes in accordance with GAAP.
"Capital Stock": as to any Person, all shares, interests,
partnership interests, limited liability company interests, membership units,
participations, rights in or other equivalents (however designated) of such
Person's equity (however designated) and any rights, warrants or options
exchangeable for or convertible into such shares, interests, units,
participations, rights or other equity.
"Cash Equivalents": (i) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in full support thereof) having maturities of not
more than twelve months from the date of acquisition, (ii) Dollar denominated
time deposits, certificates of deposit and bankers acceptances of (x) any Lender
or (y) any Approved Bank, in any such case with maturities of not more than
twelve months from the date of acquisition, (iii) commercial paper issued by any
Approved Bank or by the parent company of any Approved Bank and commercial paper
issued by, or guaranteed by, any industrial or financial company with an
unsecured non-credit supported short-term commercial paper rating of at least
A-1 or the equivalent by Standard & Poor's or at least P-1 or the equivalent by
Moody's, or guaranteed by any industrial or financial company with a long term
unsecured non-credit supported senior debt rating of at least A or A-2, or the
equivalent, by Standard & Poor's or Moody's, as the case may be, and in each
case maturing within twelve months after the date of acquisition, (iv)
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 maturing within twelve months from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either Standard & Poor's or Moody's, (v)
investments in money market funds substantially all the assets of which are
comprised of securities of the types described in clauses (i) through (iv) above
and (vi) fully collateralized repurchase agreements with a term of not more than
twelve months for securities described in clause (i) above and entered into with
any Lender, any Approved Bank or primary dealers in U.S. Government securities;
in each case so long as the same (x) provide for the payment of principal and
interest (and not principal alone or interest alone) and (y) are not subject to
any contingency regarding the payment of principal or interest.
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"Change of Control": any one or more of the following events:
(a) the Xxxxxx Group shall fail to own, beneficially and of record, directly or
indirectly 80% of the issued and outstanding voting Capital Stock of the
Borrower and of each of the Guarantors owning, beneficially and of record any
Capital Stock of the Borrower or (b) the Xxxxxx Group shall fail to own,
beneficially and of record, directly or indirectly 25% of the issued and
outstanding Capital Stock of the Borrower and each of the Guarantors owning,
beneficially and of record any Capital Stock of the Borrower.
"Code": the Internal Revenue Code of 1986, as the same may be
amended from time to time, or any successor thereto, and the rules and
regulations issued thereunder, as from time to time in effect.
"Collateral": collectively, the Property in which a security
interest is granted under the Collateral Documents.
"Collateral Documents": collectively, (i) the Pledge
Agreements, the Security Agreement, the Guaranty, and (ii) all documents
executed or delivered in connection with any of the foregoing.
"Commitment": in respect of any Lender, such Lender's
undertaking during the Commitment Period to make Revolving Credit Loans, subject
to the terms and conditions hereof, in an aggregate outstanding principal amount
not exceeding the Commitment Amount of such Lender.
"Commitment Amount": as of any date and with respect to any
Lender, the amount set forth adjacent to its name under the heading "Commitment
Amount" in Exhibit A on such date or, in the event that such Lender is not
listed in Exhibit A, the "Commitment Amount" which such Lender shall have
assumed from another Lender in accordance with Section 11.7 on or prior to such
date, in each case as the same may be adjusted from time to time pursuant to
Sections 2.4 and 11.7.
"Commitment Fee": as defined in Section 3.2(a).
"Commitment Percentage": as to any Lender in respect of such
Lender's Commitment, the percentage equal to such Lender's Commitment Amount
divided by the Aggregate Commitment Amount (or, if no Commitments then exist,
the percentage equal to such Lender's Commitment Amount on the last day upon
which Commitments did exist divided by the Aggregate Commitment Amount on such
day).
"Commitment Period": the period from the Effective Date until
the Commitment Termination Date.
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"Commitment Termination Date": the earlier of the Business Day
immediately preceding the Maturity Date or such other date upon which the
Commitments shall have been terminated in accordance with Section 2.4 or Section
9.2.
"Compensatory Interest Payment": as defined in Section 3.1(c).
"Compliance Certificate": a certificate substantially in the
form of Exhibit E.
"Consolidated": the Borrower and its Subsidiaries which are
consolidated for financial reporting purposes.
"Contingent Obligation": as to any Person ( a "secondary
obligor"), any obligation of such secondary obligor (i) guaranteeing or in
effect guaranteeing any return on any investment made by another Person, or (ii)
guaranteeing or in effect guaranteeing any Indebtedness, lease, dividend or
other obligation (a "primary obligation") of any other Person (a "primary
obligor") in any manner, whether directly or indirectly, including any
obligation of such secondary obligor, whether contingent, (A) to purchase any
primary obligation or any Property constituting direct or indirect security
therefor, (B) to advance or supply funds (x) for the purchase or payment of any
primary obligation or (y) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of a primary
obligor, (C) to purchase Property, securities or services primarily for the
purpose of assuring the beneficiary of any primary obligation of the ability of
a primary obligor to make payment of a primary obligation, (D) otherwise to
assure or hold harmless the beneficiary of a primary obligation against loss in
respect thereof, and (E) in respect of the liabilities of any partnership in
which a secondary obligor is a general partner, except to the extent that such
liabilities of such partnership are nonrecourse to such secondary obligor and
its separate Property, provided, however, that the term "Contingent Obligation"
shall not include the indorsement of instruments for deposit or collection in
the ordinary course of business. The amount of any Contingent Obligation of a
Person shall be deemed to be an amount equal to the stated or determinable
amount of a primary obligation in respect of which such Contingent Obligation is
made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by such Person in good faith.
"Control Person": as defined in Section 3.6.
"Conversion Date": the date on which: (i) a Eurodollar Advance
is converted to an ABR Advance, (ii) an ABR Advance is converted to a Eurodollar
Advance or (iii) a Eurodollar Advance is converted to a new Eurodollar Advance.
"Credit Exposure": with respect to any Lender as of any date,
the sum as of such date of the outstanding principal balance of such Lender's
Revolving Credit Loans.
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"Credit Party": the Borrower and each other party (other than
the Agent and the Lenders) to a Loan Document.
"Default": any event or condition which constitutes an Event
of Default or which, with the giving of notice, the lapse of time, or any other
condition, would, unless cured or waived, become an Event of Default.
"Disposition": with respect to any Person, any sale,
assignment, transfer or other disposition by such Person, by any means, of (i)
the Capital Stock of any other Person, (ii) any business, going concern or
division or segment thereof, or (iii) any other Property of such Person other
than in the ordinary course of business, provided, however, that no such sale,
assignment, transfer or other disposition of Property (other than Property sold
in the ordinary course of business) shall be deemed to be in the ordinary course
of business (a) if the fair market value thereof is in excess of $250,000, or
(b) to the extent the fair market value thereof, when aggregated with all other
sales, assignments, transfers and other dispositions made by such Person within
the same fiscal year exceeds $500,000 or (c) if it is the sale, assignment,
transfer or disposition of (1) all or substantially all of the Property of such
Person, or (2) any Operating Entity.
"Dollars" and "$": lawful currency of the United States.
"Domestic Lending Office": in respect of (i) any Lender listed
on the signature pages hereof, initially, the office or offices of such Lender
designated as such on Schedule 1.1; thereafter, such other office of such
Lender, through which it shall be making or maintaining ABR Advances, as
reported by such Lender to the Agent and the Borrower and (ii) in the case of
any other Lender, initially, the office or offices of such Lender designated as
such on Schedule 2 of the Assignment and Acceptance Agreement or other document
pursuant to which it became a Lender; thereafter, such other office of such
Lender, through which it shall be making or maintaining ABR Advances, as
reported by such Lender to the Agent and the Borrower.
"EBITDA": for any period, Consolidated net income (or loss) of
the Borrower and its Subsidiaries for such period, determined in accordance with
GAAP plus the sum of, without duplication, (i) Interest Expense for such period,
(ii) provision for income taxes for such period and (iii) depreciation,
amortization and other non-cash charges, each to the extent deducted in
determining such net income for such period, and adjusted for any extraordinary
gains and losses from sales, exchanges and other dispositions of Property not in
the ordinary course of business and other non-recurring items (except
non-recurring losses in connection with net deferred production costs),
including without limitation, any non-recurring expenses or charges made in
connection with the Bash Acquisition (including bonus payments made in
connection therewith in an amount not to exceed $2,000,000) and calculated after
giving effect to Acquisitions, mergers and other Dispositions of the Borrower
and its Subsidiaries during such period as if such transactions had occurred on
the first day of such period.
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"ECTS": ECTS, a Scenic Technology Company, Inc., a New York
corporation.
"ECTS-LV": ECTS Contracting of Las Vegas, Inc., a Nevada
corporation.
"Effective Date": July 31, 1997.
"Eligible Assignee": a Lender, any affiliate of a Lender and
any other bank, insurance company, pension fund, mutual fund or other financial
institution.
"Employee Benefit Plan": an employee benefit plan within the
meaning of Section 3(3) of ERISA maintained, sponsored or contributed to by the
Borrower, any of its Subsidiaries or any ERISA Affiliate.
"Environmental Laws": any and all federal, state and local
laws relating to the environment, the use, storage, transporting, manufacturing,
handling, discharge, disposal or recycling of hazardous substances, materials or
pollutants or industrial hygiene, and including (i) the Comprehensive
Environmental Response, Compensation and Liability Act, as amended, 42 USCA
ss.9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976, as
amended, 42 USCA ss.6901 et seq.; (iii) the Toxic Substance Control Act, as
amended, 15 USCA ss.2601 et seq.; (iv) the Water Pollution Control Act, as
amended, 33 USCA ss.1251 et seq.; (v) the Clean Air Act, as amended, 42 USCA
ss.7401 et seq.; (vi) the Hazardous Materials Transportation Authorization Act
of 1994, as amended, 49 USCA ss.5101 et seq. and (vii) all rules, regulations,
judgments, decrees, injunctions and restrictions thereunder and any analogous
state law.
"ERISA": the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the rules and regulations issued thereunder,
as from time to time in effect.
"ERISA Affiliate": when used with respect to an Employee
Benefit Plan, ERISA, the PBGC or a provision of the Code pertaining to employee
benefit plans, any Person which is a member of any group of organizations within
the meaning of Sections 414(b) or (c) of the Code (or, solely for purposes of
potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of
the Code and the lien created under Section 302(f) of ERISA and Section 412(n)
of the Code, Sections 414(m) or (o) of the Code) of which the Borrower or any of
its Subsidiaries is a member.
"Eurodollar Advances": collectively, the Revolving Credit
Loans (or any portions thereof), at such time as they (or such portions) are
made and/or being maintained at a rate of interest based upon the Eurodollar
Rate.
"Eurodollar Lending Office": in respect of (i) any Lender
listed on the signature pages hereof, initially, the office or offices of such
Lender designated as such on Schedule 1.1;
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thereafter, such other office of such Lender, through which it shall be making
or maintaining Eurodollar Advances, as reported by such Lender to the Agent and
the Borrower and (ii) in the case of any other Lender, initially, the office or
offices of such Lender designated as such on Schedule 2 of the Assignment and
Acceptance Agreement or other document pursuant to which it became a Lender;
thereafter, such other office of such Lender, through which it shall be making
or maintaining Eurodollar Advances, as reported by such Lender to the Agent and
the Borrower.
"Eurodollar Rate": with respect to the Interest Period
applicable to any Eurodollar Advance, a rate of interest per annum, as
determined by the Agent, obtained by dividing (and then rounding to the nearest
1/16 of 1% or, if there is no nearest 1/16 of 1%, then to the next higher 1/16
of 1%):
(a) the rate, as reported by BNY to the Agent, quoted
by BNY to leading banks in the interbank eurodollar market as the rate at which
BNY is offering Dollar deposits in an amount equal approximately to the
Eurodollar Advance to which such Interest Period shall apply for a period equal
to such Interest Period, as quoted at approximately 11:00 a.m. two Business Days
prior to the first day of such Interest Period, by
(b) a number equal to 1.00 minus the aggregate of the
then stated maximum rates during such Interest Period of all reserve
requirements (including marginal, emergency, supplemental and special reserves),
expressed as a decimal, established by the Board of Governors of the Federal
Reserve System and any other banking authority to which BNY and other major
United States money center banks are subject, in respect of eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in Regulation D of the
Board of Governors of the Federal Reserve System) or in respect of any other
category of liabilities including deposits by reference to which the interest
rate on Eurodollar Advances is determined or any category of extensions of
credit or other assets which includes loans by non-domestic offices of any
Lender to United States residents. Such reserve requirements shall include,
without limitation, those imposed under such Regulation D. Eurodollar Advances
shall be deemed to constitute Eurocurrency liabilities and as such shall be
deemed to be subject to such reserve requirements without benefit of credits for
proration, exceptions or offsets which may be available from time to time to any
Lender under such Regulation D. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in any such reserve
requirement.
"Event of Default": as defined in Section 9.1.
"Excess Cash Flow": with respect to any fiscal year, EBITDA
(before giving effect to Acquisitions, mergers and Dispositions during such
period) for such fiscal year less the sum of, without duplication, (i) without
duplication, taxes and Restricted Payments for Members' Tax Liability paid or
required to be paid during such period, (ii) Capital Expenditures, (iii)
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Interest Expense and (iv) mandatory payments of principal of the Revolving
Credit Loans resulting from reductions in the Aggregate Commitment Amount
pursuant to Section 2.4(b)(ii).
"Existing Bank Debt": collectively, the Indebtedness of the
Borrower under the Amended and Restated Credit Agreement, dated as of July 25,
1996, as amended, by and between the Borrower and BNY, including all outstanding
principal, unpaid and accrued interest, unpaid and accrued fees and other unpaid
sums thereunder.
"Federal Funds Rate": for any day, a rate per annum (expressed
as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%)
equal to the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day, provided that (i) if the day for
which such rate is to be determined is not a Business Day, the Federal Funds
Rate for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (ii) if
such rate is not so published for any day, the Federal Funds Rate for such day
shall be the average of the quotations for such day on such transactions
received by BNY as determined by BNY and reported to the Agent.
"Fees": as defined in Section 2.7.
"Financial Officer": as to any Person, the chief financial
officer of such Person or such other officer as shall be satisfactory to the
Agent.
"Financial Statements": as defined in Section 4.13.
"Fixed Charge Coverage Ratio": at any date of determination,
the ratio of EBITDA to Fixed Charges for the four fiscal quarter period ending
on such date or, if such date is not the last day of a fiscal quarter, for the
immediately preceding four fiscal quarter period.
"Fixed Charges": for any period, with respect to the Borrower
and its Subsidiaries on a Consolidated basis in accordance with GAAP, the sum of
(i) mandatory payments of principal (including mandatory payments of the
Revolving Credit Loans resulting from reductions in the Aggregate Commitment
Amount pursuant to Section 2.4(b)(ii)) on Total Debt made or required to be made
during such period, (ii) Capital Expenditures made during such period, (iii)
Capitalized Lease Obligations paid or required to be paid during such period,
(iv) without duplication, taxes and Restricted Payments for Members' Tax
Liability, and (v) Interest Expense.
"Funded Current Liability Percentage": as defined in Section
401(a)(29) of the Code.
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"GAAP": generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and in the statements and
pronouncements of the Financial Accounting Standards Board or in such other
statement by such other entity as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the
date of determination, consistently applied.
"Governmental Authority": any foreign, federal, state,
municipal or other government, or any department, commission, board, bureau,
agency, public authority or instrumentality thereof, or any court or arbitrator.
"Guarantors": collectively (i) (1) HPS, (2) ECTS, (3) Theatre
Techniques Associates, Inc., (4) ECTS-LV, (5) Showpay, Inc., (6) Scenic
Properties L.L.C., (7) ECTS, A Scenic Technology Company, Inc., a Delaware
corporation, (8) Scenic Technologies Contracting, L.L.C., and (9) Showpay
L.L.C., and (ii) each other Person which becomes a Guarantor pursuant to the
provisions of the Guaranty.
"Guaranty": the Guaranty by and between the Guarantors and the
Agent, substantially in the form of Exhibit J, as the same may be amended,
supplemented or otherwise modified from time to time.
"Xxxxxx Group": Xxxxxxxx Xxxxxx, his spouse, his issue and any
of their respective spouses, including any trust with respect to which any such
individual is a beneficiary, and the descendants and heirs of Xxxxxxxx Xxxxxx.
"Hazardous Substance": any hazardous or toxic substance,
material or waste, including (i) those substances, materials, and wastes listed
in the United States Department of Transportation Hazardous Materials Table (49
CFR 172.101) or by the Environmental Protection Agency as hazardous substances
(40 CFR Part 302) and amendments thereto and replacements thereof and (ii) any
substance, pollutant or material defined as, or designated in, any Environmental
Law as a "hazardous substance," "toxic substance," "hazardous material,"
"hazardous waste," "restricted hazardous waste," "pollutant," "toxic pollutant"
or words of similar import.
"Highest Lawful Rate": as to any Lender, the maximum rate of
interest, if any, that at any time or from time to time may be contracted for,
taken, charged or received by such Lender on the Revolving Credit Note held by
it, or which may be owing to such Lender pursuant to the Loan Documents under
the laws applicable to such Lender and this transaction.
"HPS": Xxxxxx Production Services, Inc., a New York
corporation.
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"Indebtedness": as to any Person, at a particular time, all
items which constitute, without duplication, (i) indebtedness for borrowed
money, (ii) indebtedness in respect of the deferred purchase price of Property
(other than trade payables incurred in the ordinary course of business), (iii)
indebtedness evidenced by notes, bonds, debentures or similar instruments, (iv)
obligations with respect to any conditional sale or title retention agreement,
(v) indebtedness arising under acceptance facilities and the amount available to
be drawn under all letters of credit issued for the account of such Person and,
without duplication, all drafts drawn thereunder to the extent such Person shall
not have reimbursed the issuer in respect of the issuer's payment thereof, (vi)
all liabilities secured by any Lien on any Property owned by such Person even
though such Person has not assumed or otherwise become liable for the payment
thereof (other than carriers', warehousemen's, mechanics', repairmen's or other
like non-consensual statutory Liens arising in the ordinary course of business),
(vii) Capital Lease Obligations, (viii) all obligations of such Person in
respect of Capital Stock subject to mandatory redemption or redemption at the
option of the holder thereof, in whole or in part, and (ix) all Contingent
Obligations of such Person in respect of any of the foregoing.
"Indemnified Liability": as defined in Section 11.5.
"Indemnified Person": as defined in Section 11.8.
"Indemnified Tax": as defined in Section 3.10(a).
"Indemnified Tax Person": as defined in Section 3.10(a).
"Intercompany Indebtedness": loans which are (i) made by the
Borrower to direct or indirect Subsidiaries or (ii) made by direct or indirect
Subsidiaries to the Borrower or to other direct or indirect Subsidiaries of the
Borrower.
"Interest Expense": for any period, the sum of all interest
(adjusted to give effect to all Interest Rate Protection Agreements and fees and
expenses paid in connection therewith), of the Borrower and its Subsidiaries
paid or accrued in respect of Total Debt during such period, determined on a
Consolidated basis in accordance with GAAP.
"Interest Payment Date": (i) as to any ABR Advance, the last
day of each March, June, September and December commencing on the first of such
days to occur after such ABR Advance is made or any Eurodollar Advance is
converted to an ABR Advance, (ii) as to any Eurodollar Advance as to which the
Borrower has selected an Interest Period of one, two or three months, the last
day of such Interest Period, (iii) as to any Eurodollar Advance as to which the
Borrower has selected an Interest Period of six months, the last day of each
three month interval occurring during such Interest Period and the last day of
such Interest Period; and (iv) as to all Advances, the Maturity Date.
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"Interest Period": with respect to any Eurodollar Advance
requested by the Borrower, the period commencing on, as the case may be, the
Borrowing Date or Conversion Date with respect to such Eurodollar Advance and
ending one, two, three or six months, thereafter, as selected by the Borrower in
its irrevocable Borrowing Request or its irrevocable Notice of Conversion,
provided, however, that (i) if any Interest Period would otherwise end on a day
which is not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be to carry
such Interest Period into another calendar month, in which event such Interest
Period shall end on the immediately preceding Business Day and (ii) any Interest
Period which begins on the last Business Day of a calendar month (or on a day
for which there is no numerically corresponding day in the calendar month at the
end of such Interest Period) shall end on the last Business Day of a calendar
month. Interest Periods shall be subject to the provisions of Section 3.4.
"Interest Rate Protection Agreements": any interest rate swap,
cap or collar arrangement or any other derivative product customarily offered by
banks or other financial institutions to their customers in order to reduce the
exposure of such customers to interest rate fluctuations.
"Investments": as defined in Section 8.5.
"Leverage Ratio": at any date of determination, the ratio of
(i) Total Debt on such date to (ii) EBITDA for the four fiscal quarter period
ending on such date or, if such date is not the last day of a fiscal quarter,
for the immediately preceding four fiscal quarter period.
"Lien": any mortgage, pledge, hypothecation, assignment,
deposit or preferential arrangement, encumbrance, lien (statutory or other), or
other security agreement or security interest of any kind or nature whatsoever,
including any conditional sale or other title retention agreement and any
capital or financing lease having substantially the same economic effect as any
of the foregoing.
"Loan Documents": collectively, this Agreement, the Revolving
Credit Notes, the Collateral Documents and all other agreements, instruments and
documents executed or delivered in connection herewith, in each case as amended,
supplemented or otherwise modified from time to time.
"Managing Person": with respect to any Person that is (i) a
corporation, its board of directors, (ii) a limited liability company, its board
of control, managing member or manager, (iii) a limited partnership, its general
partner, (iv) a general partnership or a limited liability partnership, its
managing partner or executive committee or (v) any other Person, the managing
body thereof or other Person analogous to the foregoing.
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"Margin Stock": any "margin stock", as defined in Regulation
U of the Board of Governors of the Federal Reserve System, as amended,
supplemented or otherwise modified from time to time.
"Material Adverse Change": a material adverse change in (i)
the financial condition, operations, business, prospects or Property of (A) the
Borrower or (B) the Borrower and the Guarantors taken as a whole, (ii) the
ability of the Borrower or any of the Guarantors to perform its obligations
under the Loan Documents to which it is a party or (iii) the ability of the
Agent and the Lenders to enforce the Loan Documents.
"Material Adverse Effect": a material adverse effect on (i)
the financial condition, operations, business, prospects or Property of (A) the
Borrower or (B) the Borrower and the Guarantors taken as a whole, (ii) the
ability of the Borrower or any of the Guarantors to perform its obligations
under the Loan Documents to which it is a party or (iii) the ability of the
Agent and the Lenders to enforce the Loan Documents.
"Maturity Date": June 30, 2003, or such earlier date on which
the Revolving Credit Notes shall become due and payable, whether by acceleration
or otherwise.
"Members' Tax Liability": with respect to any period, the
amount required for the members of a limited liability company or a corporation
subject to the provisions of Subchapter S of the Code to pay their personal
income taxes as a result of such company's status as a limited liability company
or Subchapter S Corporation, assuming that each member is an individual subject
to Federal and New York State income tax at the maximum applicable rate.
"Moody's": Xxxxx'x Investors Service, Inc., or any successor
thereto.
"Multiemployer Plan": a Pension Plan which is a multiemployer
plan as defined in Section 4001(a)(3) of ERISA.
"Net Cash Proceeds": with respect to any Disposition by the
Borrower or any of its Subsidiaries or a Guarantor, the aggregate gross sales
proceeds received by the Borrower or such Subsidiary or Guarantor in cash in
connection with such Disposition minus the sum of (i) sales and other
commissions and legal and other expenses incurred in connection with such
Disposition, (ii) any taxes paid or payable by the Borrower or such Subsidiary
or Guarantor in connection therewith, and (iii) the amount of Indebtedness
(other than the Revolving Credit Loans) secured by the Property subject to such
Disposition which, in accordance with the terms governing such Indebtedness, is
required to be repaid upon such Disposition.
"New Subsidiary": as defined in Section 8.12.
"Notice of Conversion": a notice substantially in the form of
Exhibit D.
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"Offering": any public or private offering of Capital Stock
of the Borrower, any Subsidiary or Guarantor or any parent of any thereof.
"Offering Proceeds": with respect to any Offering, the
aggregate amount of cash received by the issuer in connection therewith, after
deduction of reasonable and customary fees and expenses in connection
therewith.
"Other Taxes": as defined in Section 3.10(c).
"Operating Entity": any Person or any business or operating
unit of a Person which is, or could be, operated separate and apart from (i)
the other businesses and operations of such Person, or (ii) any other line of
business or business segment.
"Organizational Documents": as to any Person which is (i) a
corporation, the certificate or articles of incorporation and by-laws of such
Person, (ii) a limited liability company, the limited liability company
agreement or similar agreement of such Person, (iii) a partnership, the
partnership agreement or similar agreement of such Person, or (iv) any other
form of entity or organization, the organizational documents analogous to the
foregoing.
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA, or any Governmental Authority
succeeding to the functions thereof.
"Pension Plan": at any date of determination, any Employee
Benefit Plan (including a Multiemployer Plan), the funding requirements of which
(under Section 302 of ERISA or Section 412 of the Code) are, or at any time
within the six years immediately preceding such date, were in whole or in part,
the responsibility of the Borrower, any of its Subsidiaries or any ERISA
Affiliate.
"Permitted Acquisition": an Acquisition permitted by Section
8.3.
"Permitted Lien": a Lien permitted to exist under Section 8.2.
"Person": any individual, firm, partnership, limited liability
company, joint venture, corporation, association, business enterprise, joint
stock company, unincorporated association, trust, Governmental Authority or any
other entity, whether acting in an individual, fiduciary, or other capacity, and
for the purpose of the definition of "ERISA Affiliate", a trade or business.
"Pledge Agreements": the Pledge Agreements, made by the
Pledgors in favor of the Agent, substantially in the form of Exhibit K hereto.
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"Pledgors": (i) Xxxxx Xxxxxx, (ii) Xxxxxxx Xxxxx, and (iii)
any other Person who becomes a Pledgor after the Effective Date pursuant to
Section 8.12.
"Preferred Membership Units": the preferred membership units
which may be issued to Xxxxxx Xxxxx or Xxxxxx Xxxxxx pursuant to an investment
option agreement that shall be executed in connection with the Bash
Acquisition.
"PRG Operating Agreement": the Amended and Restated Limited
Liability Company Agreement of the Borrower, dated as of January 1, 1996.
"Pricing Level": Pricing Level I, Pricing Level II, Pricing
Level III, Pricing Level IV or Pricing Level V, as said terms are used in the
definitions of "Applicable Fee Percentage" and "Applicable Margin", as
applicable.
"Pro Forma Interest Coverage Ratio": at any date of
determination, the ratio of EBITDA for the four fiscal quarter period ending on
such date or, if such date is not the last day of a fiscal quarter, for the
immediately preceding four fiscal quarter period, to Pro Forma Interest Expense
as of such date.
"Pro Forma Interest Expense": at any date of determination,
the sum of Interest Expense on Total Debt for the period of the four fiscal
quarters immediately succeeding such date of determination. For purposes of
calculating "Pro Forma Interest Expense", the principal amount of Total Debt
outstanding during such succeeding four fiscal quarters shall be assumed to be
the average daily Total Debt outstanding during the fiscal quarter immediately
preceding such date of determination (or, in the event that such date of
determination is a fiscal quarter ending date, the fiscal quarter then ended),
subject to any mandatory repayments required to be made under any outstanding
facilities as a result of any scheduled mandatory reductions to the amounts of
such facilities during such succeeding four fiscal quarters. If any item of
interest varies or depends upon a variable rate of interest such rate shall be
assumed to equal the Alternate Base Rate plus the Applicable Margin in effect on
the date of such calculation, or, if such rate is a Eurodollar Rate, the
applicable Eurodollar Rate plus the Applicable Margin in effect on the date of
such calculation.
"Prohibited Transaction": a transaction which is prohibited
under Section 4975 of the Code or Section 406 of ERISA and not exempt under
Section 4975 of the Code or Section 408 of ERISA.
"Property": all types of real, personal, tangible, intangible
or mixed property.
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"Rate Protection Lenders": collectively, the Lenders and any
affiliates of the Lenders which from time to time enter or have entered into
Interest Rate Protection Arrangements with the Borrower.
"Real Property": all real property owned or leased by the
Borrower or any of its Subsidiaries.
"Regulatory Change": (i) the introduction or phasing in of any
law, rule or regulation after the Effective Date, (ii) the issuance or
promulgation after the Effective Date of any directive, guideline or request
from any central bank or United States or foreign Governmental Authority
(whether or not having the force of law), or (iii) any change after the
Effective Date in the interpretation of any existing law, rule, regulation,
directive, guideline or request by any central bank or United States or foreign
Governmental Authority charged with the administration thereof.
"Remaining Interest Period": (i) in the event that the
Borrower shall fail for any reason to borrow a Revolving Credit Loan in respect
of which it shall have requested a Eurodollar Advance or convert an Advance to a
Eurodollar Advance after it shall have notified the Agent of its intent to do
so, a period equal to the Interest Period that the Borrower elected in respect
of such Eurodollar Advance; or (ii) in the event that a Eurodollar Advance shall
terminate for any reason prior to the last day of the Interest Period applicable
thereto, a period equal to the remaining portion of such Interest Period if such
Interest Period had not been so terminated; or (iii) in the event that the
Borrower shall prepay or repay all or any part of the principal amount of a
Eurodollar Advance prior to the last day of the Interest Period applicable
thereto, a period equal to the period from and including the date of such
prepayment or repayment to but excluding the last day of such Interest Period.
"Reportable Event": with respect to any Pension Plan, (i) any
event set forth in Sections 4043(c) (other than a Reportable Event as to which
the 30 day notice requirement is waived by the PBGC under applicable
regulations), 4062(c) or 4063(a) of ERISA or the regulations thereunder, (ii) an
event requiring the Borrower, any of its Subsidiaries or any ERISA Affiliate to
provide security to a Pension Plan under Section 401(a)(29) of the Code, or
(iii) any failure to make any payment required by Section 412(m) of the Code.
"Required Lenders": at any time when (i) no Revolving Credit
Loans are outstanding, Lenders having Commitment Amounts (or if no Commitments
then exist, Lenders having Commitment Amounts on the last day on which
Commitments did exist) greater than or equal to 51% of the Aggregate Commitment
Amount and (ii) at any time when Revolving Credit Loans are outstanding, Lenders
which have Revolving Credit Loans outstanding in an aggregate amount greater
than or equal to 51% of the Aggregate Credit Exposure.
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"Restricted Payment": as to any Person (i) any dividend or
other distribution, direct or indirect, on account of any Capital Stock in such
Person now or hereafter outstanding (other than a dividend payable solely in
shares or units of such Capital Stock to the holders thereof), (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition, direct or indirect, of any Capital Stock in such Person now or
hereafter outstanding, (iii) any tax sharing or similar payment payable by such
Person to another Person and (iv) any distribution made, directly or indirectly,
with respect to such Person's Members' Tax Liability.
"Revolving Credit Loan" and "Revolving Credit Loans": as
defined in Section 2.1.
"Revolving Credit Note" and "Revolving Credit Notes": as
defined in Section 2.2.
"SEC": the Securities and Exchange Commission or any
Governmental Authority succeeding to the functions thereof.
"Security Agreement": the Security Agreement by and between
the Borrower, the Guarantors and the Agent, substantially in the form of
Exhibit I, as the same may be amended, supplemented or otherwise modified from
time to time.
"Special Counsel": Xxxxx, Xxxxxx & Xxxxxx, LLP, special
counsel to the Agent.
"Standard & Poor's": Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc., or any successor thereto.
"Subsidiary": as to any Person, any corporation, association,
partnership, limited liability company, joint venture or other business entity
of which such Person or any Subsidiary of such Person, directly or indirectly,
either (i) in respect of a corporation, owns or controls more than 50% of the
outstanding Capital Stock having ordinary voting power to elect a majority of
the Managing Person, irrespective of whether a class or classes shall or might
have voting power by reason of the happening of any contingency, or (ii) in
respect of an association, partnership, limited liability company, joint
venture or other business entity, is entitled to share in more than 50% of the
profits and losses, however determined provided, however that for purposes of
this Agreement X. Xxxxxx Inc. and Kaleidoscope Creative, Inc. shall not be
Subsidiaries of any Credit Party.
"Taxes": as defined in Section 3.10(a).
"Tax on the Income": as defined in Section 3.10(a).
"Termination Event": with respect to any Pension Plan, (i) a
Reportable Event, (ii) the termination of a Pension Plan,
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or the filing of a notice of intent to terminate a Pension Plan, or the
treatment of a Pension Plan amendment as a termination under Section 4041(c) of
ERISA, (iii) the institution of proceedings to terminate a Pension Plan under
Section 4042 of ERISA, or (iv) the appointment of a trustee to administer any
Pension Plan under Section 4042 of ERISA.
"Total Debt": at any date of determination, all Indebtedness
(other than trade payables incurred in the ordinary course of business) on such
date of the Borrower and its Subsidiaries on a Consolidated basis as determined
in accordance with GAAP.
"Type": with respect to any Revolving Credit Loan, the
character of such Revolving Credit Loan as an ABR Advance or a Eurodollar
Advance, each of which constitutes a type of loan.
"Unfunded Pension Liabilities": with respect to any Pension
Plan, at any date of determination, the amount determined by taking the
accumulated benefit obligation, as disclosed in accordance with Statement of
Accounting Standards No. 87, "Employers' Accounting for Pensions", over the
fair market value of Pension Plan assets.
"United States": the United States of America (including the
States thereof and the District of Columbia).
"Unqualified Amount": as defined in Section 3.1(c).
"Unrecognized Retiree Welfare Liability": with respect to any
Employee Benefit Plan that provides postretirement benefits other than pension
benefits, the amount of the transition obligation, as determined in accordance
with Statement of Financial Accounting Standards No. 106, "Employers' Accounting
for Postretirement Benefits Other Than Pensions," as of the most recent
valuation date, that has not been recognized as an expense in an income
statement of the Borrower and its Subsidiaries, provided that prior to the date
such Statement is applicable to the Borrower, such amount shall be based on an
estimate made in good faith of such transition obligation.
"U.S. Person": a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in or under any
laws of the United States, or any estate or trust that is subject to United
States federal income taxation regardless of the source of its income.
1.2. Principles of Construction
(a) All terms defined in a Loan Document shall have the
meanings given such terms therein when used in the other Loan Documents or any
certificate, opinion or other document made or delivered pursuant thereto,
unless otherwise defined therein.
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(b) As used in the Loan Documents and in any certificate,
opinion or other document made or delivered pursuant thereto, accounting terms
not defined in Section 1.1, and accounting terms partly defined in Section 1.1,
to the extent not defined, shall have the respective meanings given to them
under GAAP. If at any time any change in GAAP would affect the computation of
any financial ratio or requirement set forth in this Agreement, the Agent, the
Lenders and the Borrower shall negotiate in good faith to amend such ratio or
requirement to reflect such change in GAAP (subject to the approval of the
Required Lenders), provided that, until so amended, (i) such ratio or
requirement shall continue to be computed in accordance with GAAP prior to such
change therein and (ii) the Borrower shall provide to the Agent and the Lenders
financial statements and other documents required under this Agreement or as
reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect to
such change in GAAP.
(c) The words "hereof", "herein", "hereto" and "hereunder" and
similar words when used in a Loan Document shall refer to such Loan Document as
a whole and not to any particular provision thereof, and Section, schedule and
exhibit references contained therein shall refer to Sections thereof or
schedules or exhibits thereto unless otherwise expressly provided therein.
(d) The phrase "may not" is prohibitive and not permissive.
(e) Unless the context otherwise requires, words in the
singular number include the plural, and words in the plural include the
singular.
(f) Unless specifically provided in a Loan Document to the
contrary, any reference to a time shall refer to such time in New York.
(g) Unless specifically provided in a Loan Document to the
contrary, in the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including" and the words "to"
and "until" each means "to but excluding".
(h) References in any Loan Document to a fiscal period shall
refer to that fiscal period of the Borrower.
(i) The words "include" and "including", when used in each
Loan Document, shall mean that the same shall be included "without limitation",
unless otherwise expressly provided therein.
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2. AMOUNT AND TERMS OF REVOLVING CREDIT LOANS
2.1. Revolving Credit Loans
Subject to the terms and conditions hereof, each Lender
severally (and not jointly) agrees to make revolving credit loans (each a
"Revolving Credit Loan" and, as the context may require, collectively with all
other Revolving Credit Loans of such Lender and with the Revolving Credit Loans
of all other Lenders, the "Revolving Credit Loans") to the Borrower from time to
time during the Commitment Period, provided that immediately after giving effect
thereto (i) such Lender's Credit Exposure would not exceed such Lender's
Commitment Amount, and (ii) the Aggregate Credit Exposure would not exceed the
Aggregate Commitment Amount. During the Commitment Period, the Borrower may
borrow, prepay in whole or in part and reborrow under the Commitments, all in
accordance with the terms and conditions of this Agreement. Subject to the
provisions of Sections 2.3 and 3.3, at the option of the Borrower, Revolving
Credit Loans may be made as one or more (i) ABR Advances, (ii) Eurodollar
Advances or (iii) any combination thereof.
2.2. Revolving Credit Notes
The Revolving Credit Loans made by each Lender shall be
evidenced by a promissory note of the Borrower, substantially in the form of
Exhibit B, with appropriate insertions therein as to date and principal amount
(each, as indorsed or modified from time to time, a "Revolving Credit Note" and,
collectively with the Revolving Credit Notes of all other Lenders, the
"Revolving Credit Notes"), payable to the order of such Lender for the account
of its Applicable Lending Office, dated the first Borrowing Date, and in the
stated principal amount equal to such Lender's Commitment Amount. The
outstanding principal balance of the Revolving Credit Loans shall be due and
payable on the Maturity Date.
2.3. Procedure for Borrowing
(a) The Borrower may borrow under the Commitments on any
Business Day during the Commitment Period, provided that the Borrower shall
notify the Agent by the delivery of a Borrowing Request, which shall be sent by
telecopy and shall be irrevocable (confirmed promptly, and in any event within
five Business Days, by the delivery to the Agent of a Borrowing Request
manually signed by the Borrower), no later than: 11:00 a.m., three Business
Days prior to the requested Borrowing Date, in the case of Eurodollar Advances,
or 11:00 a.m., one Business Day prior to the requested Borrowing Date, in the
case of ABR Advances, specifying (A) the aggregate principal amount to be
borrowed under the Commitments, (B) the requested Borrowing Date, (C) whether
such borrowing is to consist of one or more Eurodollar Advances, ABR Advances,
or a combination thereof and (D) if the borrowing is to consist of one or more
Eurodollar Advances, the length of the Interest Period for each such Eurodollar
Advance. Each (i) Eurodollar Advance to be made on a Borrowing Date, when
aggregated with
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all amounts to be converted to a Eurodollar Advance on such date and having the
same Interest Period as such first Eurodollar Advance, shall equal no less than
$1,000,000 or such amount plus a whole multiple of $500,000 in excess thereof,
and (ii) each ABR Advance made on each Borrowing Date shall equal no less than
$500,000 or such amount plus a whole multiple of $100,000 in excess thereof or,
if less, the Available Commitment Amount.
(b) Upon receipt of each Borrowing Request, the Agent shall
promptly notify each Lender thereof. Subject to its receipt of the notice
referred to in the preceding sentence, each Lender will make the amount of its
Commitment Percentage of the requested Revolving Credit Loans available to the
Agent for the account of the Borrower at the office of the Agent set forth in
Section 11.2 not later than 12:00 noon on the relevant Borrowing Date requested
by the Borrower, in funds immediately available to the Agent at such office. The
amounts so made available to the Agent on such Borrowing Date will then, subject
to the satisfaction of the terms and conditions of this Agreement, as determined
by the Agent, be made available on such date to the Borrower by the Agent at the
office of the Agent specified in Section 11.2 by crediting the account of the
Borrower on the books of such office with the aggregate of said amounts received
by the Agent.
(c) Unless the Agent shall have received prior notice from a
Lender (by telephone or otherwise, such notice to be promptly confirmed by
telecopy or other writing) that such Lender will not make available to the Agent
such Lender's Commitment Percentage of the Revolving Credit Loans requested by
the Borrower, the Agent may assume that such Lender has made such share
available to the Agent on the Borrowing Date in accordance with this Section,
provided that such Lender received notice of the requested Revolving Credit
Loans from the Agent, and the Agent may, in reliance upon such assumption, make
available to the Borrower on the Borrowing Date a corresponding amount. If and
to the extent such Lender shall not have so made its Commitment Percentage of
such Revolving Credit Loans available to the Agent, such Lender and the Borrower
severally agree to pay to the Agent forthwith on demand such corresponding
amount (to the extent not previously paid by the other), together with interest
thereon for each day from the date such amount is made available to the Borrower
to the date such amount is paid to the Agent, at a rate per annum equal to, in
the case of the Borrower, the applicable interest rate set forth in Section 3.1
for ABR Advances, and, in the case of such Lender, at a rate of interest per
annum equal to the Federal Funds Rate for the first three days after the due
date of such payment until the date such payment is received by the Agent and
the Federal Funds Rate plus 2% thereafter. Such payment by the Borrower,
however, shall be without prejudice to its rights against such Lender. If such
Lender shall pay to the Agent such corresponding amount, such amount so paid
shall constitute such Lender's Revolving Credit Loan as part of the Revolving
Credit Loans for purposes of this Agreement, which Revolving Credit Loan shall
be deemed to have been made by such Lender on the Borrowing Date applicable to
such Revolving Credit Loans.
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(d) If a Lender makes a new Revolving Credit Loan on a
Borrowing Date on which the Borrower is to repay a Revolving Credit Loan from
such Lender, such Lender shall apply the proceeds of such new Revolving Credit
Loan to make such repayment, and only the excess of the proceeds of such new
Revolving Credit Loan over the Revolving Credit Loan being repaid need be made
available to the Agent.
2.4. Termination or Reduction of Commitments
(a) Voluntary Reductions. The Borrower shall have the right,
upon at least three Business Days' prior written notice to the Agent, to reduce
permanently the Aggregate Commitment Amount, in whole at any time, or in part
from time to time, to an amount not less than the sum of the aggregate principal
balance of the Revolving Credit Loans then outstanding (after giving effect to
any contemporaneous prepayment thereof), provided, however, that each partial
reduction of the Aggregate Commitment Amount shall be an amount equal to
$2,000,000 or such amount plus a whole multiple of $500,000 in excess thereof.
(b) Mandatory Reductions.
(i) On each date that a prepayment is made pursuant
to Section 2.5(b), (c), (d), (e) or (f), the Aggregate Commitment
Amount shall be automatically and permanently reduced in an amount
equal to the amount of the required prepayment.
(ii) On each of the dates set forth below, the
Aggregate Commitment Amount shall be automatically and permanently
reduced as set forth below:
Commitment Commitment
Date Reduction Amount
---- --------- ------
September 30, 2000 $9,750,000 $120,250,000
December 31, 2000 $9,750,000 $110,500,000
March 31, 2001 $9,750,000 $100,750,000
June 30, 2001 $9,750,000 $91,000,000
September 30, 2001 $9,750,000 $81,250,000
December 31, 2001 $9,750,000 $71,500,000
March 31, 2002 $9,750,000 $61,750,000
June 30, 2002 $9,750,000 $52,000,000
September 30, 2002 $13,000,000 $39,000,000
December 31, 2002 $13,000,000 $26,000,000
March 31, 2003 $13,000,000 $13,000,000
June 30, 2003 $13,000,000 $0
(c) In General.
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(i) Each reduction of the Aggregate Commitment Amount
pursuant to this Section shall effect a corresponding reduction of each
Lender's Commitment Amount by an amount equal to such Lender's
applicable Commitment Percentage of such reduction.
(ii) Reductions of the Aggregate Commitment Amount
made pursuant to Section 2.4(a) or 2.4(b)(i) shall be applied on a pro
rata basis among the remaining Aggregate Commitment Amount reductions
set forth in Section 2.4(b)(ii), except that in the case of a
prepayment made pursuant to Section 2.5(c) or (f), such corresponding
reductions of the Aggregate Commitment Amount made pursuant to Section
2.4(b)(i) shall be applied in inverse order among the remaining
Aggregate Commitment Amount reductions set forth in Section 2.4(b)(ii).
(iii) Simultaneously with each reduction of the
Aggregate Commitment Amount under this Section, the Borrower shall pay
the Commitment Fee accrued on the amount by which the Aggregate
Commitment Amount has been reduced.
2.5. Prepayments of the Revolving Credit Loans
(a) Voluntary Prepayments. The Borrower may, at its option,
prepay the Revolving Credit Loans without premium or penalty (but subject to
Section 3.5), in full at any time or in part from time to time by notifying the
Agent in writing at least one Business Day prior to the proposed prepayment
date, in the case of Revolving Credit Loans consisting of ABR Advances and at
least three Business Days prior to the proposed prepayment date, in the case of
Revolving Credit Loans consisting of Eurodollar Advances, specifying whether the
Revolving Credit Loans to be prepaid consist of ABR Advances, Eurodollar
Advances, or a combination thereof, the amount to be prepaid and the date of
prepayment. Each such notice shall be irrevocable and the amount specified in
each such notice shall be due and payable on the date specified, together with
accrued interest to the date of such payment on the amount prepaid. Upon receipt
of such notice, the Agent shall promptly notify each Lender thereof. Each
partial prepayment of the Revolving Credit Loans pursuant to this subsection
shall be in an aggregate principal amount of $2,000,000 or such amount plus a
whole multiple of $500,000 in excess thereof, or, if less, the outstanding
principal balance of the Revolving Credit Loans. After giving effect to any
partial prepayment with respect to Eurodollar Advances which were made (whether
as the result of a borrowing or a conversion) on the same date and which had the
same Interest Period, the outstanding principal balance of such Eurodollar
Advances shall exceed (subject to Section 3.3) $2,000,000.
(b) Mandatory Prepayments of Revolving Credit Loans Relating
to Terminations of the Commitments and Reductions of the Aggregate Commitment
Amount. Simultaneously with the termination of the Commitments of all of the
Lenders and each reduction of the Aggregate Commitment Amount under Section 2.4,
the Borrower shall prepay the Revolving Credit Loans in full in the case of the
termination of the Commitments of all of the
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Lenders and prepay the Revolving Credit Loans by the amount, if any, by which
the Aggregate Credit Exposure exceeds the Aggregate Commitment Amount as so
reduced, in the case of a reduction of the Aggregate Commitment Amount.
(c) Mandatory Prepayments of Revolving Credit Loans in Respect
of Excess Cash Flow. Upon the delivery of annual financial statements, but no
later than the March 31st of the following year with respect to any fiscal year,
commencing on March 31, 1999 with respect to the fiscal year ended December 31,
1998, when the Leverage Ratio is greater than or equal to 2.00 to 1.00, the
Borrower shall prepay the Revolving Credit Loans by an amount equal to 50% of
Excess Cash Flow for the prior fiscal year.
(d) Mandatory Prepayments of Revolving Credit Loans in Respect
of Dispositions. With respect to any Disposition by the Borrower, any of its
Subsidiaries or any Guarantor resulting in Net Cash Proceeds (other than from
the sale of Property in the ordinary course of business), such Net Cash Proceeds
shall be applied within ten Business Days' of the date of receipt thereof to the
prepayment of the Revolving Credit Loans.
(e) Mandatory Prepayments of Revolving Credit Loans Relating
to Insurance. In the event that the Borrower receives proceeds of insurance
maintained pursuant to Section 7.5 in excess of $500,000 and elects not to
repair, restore or replace Property in connection therewith, or such repair,
restoration or replacement is not completed within 180 days of receipt of such
insurance, 100% of such proceeds of insurance shall be applied upon receipt to
the prepayment of the Revolving Credit Loans.
(f) Mandatory Prepayments of Revolving Credit Loans Relating
to Receipt of Proceeds of Additional Indebtedness or Offering Proceeds. On the
date of receipt of the (i) net proceeds of any Indebtedness (evidenced by notes,
bonds or similar instruments) pursuant to Section 8.1(vi), or (ii) Offering
Proceeds (other than proceeds received in connection with the issuance of
Preferred Membership Units and proceeds received in connection with any
Investment permitted under Section 8.5(f) to purchase Capital Stock of the
Borrower) from an Offering, such proceeds of Indebtedness or Offering Proceeds
shall be applied to the prepayment of the Revolving Credit Loans.
(g) In General. Simultaneously with each prepayment of a
Revolving Credit Loan, the Borrower shall prepay all accrued interest on the
amount prepaid through the date of prepayment. Unless otherwise specified by the
Borrower, each prepayment of Revolving Credit Loans shall first be applied to
ABR Advances. If any prepayment is made in respect of any Eurodollar Advance, in
whole or in part, prior to the last day of the applicable Interest Period, the
Borrower agrees to indemnify the Lenders in accordance with Section 3.5.
2.6. Use of Proceeds
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The Borrower agrees that the proceeds of the Revolving Credit
Loans shall be used solely, directly or indirectly, to (i) repay the Existing
Bank Debt, (ii) pay all of the Fees due hereunder, (iii) pay the reasonable
out-of-pocket fees and expenses incurred by the Borrower in connection with the
Loan Documents, (iv) to finance Acquisitions permitted hereunder and (v) for the
Borrower's general corporate and working capital purposes not inconsistent with
the provisions hereof. Notwithstanding anything to the contrary contained in any
Loan Document, the Borrower agrees that no part of the proceeds of any Revolving
Credit Loan will be used, directly or indirectly, to purchase or carry any
Margin Stock or for a purpose which violates any law, including the provisions
of Regulations G, T, U or X of the Board of Governors of the Federal Reserve
System, as amended.
2.7. Payments
(a) Each borrowing of Revolving Credit Loans by the Borrower
from the Lenders, any conversion of Revolving Credit Loans from one Type to
another and any reduction in the Aggregate Commitment Amount shall be made pro
rata according to the Commitment Percentage of such Lender. Each payment,
including each prepayment, of principal and interest on the Revolving Credit
Loans, of the Commitment Fee, and of all of the other fees to be paid to the
Agent and the Lenders in connection with this Agreement (the Commitment Fee,
together with all of such other fees, being sometimes hereinafter collectively
referred to as the "Fees") shall be made by the Borrower prior to 1:00 p.m. on
the date such payment is due to the Agent for the account of the applicable
Lenders at the Agent's office specified in Section 11.2, in each case in lawful
money of the United States, in immediately available funds and without set-off
or counterclaim. As between the Borrower and the Lenders, any payment by the
Borrower to the Agent for the account of the Lenders shall be deemed to be
payment by the Borrower to the Lenders. The failure of the Borrower to make any
such payment by such time shall not constitute a Default, provided that such
payment is made on such due date, but any such payment made after 1:00 p.m. on
such due date shall be deemed to have been made on the next Business Day for the
purpose of calculating interest on amounts outstanding on the Revolving Credit
Loans. Promptly upon receipt thereof by the Agent, each payment of principal and
interest on the Revolving Credit Loans shall be remitted by the Agent in like
funds as received to each Lender pro rata according to the aggregate outstanding
principal balance of the Revolving Credit Loans. Subject to Section 9.2(b),
promptly upon receipt by the Agent of each payment, including each prepayment,
pursuant to this Section, the Agent shall remit such payment in like funds as
received as follows: (i) in the case of the Commitment Fee, to each Lender
according to its Commitment Percentage, and (ii) in the case of principal and
interest on the Revolving Credit Loans, to each Lender pro rata according to the
amount of principal or interest, as the case may be, which is then due and
payable.
(b) If any payment hereunder or under the Revolving Credit
Notes shall be due and payable on a day which is not a Business Day, the due
date thereof (except as otherwise provided in the definition of Interest Period)
shall be extended to the next Business Day and
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(except with respect to payments in respect of the Fees) interest shall be
payable at the applicable rate specified herein during such extension,
provided, however that if such next Business Day is after the Maturity Date,
any such payment shall be due on the immediately preceding Business Day.
3. INTEREST, FEES, YIELD PROTECTIONS, ETC.
3.1. Interest Rate and Payment Dates
(a) Prior to Maturity. Except as otherwise provided in Section
3.1(b) and 3.1(c), prior to maturity, the Revolving Credit Loans shall bear
interest on the outstanding principal balance thereof at the applicable interest
rate or rates per annum set forth below:
ADVANCES RATE
-------- ----
Each ABR Advance Alternate Base Rate plus the Applicable
Margin applicable to ABR Advances.
Each Eurodollar Advance Eurodollar Rate for the applicable Interest
Period plus the Applicable Margin applicable
to Eurodollar Advances.
(b) Default Rate. Upon the occurrence and during the
continuance of an Event of Default under Section 9.1(a) or (b), the unpaid
principal balance of the Revolving Credit Loans shall bear interest, payable on
demand, at a rate per annum (whether before or after the entry of a judgment
thereon) equal to 2% plus the rate which would otherwise be applicable under
Section 3.1(a), and any overdue interest or other amount payable under the Loan
Documents shall bear interest, payable on demand, at a rate per annum (whether
before or after the entry of a judgment thereon) equal to the Alternate Base
Rate plus the Applicable Margin applicable to ABR Advances plus 2%.
(c) Highest Lawful Rate. At no time shall the interest rate
payable on the Revolving Credit Loans of any Lender, together with the Fees and
all other amounts payable under the Loan Documents to such Lender, to the extent
the same are construed to constitute interest, exceed the Highest Lawful Rate
applicable to such Lender. If with respect to any Lender for any period during
the term of this Agreement, any amount paid to such Lender under the Loan
Documents, to the extent the same shall (but for the provisions of this Section)
constitute or be deemed to constitute interest, would exceed the maximum amount
of interest permitted by the Highest Lawful Rate applicable to such Lender
during such period (such amount being hereinafter referred to as an "Unqualified
Amount"), then (i) such Unqualified Amount shall be applied or shall be deemed
to have been applied as a prepayment of the
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Revolving Credit Loans of such Lender, and (ii) if in any subsequent period
during the term of this Agreement, all amounts payable under the Loan Documents
to such Lender in respect of such period which constitute or shall be deemed to
constitute interest shall be less than the maximum amount of interest permitted
by the Highest Lawful Rate applicable to such Lender during such period, then
the Borrower shall pay to such Lender in respect of such period an amount (each
a "Compensatory Interest Payment") equal to the lesser of (x) a sum which, when
added to all such amounts, would equal the maximum amount of interest permitted
by the Highest Lawful Rate applicable to such Lender during such period, and
(y) an amount equal to the Unqualified Amount less all other Compensatory
Interest Payments made in respect thereof.
(d) In General. Interest on (i) ABR Advances to the extent
based on the BNY Rate shall be calculated on the basis of a 365 or 366-day year
(as the case may be), and (ii) ABR Advances to the extent based on the Federal
Funds Rate and on Eurodollar Advances shall be calculated on the basis of a
360-day year, in each case, for the actual number of days elapsed. Except as
otherwise provided in Section 3.1(b), interest shall be payable in arrears on
each Interest Payment Date and upon each payment (including prepayment) of the
Revolving Credit Loans. Any change in the interest rate on the Revolving Credit
Loans resulting from a change in the Alternate Base Rate or reserve requirements
shall become effective as of the opening of business on the day on which such
change shall become effective. The Agent shall, as soon as practicable, notify
the Borrower and the Lenders of the effective date and the amount of each such
change in the BNY Rate, but any failure to so notify shall not in any manner
affect the obligation of the Borrower to pay interest on the Revolving Credit
Loans in the amounts and on the dates required. Each determination of the
Alternate Base Rate or a Eurodollar Rate by the Agent pursuant to this Agreement
shall be conclusive and binding on all parties hereto absent manifest error. The
Borrower acknowledges that to the extent interest payable on ABR Advances is
based on the BNY Rate, such rate is only one of the bases for computing interest
on loans made by the Lenders, and by basing interest payable on ABR Advances on
the BNY Rate, the Lenders have not committed to charge, and the Borrower has not
in any way bargained for, interest based on a lower or the lowest rate at which
the Lenders may now or in the future make loans to other borrowers.
3.2. Fees
(a) Commitment Fees. The Borrower agrees to pay to the Agent,
for the account of the Lenders in accordance with each Lender's Commitment
Percentage, a fee (the "Commitment Fee"), during the Commitment Period, at a
rate per annum equal to the Applicable Fee Percentage on the average daily
Available Commitment Amount. The Commitment Fee shall be payable quarterly in
arrears on the last day of each March, June, September and December of each
year, commencing on the first such day following the Effective Date, and ending
on the date that the Commitments shall expire or otherwise terminate. The
Commitment Fee shall be calculated on the basis of a 365 or 366 day year, as the
case may be, for the actual number of days elapsed.
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(b) Agent's Fees. The Borrower agrees to pay to the Agent, for
its own account, such other fees as have been agreed to in writing by the
Borrower and the Agent.
3.3. Conversions
(a) The Borrower may elect from time to time to convert one or
more Eurodollar Advances to ABR Advances by giving the Agent at least one
Business Day's prior irrevocable notice of such election, specifying the amount
to be converted, provided, that any such conversion of Eurodollar Advances shall
only be made on the last day of the Interest Period applicable thereto. In
addition, the Borrower may elect from time to time to convert (i) ABR Advances
to Eurodollar Advances and (ii) Eurodollar Advances to new Eurodollar Advances
by selecting a new Interest Period therefor, in each case by giving the Agent at
least three Business Days' prior irrevocable notice of such election, in the
case of a conversion to Eurodollar Advances, specifying the amount to be so
converted and the initial Interest Period relating thereto, provided that any
such conversion of ABR Advances to Eurodollar Advances shall only be made on a
Business Day and any such conversion of Eurodollar Advances to new Eurodollar
Advances shall only be made on the last day of the Interest Period applicable to
the Eurodollar Advances which are to be converted to such new Eurodollar
Advances. Each such notice shall be irrevocable and shall be given by the
delivery by telecopy of a Notice of Conversion (confirmed promptly, and in any
event within five Business Days, by the delivery to the Agent of a Notice of
Conversion manually signed by the Borrower). The Agent shall promptly provide
the Lenders with notice of each such election. Advances may be converted
pursuant to this Section in whole or in part, provided that the amount to be
converted to each Eurodollar Advance, when aggregated with any Eurodollar
Advance to be made on such date in accordance with Section 2.3 and having the
same Interest Period as such first Eurodollar Advance, shall equal no less than
$2,000,000 or such amount plus a whole multiple of $500,000 in excess thereof.
(b) Notwithstanding anything in this Agreement to the
contrary, upon the occurrence and during the continuance of a Default or an
Event of Default, the Borrower shall have no right to elect to convert any
existing ABR Advance to a new Eurodollar Advance or to convert any existing
Eurodollar Advance to a new Eurodollar Advance. In such event, all ABR Advances
shall be automatically continued as ABR Advances and all Eurodollar Advances
shall be automatically converted to ABR Advances on the last day of the Interest
Period applicable to such Eurodollar Advance.
(c) Each conversion shall be effected by each Lender by
applying the proceeds of its new ABR Advance or Eurodollar Advance, as the case
may be, to its Advances (or portion thereof) being converted (it being
understood that any such conversion shall not constitute a borrowing for
purposes of Sections 4, 5 or 6).
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3.4. Concerning Interest Periods
Notwithstanding any other provision of any Loan Document:
(a) If the Borrower shall have failed to elect a Eurodollar
Advance under Section 2.3 or 3.3, as the case may be, in connection with any
borrowing of new Revolving Credit Loans or expiration of an Interest Period with
respect to any existing Eurodollar Advance, the amount of the Revolving Credit
Loans subject to such borrowing or such existing Eurodollar Advance shall
thereafter be an ABR Advance until such time, if any, as the Borrower shall
elect a new Eurodollar Advance pursuant to Section 3.3.
(b) No Interest Period selected in respect of the conversion
of any Eurodollar Advance shall end after the Maturity Date.
(c) The Borrower shall select Interest Periods such that, on
each date that a mandatory scheduled reduction in the Aggregate Commitment
Amount is required to be made pursuant to Section 2.4(b), the outstanding
principal balance of all ABR Advances comprising all or a portion of the
Revolving Credit Loans, when added to the aggregate principal balance of each
Eurodollar Advance comprising all or a portion of the Revolving Credit Loans,
the applicable Interest Period of which shall end on or before such date, shall
equal or exceed the aggregate amount of the reduction required to be made on
such date.
(d) The Borrower shall not be permitted to have more than
eight Eurodollar Advances outstanding at any one time, it being agreed that each
borrowing of a Eurodollar Advance pursuant to a single Borrowing Request shall
constitute the making of one Eurodollar Advance for the purpose of calculating
such limitation.
3.5. Indemnification for Loss
Notwithstanding anything contained herein to the contrary, if
the Borrower shall fail to borrow or convert on a Borrowing Date or Conversion
Date after it shall have given notice to do so in which it shall have requested
a Eurodollar Advance, or if a Eurodollar Advance shall be terminated for any
reason prior to the last day of the Interest Period applicable thereto, or if,
while a Eurodollar Advance is outstanding, any repayment or prepayment of such
Eurodollar Advance is made for any reason (including as a result of acceleration
or illegality or the application of Section 2.6) on a date which is prior to the
last day of the Interest Period applicable thereto, the Borrower agrees to
indemnify each Lender against, and to pay on demand directly to such Lender, any
loss or expense suffered by such Lender as a result of such failure to borrow or
convert, termination, repayment or prepayment, including an amount, if greater
than zero, equal to:
A x (B-C) x D
---
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360
where:
"A" equals such Lender's pro rata share of the Affected Principal Amount;
"B" equals the Eurodollar Rate (expressed as a decimal), applicable to such
Eurodollar Advances;
"C" equals the Eurodollar Rate (expressed as a decimal), in effect on or about
the first day of the applicable Remaining Interest Period, based on the
applicable rates offered or bid, as the case may be, on or about such date, for
deposits in an amount equal approximately to such Lender's pro rata share of the
Affected Principal Amount with an Interest Period equal approximately to the
applicable Remaining Interest Period, as determined by such Lender;
"D" equals the number of days from and including the first day of the applicable
Remaining Interest Period to but excluding the last day of such Remaining
Interest Period;
and any other out-of-pocket loss or expense (including any internal processing
charge customarily charged by such Lender) suffered by such Lender in connection
with such Eurodollar Advance, including in liquidating or employing deposits
acquired to fund or maintain the funding of its pro rata share of the Affected
Principal Amount, or redeploying funds prepaid or repaid, in amounts which
correspond to its pro rata share of the Affected Principal Amount. Each
determination by the Agent or a Lender pursuant to this Section shall be
conclusive and binding on the Borrower absent manifest error.
3.6. Capital Adequacy
If the amount of capital required or expected to be maintained
by any Lender or any Person directly or indirectly owning or controlling such
Lender (each a "Control Person"), shall be affected by the occurrence of a
Regulatory Change and such Lender shall have determined that such Regulatory
Change shall have had or will thereafter have the effect of reducing (i) the
rate of return on such Lender's or such Control Person's capital, or (ii) the
asset value to such Lender or such Control Person of the Revolving Credit Loans
made or maintained by such Lender, in either case to a level below that which
such Lender or such Control Person could have achieved or would thereafter be
able to achieve but for such Regulatory Change (after taking into account such
Lender's or such Control Person's policies regarding capital adequacy) by an
amount deemed by such Lender to be material to such Lender or Control Person,
then, within ten days after demand by such Lender, the Borrower shall pay to
such Lender or such Control Person such additional amount or amounts as shall be
sufficient to compensate such Lender or such Control Person, as the case may be,
for such reduction.
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3.7. Reimbursement for Increased Costs
If any Lender or the Agent shall determine that a Regulatory
Change:
(a) does or shall subject it to any Taxes of any kind
whatsoever with respect to any Eurodollar Advances or its obligations under this
Agreement to make Eurodollar Advances, or change the basis of taxation of
payments to it of principal, interest or any other amount payable hereunder in
respect of its Eurodollar Advances, or impose on the Agent or such Lender any
other condition, including any Taxes required to be withheld from any amounts
payable under the Loan Documents (except for imposition of, or change in the
rate of, Tax on the Income of such Lender or its Applicable Lending Office for
any of such Advances by the jurisdiction in which the Bank is incorporated or
has its principal office or such Applicable Lending Office, including such tax
imposed by the United States); or
(b) does or shall impose, modify or make applicable any
reserve, special deposit, compulsory loan, assessment, increased cost or similar
requirement against assets held by, or deposits of, or advances or loans by, or
other credit extended by, or any other acquisition of funds by, any office of
such Lender in respect of its Eurodollar Advances which is not otherwise
included in the determination of a Eurodollar Rate;
and the result of any of the foregoing is to increase the cost to such Lender of
making, renewing, converting or maintaining its Eurodollar Advances or its
commitment to make such Eurodollar Advances, or to reduce any amount receivable
hereunder in respect of its Eurodollar Advances, or increase the cost to the
Agent of performing its functions hereunder, then, in any such case, the
Borrower shall pay such Lender or the Agent, as the case may be, within ten days
after demand therefor, such additional amounts as is sufficient to compensate
such Lender or the Agent, as the case may be, for such additional cost or
reduction in such amount receivable which such Lender deems to be material as
determined by such Lender or the Agent, as the case may be; provided, however,
(i) that nothing in this Section shall require the Borrower to indemnify the
Lenders or the Agent, as the case may be, with respect to withholding Taxes for
which the Borrower has no obligation under Section 3.10 and (ii) that before
making any such demand, each Lender agrees to use reasonable efforts (consistent
with its internal policy and legal and regulatory restrictions) to designate a
different Applicable Lending Office if the making of such a designation would
avoid the need for, or reduce the amount of, such increased costs and would not,
in the reasonable judgment of such Lender, be otherwise disadvantageous to such
Lender. No failure by any Lender or the Agent to demand, and no delay in
demanding, compensation for any increased cost shall constitute a waiver of its
right to demand such compensation at any time. A statement setting forth the
calculations of any additional amounts payable pursuant to this Section
submitted by a Lender or the Agent, as the case may be, to the Borrower shall be
conclusive absent manifest error.
3.8. Illegality of Funding
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Notwithstanding any other provision hereof, if any Lender
shall reasonably determine that any law, regulation, treaty or directive, or any
change therein or in the interpretation or application thereof, shall make it
unlawful for such Lender to make or maintain any Eurodollar Advance as
contemplated by this Agreement, such Lender shall promptly notify the Borrower
and the Agent thereof, and (i) the commitment of such Lender to make such
Eurodollar Advances or convert ABR Advances to Eurodollar Advances shall
forthwith be suspended, (ii) such Lender shall fund its portion of each
requested Eurodollar Advance as an ABR Advance and (iii) such Lender's Revolving
Credit Loans then outstanding as such Eurodollar Advances, if any, shall be
converted automatically to ABR Advances on the last day of the then current
Interest Period applicable thereto or at such earlier time as may be required by
law. If the commitment of any Lender with respect to Eurodollar Advances is
suspended pursuant to this Section and such Lender shall have obtained actual
knowledge that it is once again legal for such Lender to make or maintain
Eurodollar Advances, such Lender shall promptly notify the Agent and the
Borrower thereof and, upon receipt of such notice by each of the Agent and the
Borrower, such Lender's commitment to make or maintain Eurodollar Advances shall
be reinstated.
3.9. Substituted Interest Rate
In the event that (i) the Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that by reason
of circumstances affecting the interbank eurodollar market either adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate applicable
pursuant to Section 3.1 or (ii) the Required Lenders shall have notified the
Agent that they have determined (which determination shall be conclusive and
binding on the Borrower) that the applicable Eurodollar Rate will not adequately
and fairly reflect the cost to such Lenders of maintaining or funding loans
bearing interest based on such Eurodollar Rate, with respect to any portion of
the Revolving Credit Loans that the Borrower has requested be made as Eurodollar
Advances or Eurodollar Advances that will result from the requested conversion
of any portion of the Advances into or of Eurodollar Advances (each, an
"Affected Advance"), the Agent shall promptly notify the Borrower and the
Lenders (by telephone or otherwise, to be promptly confirmed in writing) of such
determination, on or, to the extent practicable, prior to the requested
Borrowing Date or Conversion Date for such Affected Advances. If the Agent shall
give such notice, (a) any Affected Advances shall be made as ABR Advances, (b)
the Advances (or any portion thereof) that were to have been converted to
Affected Advances shall be converted to ABR Advances and (c) any outstanding
Affected Advances shall be converted, on the last day of the then current
Interest Period with respect thereto, to ABR Advances. Until any notice under
clauses (i) or (ii), as the case may be, of this Section has been withdrawn by
the Agent (by notice to the Borrower promptly upon either (x) the Agent having
determined that such circumstances affecting the interbank eurodollar no longer
exist and that adequate and reasonable means do exist for determining the
Eurodollar Rate pursuant to Section 3.1 or (y) the Agent having been notified by
such Required Lenders that
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circumstances no longer render the Advances (or any portion thereof) Affected
Advances, no further Eurodollar Advances shall be required to be made by the
Lenders, nor shall the Borrower have the right to convert all or any portion of
the Revolving Credit Loans to or as Eurodollar Advances.
3.10. Taxes
(a) Payments to be Free and Clear. All payments by each Credit
Party under the Loan Documents to or for the account of the Agent or any Lender
(each, an "Indemnified Tax Person") shall be made free and clear of, and without
any deduction or withholding for or on account of, any and all present or future
income, stamp or other taxes, levies, imposts, duties, fees, assessments,
deductions, withholdings, or other charges of whatever nature, now or hereafter
imposed, levied, collected, withheld, or assessed by any jurisdiction, or by any
department, agency, state or other political subdivision thereof or therein
(collectively, "Taxes"), excluding as to any Indemnified Tax Person, (i) a Tax
on the Income imposed on such Indemnified Tax Person and (ii) any interest,
fees, additions to tax or penalties for late payment thereof (each such
nonexcluded Tax, an "Indemnified Tax"). For purposes hereof, "Tax on the Income"
shall mean, as to any Person, a Tax imposed by one of the following
jurisdictions or by any political subdivision or taxing authority thereof: (i)
the United States, (ii) the jurisdiction in which such Person is organized,
(iii) the jurisdiction in which such Person's principal office is located, or
(iv) in the case of each Lender, any jurisdiction in which such Lender's
Applicable Lending Office is located; which Tax is an income tax or franchise
tax imposed on all or part of the net income or net profits of such Person or
which Tax represents interest, fees, or penalties for late payment of such an
income tax or franchise tax.
(b) Grossing Up of Payments. If any Credit Party or any other
Person is required by any law, rule, regulation, order, directive, treaty or
guideline to make any deduction or withholding (which deduction or withholding
would constitute an Indemnified Tax) from any amount required to be paid by any
Credit Party to or on behalf of an Indemnified Tax Person under any Loan
Document (i) such Credit Party shall pay such Indemnified Tax before the date on
which penalties attach thereto, such payment to be made for its own account (if
the liability to pay is imposed on such Credit Party) or on behalf of and in the
name of such Indemnified Tax Person (if the liability is imposed on such
Indemnified Tax Person), and (ii) the sum payable to such Indemnified Tax Person
shall be increased as may be necessary so that after making all required
deductions and withholdings (including deductions and withholdings applicable to
additional sums payable under this Section) such Indemnified Tax Person receives
an amount equal to the sum it would have received had no such deductions or
withholdings been made.
(c) Other Taxes. Each Credit Party agrees to pay any current
or future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies that arise from any payment made hereunder or from the
execution, delivery or registration of, or any amendment, supplement or
modification of, or any waiver or consent under or in respect of, the
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Loan Documents or otherwise with respect to, the Loan Documents (collectively,
the "Other Taxes").
(d) Evidence of Payment. Within 30 days after the reasonable
request therefor by the Agent in connection with any payment of Indemnified
Taxes or Other Taxes, each Credit Party will furnish to the Agent the original
or a certified copy of an official receipt from the jurisdiction to which
payment is made evidencing payment thereof or, if unavailable, a certificate
from a Financial Officer that states that such payment has been made and that
sets forth the date and amount of such payment.
(e) U.S. Tax Certificates. Each Indemnified Tax Person that is
organized under the laws of any jurisdiction other than the United States or any
political subdivision thereof that is exempt from United States federal
withholding tax, or that is subject to such tax at a reduced rate under an
applicable treaty, with respect to payments under the Loan Documents shall
deliver to the Agent for transmission to the Borrower, on or prior to the
Effective Date (in the case of each Indemnified Tax Person listed on the
signature pages hereof) or on the effective date of the Assignment and
Acceptance Agreement or other document pursuant to which it becomes an
Indemnified Tax Person (in the case of each other Indemnified Tax Person), and
at such other times as the Borrower or the Agent may reasonably request Internal
Revenue Form 4224 or Form 1001 or other certificate or document required under
United States law to establish entitlement to such exemption or reduced rate. No
Credit Party shall be required to pay any additional amount to any such
Indemnified Tax Person under subsection (b) above if such Indemnified Tax Person
shall have failed to satisfy the requirements of the immediately preceding
sentence; provided that if such Indemnified Tax Person shall have satisfied such
requirements on the Effective Date (in the case of each Indemnified Tax Person
listed on the signature pages hereof) or on the effective date of the Assignment
and Acceptance Agreement or other document pursuant to which it became an
Indemnified Tax Person (in the case of each other Indemnified Tax Person),
nothing in this subsection shall relieve any Credit Party of its obligation to
pay any additional amounts pursuant to subsection (b) in the event that, as a
result of any change in applicable law or treaty, such Indemnified Tax Person is
no longer properly entitled to deliver certificates, documents or other evidence
at a subsequent date establishing the fact that such Indemnified Tax Person is
no longer entitled to such exemption or reduced rate.
(f) Any Lender claiming any additional amounts payable
pursuant to this Section 3.10 agrees to use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Applicable Lending Office if the making of such a change
would avoid the need for, or reduce the amount of, any such additional amounts
that may thereafter accrue and would not, in the reasonable judgment of such
Lender, be otherwise disadvantageous to such Lender.
(g) As of the Effective Date, each Indemnified Tax Person that
is organized under the laws of any jurisdiction other than the United States or
any political subdivision thereof
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represents and warrants to the Borrower and the Agent that it is exempt from
United States federal withholding tax.
3.11. Option to Fund
Each Lender has indicated that, if the Borrower requests a
Eurodollar Advance, such Lender may wish to purchase one or more deposits in
order to fund or maintain its funding of its Commitment Percentage of such
Eurodollar Advance during the Interest Period with respect thereto; it being
understood that the provisions of this Agreement relating to such funding are
included only for the purpose of determining the rate of interest to be paid in
respect of such Eurodollar Advance and any amounts owing under Sections 3.5 and
3.7. Each Lender shall be entitled to fund and maintain its funding of all or
any part of each Eurodollar Advance in any manner it sees fit, but all such
determinations hereunder shall be made as if each Lender had actually funded and
maintained its Commitment Percentage of each Eurodollar Advance during the
applicable Interest Period through the purchase of deposits in an amount equal
to its Commitment Percentage of such Eurodollar Advance having a maturity
corresponding to such Interest Period. Any Lender may fund its Commitment
Percentage of each Eurodollar Advance from or for the account of any branch or
office of such Lender as such Lender may choose from time to time provided,
however, that each Lender agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different
Applicable Lending Office if the making of such a designation would avoid the
need for, or reduce the amount of, any increased costs and would not, in the
reasonable judgment of such Lender, be otherwise disadvantageous to such Lender.
3.12. Substitution of Lender.
(a) In the event that the Borrower becomes obligated to pay
additional amounts to any Lender pursuant to Sections 3.6, 3.7 or 3.10 in an
aggregate amount in excess of $50,000, the Borrower may, within 60 days of the
demand by such Lender for such additional amounts in excess of $50,000, (i)
request one or more of the other Lenders to elect to increase its Commitment by
an amount up to the amount of the Commitment of such Lender (a "Selling Lender")
and purchase the Revolving Credit Loans of such Selling Lender subject to the
written consent of the Agent which shall not be unreasonably withheld or (ii)
designate another lender (such lender, a "Replacement Lender") upon the written
consent of the Agent which shall not be unreasonably withheld and the
Replacement Lender (other than such Selling Lender) willing to assume the
Commitment, and purchase the Revolving Credit Loans, of such Selling Lender.
Upon the Commitment and Revolving Credit Loans of such Selling Lender being
taken up by a Replacement Lender, such Replacement Lender shall assume the
Commitment and Revolving Credit Loans of such Selling Lender by purchasing such
Selling Lender's Revolving Credit Note without recourse or warranty (except as
to the amount due thereon, its title to such Revolving Credit Note and its right
to sell the same), at a price in immediately available funds equal to the
outstanding principal balance of such Selling Lender's Revolving Credit Loans,
together with
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accrued and unpaid interest thereon to the date of such assumption and
purchase, accrued and unpaid Commitment Fees due to such Selling Lender and any
other amounts due to such Selling Lender under the Loan Documents. Effective
upon such sale, each Replacement Lender shall be deemed to be a "Lender" for
purposes of this Agreement, and such Selling Lender shall cease to be a
"Lender" for all purposes of this Agreement (except with respect to its rights
hereunder to be reimbursed for costs and expenses, and to indemnification, with
respect to matters attributable to events, acts or conditions occurring prior
to such assumption and purchase) and shall no longer have any obligations
hereunder. The Borrower shall execute and deliver to such Replacement Lender a
Revolving Credit Note in an aggregate principal amount equal to the Revolving
Credit Loans assigned to, and the Commitment assumed by, such Replacement
Lender and the Selling Lender shall return its cancelled Revolving Credit Note
to the Borrower.
(b) Notwithstanding anything herein to the contrary, but
provided that a Selling Lender has complied with its obligations under Sections
3.7, 3.10 or 3.11, as applicable, a Selling Lender shall be entitled to receive
the additional amounts to which it would be entitled pursuant to Section 3.6,
3.7 or 3.10 had it not been replaced pursuant hereto.
4. REPRESENTATIONS AND WARRANTIES
In order to induce the Agent and the Lenders to enter into this
Agreement and to make the Revolving Credit Loans, the Borrower makes the
following representations and warranties to the Agent and each Lender:
4.1. Subsidiaries; Organization
The Borrower and each Guarantor has only the Subsidiaries set
forth on Schedule 4.1. As of the Effective Date, the authorized, issued and
outstanding Capital Stock of the Borrower, each Guarantor and each Subsidiary is
as set forth in Schedule 4.1. The shares of each corporate Subsidiary or
corporate Guarantor are duly authorized, validly issued, fully paid and
nonassessable and are owned free and clear of any Liens, except the Liens in
favor of the Agent pursuant to the Collateral Documents. The interest of the
Borrower and each Guarantor in each non-corporate Subsidiary is owned free and
clear of any Liens, except the Liens in favor of the Agent pursuant to the
Collateral Documents. The outstanding Capital Stock of the Borrower, each
Subsidiary of the Borrower and each Guarantor on the Effective Date are as set
forth on Schedule 4.1. As of the Effective Date, the owner of each membership
unit or other Capital Stock listed on Schedule 4.1 is the registered and
beneficial owner thereof. Neither the Borrower, any Guarantor or any Subsidiary
has issued any securities convertible into Capital Stock and there are no
outstanding options or warrants to purchase Capital Stock of any class or kind,
and, except as set forth on Schedule 4.1, there are no agreements, voting trusts
or understandings with respect thereto or affecting in any manner the sale,
pledge, assignment or other disposition thereof, including, without limitation,
any right of first refusal, option, redemption, call or other
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rights with respect thereto, whether similar or dissimilar to any of the
foregoing. The ownership of each membership unit of the Borrower is fully
vested in each member as indicated in Schedule 4.1, except as set forth on
Schedule 1 to the Pledge Agreement, as the same may be amended, supplemented or
otherwise modified from time to time.
4.2. Existence and Power
Each of the Borrower, its Subsidiaries and each Guarantor is
duly organized or formed and validly existing in good standing under the laws of
its jurisdiction of incorporation or formation, has all requisite power and
authority to own its Property and to carry on its business as now conducted, and
is in good standing and authorized to do business as a foreign entity in each
jurisdiction in which failure to so qualify could reasonably be expected to have
a Material Adverse Effect.
4.3. Authority and Execution
Each of the Borrower and each Credit Party has full legal
power and authority to enter into, execute, deliver and perform the terms of the
Loan Documents to which it is a party, and in the case of the Borrower, to make
the borrowings contemplated hereby and by the Revolving Credit Notes, to
execute, deliver and carry out the terms of the Revolving Credit Notes and to
incur the obligations provided for herein and therein, all of which have been
duly authorized by all proper and necessary corporate, partnership or other
applicable action and are in full compliance with its Organizational Documents
and no other corporate or other action is required. Each Credit Party has duly
executed and delivered the Loan Documents to which it is a party.
4.4. Binding Agreement
The Loan Documents (other than the Revolving Credit Notes)
constitute, and the Revolving Credit Notes, when issued and delivered pursuant
hereto for value received, will constitute, the valid and legally binding
obligations of each Credit Party, to the extent it is a party thereto,
enforceable in accordance with their terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or other similar
laws affecting the enforcement of creditors' rights generally.
4.5. Litigation
Except as set forth on Schedule 4.5, there are no actions,
suits or proceedings at law or in equity or by or before any Governmental
Authority pending or, to the knowledge of the Borrower, threatened against the
Borrower, any of its Subsidiaries or any Credit Party or any of their respective
Properties or rights, which (i) if adversely determined, could reasonably be
expected to have a Material Adverse Effect, or (ii) call into question the
validity or enforceability
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of any of the Loan Documents, or (iii) could reasonably be expected to result
in the rescission, termination or cancellation of any material franchise,
right, license, permit or similar authorization held by the Borrower or any of
its Subsidiaries or any Credit Party.
4.6. Required Consents
Except as set forth on Schedule 4.6, no consent, authorization
or approval of, filing with, notice to, or exemption by, stockholders, members,
any Governmental Authority or any other Person is required to authorize, or is
required in connection with the execution, delivery and performance of the Loan
Documents to which the Borrower, any of its Subsidiaries or any Credit Party is
a party or is required as a condition to the validity or enforceability of the
Loan Documents to which the Borrower, any of its Subsidiaries or any Credit
Party is a party.
4.7. Absence of Defaults; No Conflicting Agreements
Neither the Borrower, any of its Subsidiaries nor any Credit
Party is in default under any mortgage, indenture, contract or agreement to
which it is a party or by which it or any of its Property is bound, the effect
of which default could reasonably be expected to have a Material Adverse Effect.
The execution, delivery or carrying out of the terms of the Loan Documents will
not constitute a default under, or result in the creation or imposition of, or
obligation to create, any Lien upon any Property of the Borrower or any of its
Subsidiaries or any Credit Party, or result in a breach of or require the
mandatory repayment of or other acceleration of payment under or pursuant to the
terms of any such mortgage, indenture, contract or agreement.
4.8. Compliance with Applicable Laws
Neither the Borrower, any of its Subsidiaries nor any Credit
Party is in default with respect to any judgment, order, writ, injunction,
decree or decision of any Governmental Authority which default could reasonably
be expected to have a Material Adverse Effect. The Borrower, each of its
Subsidiaries and each Credit Party is complying in all material respects with
all statutes, regulations, rules and orders applicable to the Borrower, such
Subsidiary or such Credit Party of all Governmental Authorities, including,
without limitation, Environmental Laws and ERISA, a violation of which could
reasonably be expected to have a Material Adverse Effect.
4.9. Taxes
Each of the Borrower, its Subsidiaries and each Credit Party
has filed or caused to be filed all tax returns required to be filed and has
paid, or has made adequate provision for the payment of, all taxes shown to be
due and payable on said returns or in any assessments made against it (other
than those being contested as set forth in Section 7.4) which would be material
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to the Borrower, such Subsidiary or such Credit Party and no tax Liens have been
filed with respect thereto.
4.10. Governmental Regulations
Neither the Borrower, any of its Subsidiaries nor any Credit
Party is subject to regulation under the Public Utility Holding Company Act of
1935, as amended, the Federal Power Act or the Investment Company Act of 1940,
as amended, and neither the Borrower, any of its Subsidiaries nor any Credit
Party is subject to any statute or regulation which prohibits or restricts the
incurrence of Indebtedness under the Loan Documents, including, without
limitation, statutes or regulations relative to common or contract carriers or
to the sale of electricity, gas, steam, water, telephone, telegraph or other
public utility services.
4.11. Federal Reserve Regulations; Use of Loan Proceeds
Neither the Borrower, any of its Subsidiaries nor any Credit
Party 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. No part of the proceeds of the Loan will be used, directly or
indirectly, for a purpose which violates any law, rule or regulation of any
Governmental Authority, including, without limitation, the provisions of
Regulations G, T, U or X of the Board of Governors of the Federal Reserve
System, as amended.
4.12. Pension Plans
The only Pension Plans in effect as of the Effective Date are
listed on Schedule 4.12. Each Employee Benefit Plan of the Borrower, its
Subsidiaries, the Credit Parties and the ERISA Affiliates is in compliance with
ERISA and the Code, where applicable, in all material respects. Each of the
Borrower, its Subsidiaries, the Credit Parties and the ERISA Affiliates has
complied with the requirements of Section 515 of ERISA with respect to each
Pension Plan that is a Multiemployer Plan. Neither the Borrower, its
Subsidiaries, the Credit Parties nor any ERISA Affiliate has incurred or is
reasonably expected to incur any withdrawal liability as determined in
accordance with Title IV of ERISA to any Multiemployer Plan. The Borrower and
the ERISA Affiliates have fulfilled all obligations under the minimum funding
standards of ERISA and the Code with respect to each Pension Plan, is in
compliance in all material respects with the applicable provisions of ERISA and
the Code, and has not incurred any material liability to the PBGC under Title IV
of ERISA. None of the events set forth in Section 7.2(c) which would require
supplying a notice to the Agent has occurred, or copies of such notices have
been provided.
4.13. Financial Statements
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The Borrower has heretofore delivered to the Agent and the
Lenders copies of the (i) audited Consolidated balance sheets of the Borrower as
of December 31, 1996, and the related Consolidated statements of income,
retained earnings and cash flows for the fiscal year then ended and (ii) the
unaudited Consolidated balance sheet of the Borrower as of March 31, 1997, and
the related Consolidated statements of income, retained earnings and cash flows
for the fiscal quarter then ended (the foregoing together with the related notes
and schedules, the "Financial Statements"). The Financial Statements fairly
present the consolidated financial condition and results of the operations of
the Borrower and its Subsidiaries as of the dates and for the periods indicated
therein and have been prepared in conformity with generally accepted accounting
principles, and there has been no Material Adverse Change since December 31,
1996. Except as reflected in the Financial Statements or in the notes thereto,
neither the Borrower nor any of its Subsidiaries has any obligation or liability
of any kind (whether fixed, accrued, Contingent, unmatured or otherwise) which,
in accordance with GAAP, should have been shown on the Financial Statements and
was not.
4.14. Property
Each of the Borrower, its Subsidiaries and each Guarantor has
good and marketable title to all Property owned by it, title to which is
material to the Borrower, such Subsidiary or such Guarantor, subject to no Liens
except for Liens permitted under Section 8.2.
4.15. Franchises, Intellectual Property, Etc.
Each of the Borrower, its Subsidiaries and each Credit Party
possesses or has the right to use all franchises, intellectual Property,
licenses and other rights as are material and necessary for the conduct of its
business, and are in compliance with such franchises, intellectual Property,
licenses and other rights, except for any non-compliance which could not be
expected to have a Material Adverse Effect. There are no known conflicts with
the valid rights of others with respect to such franchises, intellectual
Property, licenses and other rights which could be expected to have a Material
Adverse Effect.
4.16. Security Interests
The Liens granted to the Agent under the Collateral Documents
constitute valid, binding and continuing first priority Liens in the Collateral,
subject to no Liens other than Liens described under Section 8.2.
4.17. Environmental Matters
(a) Except as described on Schedule 4.17(a), the Borrower,
each of its Subsidiaries and each Credit Party is in compliance in all material
respects with the requirements
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of all applicable Environmental Laws, except where the failure to so comply
could not reasonably be expected to have a Material Adverse Effect.
(b) Except as described on Schedule 4.17(b), no Hazardous
Substances have been generated or manufactured on, transported to or from,
treated at, stored at or discharged from any Real Property in violation of any
Environmental Laws; no Hazardous Substances have been discharged into subsurface
waters under any Real Property in violation of any Environmental Laws; no
Hazardous Substances have been discharged from any Real Property on or into
Property or waters (including subsurface waters) adjacent to any Real Property
in violation of any Environmental Laws; and there are not now, nor ever have
been, on any Real Property any underground or above ground storage tanks
regulated under any Environmental Laws , except where the failure to so comply
with such Environmental Laws could not reasonably be expected to have a Material
Adverse Effect.
(c) Neither the Borrower nor any of its Subsidiaries nor any
Credit Party (i) has received notice (written or oral) or otherwise learned of
any claim, demand, suit, action, proceeding, event, condition, report,
directive, Lien, violation, non-compliance or investigation indicating or
concerning any potential or actual liability (including, without limitation,
potential liability for enforcement, investigatory costs, cleanup costs,
government response costs, removal costs, remedial costs, natural resources
damages, Property damages, personal injuries or penalties) arising in connection
with: (x) any non- compliance with or violation of the requirements of any
applicable Environmental Laws, or (y) the presence of any Hazardous Substance on
any Real Property (or any Real Property previously owned by the Borrower or the
release or threatened release of any Hazardous Substance into the environment,
(ii) has threatened or actual liability in connection with the presence of any
Hazardous Substance on any Real Property (or any Real Property previously owned
by the Borrower) or the release or threatened release of any Hazardous Substance
into the environment, (iii) has received notice of any federal or state
investigation evaluating whether any remedial action is needed to respond to the
presence of any Hazardous Substance on any Real Property (or any Real Property
previously owned by the Borrower) or a release or threatened release of any
Hazardous Substance into the environment for which the Borrower is or may be
liable, or (iv) has received notice that the Borrower is or may be liable to any
Person under any Environmental Law.
4.18. Burdensome Obligations
Neither the Borrower, any of its Subsidiaries nor any Credit
Party is a party to or bound by any franchise, agreement, deed, lease or other
instrument, or subject to any restriction which, in the opinion of the
management of the Borrower, is so unusual or burdensome, in the context of its
business, as in the foreseeable future might materially and adversely affect or
impair the revenue or cash flow of the Borrower, such Subsidiary or such Credit
Party or the ability of the Borrower, such Subsidiary or such Credit Party to
perform its obligations under the Loan Documents to which it is a party. The
Borrower does not presently anticipate that future
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expenditures by the Borrower, any of its Subsidiaries or any Credit Party
needed to meet the provisions of federal or state statutes, orders, rules or
regulations will be so burdensome as to result in a Material Adverse Effect or
Material Adverse Change.
4.19. No Misrepresentation
No representation or warranty contained in any Loan Document
and no certificate or report furnished or to be furnished by the Borrower, any
of its Subsidiaries or any Credit Party in connection with the transactions
contemplated thereby, contains or will contain a misstatement of material fact,
or, to the best knowledge of the Borrower, omits or will omit to state a
material fact required to be stated in order to make the statements contained
therein not misleading in light of the circumstances under which made.
4.20. Ownership of Assets; Operating Entities
Except as set forth on Schedule 4.20, with respect to the
Borrower and each Credit Party, the Borrower and its Subsidiaries are (i) the
sole operating entities, and (ii) the legal owner of all of the Property and
assets of the Borrower, its Subsidiaries and each Guarantor (except membership
interests in the Borrower held by the Guarantors).
5. CONDITIONS TO FIRST REVOLVING CREDIT LOANS
In addition to the conditions precedent set forth in Section
6, the obligation of each Lender to make Revolving Credit Loans on the first
Borrowing Date shall be subject to the fulfillment of the following conditions
precedent:
5.1. Evidence of Action
(a) The Borrower. The Agent shall have received a certificate,
dated the Effective Date, of the Secretary or Assistant Secretary or other
analogous counterpart of the Borrower (i) attaching a true and complete copy of
the resolutions of its Managing Person and of all documents evidencing other
necessary company action (in form and substance satisfactory to the Agent) taken
by it to authorize the Loan Documents and the transactions contemplated thereby,
(ii) attaching a true and complete copy of its Organizational Documents, (iii)
attaching a true and complete copy of the PRG Operating Agreement and all
amendments thereto, (iv) setting forth the incumbency of its officers or other
analogous counterpart who may sign such Loan Documents, including therein a
signature specimen of such officers, and (v) attaching a certificate of good
standing of the Secretary of State of the State of its formation and each other
jurisdiction in which it is qualified to do business.
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(b) The Guarantors. The Agent shall have received a
certificate, dated the Effective Date, of the Secretary or Assistant Secretary
or other analogous counterpart of each of the Guarantors (i) attaching a true
and complete copy of the resolutions of its Managing Person and of all documents
evidencing other necessary corporate or company action (in form and substance
satisfactory to the Agent) taken by it to authorize the Loan Documents to which
it is a party and the transactions contemplated thereby, (ii) attaching a true
and complete copy of its Organizational Documents, (iii) setting forth the
incumbency of its officer or officers or other analogous counterpart who may
sign such Loan Documents, including therein a signature specimen of such officer
or officers and (iv) attaching a certificate of good standing of the Secretary
of State of the jurisdiction of its incorporation or formation and of each other
jurisdiction in which it is qualified to do business.
5.2. This Agreement
The Agent shall have received counterparts of this Agreement,
signed by each of the parties hereto (or receipt by the Agent from a party
hereto of a telecopy signature page signed by such party which shall have agreed
to promptly provide the Agent with originally executed counterparts hereof).
5.3. Revolving Credit Notes
The Agent shall have received the Revolving Credit Notes, duly
executed by an Authorized Signatory of the Borrower.
5.4. The Security Agreement
The Agent shall have received the Security Agreement, duly
executed by an Authorized Signatory of each Credit Party a party thereto,
together with (i) stock certificates, membership certificates or other evidence
of ownership interest representing all of the issued and outstanding Capital
Stock or membership units of the Borrower and each of its Subsidiaries held by
the Borrower or the Guarantors, together with undated stock powers or other
assignments executed in blank, (ii) Instruments constituting Collateral, duly
indorsed in blank by an Authorized Signatory of the Borrower or Guarantor which
is an owner thereof, (iii) Transaction Statements in the form of Annex A to the
Security Agreement, executed by an Authorized Signatory of the Borrower or
Guarantor with respect to each Uncertificated Security (as defined therein)
owned by such Borrower or Guarantor constituting Collateral thereunder, (iv)
such UCC Financing Statements, executed by the Borrower and each Guarantor, as
shall be reasonably requested by the Agent in order to perfect the security
interest in any collateral security granted under the Security Agreement and (v)
such other documents as the Agent may require in connection with the perfection
of its Security interest therein.
5.5. The Pledge Agreements
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The Agent shall have received the Pledge Agreements, duly
executed by each individual Pledgor, together with (i) such membership
certificates or other evidence of ownership interest representing all the issued
and outstanding Capital Stock or membership units of the Borrower held by the
Pledgors, together with undated assignments executed in blank and (ii) such
other documents as the Agent may require in connection with the perfection of
its security interests therein.
5.6. Guaranty
The Agent shall have received the Guaranty, duly executed by
an Authorized Signatory of each of the Guarantors.
5.7. Litigation
There shall be no injunction, writ, preliminary restraining
order or other order of any nature issued by any Governmental Authority in any
respect affecting the transactions provided for herein and no action or
proceeding by or before any Governmental Authority shall have been commenced and
be pending or, to the knowledge of the Borrower, threatened, seeking to prevent
or delay the transactions contemplated by the Loan Documents or challenging any
other terms and provisions hereof or thereof or seeking any damages in
connection therewith, and the Agent shall have received a certificate of an
Authorized Signatory of the Borrower to the foregoing effects.
5.8. Approvals and Consents
The Agent shall have received a certificate of an authorized
signatory of the Borrower to the effect that all approvals and consents of all
Persons required to be obtained in connection with the consummation of the
transactions contemplated by the Loan Documents have been duly obtained and are
in full force and effect, and that all required notices have been given and any
required waiting periods have expired.
5.9. Search Reports and Related Documents
The Agent shall have received (i) UCC, tax and judgment lien
searches with respect to each applicable public office where Liens are or may be
filed disclosing that there are no Liens of record in such official's office
covering any Collateral or showing the Borrower or any Guarantor as debtor
thereunder (other than a Permitted Lien and other than Liens with respect to
Existing Indebtedness to be repaid on the first Borrowing Date and (ii) a
certificate of the Borrower and the Guarantors signed by an Authorized Signatory
of each thereof, dated the first Borrowing Date, certifying that, upon the
making of the Loans on such date there will exist no Liens on the Collateral
other than Permitted Liens.
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5.10. Existing Indebtedness
Prior to or simultaneously with the making of the first
Revolving Credit Loans, the Borrower shall have fully repaid all Existing Bank
Debt.
5.11. Certain Agreements
The Agent shall have received a fully executed copy of the
Restricted Limited Liability Company Unit Incentive Compensation Plan, certified
by an Authorized Signatory of the Borrower as being true and correct as of the
Effective Date, and such Plan shall require each recipient of vested membership
units to pledge such units to the Agent as Collateral under the Loan Documents.
5.12. Financial Statements; Compliance Certificate; Projections
The Agent shall have received (i) the Financial Statements set
forth in Section 4.13, (ii) a Compliance Certificate (prepared on a pro-forma
basis after giving effect to the first Borrowings hereunder) showing compliance
with the financial covenants on the first Borrowing Date, certified by a
Financial Officer of the Borrower, and (iii) financial projections of the
Borrower and its Subsidiaries for such periods, in such form and with respect to
such matters as the Agent may reasonably request.
5.13. Opinion of Counsel to the Borrower and the Guarantors
The Agent shall have received an opinion of counsel to the
Borrower and the Guarantors, addressed to the Agent and the Lenders (and
permitting Special Counsel to rely thereon), and dated the first Borrowing Date,
substantially in the form of Exhibit F. It is understood that such opinion is
being delivered to the Agent and the Lenders upon the direction of the Borrower
and the Guarantors and that the Agent and the Lenders may and will rely upon
such opinion.
5.14. Opinion of Special Counsel
The Agent shall have received an opinion of Special Counsel,
addressed to the Agent and the Lenders and dated the first Borrowing Date
substantially in the form of Exhibit G.
5.15. Insurance
The Agent shall have received a certificate of all insurance
maintained by the Borrower, its Subsidiaries and the Guarantors in form and
substance reasonably satisfactory to the Agent, and naming the Agent as loss
payee.
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5.16. Fees
All fees payable to the Agent and the Lenders on the first
Borrowing Date shall have been paid.
5.17. Fees and Expenses of Special Counsel
The fees and expenses of Special Counsel in connection with
the preparation, negotiation and closing of the Loan Documents shall have been
paid.
5.18. Other Documents
The Agent shall have received such other documents as the
Agent or the Lenders shall reasonably request.
6. CONDITIONS OF LENDING - ALL REVOLVING CREDIT LOANS
The obligation of each Lender to make any Revolving Credit Loan on a
Borrowing Date is subject to the satisfaction of the following conditions
precedent as of the date of such Revolving Credit Loan:
6.1. Compliance
On each Borrowing Date and after giving effect to the
Revolving Credit Loans to be made thereon (i) there shall exist no Default or
Event of Default and (ii) the representations and warranties contained in the
Loan Documents shall be true and correct with the same effect as though such
representations and warranties had been made on such Borrowing 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 and correct on and as of such earlier date. Each borrowing by the Borrower
shall constitute a certification by the Borrower as of such Borrowing Date that
each of the foregoing matters is true and correct in all respects.
6.2. Borrowing Request
With respect to the Revolving Credit Loans to be made on each
Borrowing Date, the Agent shall have received, a Borrowing Request, duly
executed by an Authorized Signatory of the Borrower.
6.3. Loan Closings
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All documents required by the provisions of the Loan Documents
to be executed or delivered to the Agent on or before the applicable Borrowing
Date shall have been executed and shall have been delivered at the office of the
Agent set forth in Section 11.2 on or before such Borrowing Date.
6.4. Other Documents
The Agent shall have received such other documents as the
Agent or the Lenders shall reasonably request.
7. AFFIRMATIVE COVENANTS
The Borrower agrees that, so long as this Agreement is in effect, any
Revolving Credit Loan remains outstanding and unpaid, any Lender has any
obligation to make any Revolving Credit Loan, or any other amount is owing under
any Loan Document to any Lender or the Agent, the Borrower shall:
7.1. Financial Statements
Maintain a standard system of accounting in accordance with
GAAP consistently applied, and furnish or cause to be furnished to the Agent and
each Lender:
(a) As soon as available, but in any event within 90 days
after the end of each fiscal year, a copy of its Consolidated balance
sheet as at the end of such fiscal year, together with the related
Consolidated statements of income, retained earnings and cash flows as
of and through the end of such fiscal year, setting forth in each case
in comparative form the figures for the preceding fiscal year. The
Consolidated balance sheets and Consolidated statements of income,
retained earnings and cash flows shall be audited and certified without
qualification by the Accountants, which certification shall (i) state
that the examination by such accountants in connection with such
financial statements has been made in accordance with generally
accepted auditing standards and, accordingly, included such tests of
the accounting records and such other auditing procedures as were
considered necessary in the circumstances, and (ii) include the opinion
of such accountants that such financial statements have been prepared
in accordance with GAAP in a manner consistent with prior fiscal
periods, except as otherwise specified in such opinion.
(b) As soon as available, but in any event within 45 days
after the end of each of the first three fiscal quarters, a copy of the
Consolidated balance sheet of the Borrower as at the end of each such
quarterly period, together with the related Consolidated statements of
income, retained earnings and cash flows for such period and for the
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elapsed portion of the fiscal year through such date, setting forth in
each case in comparative form the figures for the corresponding periods
of the preceding fiscal year, certified by a Financial Officer of the
Borrower (or such other member acceptable to the Agent), as being
complete and correct in all material respects and as presenting fairly
the Consolidated financial condition and the Consolidated results of
operations of the Borrower and its Subsidiaries, such statements to
include such additional specific information as to income and expenses
as the Agent may reasonably request.
(c) Within 45 days after the end of each of the first three
fiscal quarters and within 90 days after the end of the last fiscal
quarter, a Compliance Certificate, certified by a Financial Officer of
the Borrower (or such other member as shall be acceptable to the
Agent).
(d) Financial statements with respect to any new Acquisitions
in such form as the Agent may reasonably request within 90 days after
the end of each fiscal year.
(e) An annual budget in such form as shall be acceptable to
the Agent.
(f) Such other information as the Agent or any Lender may
reasonably request from time to time.
7.2. Certificates; Other Information
Furnish to the Agent and each Lender:
(a) Prompt written notice if: (i) any Indebtedness in excess
of $100,000 of the Borrower or any of its Subsidiaries is declared or shall
become due and payable prior to its stated maturity, or is called and not paid
when due, (ii) a default shall have occurred under any note (other than the
Notes) or the holder of any such note, or other evidence of Indebtedness,
certificate or security evidencing any such Indebtedness or any obligee with
respect to any other Indebtedness of the Borrower or any of its Subsidiaries has
the right to declare any such Indebtedness due and payable prior to its stated
maturity, (iii) there shall occur and be continuing a Default or an Event of
Default or (iv) a Change of Control should occur;
(b) Prompt written notice of: (i) any citation, summons,
subpoena, order to show cause or other document naming the Borrower or any of
its Subsidiaries a party to any proceeding before any Governmental Authority
which could reasonably be expected to have a Material Adverse Effect or which
calls into question the validity or enforceability of any of the Loan Documents,
and include with such notice a copy of such citation, summons, subpoena, order
to show cause or other document and (ii) any lapse or other termination of any
license, permit, franchise or other authorization issued to the Borrower or any
of its Subsidiaries by any
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Person or Governmental Authority which could reasonably be expected to have a
Material Adverse Effect;
(c) If and when the Borrower or any ERISA Affiliate (i) gives
or is required to give notice to the PBGC of any "reportable event" (as defined
in Section 4043 of ERISA) with respect to any Pension Plan, a copy of the notice
of such reportable event given or required to be given to the PBGC; (ii)
receives notice of complete or partial withdrawal liability under Title IV of
ERISA or notice that any Multiemployer Plan is in reorganization, is insolvent
or has been terminated, a copy of such notice; (iii) receives notice from the
PBGC of an intent to terminate, impose liability (other than for premiums in
respect of, or appoint a trustee to administer any Pension Plan, a copy of such
notice; (iv) applies for a waiver of the minimum funding standard under Section
412 of the Code, a copy of such application; (v) gives notice of intent to
terminate any Pension Plan under Section 4041(c) of ERISA, a copy of such notice
and other information filed with the PBGC; (vi) gives notice of withdrawal from
any Pension Plan pursuant to Section 4063 of ERISA, a copy of such notice; or
(vii) fails to make any payment or contribution to any Pension Plan or
Multiemployer Plan makes any amendment to any Pension Plan which in either case
would trigger the provisions of Sections 412(n) or 401(a)(29) of the Code (and
any corresponding provisions of ERISA), a certificate of the chief financial
officer of the Borrower setting forth details as to such occurrence and action,
if any, which the Borrower or ERISA Affiliate is required or proposes to take;
(d) Prompt written notice of any order, notice, claim or
proceeding received by, or brought against, the Borrower or any of its
Subsidiaries, or with respect to any of the Real Property, under any
Environmental Law; and
(e) Such other information as the Agent or any Lender shall
reasonably request from time
to time.
7.3. Legal Existence
Except for mergers, consolidations and acquisitions permitted
under Section 8.3, maintain, and cause each of its Subsidiaries to maintain, its
corporate or partnership or analogous existence in good standing in the
jurisdiction of its incorporation or formation and in each other jurisdiction in
which the failure so to do could have a Material Adverse Effect.
7.4. Taxes
Pay and discharge when due, and cause each of its Subsidiaries
so to do, all taxes, assessments and governmental charges, license fees and
levies upon, or with respect to the Borrower and all taxes upon the income,
profits and Property of the Borrower or any of its Subsidiaries, which if
unpaid, could reasonably be expected to have a Material Adverse Effect or become
a Lien on the Property of the Borrower or any of its Subsidiaries, except those
which are
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being contested in good faith by appropriate proceedings, and with respect to
which adequate reserves have been set aside, and provided that the Borrower
shall give the Agent prompt notice of such contest.
7.5. Insurance
(a) Maintain, and cause each of its Subsidiaries to maintain,
insurance with financially sound insurance carriers on such of its Property,
against at least such risks, and in at least such amounts, as are usually
insured against by similar businesses, including public liability (bodily injury
and property damage), fidelity, business interruption, and workers' compensation
with deductibles which are customary for companies engaged in similar
businesses, and which, in the case of property insurance, shall be (i) in
amounts sufficient to prevent the Borrower or such Subsidiary from becoming a
co-insurer, and (ii) against all risks; and file with the Agent within ten days
after request therefor a detailed list of such insurance then in effect, stating
the names of the carriers thereof, the policy numbers, the insureds thereunder,
the amounts of insurance, dates of expiration thereof, and the Property and
risks covered thereby, together with a certificate of the Financial Officer (or
such other officer as shall be acceptable to the Agent) of the Borrower
certifying that in the opinion of such officer such insurance is adequate in
nature and amount, complies with the obligations of the Borrower under this
Section, and is in full force and effect.
(b) Insurance Covering Collateral. Promptly upon request
therefor, deliver or cause to be delivered to the Agent originals or duplicate
originals of all such policies of insurance. All such insurance policies in
respect of property insurance and business interruption insurance shall contain
a standard loss payable clause and shall be endorsed to provide that, in respect
of the interests of the Agent and the Lenders: (i) the Agent shall be an
additional insured, (ii) 30 days' prior written notice of any cancellation,
reduction of amounts payable, or any changes and amendments shall be given to
the Agent, and (iii) the Agent shall have the right, but not the obligation, to
pay any premiums due or to acquire other such insurance upon the failure of the
Borrower or such Subsidiary to pay the same or to so insure. All property
insurance policies shall name the Agent as sole loss payee in respect of each
claim relating to the Collateral and resulting in a payment under any such
insurance policy exceeding $1,000,000. Provided that no Default or Event of
Default shall exist, the Agent agrees, promptly upon its receipt thereof, to pay
over to the Borrower the proceeds of such payment to enable the Borrower to
repair, restore or replace the Property subject to such claim. To the extent
that the Borrower elects not to repair, restore or replace such Property an
amount equal to such proceeds shall be immediately applied as a permanent
reduction of the Aggregate Commitment Amount pursuant to Section 2.5(e). If a
Default or Event of Default shall then exist, the Agent shall (i) hold the
proceeds of such payment as Collateral until such Default or Event of Default
shall no longer exist and then pay over the same to the Borrower to enable the
Borrower to repair, restore or replace or cause to be repaired, restored or
replaced the Property subject to the claim which resulted in such payment or
(ii) hold such proceeds as Collateral and apply the same to the obligations of
the Borrower under
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the Loan Documents in such order, in such amounts and at such times as the
Agent, with the consent of Required Lenders, shall decide.
7.6. Payment of Indebtedness and Performance of Obligations
Pay and discharge when due, and cause each of its Subsidiaries
to pay and discharge, all lawful Indebtedness, obligations and claims for labor,
materials and supplies or otherwise (which, if unpaid, might (i) have a Material
Adverse Effect, or (ii) become a Lien upon Property of the Borrower or any of
its Subsidiaries other than a Permitted Lien, (except to the extent that any
such Indebtedness, obligations or claims are being contested in good faith by
the Borrower or any of its Subsidiaries by appropriate proceedings diligently
conducted by the Borrower or such Subsidiary, and provided that the Borrower
shall give the Agent prompt notice of any such contest and that such reserve or
other appropriate provision as shall be required by the Accountants in
accordance with GAAP shall have been made therefor).
7.7. Condition of Property
At all times, maintain, protect and keep in good repair,
working order and condition (ordinary wear and tear excepted), and cause each of
its Subsidiaries so to do, all Property necessary to the operation of the
Borrower's or such Subsidiary's business and activities, except where the
failure to maintain such Property could reasonably be expected to have a
Material Adverse Effect.
7.8. Observance of Legal Requirements
Observe and comply in all respects, and cause each of its
Subsidiaries so to do, with all laws, ordinances, orders, judgments, rules,
regulations, certifications, franchises, permits, licenses, directions and
requirements of all Governmental Authorities, which now or at any time hereafter
may be applicable to it, including, without limitation, all Environmental Laws,
a violation of which could reasonably be expected to have a Material Adverse
Effect.
7.9. Inspection of Property; Books and Records; Discussions
Keep proper books of record and account in which full, true
and correct entries in conformity with generally accepted accounting principles,
consistently applied, and all requirements of law shall be made of all dealings
and transactions in relation to its business and activities and permit
representatives of the Agent and each Lender to visit the offices of the
Borrower and each of its Subsidiaries, to inspect any of its Property and
examine and make copies or abstracts from any of its books and records with
reasonable advance notice, at any reasonable time and as often as may reasonably
be desired, and to discuss the business, operations, prospects, licenses,
Property and financial condition of the Borrower and each such Subsidiary with
the officers thereof and the Accountants.
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7.10. Licenses
Maintain, and cause each of its Subsidiaries to maintain, in
full force and effect, all material licenses, franchises, intellectual property,
permits, licenses, authorizations and other rights as are necessary for the
conduct of its business except where such failure could not reasonably be
expected to have a Material Adverse Effect.
7.11. Financial Covenants
(a) Pro Forma Interest Coverage Ratio. Maintain at all times
a Pro Forma Interest Coverage Ratio of not less than 2.00 to 1.00.
(b) Fixed Charge Coverage Ratio. Maintain at all times a Fixed
Charge Coverage Ratio of not less than 1.10 to 1.00, commencing with the fiscal
quarter ending March 31, 1998.
(c) Leverage Ratio. Maintain at all times during the periods
set forth below, a Leverage Ratio of not more than the ratios set forth below:
Period Ratio
------ -----
Effective Date through
December 30, 1997 3.50:1.00
December 31, 1997 through
June 29, 1998 3.25:1.00
June 30, 1998 through
December 30, 1998 3.00:1:00
December 31, 1998 through
December 30, 1999 2.75:1.00
December 31, 1999 through
December 30, 2000 2.50:1.00
December 31, 2000
and thereafter 2.25:1.00
7.12. Additional Collateral
In the event that the Borrower shall purchase any real
property using the proceeds of the Revolving Credit Loans, the Borrower shall
(i) provide the Agent with 10 days' written notice of such purchase and (ii)
grant to the Agent a mortgage on such real property on such
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terms and conditions as the Agent may require and shall deliver such mortgage
on or within 30 days of the acquisition of such real property.
8. NEGATIVE COVENANTS
The Borrower agrees that, so long as this Agreement is in effect, any
Revolving Credit Loan remains outstanding and unpaid, any Lender has any
obligation to make any Revolving Credit Loan, or any other amount is owing under
any Loan Document to any Lender or the Agent, the Borrower shall not, directly
or indirectly:
8.1. Indebtedness
Create, incur, assume or suffer to exist any liability for
Indebtedness, or permit any of its Subsidiaries so to do, except (i)
Indebtedness under the Loan Documents, (ii) Indebtedness of the Borrower or any
of its Subsidiaries existing on the Effective Date as set forth on Schedule 8.1
(other than the Existing Bank Debt which is to be repaid on the Effective Date),
excluding increases and refinancings thereof, (iii) Intercompany Indebtedness,
(iv) purchase money Indebtedness and Capital Lease Obligations (other than any
such purchase money Indebtedness or Capital Lease Obligations described in
clause (ii) above) incurred in connection with the purchase, after the Effective
Date, of any Property, in an aggregate principal amount not to exceed $1,000,000
at any one time outstanding, (v) Indebtedness under Interest Rate Protection
Agreements and (vi) Indebtedness incurred to prepay outstanding Revolving Credit
Loans pursuant to Section 2.5(f).
8.2. Liens
Create, incur, assume or suffer to exist any Lien upon any of
its Property, whether now owned or hereafter acquired, or covenant or agree with
any Person to xxxxx x Xxxx in favor of any other Person or permit any of its
Subsidiaries so to do, except (i) Liens on Property of the Borrower and its
Subsidiaries existing on the Effective Date as set forth in Schedule 8.2, (ii)
Liens for taxes, assessments or similar charges incurred in the ordinary course
of business which are not delinquent, (iii) Liens in connection with workers'
compensation, unemployment insurance or other social security obligations (but
not ERISA), (iv) deposits or pledges to secure bids, tenders, contracts (other
than contracts for the payment of money), leases, statutory obligations, surety
and appeal bonds and other obligations of like nature arising in the ordinary
course of business, (v) zoning ordinances, easements, rights of way, minor
defects, irregularities, and other similar restrictions affecting Real Property
which do not adversely affect the value of such Real Property or the financial
condition of the Borrower or such Subsidiary or impair its use for the operation
of the business of the Borrower or such Subsidiary, (vi) Liens arising by
operation of law such as mechanics', materialmen's, carriers', warehousemen's
liens incurred in the ordinary course of business which are not delinquent,
(vii) Liens in favor of the Agent and
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the Lenders under the Loan Documents, (viii) Liens on Property of the Borrower
or any of its Subsidiaries acquired after the Effective Date provided that such
Liens are limited to the Property so acquired and were not created in
contemplation of such acquisition, and (ix) purchase money Liens on Property of
the Borrower or any of its Subsidiaries acquired after the date hereof to
secure Indebtedness of the Borrower permitted by Section 8.1(iv).
8.3. Mergers, Consolidations and Acquisitions
Consolidate with, be acquired by, merge into or with any
Person, make any Acquisition or enter into any binding agreement to do any of
the foregoing which is not contingent on obtaining the consent of the Required
Lenders, or permit any of its Subsidiaries so to do, except:
(a) Capital Expenditures;
(b) provided that the Agent shall have received ten
days' prior written notice, any Subsidiary of the Borrower may merge or
consolidate with any other Subsidiary of the Borrower;
(c) mergers involving Subsidiaries as part of an
Acquisition permitted by subsection (e) below, provided that no Capital
Stock is issued in connection therewith except to the extent permitted
by Section 8.12;
(d) Investments permitted by Section 8.5;
(e) Acquisitions, provided, however, that the
Acquisition Cost in respect thereof shall not exceed $30,000,000 in the
aggregate for the period from the Effective Date to the termination of
this Agreement without the prior written consent of the Required
Lenders and, provided further, that with respect to any Acquisition
whenever consummated (A) such Acquisition shall be of a Person or
operating entity or involve the purchase of assets of a Person in the
same or a similar line of business as the Borrower is engaged in on the
Effective Date, (B) no Default or Event of Default shall exist
immediately before or after giving effect to such Acquisition, the
Borrower will be in compliance with all financial covenants contained
herein on a pro-forma basis after giving effect to such Acquisition and
any Indebtedness incurred or assumed in connection therewith is
permitted by Section 8.1, and, immediately after giving effect to each
such Acquisition, all of the representations and warranties contained
in Section 4 shall be true and correct as if then made and the Agent
shall have received a certificate of a Financial Officer of the
Borrower to such effect, (C) the Agent and the Lenders shall have been
given not less than 30 calendar days' prior written notice thereof, (D)
the Agent shall have received a certificate signed by a Financial
Officer of the Borrower, identifying the Person or Property to be
acquired, the name of the Person making such Acquisition and
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setting forth the total consideration to be paid in respect of such
Acquisition, (E) the conditions of Section 8.12 shall have been
satisfied, (F) in the case of an Acquisition of Property, Capital
Stock or other ownership interest of a Person that will be a
Subsidiary of the Borrower, such new Subsidiary shall deliver to the
Agent a duly executed Guaranty and Security Agreement or supplements
thereto and such other documents as the Agent shall reasonably require
in order that the Agent shall have a perfected first priority security
interest in the Property, Capital Stock or other ownership interest so
acquired and (G) the Agent shall have received such other information
or documents as the Agent shall have reasonably requested, which may
include, without limitation, a copy of any letter of intent with
respect to any acquisition and a copy of the final acquisition
agreement between the purchaser and seller.
8.4. Dispositions
Make any Disposition, or permit any of its Subsidiaries so to
do, except:
(a) Dispositions of any Investments permitted under
Section 8.5(a);
(b) Dispositions of Property which, in the
reasonable opinion of the Borrower or such Subsidiary, is obsolete or
no longer useful in the conduct of its business;
(c) Dispositions as to which the following
conditions have been satisfied:
(i) the Agent and the Required Lenders shall
have consented thereto (which consent shall be discretionary),
(ii) no Default or Event of Default shall
exist immediately before or after giving effect thereto,
(iii) the total consideration received or to
be received therefor by the Borrower or any of its
Subsidiaries shall be payable in cash on or before the closing
thereof or with the consent of the Required Lenders, payable
in other forms and shall not be less than the fair market
value thereof as reasonably determined by the Managing Person
of the Borrower or such Subsidiary,
(iv) the Borrower shall apply 100% of the
Net Cash Proceeds thereof within ten Business Days of the
receipt thereof, to the mandatory reduction of the Aggregate
Commitment Amount pursuant to Section 2.4, and the mandatory
prepayment of the Revolving Credit Loans pursuant to Section
2.5, and
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(v) within ten Business Days prior to each
such Disposition, the Agent and the Lenders shall have
received a certificate in respect thereto signed by an
Authorized Signatory of the Borrower identifying the Property
to be sold or otherwise disposed of and stating (x) that
immediately before or after giving effect thereto, no Default
or Event of Default shall exist, (y) that the consideration
received or to be received by the Borrower or such Subsidiary
for such Property has been determined by the Managing Person
thereof to be not less than the fair market value of such
Property and (z) the total consideration to be paid in respect
of such Disposition, together with estimates of items to be
deducted therefrom in arriving at the Net Cash Proceeds
thereof.
8.5. Investments, Loans, Etc.
At any time, directly or indirectly, purchase or otherwise
hold, own, acquire or invest in the Capital Stock of, evidence of indebtedness
or other obligation or security issued by, any other Person, or make any loan or
advance to, or enter into any arrangement for the purpose of providing funds or
credit to, or make any Acquisition (other than a Permitted Acquisition), or
become a partner or joint venturer in any partnership or joint venture, or make
any other investment (whether in cash or other Property) in any other Person, or
make any commitment or otherwise to agree to do any of the foregoing (all of
which are sometimes referred to herein as "Investments"), or permit any of its
Subsidiaries so to do, or except:
(a) Investments in Cash Equivalents;
(b) Investments existing on the Effective Date
as set forth on Schedule 8.5;
(c) normal business banking accounts;
(d) short-term certificates of deposit and time
deposits in, or issued by, federally insured institutions in amounts
not exceeding the limits of such insurance;
(e) Investments by the Borrower or any Subsidiary in
Intercompany Indebtedness permitted under Section 8.1;
(f) loans to employees of the Borrower or any
Subsidiary (i) to pay for relocation costs of such employees, provided
that such loans shall not exceed $500,000 at any one time oustanding or
(ii) to purchase Capital Stock of the Borrower, provided that such
Capital Stock shall be pledged by such employees to the Agent, pursuant
to and in accordance with Section 8.12(a); and
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(g) other Investments in an aggregate amount not to
exceed $750,000 from the Effective Date to the termination of this
Agreement, provided that in no case shall such Investments be made to
become a partner or joint venturer in any partnership or joint venture
in respect of which the liability of the Borrower exceeds the amount of
the Investment permitted by this clause (g).
8.6. Restricted Payments
Declare or pay any Restricted Payments payable in cash or
otherwise or apply any of its Property thereto or set apart any sum therefor, or
permit any of its Subsidiaries so to do, except: (i) a wholly-owned Subsidiary
may declare and pay Restricted Payments to the Borrower, provided that no
Default or Event of Default has occurred and is continuing or would occur after
giving effect thereto, (ii) the Borrower and any Subsidiaries may declare and
pay Restricted Payments, directly or indirectly, to its members to enable such
members to pay taxes when due, provided that such Restricted Payments shall not
exceed the Members' Tax Liability with respect to each such entity and provided
further that no Event of Default under Section 9.1(a), (b), (h) or (i) has
occurred and is continuing or would occur after giving effect thereto, (iii)
commencing December 31, 1998, the Borrower may declare and pay dividends in an
amount not to exceed 50% of Excess Cash Flow for the immediately preceding
fiscal year of the Borrower, provided that the Leverage Ratio for the two fiscal
quarters prior to and after giving effect thereto is less than 2.00:1.00 and
provided further that no Default or Event of Default has occurred and is
continuing or would occur after giving effect thereto, and (iv) Restricted
Payments in connection with a put or redemption of any Preferred Membership
Units, provided that (A) the Leverage Ratio for the two fiscal quarters prior to
and after giving effect thereto is less than 2.50:1.00 or, alternatively, three
years shall have passed from the issuance of such Preferred Membership Units,
(B) such Restricted Payments shall not in the aggregate exceed $4,000,000 from
the Effective Date until the termination of this Agreement and (C) no Default or
Event of Default has occurred and is continuing or would occur after giving
effect thereto.
8.7. Business and Name Changes
Materially change the nature of the business or the fiscal
year of the Borrower and its Subsidiaries as conducted on the Effective Date, or
alter or modify the Borrower's name, structure or status, as conducted on the
Effective Date.
8.8. Subsidiaries
Create or acquire any other Subsidiary, or permit any of its
Subsidiaries so to do, except as permitted pursuant to and in accordance with
Section 8.12.
8.9. ERISA
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Establish or contribute, or permit any of its Subsidiaries so
to do, to any Pension Plan (other than an Existing Pension Plan) except to the
extent that the same could not reasonably be expected to result in a Material
Adverse Effect, cause any Pension Plan to have a Funded Current Liability
Percentage of less than 60%, or increase benefits, or permit any of its
Subsidiaries so to do, under any Employee Benefit Plan or establish or
contribute to any new Employee Benefit Plan except to the extent that the same
could not reasonably be expected to result in a Material Adverse Effect.
8.10. Amendments, Etc. of Certain Agreements
Enter into or agree to any amendment, modification or waiver
of any term or condition of its Organizational Documents, including the PRG
Operating Agreement, or the Restricted Limited Liability Company Unit Incentive
Compensation Plan.
8.11. Transactions with Affiliates and Employees
Become a party to any transaction with an Affiliate or any
employee of the Borrower or any Subsidiary (other than a Guarantor) unless the
Borrower's Managing Person shall have determined that the terms and conditions
relating thereto are as favorable to the Borrower as those which would be
obtainable at the time in a comparable arms-length transaction with a Person
other than an Affiliate or employee of the Borrower or any Subsidiary, or permit
any of its Subsidiaries so to do.
8.12. Issuance of Additional Capital Stock
Create or acquire the Capital Stock in, or Property of, any
Person which shall thereupon become a direct or indirect Subsidiary (each, a
"New Subsidiary"), or issue any additional Capital Stock, or permit any of its
Subsidiaries so to do, except as follows:
(a) the Borrower may issue additional Capital Stock
(other than Capital Stock subject to mandatory redemption or redemption
at the option of the holder thereof, in whole or in part except for
Preferred Membership Units), including issuance pursuant to the
Restricted Limited Liability Company Unit Incentive Plan, provided that
(i) the same is not otherwise prohibited under the Loan Documents, (ii)
simultaneously therewith (A) such Capital Stock shall be pledged by the
holder thereof to the Agent, for the ratable benefit of the Lenders
pursuant to the Security Agreement or Pledge Agreement, as the case may
be, and (B) appropriate documentation with respect thereto as the Agent
shall reasonably request shall be delivered to the Agent, and (iii)
there shall be no Lien upon such Capital Stock except for the Lien
created in favor of the Agent, for the ratable benefit of the Lenders
under the Collateral Documents;
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(b) a Subsidiary may issue additional Capital Stock
to its immediate parent provided that (i) the same is not otherwise
prohibited under the Loan Documents, (ii) simultaneously therewith (A)
such Capital Stock shall be pledged to the Agent, for the ratable
benefit of the Lenders pursuant to the Security Agreement and (B)
appropriate documentation with respect thereto as the Agent shall
reasonably request shall be delivered to the Agent, and (iii) there
shall be no Lien upon such Capital Stock except for the Lien created in
favor of the Agent, for the ratable benefit of the Lenders under the
Security Agreement or Guaranty, as the case may be; and
(c) the Borrower or any of its Subsidiaries may
create or acquire a New Subsidiary with respect to an Acquisition
provided that: (i) in the case of an Acquisition, such Acquisition is a
Permitted Acquisition; (ii) the Agent shall have received 30 calendar
days' advance written notice thereof; (iii) prior to or simultaneously
with the consummation of such Acquisition, (A) such New Subsidiary
shall execute and deliver to the Agent a supplement to the Guaranty and
the Security Agreement in accordance with the terms thereof together
with (1) a certificate, dated the date such New Subsidiary shall have
become a party to the Guaranty, executed by such New Subsidiary and
substantially in the form of, and with substantially the same
attachments as, the certificate which would have been required under
Section 5.1 if such New Subsidiary had become a party to the Guaranty
and the Security Agreement on the Effective Date and (2) such
certificates, stock powers, membership units instruments, Grants of
Security Interest, Transaction Statements, UCC Financing Statements and
UCC, tax and judgment lien searches which would have been required
under Section 5.4 and 5.9 if such New Subsidiary had become a party to
the Guaranty and the Security Agreement on the Effective Date; (B) each
Credit Party owning Capital Stock of such New Subsidiary shall deliver
certificates evidencing such Capital Stock to the Agent as additional
Collateral, together with appropriate stock or transfer powers; (iv)
the Agent shall have received an opinion of counsel to the New
Subsidiary, in all respects satisfactory to the Agent and dated the
date of such supplement to the Guaranty and the Security Agreement; and
(v) the Agent shall have received such other documents as the Agent
shall have reasonably requested.
8.13. Limitation on Upstream Dividends by Subsidiaries
Permit or cause any of its Subsidiaries to enter into or
agree, or otherwise be or become subject, to any agreement, contract or other
arrangement (other than this Agreement) with any Person pursuant to the terms of
which such Subsidiary is or would be limited or prohibited from declaring or
paying any cash dividends or distributions on its Capital Stock owned directly
or indirectly by the Borrower or any of the other Subsidiaries.
8.14. Prepayments of Indebtedness
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Prepay or obligate itself to prepay, in whole or in part, any
Indebtedness (other than Indebtedness under the Loan Documents), or permit any
of its Subsidiaries so to do except that the Borrower may prepay up to
$1,000,000 of Indebtedness provided that no Default or Event of Default has
occurred and is continuing or would occur after giving effect thereto.
9. DEFAULT
9.1. Events of Default
The following shall each constitute an "Event of Default"
hereunder:
(a) Any payment of principal with respect to any
Revolving Credit Note shall not be made on the date when due and
payable; or
(b) Any payment of interest, fees, expenses or other
amounts payable under any Loan Document or otherwise to the Agent with
respect to the loan facilities established hereunder shall not be made
within three Business Days of the date when due and payable; or
(c) The failure of the Borrower to observe or perform
any covenant or agreement contained in Sections 2.6, 7.3, 7.11 or
Section 8; or
(d) The failure of any Credit Party to observe or
perform any other term, covenant, or agreement contained in any Loan
Document and such failure shall have continued unremedied for a period
of 30 days after such Credit Party shall have obtained knowledge
thereof; or
(e) Any representation or warranty made by any Credit
Party (or by an officer thereof on its behalf) in any Loan Document or
in any certificate, report, opinion (other than an opinion of counsel)
or other document delivered or to be delivered pursuant thereto, shall
prove to have been incorrect or misleading (whether because of
misstatement or omission) in any material respect when made; or
(f) Liabilities and/or other obligations of the
Borrower (other than its obligations hereunder), any of its
Subsidiaries or any Guarantor, whether as principal, guarantor, surety
or other obligor, for the payment of any Indebtedness or operating
leases in an aggregate amount in excess of $250,000 (i) shall become or
shall be declared to be due and payable prior to the expressed maturity
thereof, or (ii) shall not be paid when due or within any grace period
for the payment thereof, (iii) any holder of any such obligation shall
have the right to declare such obligation due and payable prior to the
expressed maturity thereof or (iv) as a consequence of the occurrence
or continuation of
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any event or condition, the Borrower, any of its Subsidiaries or any
Guarantor, has become obligated to purchase or repay any Indebtedness
in an aggregate amount in excess of $250,000 before its regularly
scheduled maturity date;
(g) Any license, franchise, permit, right, approval
or agreement of the Borrower, any of its Subsidiaries or any Guarantor,
is not renewed, or is suspended, revoked or terminated and the
non-renewal, suspension, revocation or termination thereof would have a
Material Adverse Effect; or
(h) The Borrower, any of its Subsidiaries or any
Guarantor, shall (i) suspend or discontinue its business, (ii) make an
assignment for the benefit of creditors, (iii) generally not be paying
its debts as such debts become due, (iv) admit in writing its inability
to pay its debts as they become due, (v) file a voluntary petition in
bankruptcy, (vi) become insolvent (however such insolvency shall be
evidenced), (vii) file any petition or answer seeking for itself any
reorganization, arrangement, composition, readjustment of debt,
liquidation or dissolution or similar relief under any present or
future statute, law or regulation of any jurisdiction, (viii) petition
or apply to any tribunal for any receiver, custodian or any trustee for
any substantial part of its Property, (ix) be the subject of any such
proceeding filed against it which remains undismissed for a period of
60 days, (x) file any answer admitting or not contesting the material
allegations of any such petition filed against it or any order,
judgment or decree approving such petition in any such proceeding, (xi)
seek, approve, consent to, or acquiesce in any such proceeding, or in
the appointment of any trustee, receiver, sequestrator, custodian,
liquidator, or fiscal agent for it, or any substantial part of its
Property, or an order is entered appointing any such trustee, receiver,
custodian, liquidator or fiscal agent and such order remains in effect
for 60 days, or (xii) take any formal action for the purpose of
effecting any of the foregoing or looking to the liquidation or
dissolution of the Borrower, such Subsidiary or any Guarantor; or
(i) An order for relief is entered under the
bankruptcy or insolvency laws of any jurisdiction or any other decree
or order is entered by a court having jurisdiction (i) adjudging the
Borrower, any of its Subsidiaries or any Guarantor, bankrupt or
insolvent, (ii) approving as properly filed a petition seeking
reorganization, liquidation, arrangement, adjustment or composition of
or in respect of the Borrower, any of its Subsidiaries or any
Guarantor, under the bankruptcy or insolvency laws of any jurisdiction,
(iii) appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) of the Borrower, any of its
Subsidiaries or any Guarantor, or of any substantial part of the
Property of any thereof, or (iv) ordering the winding up or liquidation
of the affairs of the Borrower, any of its Subsidiaries or any
Guarantor, and any such decree or order continues unstayed and in
effect for a period of 60 days; or
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(j) Judgments or decrees against the Borrower, any of
its Subsidiaries or any Guarantor, aggregating in excess of $250,000
shall remain unpaid, unstayed on appeal, undischarged, unbonded or
undismissed for a period of 30 days; or
(k) Any Loan Document shall cease, for any reason, to
be in full force and effect, or any Credit Party shall so assert in
writing or shall disavow any of its obligations thereunder; or
(l) The occurrence of an Event of Default as
defined in any Collateral Document; or
(m) The occurrence of a Material Adverse
Change; or
(n) The occurrence of a Change of Control; or
(o) (i) any Termination Event shall occur; (ii) any
Accumulated Funding Deficiency, whether waived, shall exist with
respect to any Pension Plan; (iii) any Person shall engage in any
Prohibited Transaction involving any Employee Benefit Plan; (iv) the
Borrower, any of its Subsidiaries or any ERISA Affiliate shall fail to
pay when due an amount which is payable by it to the PBGC or to a
Pension Plan under Title IV of ERISA; (v) the imposition of any tax
under Section 4980B(a) of the Code; (vi) the assessment of a civil
penalty with respect to any Employee Benefit Plan under Section 502(c)
of ERISA; or (vii) any other event or condition shall occur or exist
with respect to an Employee Benefit Plan which in the case of clauses
(i) through (vii) would, individually or in the aggregate, have a
Material Adverse Effect.
9.2. Contract Remedies
(a) Upon the occurrence of an Event of Default or at any time
thereafter during the continuance thereof, (i) if such event is an Event of
Default specified in clause (h) or (i) above, the Commitments of all of the
Lenders shall immediately and automatically terminate and the Revolving Credit
Loans, all accrued and unpaid interest thereon and all other amounts owing under
the Loan Documents shall immediately become due and payable, and the Agent may,
and, upon the direction of the Required Lenders shall, exercise any and all
remedies and other rights provided in the Loan Documents, and (ii) if such event
is any other Event of Default, any or all of the following actions may be taken:
(A) with the consent of the Required Lenders, the Agent may, and upon the
direction of the Required Lenders shall, by notice to the Borrower, declare the
Commitments of all of the Lenders terminated forthwith, whereupon such
Commitments shall immediately terminate, and (B) with the consent of the
Required Lenders, the Agent may, and upon the direction of the Required Lenders
shall, by notice of default to the Borrower, declare the Revolving Credit Loans,
all accrued and unpaid interest thereon and all other amounts owing under the
Loan Documents to be due and payable forthwith, whereupon the
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same shall immediately become due and payable, and the Agent may, and upon the
direction of the Required Lenders shall, exercise any and all remedies and
other rights provided in the Loan Documents. Except as otherwise provided in
this Section, presentment, demand, protest and all other notices of any kind
are hereby expressly waived. The Borrower hereby further expressly waives and
covenants not to assert any appraisement, valuation, stay, extension,
redemption or similar laws, now or at any time hereafter in force which might
delay, prevent or otherwise impede the performance or enforcement of any Loan
Document.
(b) In the event that the Commitments of all the Lenders shall
have been terminated or the Revolving Credit Loans shall have been declared due
and payable pursuant to the provisions of this Section, any funds received by
the Agent and the Lenders from or on behalf of the Borrower shall be applied by
the Agent and the Lenders in liquidation of the Revolving Credit Loans and the
other obligations of the Borrower under the Loan Documents in the following
manner and order: (i) first, to the payment of interest on, and then the
principal portion of, any Revolving Credit Loans which the Agent may have
advanced on behalf of any Lender for which the Agent has not then been
reimbursed by such Lender or the Borrower; (ii) second, to the payment of any
fees or expenses due the Agent from the Borrower, (iii) third, to reimburse the
Agent and the Lenders for any expenses (to the extent not paid pursuant to
clause (ii) above) due from the Borrower pursuant to the provisions of Section
11.5; (iv) fourth, to the payment of accrued Fees and all other fees, expenses
and amounts due under the Loan Documents (other than principal and interest on
the Revolving Credit Loans), (v) fifth, to the payment pro rata according to the
outstanding principal balance of the Revolving Credit Loans, of interest due on
the Revolving Credit Loans of each Lender; (vi) sixth, to the payment, pro rata
according to the outstanding principal balance of the Revolving Credit Loans, of
principal outstanding on the Loans; and (vii) seventh, to the payment of any
other amounts owing to the Agent and the Lenders under any Loan Document.
10. THE AGENT
10.1. Appointment
Each Lender hereby irrevocably designates and appoints BNY as
the Agent of such Lender under the Loan Documents and each Lender hereby
irrevocably authorizes the Agent to take such action on its behalf under the
provisions of the Loan Documents and to exercise such powers and perform such
duties as are expressly delegated to the Agent by the terms of the Loan
Documents, together with such other powers as are reasonably incidental thereto.
The duties of the Agent shall be mechanical and administrative in nature, and,
notwithstanding any provision to the contrary elsewhere in any Loan Document,
the Agent shall not have any duties or responsibilities other than those
expressly set forth therein, or any fiduciary relationship with, or fiduciary
duty to, any Lender, and no implied covenants,
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functions, responsibilities, duties, obligations or liabilities shall be read
into the Loan Documents or otherwise exist against the Agent.
10.2. Delegation of Duties
The Agent may execute any of its duties under the Loan
Documents by or through agents or attorneys-in-fact and shall be entitled to
rely upon, and shall be fully protected in, and shall not be under any liability
for, relying upon, the advice of counsel concerning all matters pertaining to
such duties.
10.3. Exculpatory Provisions
Neither the Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be (A) liable for any
action lawfully taken or omitted to be taken by it or such Person under or in
connection with the Loan Documents (except the Agent for its own gross
negligence or willful misconduct), or (B) responsible in any manner to any of
the Lenders for any recitals, statements, representations or warranties made by
the Borrower or any other Credit Party or any officer thereof contained in the
Loan Documents or in any certificate, report, statement or other document
referred to or provided for in, or received by the Agent under or in connection
with, the Loan Documents or for the value, validity, effectiveness, genuineness,
perfection, enforceability or sufficiency of any of the Loan Documents or for
any failure of the Borrower or any other Credit Party or any other Person to
perform its obligations thereunder. The Agent shall not be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, the Loan Documents, or to
inspect the Property, books or records of the Borrower or any other Credit
Party. The Lenders acknowledge that the Agent shall not be under any duty to
take any discretionary action permitted under the Loan Documents unless the
Agent shall be instructed in writing to do so by the Required Lenders and such
instructions shall be binding on all Lenders and all holders of the Revolving
Credit Notes; provided, however, that the Agent shall not be required to take
any action which exposes the Agent to personal liability or is contrary to law
or any provision of the Loan Documents. The Agent shall not be under any
liability or responsibility whatsoever, as Agent, to the Borrower or any other
Credit Party or any other Person as a consequence of any failure or delay in
performance, or any breach, by any Lender of any of its obligations under any of
the Loan Documents.
10.4. Reliance by Agent
The Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, opinion, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document or conversation reasonably
believed by it to be genuine and correct and to have been signed, sent or made
by a proper Person or Persons and upon advice and statements of legal counsel
(including counsel to
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the Borrower or any other Credit Party), independent accountants and other
experts selected by the Agent. The Agent may treat each Lender or the Person
designated in the last notice filed with it under this Section, as the holder
of all of the interests of such Lender in its Revolving Credit Loans and
Revolving Credit Note until written notice of transfer, signed by such Lender
(or the Person designated in the last notice filed with the Agent) and by the
Person designated in such written notice of transfer, in form and substance
satisfactory to the Agent, shall have been filed with the Agent. The Agent
shall not be under any duty to examine or pass upon the validity,
effectiveness, enforceability or genuineness of the Loan Documents or any
instrument, document or communication furnished pursuant thereto or in
connection therewith, and the Agent shall be entitled to assume that the same
are valid, effective and genuine, have been signed or sent by the proper
parties and are what they purport to be. The Agent shall be fully justified in
failing or refusing to take any action under the Loan Documents unless it shall
first receive such advice or concurrence of the Required Lenders as it deems
appropriate. The Agent shall in all cases be fully protected in acting, or in
refraining from acting, under the Loan Documents in accordance with a request
or direction of the Required Lenders, and such request or direction and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders and all future holders of the Revolving Credit Notes.
10.5. Notice of Default
The Agent shall not be deemed to have knowledge or notice of
the occurrence of any Default or Event of Default unless the Agent has received
written notice thereof from a Lender or the Borrower. In the event that the
Agent receives such a notice, the Agent shall promptly give notice thereof to
the Lenders and the Borrower. The Agent shall take such action, or refrain from
taking such action, with respect to such Default or Event of Default as shall be
directed by the Required Lenders, provided, however, that unless and until the
Agent shall have received such directions, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem to be in the best interests
of the Lenders.
10.6. Non-Reliance on Agent and Other Lenders
Each Lender expressly acknowledges that neither the Agent nor
any of its respective officers, directors, employees, agents, attorneys-in-fact
or affiliates has made any representations or warranties to it and that no act
by the Agent hereinafter, including any review of the affairs of the Borrower or
any other Credit Party, shall be deemed to constitute any representation or
warranty by the Agent to any Lender. Each Lender represents to the Agent that it
has, independently and without reliance upon the Agent or any Lender, and based
on such documents and information as it has deemed appropriate made its own
evaluation of and investigation into the business, operations, Property,
financial and other condition and creditworthiness of the Borrower or any other
Credit Party and the value and Lien status of any collateral security and made
its own decision to enter into this Agreement. Each Lender also
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represents that it will, independently and without reliance upon the Agent or
any Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, evaluations
and decisions in taking or not taking action under any Loan Document, and to
make such investigation as it deems necessary to inform itself as to the
business, operations, Property, financial and other condition and
creditworthiness of the Borrower or any other Credit Party and the value and
Lien status of any collateral security. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the Agent
hereunder, the Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business,
operations, Property, financial and other condition or creditworthiness of the
Borrower or any other Credit Party which at any time may come into the
possession of the Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.
10.7. Indemnification
Each Lender agrees to indemnify and hold harmless the Agent in
its capacity as such (to the extent not promptly reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), pro rata according to
the aggregate of the outstanding principal balance of the Revolving Credit Loans
(or at any time when no Revolving Credit Loans are outstanding, according to its
Commitment Percentage), from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever including any amounts paid to the Lenders
(through the Agent) by the Borrower or any other Credit Party pursuant to the
terms of the Loan Documents, that are subsequently rescinded or avoided, or must
otherwise be restored or returned) which may at any time (including at any time
following the payment of the Revolving Credit Loans and Revolving Credit Notes)
be imposed on, incurred by or asserted against the Agent in any way relating to
or arising out of the Loan Documents or any other documents contemplated by or
referred to therein or the transactions contemplated thereby or any action taken
or omitted to be taken by the Agent under or in connection with any of the
foregoing; provided, however, that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements to the extent
resulting solely from the finally adjudicated gross negligence or willful
misconduct of the Agent. Without limitation of the foregoing, each Lender agrees
to reimburse the Agent promptly upon demand for its pro rata share of any unpaid
fees owing to the Agent, and any costs and expenses (including reasonable fees
and expenses of counsel) payable by the Borrower under Section 11.5, to the
extent that the Agent has not been paid such fees or has not been reimbursed for
such costs and expenses, by the Borrower. The failure of any Lender to reimburse
the Agent promptly upon demand for its pro rata share of any amount required to
be paid by the Lenders to the Agent as provided in this Section shall not
relieve any other Lender of its obligation hereunder to reimburse the Agent for
its pro rata share of such amount, but no Lender shall be responsible for the
failure of other Lender to reimburse the Agent for such other Lender's pro rata
share of such
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amount. The agreements in this Section shall survive the termination of the
Commitments of all of the Lenders and the payment of all amounts payable under
the Loan Documents.
10.8. Agent in Its Individual Capacity
BNY and its affiliates may make secured or unsecured loans to,
accept deposits from, issue letters of credit for the account of, act as trustee
under indentures of, and generally engage in any kind of business with, the
Borrower or any other Credit Party as though BNY were not Agent hereunder and
BNY Capital Markets, Inc. did not arrange the transactions contemplated hereby.
With respect to the Commitment made or renewed by BNY and the Revolving Credit
Note issued to BNY, BNY shall have the same rights and powers under the Loan
Documents as any Lender and may exercise the same as though it were not the
Agent, and the terms "Lender" and "Lenders" shall in each case include BNY.
10.9. Successor Agent
If at any time the Agent deems it advisable, in its sole
discretion, it may submit to each of the Lenders a written notice of its
resignation as Agent under the Loan Documents, such resignation to be effective
upon the earlier of (i) the written acceptance of the duties of the Agent under
the Loan Documents by a successor Agent and (ii) on the 30th day after the date
of such notice. Upon any such resignation, the Required Lenders shall have the
right to appoint from among the Lenders a successor Agent. If no successor Agent
shall have been so appointed by the Required Lenders and accepted such
appointment in writing within 30 days after the retiring Agent's giving of
notice of resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent, which successor Agent shall be a commercial bank
organized under the laws of the United States or any State thereof and having a
combined capital, surplus, and undivided profits of at least $100,000,000. Upon
the acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent's rights, powers, privileges and duties as Agent under the Loan Documents
shall be terminated. The Borrower, the other Credit Parties and the Lenders
shall execute such documents as shall be necessary to effect such appointment.
After any retiring Agent's resignation as Agent, the provisions of the Loan
Documents shall inure to its benefit as to any actions taken or omitted to be
taken by it, and any amounts owing to it, while it was Agent under the Loan
Documents. If at any time there shall not be a duly appointed and acting Agent,
the Borrower agrees to make each payment due under the Loan Documents directly
and the Lenders entitled thereto during such time.
11. OTHER PROVISIONS
11.1. Amendments and Waivers
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With the written consent of the Required Lenders, the Agent
and the Borrower and any other appropriate Credit Party may, from time to time,
enter into written amendments, supplements or modifications of the Loan
Documents and, with the consent of the Required Lenders, the Agent on behalf of
the Lenders may execute and deliver to any such parties a written instrument
waiving or a consent to a departure from, on such terms and conditions as the
Agent may specify in such instrument, any of the requirements of the Loan
Documents or any Default or Event of Default and its consequences; provided,
however, that no such amendment, supplement, modification, waiver or consent
shall:
(a) without the consent of all of the Lenders, (i) increase
the Aggregate Commitment Amount, (ii) extend the Maturity Date, (iii)
decrease the rate, or extend the time of payment, of interest of, or
change or forgive the principal amount or extend the time of payment
of, or change the pro rata allocation of payments under, any Revolving
Credit Note, or decrease the rate, or extend the time of payment, or
change the pro rata allocation of payments in respect of the Commitment
Fee, (iv) extend the date or decrease the amount of any required
reduction of the Commitment Amount pursuant to Section 2.4(b), (v)
release all or any of the obligations of any Credit Party under the
Collateral Documents (other than in connection with (A) a Disposition
by or of any Credit Party permitted by Section 8.4, or (B) any release
specifically provided for in the Collateral Documents), (vi) release
any Collateral or any security interest therein (other than in
connection with (A) a Disposition permitted under Section 8.4, or (B)
any release specifically provided for in the Collateral Documents,
(vii) change the provisions of Sections 3.6, 3.10, 9.1(a), 9.1(b), 11.1
or 11.7(a), or (viii) change the definition of "Required Lenders";
(b) without the written consent of the Agent, amend, modify or
waive any provision of Section 10 or otherwise change any of the rights
or obligations of the Agent hereunder or under the Loan Documents; and
(c) increase or decrease a Lender's Commitment Amount without
such Lender's consent.
Any such amendment, supplement, modification or waiver shall
apply equally to the Agent and each of the Lenders and shall be binding upon the
parties to the applicable Loan Document, the Lenders, the Agent and all future
holders of the Revolving Credit Notes. In the case of any waiver, the parties to
the applicable Loan Document, the Lenders and the Agent shall be restored to
their former position and rights hereunder and under the outstanding Revolving
Credit Notes and other Loan Documents to the extent provided for in such waiver,
and any Default or Event of Default waived shall not extend to any subsequent or
other Default or Event of Default, or impair any right consequent thereon. The
Loan Documents may not be amended orally or by any course of conduct.
Notwithstanding anything to the contrary contained in any
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Loan Document, the Agent may, at any time and from time to time without the
consent of any one or more of the Lenders, (i) release all or any of the
obligations of any Credit Party under the Collateral Documents in connection
with (A) a Disposition by or of such Credit Party permitted by Section 8.4, or
(B) any release specifically provided for in the Collateral Documents, and (ii)
release any Collateral or any security interest therein in connection with (A)
any disposition of such Collateral permitted by Section 8.4, or (B) any release
specifically provided for in the Collateral Documents.
11.2. Notices
All notices, requests and demands to or upon the respective
parties to the Loan Documents to be effective shall be in writing and, unless
otherwise expressly provided therein, shall be deemed to have been duly given or
made when delivered by hand, one Business Day after having been sent by
overnight courier service, or when deposited in the mail, first-class postage
prepaid, or, in the case of notice by telecopy, when sent, addressed as follows
in the case of the Borrower or the Agent, addressed to the Domestic Lending
Office, in the case of each Lender, or addressed to such other addresses as to
which the Agent may be hereafter notified by the respective parties thereto or
any future holders of the Revolving Credit Notes:
The Borrower:
Production Resource Group, L.L.C.
000 Xxxxxx Xxxx Xxxx
Xxx Xxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx,
Chief Financial Officer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
The Agent:
The Bank of Xxx Xxxx
Xxx Xxxx Xxxxxx
Agency Function Administration
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxx,
Agency Function Administrator
Telephone: (000) 000-0000
Telecopy: (000) 000-0000 or 6366 or 6367
with a copy to:
-00-
Xxx Xxxx xx Xxx Xxxx
Xxx Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxxxx,
Assistant Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000,
except that any notice, request or demand by the Borrower to or upon the Agent
or the Lenders pursuant to Sections 2.3 or 3.3 shall not be effective until
received. Any party to a Loan Document may rely on signatures of the parties
thereto which are transmitted by telecopy or other electronic means as fully as
if originally signed.
11.3. No Waiver; Cumulative Remedies
No failure to exercise and no delay in exercising, on the part
of the Agent or any Lender, any right, remedy, power or privilege under any Loan
Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege under any Loan Document
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights, remedies, powers and privileges
under the Loan Documents are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.
11.4. Survival of Representations and Warranties and Certain
Obligations
(a) All representations and warranties made under the Loan
Documents and in any document, certificate or statement delivered pursuant
thereto or in connection therewith shall survive the execution and delivery of
the Loan Documents.
(b) The obligations of the Borrower under Sections 3.5, 3.6,
3.7, 3.8, 3.9, 3.10, 3.11, 11.5 and 11.8 shall survive the termination of the
Commitments of all of the Lenders and the payment of the Revolving Credit Loans
and all other amounts payable under the Loan Documents.
11.5. Expenses
The Borrower agrees, promptly upon presentation of a statement
or invoice therefor, and whether any Revolving Credit Loan is made (i) to pay or
reimburse the Agent and BNY Capital Markets, Inc. for all their respective
out-of-pocket costs and expenses reasonably incurred in connection with the
development, preparation, execution and syndication of, the Loan Documents and
any amendment, supplement or modification thereto (whether or not executed or
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effective), any documents prepared in connection therewith and the consummation
of the transactions contemplated thereby, including the reasonable fees and
disbursements of Special Counsel, (ii) to pay or reimburse the Agent and the
Lenders for all of their respective costs and expenses, including reasonable
fees and disbursements of counsel, incurred in connection with (A) any Default
or Event of Default and any enforcement or collection proceedings resulting
therefrom or in connection with the negotiation of any restructuring or
"work-out" (whether consummated or not) of the obligations of any Credit Party
under any of the Loan Documents and (B) the enforcement of this Section and
(iii) to pay, indemnify and hold each Lender and the Agent and each of their
respective officers, directors and employees harmless from and against any and
all other liabilities, obligations, claims, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever (including reasonable counsel fees and disbursements) with respect to
the enforcement and performance of the Loan Documents, the use of the proceeds
of the Revolving Credit Loans and the enforcement and performance of the
provisions of any subordination agreement involving the Agent and the Lenders
(all the foregoing, collectively, the "Indemnified Liabilities") and, if and to
the extent that the foregoing indemnity may be unenforceable for any reason, the
Borrower agrees to make the maximum payment not prohibited under applicable law;
provided, however, that the Borrower shall have no obligation to pay Indemnified
Liabilities to the Agent or any Lender arising from the finally adjudicated
gross negligence or willful misconduct of the Agent or such Lender or claims
between one indemnified party and another indemnified party. The agreements in
this Section shall survive the termination of the Commitments of all of the
Lenders and the payment of all amounts payable under the Loan Documents.
11.6. Lending Offices
(a) Each Lender shall have the right at any time and from time
to time to transfer its Revolving Credit Loans to a different office, provided
that such Lender shall promptly notify the Agent and the Borrower of any such
change of office. Such office shall thereupon become such Lender's Domestic
Lending Office or Eurodollar Lending Office, as the case may be, provided,
however, that no Lender shall be entitled to receive any greater amount under
Sections 3.5, 3.6, 3.7 and 3.10, as a result of a transfer of any such Revolving
Credit Loans to a different office of such Lender than it would be entitled to
immediately prior thereto unless such claim would have arisen even if such
transfer had not occurred.
(b) Each Lender agrees that, upon the occurrence of any event
giving rise to any increased cost or indemnity under Sections 3.5, 3.6, 3.7 and
3.10 with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Revolving Credit Loans affected by such
event, provided that such designation is made on such terms that such Lender and
its lending office suffer no economic, legal or regulatory disadvantage, with
the object of avoiding the consequence of the event giving rise to the operation
of any such Section.
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Nothing in this Section shall affect or postpone any of the obligations of the
Borrower or the right of any Lender provided in Sections 3.5, 3.6, 3.7 and
3.10.
11.7. Assignments and Participations
(a) The Loan Documents shall be binding upon and inure to the
benefit of the Borrower, the Lenders, the Agent, all future holders of the
Revolving Credit Notes, and their respective successors and assigns, except that
neither the Borrower nor any other Credit Party may assign, delegate or transfer
any of its rights or obligations under the Loan Documents without the prior
written consent of the Agent and each Lender.
(b) Each Lender shall have the right at any time, upon written
notice to the Agent of its intent to do so, to sell, assign, transfer or
negotiate all or any part of its rights and obligations under the Loan Documents
to one or more of its affiliates, to one or more of the other Lenders (or to
affiliates of such other Lenders) or, with the prior written consent of the
Borrower and the Agent (which consents shall not be unreasonably withheld and,
in the case of the Borrower, shall not be required upon the occurrence and
during the continuance of an Event of Default), to sell, assign, transfer or
negotiate all or any part of its rights and obligations under the Loan Documents
to any Eligible Assignee, provided that (i) each such sale, assignment, transfer
or negotiation (other than sales, assignments, transfers or negotiations (x) to
its affiliates or (y) its entire interest) shall be in a minimum amount of
$5,000,000 and (ii) there shall be paid to the Agent by it a fee (an "Assignment
Fee") of $3,500. For each assignment, the parties to such assignment shall
execute and deliver to the Agent for its acceptance and recording an Assignment
and Acceptance Agreement. Upon such execution, delivery, acceptance and
recording by the Agent, from and after the effective date specified in such
Assignment and Acceptance Agreement, the assignee thereunder shall be a party
hereto and, to the extent provided in such Assignment and Acceptance Agreement,
the assignor Lender thereunder shall be released from its obligations under the
Loan Documents. The Borrower agrees upon written request of the Agent and at the
Borrower's expense to execute and deliver (1) to such assignee, a Revolving
Credit Note, dated the effective date of such Assignment and Acceptance
Agreement, in an aggregate principal amount equal to the Revolving Credit Loans
assigned to, and Commitment assumed by, such assignee and (2) to such assignor
Lender if it did not assign its entire interest, a Revolving Credit Note, dated
the effective date of such Assignment and Acceptance Agreement, in an aggregate
principal amount equal to the balance of such assignor Lender's Commitment
Amount, if any, and each assignor Lender shall cancel and return to the Borrower
its existing Revolving Credit Note. Upon any such sale, assignment or other
transfer, the Commitment Amounts set forth in Exhibit A shall be adjusted
accordingly by the Agent and a new Exhibit A shall be distributed by the Agent.
(c) Each Lender may, with the prior written consent of the
Borrower and the Agent (which consents shall not be unreasonably withheld),
grant participations in all or any part of its rights under the Loan Documents
to one or more Eligible Assignees, provided that (i) its
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obligations under the Loan Documents shall remain unchanged, (ii) it shall
remain solely responsible to the other parties to the Loan Documents for the
performance of such obligations, (iii) the Borrower, the Agent and the Lenders,
as applicable, shall continue to deal solely and directly with it in connection
with its rights and obligations under the Loan Documents, (iv) no
sub-participations shall be permitted and (v) the voting rights of any holder
of any participation shall be limited to decisions that only do any of the
following: (A) subject the participant to any additional obligation, (B) reduce
the principal of, or interest on the Revolving Credit Notes or any fees or
other amounts payable under the Loan Documents, (C) postpone any date fixed for
the payment of principal of, or interest on the Revolving Credit Notes or any
fees or other amounts payable under the Loan Documents, (D) release any
security interest or Collateral, except to the extent that such release is
specifically provided for in any Loan Document or (E) release any guarantor
under any guarantee. The Borrower acknowledges and agrees that any such
participant shall for purposes of Sections 3.5, 3.6, 3.7, 3.8, 3.9, 3.10 and
3.11, be deemed to be a "Lender"; provided, however, the Borrower shall not, at
any time, be obligated to pay any participant in any interest of any Lender
hereunder any sum in excess of the sum which the Borrower would have been
obligated to pay to such Lender in respect of such interest had such Lender not
sold such participation.
(d) If any (i) assignment is made pursuant to subsection (b)
above or (ii) any participation is granted pursuant to subsection (c) above, to
any Person that is not a U.S. Person, such Person shall furnish such
certificates, documents or other evidence to the Borrower and the Agent in the
case of clause (i), and to the Borrower or the Lender which sold such
participation, as the case may be, in the case of clause (ii), as shall be
required by Section 3.10(e).
(e) No Lender shall, as between and among the Borrower, the
Agent and such Lender, as the case may be, be relieved of any of its obligations
under the Loan Documents as a result of any sale, assignment, transfer or
negotiation of, or granting of participations in, all or any part of its
Revolving Credit Loans, its Revolving Credit Note or its Commitment, except that
it shall be relieved of its obligations to the extent of any such sale,
assignment, transfer, or negotiation of all or any part of its Revolving Credit
Loans, its Commitment and its Revolving Credit Note pursuant to subsection (b)
above.
(f) Notwithstanding anything to the contrary contained in this
Section, any Lender may at any time or from time to time assign all or any
portion of its rights under the Loan Documents to a Federal Reserve Bank,
provided that any such assignment shall not release such assignor from its
obligations thereunder.
11.8. Indemnity
The Borrower agrees to defend, protect, indemnify, and hold
harmless the Agent, BNY Capital Markets, Inc. and each and all of the Lenders,
each of their respective Affiliates and each of the respective officers,
directors, employees and agents of each of the foregoing (each an
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"Indemnified Person" and, collectively, the "Indemnified Persons") from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses and disbursements of any
kind or nature whatsoever (including the fees and disbursements of counsel to
such Indemnified Persons in connection with any investigative, administrative
or judicial proceeding, whether direct, indirect or consequential and whether
based on any federal or state laws or other statutory regulations, including
securities and commercial laws and regulations, under common law or at
equitable cause, or on contract or otherwise, including any liabilities and
costs under Environmental Laws, Federal, state or local health or safety laws,
regulations, or common law principles, arising from or in connection with the
past, present or future operations of the Borrower, any other Credit Party, or
their respective predecessors in interest, or the past, present or future
environmental condition of the Property of the Borrower or any of its
Subsidiaries, the presence of asbestos-containing materials at any such
Property, or the release or threatened release of any Hazardous Substance into
the environment from any such Property) in any manner relating to or arising
out of the Loan Documents, any commitment letter or fee letter executed and
delivered by the Borrower or any of its Subsidiaries and/or the Agent, the
capitalization of the Borrower or any of its Subsidiaries, the Commitments, the
making of, management of and participation in the Revolving Credit Loans, or
the use or intended use of the proceeds of the Revolving Credit Loans
hereunder, provided that the Borrower shall have no obligation under this
Section to an Indemnified Person with respect to any of the foregoing to the
extent found in a final judgment of a court having jurisdiction to have
resulted primarily out of the gross negligence or wilful misconduct of such
Indemnified Person or arising solely from claims between one such Indemnified
Person and another such Indemnified Person. The indemnity set forth herein
shall be in addition to any other obligations or liabilities of the Borrower to
each Indemnified Person under the Loan Documents or at common law or otherwise,
and shall survive any termination of the Loan Documents, the expiration of the
Commitments of all of the Lenders and the payment of all Indebtedness of the
Credit Parties under the Loan Documents.
11.9. Limitation of Liability
No claim may be made by the Borrower, any of its Subsidiaries,
any other Credit Party, any Lender or other Person against the Agent, any
Lender, or any directors, officers, employees, or agents of any of them for any
special, indirect, consequential or punitive damages in respect of any claim for
breach of contract or any other theory of liability arising out of or related to
the transactions contemplated by any Loan Document, or any act, omission or
event occurring in connection therewith, and each of the Borrower, its
Subsidiaries, such other Credit Party, any such Lender or other Person hereby
waives, releases and agrees not to xxx upon any claim for any such damages,
whether or not accrued and whether or not known or suspected to exist in its
favor.
11.10. Counterparts
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Each Loan Document (other than the Revolving Credit Notes) may
be executed by one or more of the parties thereto on any number of separate
counterparts and all of said counterparts taken together shall be deemed to
constitute one and the same document. It shall not be necessary in making proof
of any Loan Document to produce or account for more than one counterpart signed
by the party to be charged. A counterpart of any Loan Document or to any
document evidencing, and of any an amendment, modification, consent or waiver to
or of any Loan Document transmitted by telecopy shall be deemed to be an
originally executed counterpart. A set of the copies of the Loan Documents
signed by all the parties thereto shall be deposited with each of the Borrower
and the Agent. Any party to a Loan Document may rely upon the signatures of any
other party thereto which are transmitted by telecopy or other electronic means
to the same extent as if originally signed.
11.11. Adjustments; Set-off
(a) If any Lender (a "Benefited Lender") shall at any time
receive any payment of all or any part of the principal of its Revolving Credit
Loans owing to such Lender, or receive any collateral in respect thereof
(whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 9.1(h) or (i), or otherwise),
in a greater proportion than any such payment to and collateral received by any
other Lender in respect of the principal of such other Lender's Revolving Credit
Loans to such other Lender, or interest thereon, such Benefited Lender shall
purchase for cash from each of the other Lenders such portion of each such other
Lender's Revolving Credit Loans, and shall provide each of such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such Benefited Lender to share the excess payment or benefits
of such collateral or proceeds ratably with each of the Lenders, provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefited Lender, such purchase shall be
rescinded, and such other Lenders shall repay to the Benefited Lender the
purchase price to the extent of such recovery, together with an amount equal to
each Lender's pro rata share (according to the proportion of (i) the amount of
each other Lender's required repayment to (ii) the total amount so recovered
from the Benefited Lender) of any interest or other amount paid or payable by
the Benefited Lender in respect of the total amount so recovered.
(b) In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence of an Event of Default and the acceleration
of the obligations owing in connection with the Loan Documents, or at any time
upon the occurrence and during the continuance of an Event of Default, under
Section 9.1(a) or (b), each Lender shall have the right, without prior notice to
the Borrower or any other Credit Party, any such notice being expressly waived
by the Borrower and each other Credit Party to the extent not prohibited by
applicable law, to set-off and apply against any indebtedness, whether matured
or unmatured, of the Borrower or such other Credit Party, as the case may be, to
such Lender any amount owing from such Lender to the Borrower or such other
Credit Party, as the case may be, at, or at any time
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after, the happening of any of the above-mentioned events. To the extent not
prohibited by applicable law, the aforesaid right of set-off may be exercised
by such Lender against the Borrower or such other Credit Party, as the case may
be, or against any trustee in bankruptcy, custodian, debtor in possession,
assignee for the benefit of creditors, receiver, or execution, judgment or
attachment creditor of the Borrower or such other Credit Party, as the case may
be, or against anyone else claiming through or against the Borrower or such
other Credit Party, as the case may be, or such trustee in bankruptcy,
custodian, debtor in possession, assignee for the benefit of creditors,
receiver, or execution, judgment or attachment creditor, notwithstanding the
fact that such right of set-off shall not have been exercised by such Lender
prior to the making, filing or issuance, or service upon such Lender of, or of
notice of, any such petition, assignment for the benefit of creditors,
appointment or application for the appointment of a receiver, or issuance of
execution, subpoena, order or warrant. Each Lender agrees promptly to notify
the Borrower and the Agent after any such set-off and application made by such
Lender, provided that the failure to give such notice shall not affect the
validity of such set-off and application.
11.12. Construction
Each party to a Loan Document represents that it has been
represented by counsel in connection with the Loan Documents and the
transactions contemplated thereby and that the principle that agreements are to
be construed against the party drafting the same shall be inapplicable.
11.13. Governing Law
The Loan Documents and the rights and obligations of the
parties thereunder shall be governed by, and construed and interpreted in
accordance with, the internal laws of the State of New York, without regard to
principles of conflict of laws, but including Section 5-1401 of the General
Obligations Law.
11.14. Headings Descriptive
Section headings have been inserted in the Loan Documents for
convenience only and shall not be construed to be a part thereof.
11.15. Severability
Every provision of the Loan Documents is intended to be
severable, and if any term or provision thereof shall be invalid, illegal or
unenforceable for any reason, the validity, legality and enforceability of the
remaining provisions thereof shall not be affected or impaired thereby, and any
invalidity, illegality or unenforceability in any jurisdiction shall not affect
the validity, legality or enforceability of any such term or provision in any
other jurisdiction.
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11.16. Integration
All exhibits to a Loan Document shall be deemed to be a part
thereof. Except for agreements between the Agent and the Borrower with respect
to certain fees, the Loan Documents embody the entire agreement and
understanding among the Borrower, the Agent and the Lenders with respect to the
subject matter thereof and supersede all prior agreements and understandings
among the Borrower, the Agent and the Lenders with respect to the subject matter
thereof.
11.17. Consent to Jurisdiction
Each party to a Loan Document hereby irrevocably submits to
the jurisdiction of any New York State or Federal court sitting in the City of
New York over any suit, action or proceeding arising out of or relating to the
Loan Documents. Each party to a Loan Document hereby irrevocably waives, to the
fullest extent permitted or not prohibited by law, any objection which it may
now or hereafter have to the laying of the venue of any such suit, action or
proceeding brought in such a court and any claim that any such suit, action or
proceeding brought in such a court has been brought in an inconvenient forum.
Each Credit Party hereby agrees that a final judgment in any such suit, action
or proceeding brought in such a court, after all appropriate appeals, shall be
conclusive and binding upon it.
11.18. Service of Process
Each party to a Loan Document hereby irrevocably consents to
the service of process in any suit, action or proceeding by sending the same by
first class mail, return receipt requested or by overnight courier service, to
the address of such party set forth in Section 11.2 of the applicable Loan
Document executed by such party. Each party to a Loan Document hereby agrees
that any such service (i) shall be deemed in every respect effective service of
process upon it in any such suit, action, or proceeding, and (ii) shall to the
fullest extent enforceable by law, be taken and held to be valid personal
service upon and personal delivery to it.
11.19. No Limitation on Service or Suit
Nothing in the Loan Documents or any modification, waiver,
consent or amendment thereto shall affect the right of the Agent or any Lender
to serve process in any manner permitted by law or limit the right of the Agent
or any Lender to bring proceedings against any Credit Party in the courts of any
jurisdiction or jurisdictions in which such Credit Party may be served.
11.20. WAIVER OF TRIAL BY JURY
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EACH OF THE AGENT, THE LENDERS AND THE CREDIT PARTIES HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH
THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREIN. FURTHER, EACH
CREDIT PARTY HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF THE AGENT OR
THE LENDERS, OR COUNSEL TO THE AGENT OR THE LENDERS, HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT THE AGENT OR THE LENDERS WOULD NOT, IN THE EVENT OF SUCH
LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION. EACH
CREDIT PARTY ACKNOWLEDGES THAT THE AGENT AND THE LENDERS HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, INTER ALIA, THE PROVISIONS OF THIS SECTION.
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IN WITNESS WHEREOF, the parties hereto have caused this Credit
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
PRODUCTION RESOURCE GROUP, L.L.C.
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
THE BANK OF NEW YORK,
Individually and as Agent
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
BANK OF SCOTLAND
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
CIBC INC.
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
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CORESTATES BANK
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
FIRST UNION NATIONAL BANK
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
IBJ XXXXXXXX BANK & TRUST COMPANY
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
KEY CORPORATE CAPITAL INC.
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
USTRUST
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
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XXXXX XXXXXX XXXX
By:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
