EXHIBIT 10.3
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CREDIT AGREEMENT
Dated as of March 31, 2001
$95,000,000 Senior Secured Credit Facility
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AMERICAN PLUMBING & MECHANICAL, INC.
as Borrower
BANK ONE, NA,
Individually, as LC Issuer and as Agent
CREDIT LYONNAIS NEW YORK BRANCH
as Documentation Agent
AND
THE LENDERS NAMED HEREIN
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS..............................................................................................1
1.01 Certain Defined Terms...........................................................................1
ARTICLE II
THE CREDITS.............................................................................................16
2.01. Commitment.....................................................................................16
2.02. Required Payments..............................................................................16
2.03. Ratable Loans..................................................................................17
2.04. Types of Advances..............................................................................17
2.05. Commitment Fee; Reductions in Aggregate Commitment.............................................17
2.06. Minimum Amount of Each Advance.................................................................17
2.07. Swing Loans....................................................................................17
2.08. Optional Principal Payments....................................................................18
2.09. Method of Selecting Types and Interest Periods for New Advances................................18
2.10. Conversion and Continuation of Outstanding Advances............................................19
2.11. Changes in Interest Rate, etc..................................................................20
2.12. Rates Applicable After Default.................................................................20
2.13. Method of Payment..............................................................................20
2.14. Noteless Agreement; Evidence of Indebtedness...................................................21
2.15. Telephonic Notices.............................................................................21
2.16. Interest Payment Dates; Interest and Fee Basis.................................................22
2.17. Notification...................................................................................22
2.18. Lending Installations..........................................................................22
2.19. Non-Receipt of Funds by the Agent..............................................................22
2.20. Facility LCs...................................................................................23
2.21. Replacement of Lender..........................................................................27
ARTICLE III
CHANGE IN CIRCUMSTANCES.................................................................................27
3.01. Yield Protection...............................................................................27
3.02. Changes in Capital Adequacy Regulations........................................................28
3.03. Availability of Types of Advances..............................................................29
3.04. Funding Indemnification........................................................................29
3.05. Taxes..........................................................................................29
3.06. Lender Statements; Survival of Indemnity.......................................................31
ARTICLE IV
CONDITIONS PRECEDENT....................................................................................31
4.01. Conditions Precedent to Effectiveness..........................................................31
4.02. Each Credit Extension..........................................................................33
(i)
ARTICLE V
REPRESENTATIONS AND WARRANTIES .........................................................................34
5.01. Existence and Standing.........................................................................34
5.02. Authorization and Validity.....................................................................34
5.03. No Conflict; Government Consent................................................................34
5.04. Financial Statements...........................................................................35
5.05. Material Adverse Change........................................................................35
5.06. Taxes..........................................................................................35
5.07. Litigation and Contingent Obligations..........................................................35
5.08. Subsidiaries...................................................................................35
5.09. ERISA..........................................................................................35
5.10. Accuracy of Information........................................................................35
5.11. Regulation U...................................................................................36
5.12. Material Agreements............................................................................36
5.13. Compliance With Laws...........................................................................36
5.14. Ownership of Properties........................................................................36
5.15. Plan Assets; Prohibited Transactions...........................................................36
5.16. Environmental Matters..........................................................................36
5.17. Investment Company Act.........................................................................37
5.18. Public Utility Holding Company Act.............................................................37
5.19. Permitted Senior Subordinated Debt.............................................................37
5.20. Solvency.......................................................................................37
5.21. General Purpose of Facility....................................................................37
ARTICLE VI
COVENANTS...............................................................................................37
6.01. Financial and Other Reporting..................................................................38
6.02. Use of Proceeds................................................................................39
6.03. Notice of Default..............................................................................39
6.04. Conduct of Business............................................................................39
6.05. Taxes..........................................................................................39
6.06. Insurance......................................................................................39
6.07. Compliance with Laws...........................................................................39
6.08. Maintenance of Properties......................................................................40
6.09. Inspection.....................................................................................40
6.10. Dividends......................................................................................40
6.11. Indebtedness...................................................................................40
6.12. Merger.........................................................................................41
6.13. Sale of Assets.................................................................................41
6.14. Investments and Acquisitions...................................................................41
6.15. Liens..........................................................................................42
6.16. Sale of Accounts...............................................................................43
6.17. Affiliates.....................................................................................43
6.18. New Subsidiaries...............................................................................43
6.19. Amendments to Material Agreements..............................................................43
6.20. Permitted Senior Subordinated Debt.............................................................43
(ii)
6.21. Sale and Leaseback Transactions and other Off-Balance Sheet Liabilities........................44
6.22. Contingent Obligations.........................................................................44
6.23. Letters of Credit..............................................................................44
6.24. No Lien Restriction............................................................................44
6.25. Financial Contracts............................................................................44
6.26. Financial Covenants............................................................................44
6.27. Capital Expenditures...........................................................................45
ARTICLE VII
DEFAULTS................................................................................................45
7.01. Misrepresentation..............................................................................45
7.02. Nonpayment of Obligations......................................................................45
7.03. Certain Covenants..............................................................................45
7.04. Other Breach...................................................................................45
7.05. Other Indebtedness.............................................................................45
7.06. Bankruptcy, Reorganization, etc................................................................46
7.07. Appointment of Receiver........................................................................46
7.08. Seizure of Property............................................................................46
7.09. Judgment.......................................................................................46
7.10. Excessive Unfunded ERISA Liabilities...........................................................47
7.11. Withdrawal Liability...........................................................................47
7.12. Reorganization of Multiemployer Plan...........................................................47
7.13. Environmental Release or Violation.............................................................47
7.14. Change of Control..............................................................................47
7.15. Unremedied Default.............................................................................47
7.16. Guaranty.......................................................................................47
7.17. Lack of Acceptable Security Interest...........................................................47
7.18. ERISA Misrepresentation........................................................................48
7.19. Breach of Rate Hedging Obligation, etc.........................................................48
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES..........................................................48
8.01. Acceleration; Facility LC Collateral Account...................................................48
8.02. Other Remedies.................................................................................49
8.03. Amendments.....................................................................................49
8.04. Preservation of Rights.........................................................................50
ARTICLE IX
GENERAL PROVISIONS......................................................................................50
9.01. Survival of Representations....................................................................50
9.02. Governmental Regulation........................................................................50
9.03. Headings.......................................................................................50
9.04. Entire Agreement...............................................................................51
9.05. Several Obligations; Benefits of this Agreement................................................51
9.06. Expenses; Indemnification......................................................................51
9.07. Numbers of Documents...........................................................................52
(iii)
9.08. Accounting.....................................................................................52
9.09.
Credit Agreement Controls......................................................................52
9.10. Severability of Provisions.....................................................................52
9.11. Nonliability of Lenders........................................................................52
9.12. Confidentiality................................................................................52
9.13. Nonreliance....................................................................................53
ARTICLE X
THE AGENT...............................................................................................53
10.01. Appointment; Nature of Relationship............................................................53
10.02. Powers.........................................................................................53
10.03. General Immunity...............................................................................53
10.04. No Responsibility for Loans, Recitals, etc.....................................................53
10.05. Action on Instructions of Lenders..............................................................54
10.06. Employment of Agents and Counsel...............................................................54
10.07. Reliance on Documents; Counsel.................................................................54
10.08. Agent's Reimbursement and Indemnification......................................................54
10.09. Notice of Default..............................................................................55
10.10. Rights as a Lender.............................................................................55
10.11. Lender Credit Decision.........................................................................55
10.12. Successor Agent................................................................................56
10.13. Agent's Fee....................................................................................56
10.14. Delegation to Affiliates.......................................................................56
10.15. Execution of Collateral Documents..............................................................56
10.16. Collateral Releases............................................................................57
10.17. Documentary Agent..............................................................................57
10.18. Highest Lawful Rate............................................................................57
10.19. Chapter 346 Inapplicable.......................................................................58
ARTICLE XI
SETOFF; RATABLE PAYMENTS................................................................................58
11.01. Setoff.........................................................................................58
11.02. Ratable Payments...............................................................................58
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS.......................................................59
12.01. Successors and Assigns.........................................................................59
12.02. Participations.................................................................................59
12.03. Assignments....................................................................................60
12.04. Dissemination of Information...................................................................61
12.05. Tax Treatment..................................................................................61
ARTICLE XIII
NOTICES.................................................................................................61
13.01. Notices........................................................................................61
13.02. Change of Address..............................................................................61
(iv)
ARTICLE XIV
COUNTERPARTS............................................................................................62
ARTICLE XV
CHOICE OF LAW; CONSENTS; WAIVER OF JURY TRIAL...........................................................62
15.01. Choice of Law..................................................................................62
15.02. Consent to Jurisdiction........................................................................62
15.03. Waiver of Jury Trial...........................................................................62
ARTICLE XVI
AMENDMENT AND RESTATEMENT...............................................................................63
16.01. Amendment and Restatement......................................................................63
SCHEDULES AND EXHIBITS
Schedule I Pricing Schedule
Schedule II Lending Installation Schedule
Schedule III Listing of Subsidiaries and Ownership
Schedule IV Schedule of Material Agreements
Schedule V Existing Exceptions to Unencumbered Title
Exhibit A Form of Note
Exhibit B Form of Borrowing Notice
Exhibit C Form of Conversion/Continuation Notice
Exhibit D Form of Compliance Certificate
Exhibit E Form of Money Transfer Instruction
Exhibit F Form of Guaranty
Exhibit G Form of Security Agreement
Exhibit H Form of Stock Pledge Agreement
Exhibit I Form of Note Pledge Agreement
Exhibit J Form of Assignment Agreement
(v)
CREDIT AGREEMENT
This Agreement, dated as of March 31, 2001, is among American Plumbing
& Mechanical, Inc., a Delaware corporation, the Lenders, Credit Lyonnais New
York Branch, as Documentation Agent, and Bank One, NA, as LC Issuer and as
Agent. The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.01 Certain Defined Terms: As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Acceptable Security Interest" means, in any Property, a Lien granted
pursuant to a Collateral Document (i) which exists in favor of the Agent for the
benefit of itself, the LC Issuer, the Lenders and, with respect to each Related
Rate Hedging Agreement that is registered with the Agent, the Rate Hedge Lender
thereon, (ii) which is valid and first priority, (iii) which secures the
Obligations, and (iv) which is (or, upon appropriate filing of the financing
statements already delivered to the Agent, will be) perfected and is enforceable
by the Agent, for the benefit of itself, the LC Issuer, the Lenders and the Rate
Hedge Lenders, if any, against the grantor thereof.
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the date hereof, by which the Borrower or
any of its Subsidiaries (i) acquires any going business or all or substantially
all of the assets of any firm, corporation or limited liability company, or
division thereof, whether through purchase of assets, merger or otherwise or
(ii) directly or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in number of
votes) of the securities of a corporation which have ordinary voting power for
the election of directors (other than securities having such power only by
reason of the happening of a contingency) or a majority (by percentage or voting
power) of the outstanding ownership interests of a partnership or limited
liability company.
"Advance" means a borrowing hereunder, (i) made by the Lenders on the
same Borrowing Date, or (ii) converted or continued by the Lenders on the same
date of conversion or continuation, consisting, in either case, of the aggregate
amount of the several Loans of the same Type and, in the case of Eurodollar
Loans, for the same Interest Period.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns ten
percent (10%) or more of any class of voting securities (or other ownership
interests) of the controlled Person or possesses, directly or indirectly, the
power to direct or cause the direction of the management or policies of the
controlled Person, whether through ownership of stock, by contract or otherwise.
"Agent" means Bank One, NA in its capacity as contractual
representative of the Lenders pursuant to Article X, and not in its individual
capacity as a Lender, and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means the aggregate of the Commitments of all
the Lenders, as reduced from time to time pursuant to the terms hereof.
"Aggregate Outstanding Credit Exposure" means, at any time, the
aggregate of the Outstanding Credit Exposure of all the Lenders.
"Agreement" means this
credit agreement, as it may be amended or
modified and in effect from time to time.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day and (ii) the sum
of the Federal Funds Effective Rate for such day plus one-half percent (1/2%)
per annum.
"Applicable Fee Rate" means, at any time, the percentage rate per annum
at which Commitment Fees are accruing on the unused portion of the Aggregate
Commitment at such time as set forth in the Pricing Schedule.
"Applicable Margin" means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Arranger" means Banc One Capital Markets, Inc., a Delaware
corporation, and its successors.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Assignment Agreement" is defined in Section 12.03.01.
"Authorized Officer" means any of the President, Chief Financial
Officer, Chief Operating Officer, Treasurer, or any Vice President of the
Borrower, acting singly.
"Available Aggregate Commitment" means, at any time, the Aggregate
Commitment then in effect minus the Aggregate Outstanding Credit Exposure at
such time.
"Bank One" means Bank One, NA in its individual capacity, and its
successors.
"Borrower" means American Plumbing & Mechanical, Inc., a Delaware
corporation, and its successors and assigns.
"Borrower Preferred Stock" means the Preferred Stock of the Borrower
issued pursuant to the Certificate of Designation.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.09.
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"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago and New York for the conduct of
substantially all of their commercial lending activities and on which dealings
in United States dollars are carried on in the London interbank market and (ii)
for all other purposes, a day (other than a Saturday or Sunday) on which banks
generally are open in Chicago for the conduct of substantially all of their
commercial lending activities.
"Capital Expenditures" means, without duplication, any expenditures for
any purchase or other acquisition of any asset which, in accordance with GAAP,
are classified as a fixed or capital asset on a consolidated balance sheet of
the Borrower and its Subsidiaries.
"Capital Stock" means all capital stock and all other shares,
partnership interests, equity interests, ownership interests, participations,
rights or other equivalents (however designated) of capital stock issued by any
entity (whether a corporation, a partnership or another entity).
"Capitalized Lease" of a Person means any lease of Property by such
Person as lessee which, in accordance with GAAP, is capitalized on a balance
sheet of such Person.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which, in accordance with
GAAP, are shown as a liability on a balance sheet of such Person.
"Cash Equivalent Investments" means (i) short-term obligations of, or
fully guaranteed by, the United States of America, (ii) commercial paper rated
A-1 or better by S&P or P-1 or better by Moody's, (iii) demand deposit accounts
maintained in the ordinary course of business, and (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000; provided in each case that
the same provides for payment of both principal and interest (and not principal
alone or interest alone) and is not subject to any contingency regarding the
payment of principal or interest.
"Certificate of Designation" means the Certificate of Designations of
Ten Percent Cumulative Redeemable Convertible Preferred Stock, Series A (Par
Value $0.01 per Share) of Borrower dated March 31, 1999.
"Change in Control" means (i) the acquisition by any Person, or two or
more Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of thirty percent (30%) or more of the outstanding shares
of voting stock of the Borrower; or (ii) individuals who, as of the date hereof,
constitute the Board of Directors of Borrower cease for any reason to constitute
at least a majority of the Board of Directors of the Borrower; provided that any
individual becoming a director of the Borrower subsequent to the date hereof
whose election, or nomination for election by the Borrower's shareholders, as
the case may be, was approved by a vote of at least a majority of the directors
then comprising the incumbent board shall be considered as though such
individual were a member of the incumbent board but excluding, for this purpose,
any such individual whose initial assumption of office occurs as a result of
either an actual or threatened election contest (as such terms are used in Rule
14a-11 of Regulation 14A promulgated under the Securities Exchange Act
3
of 1934) or other actual or threatened solicitation of proxies or consents by or
on behalf of a Person other than the Board of Directors of the Borrower; or the
consummation of any transaction the result of which is that any Person or group
beneficially owns more of the voting stock of the Borrower than is beneficially
owned, in the aggregate, by the holders on the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral Documents" means, collectively, the Security Agreements,
the Stock Pledge Agreements, the Note Pledge Agreements, assignments, financing
statements, lien consents and waivers and all other similar documents executed
by Borrower or any Pledgor granting to the Agent and the Lenders an Acceptable
Security Interest in substantially all of the personal property of the Borrower
and its Subsidiaries (including the securities and other ownership interests in
all of the Borrower's subsidiaries) as security for the Obligations.
"Commitment" means, for each Lender, the obligation of such Lender to
make Loans to, and participate in Facility LCs issued upon the application of,
the Borrower in an aggregate amount not exceeding the amount set forth opposite
its signature below or as set forth in any Assignment Agreement relating to any
assignment that has become effective pursuant to Section 12.03.02, as such
amount may be reduced from time to time by such Lender's Pro Rata Share of each
principal payment made on the Loans pursuant to clause (i) of Section 2.02, as
such amount may be further modified from time to time pursuant to the terms
hereof.
"Consolidated Capital Expenditures" means, with reference to any
period, the Capital Expenditures of the Borrower and its Subsidiaries calculated
on a consolidated basis for such period.
"Consolidated Cash Interest Expense" means, with reference to any
period, the cash interest expense of the Borrower and its Subsidiaries
calculated on a consolidated basis for such period.
"Consolidated Cash Taxes" means, with reference to any period, the
aggregate pro forma amount of income Taxes of the Borrower and its Subsidiaries
calculated on a consolidated basis for such period at an assumed tax rate of
twenty percent (20%) of Consolidated EBITDA for each such period; provided that
if from time to time the actual tax rate is significantly different from such
assumed tax rate, then either the Agent (at the direction of the Required
Lenders) or the Borrower, may request a redetermination of the assumed tax rate
and the redetermined tax rate (or if applicable, rates) shall become the assumed
tax rate for calculation purposes upon such redetermination until any future
redetermination.
"Consolidated EBITDA" means, with reference to any period, on a
trailing four fiscal quarter basis (using the historical financial results of
any other business acquired in an Acquisition, to the extent applicable, without
duplication, on a pro forma basis, consistent with SEC regulations), the sum of
Consolidated Net Income plus, to the extent deducted in determining Consolidated
Net Income, (i) Consolidated Interest Expense, (ii) provisions for taxes based
on income or revenues, (iii) depreciation, (iv) amortization, (v) other non-cash
expenses, and (vi) any extraordinary or non-recurring losses minus, to the
extent included in determining Consolidated Net Income, any
4
extraordinary or non-recurring gains, all calculated on a consolidated basis for
the Borrower and its Subsidiaries and as determined in accordance with GAAP.
"Consolidated Funded Total Debt" means at any time the aggregate dollar
amount of Consolidated Indebtedness which has actually been funded and is
outstanding at such time, whether or not such amount is due or payable at such
time.
"Consolidated Indebtedness" means at any time the Indebtedness of the
Borrower and its Subsidiaries calculated on a consolidated basis as of such
time.
"Consolidated Interest Expense" means, with reference to any period,
the interest expense of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Net Worth" means at any time the consolidated
stockholders' equity of the Borrower and its Subsidiaries calculated on a
consolidated basis as of such time and shall include the value of Borrower
Preferred Stock acquired by the Borrower pursuant to the mandatory redemption
provisions of such Borrower Preferred Stock and shall not be reduced by virtue
of any put rights on Borrower's common stock.
"Consolidated Senior Total Debt" means at any time the difference of
Consolidated Indebtedness minus the aggregate dollar amount of Permitted Senior
Subordinated Debt which has actually been funded and is outstanding at such
time.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, take-or-pay
contract or the obligations of any such Person as general partner of a
partnership with respect to the liabilities of the partnership.
"Conversion/Continuation Notice" is defined in Section 2.10.
"Controlled Group" means all members of a controlled group of
corporations or other business entities and all trades or businesses (whether or
not incorporated) under common control which, together with the Borrower or any
of its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Corporate Base Rate" means a rate per annum equal to the corporate
base rate of interest announced by Bank One from time to time, changing when and
as said corporate base rate changes.
5
"Credit Extension" means the making of any Advance, the conversion of
any Advance into, or continuation of any Advance as, a Eurodollar Advance, or
the issuance or Modification of any Facility LC.
"Credit Extension Date" means the Borrowing Date for an Advance or the
issuance date for a Facility LC.
"Default" means an event described in Article VII.
"Discretionary Capital Expenditures" means Consolidated Capital
Expenditures associated with (i) new business startups, (ii) capital spending on
land, buildings or tenant improvements, or (iii) capital spending on computer
equipment and related equipment.
"Distribution" means any direct or indirect dividend, distribution or
other payment of any kind or character (whether in cash, securities or other
Property) (i) in respect of any Permitted Senior Subordinated Debt, any Capital
Stock, any class of preferred stock or any other ownership interest or to the
holders, as such, of any Permitted Senior Subordinated Debt, any class of
Capital Stock, any class of preferred stock or any other ownership interest
(including without limitation, pursuant to a merger or consolidation) or (ii) in
consideration for or otherwise in connection with any retirement, purchase,
redemption or other acquisition of any Permitted Senior Subordinated Debt, any
Capital Stock, any preferred stock or any other ownership interest or any
options, warrants or rights to purchase or acquire any Permitted Senior
Subordinated Debt, any Capital Stock, any preferred stock or any other ownership
interest.
"EBIT" means, with reference to any period and for any Person, the net
income of such Person during such period plus, to the extent deducted from
revenues in determining net income, (i) interest expense of such Person during
such period, (ii) expense for taxes paid or accrued by such Person during such
period, and (iii) extraordinary losses of such Person during such period, minus,
to the extent included in net income, extraordinary gains of such Person during
such period.
"Eligible Institution" means (i) any Lender, (ii) a commercial bank or
other financial institution organized under the laws of the United States, or
any state thereof, and having total assets in excess of $1,000,000,000, (iii) a
commercial bank organized under the laws of any other country which is a member
of the Organization for Economic Cooperation and Development or any successor
organization, or a political subdivision of any such country, and having total
assets in excess of $1,000,000,000, (iv) the central bank of any country which
is a member of the Organization for Economic Cooperation and Development or any
successor organization and (v) any other bank or financial institutions approved
by the Agent and the Required Lenders (such approval not to be unreasonably
withheld).
"Environmental Laws" means all laws, rules, regulations, principles of
common law, codes, ordinances, orders, decrees, judgments, injunctions, notices
or binding agreements issued, promulgated, issued or entered into by any
governmental authority, relating in any way to the environment, preservation or
reclamation of natural resources, the management, release or threatened release
of any Hazardous Substance or to health and safety matters.
6
"Equity Offering" of any Person means an offering of any Capital Stock
of such Person issued or to be issued by such Person as consideration to one or
more other Persons.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which, except as otherwise
provided in Section 2.12, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for
the relevant Interest Period, the rate determined by the Agent to be the rate at
which Bank One offers to place deposits in U.S. dollars with first-class banks
in the London interbank market at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, in the approximate
amount of Bank One's relevant Eurodollar Loan and having a maturity equal to
such Interest Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.12, bears interest at the applicable Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the Applicable Margin. The Eurodollar Rate shall be rounded to the next
higher multiple of 1/16 of 1% if the rate is not such a multiple.
"Excluded Taxes" means, in the case of each Lender or applicable
Lending Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or (ii) the jurisdiction
in which the Agent's or such Lender's principal executive office or such
Lender's applicable Lending Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another
document is specifically referenced.
"Facility LC" is defined in Section 2.20.01.
"Facility LC Application" is defined in Section 2.20.03.
"Facility LC Collateral Account" is defined in Section 2.20.11.
"Facility Termination Date" means March 31, 2004 or any earlier date on
which the Aggregate Commitment is reduced to zero or otherwise terminated
pursuant to Section 2.05 or 8.01.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum 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 for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank
7
of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Financial Contract" of a Person means (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, or (ii) any agreements, devices or
arrangements providing for payments related to fluctuations of interest rates,
exchange rates, forward rates or commodity prices, including, but not limited
to, interest rate swap or exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each case
changing when and as the Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.12, bears interest at the Floating Rate.
"Floating Rate Loan" means a Loan which, except as otherwise provided
in Section 2.12, bears interest at the Floating Rate.
"GAAP" means U.S. generally accepted accounting principles and policies
as in effect from time to time, applied in a manner consistent with that used in
preparing the financial statements referred to in Section 5.04.
"Guarantor" means each presently existing or hereafter formed or
acquired, directly or indirectly owned, Subsidiary of Borrower, other than any
such Subsidiary that is deemed to not be "material" by the Required Lenders.
"Guaranty" means each guaranty executed by a Guarantor in favor of the
Agent, for the ratable benefit of the Lenders, guaranteeing or purporting to
guarantee all or any portion of the Obligations, substantially in the form of
Exhibit F, as it may be amended or otherwise modified from time to time.
"Hazardous Substances" means: (i) those substances included within any
applicable federal or state statutory or regulatory definition or listing of
"hazardous substance," "special waste," "hazardous waste," "extremely hazardous
substance," "regulated substance," "hazardous material," or "toxic substance,"
under any Environmental Law, (ii) any material, waste or substance either which
is or which contains: (A) petroleum, oil or a fraction or constituent thereof,
(B) explosives, (C) radioactive materials (including naturally occurring
radioactive materials), (D) solid wastes that post imminent and substantial
endangerment to health or the environment, (E) asbestos or asbestos- containing
material as defined by any Environmental Law, and (iii) any and all other
substances, materials, or wastes that are or become classified or regulated as
hazardous or toxic under any applicable federal, state or local law or
regulation.
8
"Highest Lawful Rate" means, on any day, the maximum nonusurious rate
of interest permitted for that day by whichever of applicable federal or Texas
law permits the higher interest rate, stated as a rate per annum. On each day,
if any, that applicable Texas law establishes the Highest Lawful Rate, the
Highest Lawful Rate shall be the "weekly ceiling" (as defined in Section 303 of
the Texas Finance Code -- the "Texas Finance Code" --, as amended) for that day.
The Lender may from time to time, as to current and future balances, implement
any other ceiling under the Texas Finance Code by notice to the Company if and
to the extent permitted by the Texas Finance Code.
"Indebtedness" of a Person means such Person's (i) obligations for
borrowed money or arising out of any extension of credit to or for the account
of such Person, including without limitation, extensions of credit in the form
of reimbursement or payment obligations of such Person relating to any
acceptance, letter of credit or similar facility issued for the account of such
Person or accepted by banks and other institutions, (ii) obligations
representing the deferred purchase price of Property or services (other than
accounts payable arising in the ordinary course of such Person's business
payable on terms customary in the trade), (iii) obligations, whether or not such
Person has assumed or become liable for the payment thereof, secured by (of for
which the holder of such obligations has any existing right, contingent or
otherwise, to be secured by) any Lien on or payable out of the proceeds or
production from any Property (equal to the fair market value of such Property if
the holder of such obligations is owed no duty, contingent or otherwise, from
and has no recourse to such Person except for the grant of such Lien) now or
hereafter owned or acquired by such Person, (iv) obligations of such Person
which are evidenced by notes, bonds, debentures, acceptances, or other
instruments, but excluding obligations arising as a result of such Person's
endorsement in the ordinary course of business of negotiable instruments in the
course of collection, (v) Capitalized Lease Obligations of such Person, and (vi)
any other obligation for borrowed money or other financial accommodation which
in accordance with GAAP would be shown as a liability on the consolidated
balance sheet of such Person.
"Interest Period" means, with respect to a Eurodollar Advance, a period
of one, two, three or six months commencing on a Business Day selected by the
Borrower pursuant to this Agreement. Such Interest Period shall end on the day
which corresponds numerically to such date one, two, three or six months
thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such
Interest Period shall end on the last Business Day of such next, second, third
or sixth succeeding month. If an Interest Period would otherwise end on a day
which is not a Business Day, such Interest Period shall end on the next
succeeding Business Day, provided, however, that if said next succeeding
Business Day falls in a new calendar month, such Interest Period shall end on
the immediately preceding Business Day.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business), extension of credit (other than accounts
receivable arising in the ordinary course of business on terms customary in the
trade) or contribution of capital by such Person; stocks, bonds, mutual funds,
partnership interests, notes, debentures or other securities owned by such
Person; any deposit accounts and certificate of deposit owned by such Person;
and structured notes, derivative financial instruments and other similar
instruments or contracts owned by such Person.
9
"IPO" of a Person means an Equity Offering through an initial public
offering by such Person of its Capital Stock which is registered under the
Securities Act of 1933, amended.
"LC Fee" is defined in Section 2.20.04.
"LC Issuer" means Bank One (or any subsidiary or affiliate of Bank One
designated by Bank One) in its capacity as issuer of Facility LCs hereunder.
"LC Obligations" means, at any time, the sum, without duplication, of
(i) the aggregate undrawn stated amount under all Facility LCs outstanding at
such time plus (ii) the aggregate unpaid amount at such time of all
Reimbursement Obligations.
"LC Payment Date" is defined in Section 2.20.05.
"Lenders" means the lending institutions listed on the signature pages
of this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent,
the office, branch, subsidiary or affiliate of such Lender or the Agent listed
on the Lending Installation Schedule or otherwise selected by such Lender or the
Agent pursuant to Section 2.18.
"Lending Installation Schedule" means the schedule of Lending
Installations attached as Schedule II.
"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement), whether or not filed, recorded or otherwise perfected under
applicable law.
"Loan" means, with respect to a Lender, such Lender's loan made
pursuant to Article II (or any conversion or continuation thereof).
"Loan Documents" means this Agreement, the Facility LC Applications,
all Notes issued pursuant to Section 2.14 (if any), the Collateral Documents,
the Guaranties and all other agreements, instruments or documents to which the
Borrower, any Guarantor or any Pledgor is a party and which are executed and
delivered from time to time in connection with this Agreement, and all
amendments, modifications, renewals, restatement, replacements or extensions
thereof in accordance with their respective terms..
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, operations, performances, condition (financial or
otherwise), or results of operations of the Borrower
10
and its Subsidiaries taken as a whole, (ii) the ability of the Borrower or any
Obligor to perform any of its obligations under the Loan Documents to which it
is a party, or (iii) the validity or enforceability of any of the Loan Documents
or, except as may be caused solely by an action or omission of such Person
constituting gross negligence, the rights or remedies of the Agent, the LC
Issuer or the Lenders thereunder.
"Material Agreements" means those agreements and contracts listed on
Schedule IV and all other agreements, instruments and other documents relating
to any Acquisition or any Permitted Senior Subordinated Debt.
"Material Indebtedness" is defined in Section 7.05.
"Modify" and "Modification" are defined in Section 2.20.01.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"Non-Hostile Acquisition" means an Acquisition by the Borrower,
directly or indirectly through one or more of its Subsidiaries, (i) if such
Acquisition is of the voting securities of a Target, then the Target is in the
same or a similar line of business as the Borrower, and such Acquisition does
not involve an actual or threatened election contest (as such terms are used in
Rule 14a-11 of Regulation 14A promulgated under the Securities Exchange Act of
1934) or other actual or threatened solicitation of proxies or consents by or on
behalf of Borrower, any Affiliate of Borrower and all Persons acting with
Borrower or such Affiliate as a group (as defined in Section 13(d) of the
Securities Exchange Act of 1934) to acquire beneficial ownership (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934) of at least twenty percent (20%) of voting
securities of the Target, and (ii) in connection with such Acquisition (1) no
Default or Unmatured Default exists, or would result (on a pro forma basis) from
such Acquisition, (2) the sum of cash consideration plus Indebtedness assumed by
the Borrower or any Affiliate of Borrower or otherwise secured by a Lien on
Property involved in such Acquisition plus the aggregate amount of cash deferred
compensation related to such Acquisition (such sum being the "Consideration")
does not exceed the lesser of (a) $3,000,000 for any single Acquisition, or (b)
together with the Consideration of all other Acquisitions made since the
beginning of the then most-recently ended four fiscal quarters, $20,000,000, and
(3) the total consideration for such Acquisition does not exceed 6.50x such
Target's adjusted EBIT for the most recent four fiscal quarters of such Target.
"Non-U.S. Lender" is defined in Section 3.05(iv).
"Note" means any promissory note issued at the request of a Lender
pursuant to Section 2.14 in the form of Exhibit A.
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"Note Pledge Agreement" means each note pledge agreement executed by a
Pledgor securing, or purporting to secure, all or any portion of the
Obligations, substantially in the form of Exhibit I, as may be amended or
otherwise modified from time to time.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans, all Reimbursement Obligations, all accrued and unpaid
fees and all expenses, reimbursements, indemnities and other obligations of the
Borrower to the Lenders or to any Lender, the Agent, the LC Issuer or any
indemnified party arising under the Loan Documents.
"Obligor" means, without duplication, the Borrower, each Guarantor,
each Pledgor and any other Affiliate of Borrower that enters into a Loan
Document from time to time for the benefit of the Agent and the Lenders.
"Off-Balance Sheet Liability" of a Person means (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability under any Sale and Leaseback
Transaction which is not a Capitalized Lease, (iii) any liability under any so-
called "synthetic lease" transaction entered into by such Person, or (iv) any
obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a
liability on the balance sheets of such Person.
"Other Taxes" is defined in Section 3.05(ii).
"Outstanding Credit Exposure" means, as to any Lender at any time, the
sum of (i) the aggregate principal amount of its Loans outstanding at such time,
plus (ii) an amount equal to its Pro Rata Share of the LC Obligations at such
time.
"Participants" is defined in Section 12.02.1.
"Payment Date" means the last day of each March, June, September and
December.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Permitted Acquisition" means each Non-Hostile Acquisition and any
other Acquisition to which the Required Lenders have given their written
consent.
"Permitted Sale and Leaseback Transactions" means Sale and leaseback
Transactions not to exceed $10,000,000 in the aggregate from and after the date
hereof (with a sublimit of $5,000,000, in the aggregate from and after the date
hereof, for real Property owned by the Borrower or any of its Subsidiaries as of
the date hereof), all of the net proceeds of which are applied to the
outstanding principal balance of the Obligations.
"Permitted Senior Subordinated Debt" means the Borrower's 11 5/8%
Senior Subordinated Notes due 2008 issued under an indenture dated May 19, 1999
in the original principal amount of $125,000,000 and with $94,995,000
outstanding as of March 31, 2001.
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"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title
IV of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability, other than a Multiemployer Plan.
"Pledgor" means each presently existing or hereafter formed or
acquired, directly or indirectly owned, Subsidiary of Borrower, other than any
such Subsidiary that the Required Lenders agree to not require to xxxxx x xxxx
to secure all or any part of the Obligations.
"Preferred Stock" means, as applied to any corporation, shares of such
corporation which shall be entitled to preference or priority over any other
shares of such corporation in respect of either the payment of dividends or the
distribution of assets upon liquidation.
"Pricing Schedule" means Schedule I attached hereto, identified as
such.
"Pro Rata Share" means, with respect to a Lender, a portion equal to a
fraction the numerator of which is such Lender's Commitment and the denominator
of which is the Aggregate Commitment.
"Property" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets owned,
leased or operated by such Person.
"Purchasers" is defined in Section 12.03.01.
"Rate Hedge Lender" means a Lender or Affiliate thereof party to one or
more Related Rate Hedging Agreements, who has registered with the Agent each
such Related Rate Hedging Agreement intended (i) to be pari passu with the
guaranty of the Obligations by the Guarantors, and (ii) to be secured by the
Lien of the Agent and the Lenders pursuant to the Collateral Documents.
"Rate Hedging Agreement" means an agreement, device or arrangement
providing for payments which are related to fluctuations of interest rates,
exchange rates or forward rates, including, but not limited to,
dollar-denominated or cross-currency interest rate exchange agreements, forward
currency exchange agreements, interest rate cap or collar protection agreements,
forward rate currency or interest rate options, puts and warrants.
"Rate Hedging Obligations" of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Hedging Agreements, and (ii) any and all cancellations, buy backs, reversals,
terminations or assignments of any Rate Hedging Agreement.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto
or other regulation or official
13
interpretation of said Board of Governors relating to reserve requirements
applicable to member banks of the Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Related Rate Hedging Agreement" means a Rate Hedging Agreement between
the Borrower and a Lender or Affiliate thereof and related to the Loans
hereunder providing for a fixed rate of interest on a notional amount, for all
such Rate Hedging Agreements, not in excess of the Aggregate Commitment.
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.
"Reports" is defined in Section 9.06.
"Required Lenders" means Lenders in the aggregate having at least sixty
percent (60%) of the Aggregate Commitment or, if the Aggregate Commitment has
been terminated, Lenders in the aggregate holding at least sixty percent (60%)
of the Aggregate Outstanding Credit Exposure.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Reimbursement Obligations" means, at any time, the aggregate of all
obligations of the Borrower then outstanding under Section 2.20 to reimburse the
LC Issuer for amounts paid by the LC Issuer in respect of any one or more
drawings under Facility LCs.
"S&P" means Standard and Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc.
"Sale and Leaseback Transaction" means any sale or other transfer of
Property by any Person with the intent to lease such Property as lessee.
"Schedule" refers to a specific schedule to this Agreement, unless
another document is specifically referenced.
"Scheduled Preferred Dividend Payments" means at any time the aggregate
dollar amount of payments that would be payable by the Borrower and its
Subsidiaries to Persons (other than the
14
Borrower or any Wholly-Owned Subsidiary of the Borrower) over the four fiscal
quarters following the most recently ended fiscal quarter of the Borrower if the
most recent preferred dividend rate(s) were to continue uninterrupted.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Security Agreement" means each security agreement executed by a
Pledgor securing, or purporting to secure, all or any portion of the
Obligations, substantially in the form of Exhibit G, as may be amended or
otherwise modified from time to time.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group solely for employees of the Borrower and/or any
member of the Controlled Group.
"Stock Pledge Agreement" means each stock pledge agreement executed by
a Pledgor securing, or purporting to secure, all or any portion of the
Obligations, substantially in the form of Exhibit H, as may be amended or
otherwise modified from time to time.
"Subsidiary" of a Person means (i) any corporation more than fifty
percent (50%) of the outstanding securities having ordinary voting power to
elect a majority of the board of directors of such corporation of which shall at
the time be owned or controlled, directly or indirectly, by such Person or by
one or more of its Subsidiaries or by such Person and one or more of its
Subsidiaries, or (ii) any partnership, limited liability company, association,
joint venture or similar business organization more than fifty percent (50%) of
the ownership interests having ordinary voting power to elect a majority of
Persons performing functions similar to those of a board of directors of a
corporation of which shall at the time be so owned or controlled, in each case
irrespective of whether or not at the time securities or other ownership
interests of any other class or classes of such corporation or such other entity
shall or might have voting power upon the occurrence of any contingency. Unless
otherwise expressly provided, all references herein to a "Subsidiary" shall mean
a Subsidiary of the Borrower.
"Swing Loan" is defined in Section 2.07.
"Target" means a Person (other than a natural person) that is the
subject of a proposed or actual Acquisition.
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes.
"Transferee" is defined in Section 12.04.
"Type" means, with respect to any Advance, its nature as a Floating
Rate Advance or a Eurodollar Advance.
15
"Unfunded Liabilities" means the amount (if any) by which the present
value of all vested and unvested accrued benefits under all Single Employer
Plans exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using PBGC actuarial assumptions for single employer plan terminations.
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, limited liability company,
association, joint venture or similar business organization one hundred percent
(100%) of the ownership interests having ordinary voting power of which shall at
the time be so owned or controlled.
ARTICLE II
THE CREDITS
2.01. Commitment. From and including the date hereof and prior to the
Facility Termination Date, each Lender severally agrees, on the terms and
conditions set forth in this Agreement, to (i) make Loans to the Borrower and
(ii) participate in Facility LCs issued upon the request of Borrower, provided
that, after giving effect to the making of each such Loan and the issuance of
each such Facility LC, such Lender's Outstanding Credit Exposure shall not
exceed its Commitment. Subject to the terms of this Agreement, the Borrower may
borrow, repay and reborrow at any time prior to the Facility Termination Date.
The Commitments to extend credit hereunder shall expire on the Facility
Termination Date. The LC Issuer will issue Facility LCs hereunder on the terms
and conditions set forth in Section 2.20.
2.02. Required Payments. The Aggregate Outstanding Credit Exposure and
all other unpaid Obligations shall be paid in full by the Borrower on the
Facility Termination Date. Notwithstanding anything to the contrary contained in
this Agreement or in any other Loan Document, if at any time the sum of the
aggregate principal amount of all Loans outstanding at such time plus the
aggregate amount of all LC Obligations at such time exceeds the Aggregate
Commitment at such time, the Borrower shall immediately prepay the principal of
the Loans in an amount at least equal to such excess. In addition to the amounts
required above, the Borrower shall make, promptly but in no event beyond five
(5) Business Days after the receipt thereof, the following mandatory principal
payments on the Loans:
(i) one hundred percent (100%) of the cash proceeds from any
claim on insurance covering any Property of Borrower or any of its
Subsidiaries with proceeds which, after deducting therefrom the amount
of such proceeds applied or to be promptly applied toward the repair or
replacement of damaged Property which was the subject of such claim, is
greater than $100,000;
16
(ii) one hundred percent (100%) of the net proceeds realized
from an Equity Offering of the Borrower and any of its Subsidiaries
(other than with respect to the issuance of preferred stock in
connection with a Permitted Acquisition) minus the amount of such
proceeds paid on the Borrower Preferred Stock.
(iii) one hundred percent (100%) of the nets proceeds received
from the issuance of any public or private debt financing by the
Borrower or any of its Subsidiaries.
2.03. Ratable Loans. Each Advance hereunder shall consist of Loans made
from the several Lenders ratably according to their Pro Rata Shares.
2.04. Types of Advances. The Advances may be Floating Rate Advances or
Eurodollar Advances, or a combination thereof, selected by the Borrower in
accordance with Sections 2.09 and 2.10; provided that no more than six (6)
Eurodollar Advances may be outstanding at any time.
2.05. Commitment Fee; Reductions in Aggregate Commitment. The Borrower
agrees to pay to the Agent for the account of each Lender, according to its Pro
Rata Share, a commitment fee at a per annum rate equal to the Applicable Fee
Rate on the average daily unused portion of the Aggregate Commitment (without
regard to any outstanding Swing Loans) from the date hereof to and including the
Facility Termination Date, which commitment fee shall be payable in arrears on
each Payment Date hereafter and on the Facility Termination Date. The Borrower
may permanently reduce the Aggregate Commitment in whole, or in part ratably
among the Lenders in integral multiples of $5,000,000, upon at least three (3)
Business Days' written notice to the Agent, which notice shall specify the
amount of any such reduction, provided, however, that the amount of the
Aggregate Commitment may not be reduced below the Aggregate Outstanding Credit
Exposure. All accrued commitment fees shall be payable on the effective date of
any termination of the obligations of the Lenders to make Credit Extensions
hereunder.
2.06. Minimum Amount of Each Advance. Each Eurodollar Advance shall be
in the minimum amount of $3,000,000 (and in multiples of $500,000 if in excess
thereof), and each Floating Rate Advance (other than a Swing Loan) shall be in
the minimum amount of $1,000,000 (and in multiples of $500,000 if in excess
thereof), provided, however, that any Floating Rate Advance may be in the amount
of the Available Aggregate Commitment. Each borrowing on a Swing Loan hereunder
shall be in an aggregate amount of not less than $100,000 and in multiples of
$100,000 if in excess thereof.
2.07. Swing Loans. (i) In addition to the Loans, Agent shall, from time
to time upon the request of the Borrower, if the applicable conditions precedent
specified in Sections 4.01 and 4.02 have been satisfied, make loans (the "Swing
Loans") to the Borrower in an aggregate amount which shall not exceed the
Available Aggregate Commitment on such Business Day; provided that the aggregate
amount of Swing Loans outstanding at any time shall not exceed $10,000,000;
provided further that the sum of aggregate amount of Swing Loans outstanding at
any time plus the Aggregate Outstanding Credit Exposure at such time shall not
exceed the Aggregate Commitment at such time. Swing Loans shall constitute
"Loans" for all purposes hereunder, except they shall be held by Agent and shall
not be considered a utilization of the Aggregate Commitment hereunder for
purposes of
17
calculating fees hereunder. Subject to the terms and conditions of this
Agreement, all Swing Loans shall be made as Floating Rate Loans and may be
borrowed, paid, or repaid and reborrowed pursuant to this Agreement and all such
Swing Loans shall be due and payable in full on the Facility Termination Date.
All Swing Loans shall bear interest based on applicable Floating Rate.
(ii) At any time before or after a Default or Unmatured Default, upon
the request of Agent or the Borrower through the Agent, each Lender other than
Agent shall be deemed, without further action by any Person, to have purchased
from Agent a participation in any one or more Swing Loans described in such
notice in an amount equal to such Lender's Pro Rata Share of such Swing Loans.
The Agent shall notify each such Lender of the amount of such participation and
such Lender will transfer to Agent on the next Business Day following such
request, in immediately available funds, the amount of its participation.
Whenever, at any time after Agent has received from any Lender such Lender's
participating interest in a Swing Loan, Agent receives from Borrower any payment
on account thereof, Agent will pay to such Lender its participating interest in
such amount (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender's participating interest was
outstanding and funded) which payment shall be subject to repayment by such
Lender if such payment received by Agent is required to be returned. Each
Lender's obligation to purchase such participating interests shall be absolute
and unconditional and shall not be affected by any circumstance, including,
without limitation, (A) any set-off, counterclaim, recoupment, defense or other
right which such Lender or any other Person may have against Agent or any other
Person for any reason whatsoever; (B) the occurrence or continuance of a Default
or an Unmatured Default or the termination of the Commitments; (C) any adverse
change in the condition (financial or otherwise) of the Borrower or any other
Person; (D) any breach of this Agreement by the Borrower or any other Lender; or
(E) any other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing. Each Swing Loan, once so participated by any
Lender, shall cease to be a Swing Loan with respect to that amount for purposes
of this Agreement but shall continue to be a Loan.
2.08. Optional Principal Payments. The Borrower may from time to time
pay, without penalty or premium, (i) all outstanding Floating Rate Advances, or
(ii) for any outstanding Floating Rate Advance (other than a Swing Loan), any
portion of such Floating Rate Advance in a minimum aggregate amount of
$1,000,000 or any integral multiple of $100,000 in excess thereof, in each case
upon prior notice to the Agent by 12:00 p.m. noon (Chicago time) one (1)
Business Day prior to the proposed prepayment. The Borrower may from time to
time pay, without penalty or premium, all or any portion of outstanding Swing
Loans, but partial payments thereon shall be in an aggregate principal amount of
at least $100,000, upon prior notice to the Agent by 12:00 p.m. noon (Chicago
time) on the same Business Day as the date of the proposed prepayment. The
Borrower may from time to time pay, subject to the payment of any funding
indemnification amounts required by Section 3.04 but without penalty or premium,
all outstanding Eurodollar Advances, upon three (3) Business Days' prior notice
to the Agent.
2.09. Method of Selecting Types and Interest Periods for New Advances.
The Borrower shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Interest Period applicable thereto from time to time;
provided, that Borrower may not select a Eurodollar Advance as the Type of
Advance if a Default or Unmatured Default is in existence on the proposed
Borrowing Date. The Borrower shall give the Agent irrevocable notice (a
"Borrowing Notice") substantially
18
in the form of Exhibit B not later than 12:00 p.m. noon (Chicago time) at least
one (1) Business Day before the Borrowing Date of each Floating Rate Advance
(other than a Swing Loan), three (3) Business Days before the Borrowing Date for
each Eurodollar Advance, and on the Borrowing Date for a Swing Loan, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest Period
applicable thereto.
Not later than 12:00 p.m. noon (Chicago time) on each Borrowing Date (other than
with respect to a Borrowing Notice for a Swing Loan), each Lender shall make
available its Loan or Loans in funds immediately available in Chicago to the
Agent at its address specified pursuant to Article XIII. Not later than 3:00
p.m. (Chicago time) on each Borrowing Date for a Swing Loan, the Agent shall
make available its Swing Loan or Swing Loans in funds immediately available in
Chicago to the Borrower. The Agent will make the funds so received from the
Lenders available to the Borrower at the Agent's aforesaid address.
2.10. Conversion and Continuation of Outstanding Advances. Floating
Rate Advances shall continue as Floating Rate Advances unless and until such
Floating Rate Advances are converted into Eurodollar Advances pursuant to this
Section 2.10 or are repaid in accordance with Section 2.08. Each Eurodollar
Advance shall continue as a Eurodollar Advance until the end of the then
applicable Interest Period therefor, at which time such Eurodollar Advance shall
be automatically converted into a Floating Rate Advance unless (x) such
Eurodollar Advance is or was repaid in accordance with Section 2.08 or (y) the
Borrower shall have given the Agent a Conversion/Continuation Notice (as defined
below) requesting that, at the end of such Interest Period, all or a portion of
the outstanding principal amount of such Eurodollar Advance continue as a
Eurodollar Advance for the same or another Interest Period. Subject to the terms
of Section 2.06, the Borrower may elect from time to time to convert all or any
part of a Floating Rate Advance into a Eurodollar Advance. The Borrower shall
give the Agent irrevocable notice (a "Conversion/Continuation Notice") in the
form of Exhibit C of each conversion of a Floating Rate Advance into a
Eurodollar Advance or continuation of a Eurodollar Advance not later than 12:00
p.m. noon (Chicago time) at least three (3) Business Days prior to the date of
the requested conversion or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation,
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued, and
(iii) the amount of such Advance which is to be converted into or
continued as a Eurodollar Advance and the duration of the
Interest Period applicable thereto;
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provided, that no Advances may be converted into or continued as a Eurodollar
Advance if a Default is in existence on or an Unmatured Default existed thirty
(30) days prior to the date of the proposed conversion or continuation, provided
further that any Advance that is converted into or continued as an Eurodollar
Advance shall not have an Interest Period greater than one month.
2.11. Changes in Interest Rate, etc. Each Floating Rate Advance shall
bear interest on the outstanding principal amount thereof, for each day from and
including the date such Advance is made or is automatically converted from a
Eurodollar Advance into a Floating Rate Advance pursuant to Section 2.10, to but
excluding the date it is paid or is converted into a Eurodollar Advance pursuant
to Section 2.10, at a rate per annum equal to the Floating Rate for such day.
Changes in the rate of interest on that portion of any Advance maintained as a
Floating Rate Advance will take effect simultaneously with each change in the
Alternate Base Rate. Each Eurodollar Advance shall bear interest on the
outstanding principal amount thereof from and including the first day of the
Interest Period applicable thereto to (but not including) the last day of such
Interest Period at the interest rate determined by the Agent as applicable to
such Eurodollar Advance based upon the Borrower's selections under Sections 2.09
and 2.10 and otherwise in accordance with the terms hereof. No Interest Period
may end after the Facility Termination Date.
2.12. Rates Applicable After Default. Notwithstanding anything to the
contrary contained in Section 2.09 or 2.10, during the continuance of a Default
or on and after the thirtieth day of a continuing Unmatured Default, no Advance
may be made as, converted into or continued as a Eurodollar Advance. During the
continuance of a Default or Unmatured Default the Required Lenders may, at their
option, by notice to the Borrower (which notice may be revoked at the option of
the Required Lenders notwithstanding any provision of Section 8.03 requiring
unanimous consent of the Lenders to changes in interest rates), declare that (i)
each outstanding Eurodollar Advance shall bear interest for the remainder of the
applicable Interest Period at the rate otherwise applicable to such Interest
Period plus two percent (2%) per annum, (ii) each Floating Rate Advance and each
Swing Loan shall bear interest at a rate per annum equal to the Floating Rate in
effect from time to time plus two percent (2%) per annum, and (iii) the LC Fee
shall be increased by two percent (2%) per annum; provided that, during the
continuance of a Default under Section 7.06 or 7.07, the interest rates set
forth in clauses (i) and (ii) above and the increase in the LC Fee set forth in
clause (iii) above shall be applicable to all Credit Extensions without any
election or action on the part of the Agent or any Lender.
2.13. Method of Payment. All payments of the Obligations hereunder
shall be made, without setoff, deduction, or counterclaim, in immediately
available funds to the Agent at the Agent's address specified pursuant to
Article XIII, or at any other Lending Installation of the Agent specified in
writing by the Agent to the Borrower, by 12:00 p.m. noon (Chicago time) on the
date when due and shall (except in the case of Reimbursement Obligations for
which the LC Issuer has not been fully indemnified by the Lenders, or as
otherwise specifically required hereunder) be applied ratably by the Agent among
the Lenders. Each payment delivered to the Agent for the account of any Lender
shall be delivered promptly by the Agent to such Lender in the same type of
funds that the Agent received at its address specified pursuant to Article XIII
or at any Lending Installation specified in a notice received by the Agent from
such Lender. The Agent is hereby authorized to charge the account of the
Borrower maintained with Bank One for each payment of principal, interest,
Reimbursement Obligations and fees as it becomes due hereunder. Each reference
20
to the Agent in this Section 2.13 shall also be deemed to refer, and shall apply
equally, to the LC Issuer, in the case of payments required to be made by the
Borrower to the LC Issuer pursuant to Section 2.20.06.
2.14. Noteless Agreement; Evidence of Indebtedness. (i) Each Lender
shall maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower to such Lender resulting from each
Loan made by such Lender from time to time, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
(ii) The Agent shall also maintain accounts in which it will record (a)
the amount of each Loan made hereunder, the Type thereof and the Interest Period
with respect thereto, (b) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder,
(c) the original stated amount of each Facility LC and the amount of LC
Obligations outstanding at any time, and (d) the amount of any sum received by
the Agent hereunder from the Borrower and each Lender's share thereof. The
Borrower's obligation on the Swing Loans shall be recorded as loans and advances
made by the Agent in accordance with its customary accounting practices. The
Agent is authorized to record advances and interest on the Swing Loans and
repayments of the Swing Loans in its books and records and the net balance
reflected in such records shall be controlling absent manifest error as to the
Borrower's indebtedness with respect to Swing Loans.
(iii) The entries maintained in the accounts maintained pursuant to
paragraphs (i) and (ii) above shall be prima facie evidence of the existence and
amounts of the Obligations therein recorded, absent manifest error; provided,
however, that the failure of the Agent or any Lender to maintain such accounts
or any error therein shall not in any manner affect the obligation of the
Borrower to repay the Obligations in accordance with their terms.
(iv) Any Lender may request that its Loans be evidenced by a promissory
note (a "Note"). In such event, the Borrower shall execute and deliver to such
Lender a Note payable to the order of such Lender. Thereafter, the Loans
evidenced by such Note and interest thereon shall at all times (including after
any assignment pursuant to Section 12.03) be represented by one or more Notes
payable to the order of the payee named therein or any assignee pursuant to
Section 12.03, except to the extent that any such Lender or assignee
subsequently returns any such Note for cancellation and requests that such Loans
once again be evidenced as described in paragraphs (i) and (ii) above.
2.15. Telephonic Notices. The Borrower hereby authorizes the Lenders
and the Agent to extend, convert or continue Advances, effect selections of
Types of Advances and to transfer funds based on telephonic notices made by any
person or persons the Agent or any Lender in good faith believes to be acting on
behalf of the Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. The Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the Agent
or any Lender, of each telephonic notice signed by an Authorized Officer. If the
written confirmation differs in any material respect from the action taken by
the Agent and the Lenders, the records of the Agent and the Lenders shall govern
absent manifest error.
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2.16. Interest Payment Dates; Interest and Fee Basis. Interest accrued
on each Floating Rate Advance shall be payable on each Payment Date, commencing
with the first such date to occur after the date hereof and at maturity.
Interest accrued on each Eurodollar Advance shall be payable on the last day of
its applicable Interest Period, on any date on which the Eurodollar Advance is
prepaid, whether by acceleration or otherwise, and at maturity. Interest accrued
on each Eurodollar Advance having an Interest Period longer than three months
shall also be payable on the last day of each three-month interval during such
Interest Period. Interest, commitment fees and LC Fees shall be calculated for
actual days elapsed on the basis of a 360-day year; provided that interest on
Floating Rate Advances shall be calculated for actual days elapsed on the basis
of a 365 days year. Interest shall be payable for the day an Advance is made but
not for the day of any payment on the amount paid if payment is received prior
to 12:00 p.m. noon (Chicago time) at the place of payment. If any payment of
principal of or interest on an Advance or Swing Loan, or any fee or other amount
payable hereunder, shall become due on a day which is not a Business Day, such
payment shall be made on the next succeeding Business Day and, in the case of a
principal payment, such extension of time shall be included in computing
interest in connection with such payment.
2.17. Notification. Promptly after receipt thereof, the Agent will
notify each Lender of the contents of each Aggregate Commitment reduction
notice, Borrowing Notice, Conversion/Continuation Notice, and repayment notice
received by it hereunder. Promptly after notice from the LC Issuer, the Agent
will notify each Lender of the contents of each request for issuance of a
Facility LC hereunder. The Agent will notify each Lender of the interest rate
applicable to each Eurodollar Advance promptly upon determination of such
interest rate and will give each Lender prompt notice of each change in the
Alternate Base Rate.
2.18. Lending Installations. Each Lender may book its Loans and its
participation in any LC Obligations and the LC Issuer may book the Facility LCs
at any Lending Installation selected by such Lender or the LC Issuer, as the
case may be, and may change its Lending Installation from time to time. All
terms of this Agreement shall apply to any such Lending Installation, and the
Loans, Facility LCs, participations in LC Obligations and any Notes issued
hereunder shall be deemed held by each Lender or the LC Issuer, as the case may
be, for the benefit of any such Lending Installation. Each Lender and the LC
Issuer may, by written notice to the Agent and the Borrower in accordance with
Article XIII, designate replacement or additional Lending Installations through
which Loans will be made by it or Facility LCs will be issued by it and for
whose account Loan payments or payments with respect to Facility LCs are to be
made.
2.19. Non-Receipt of Funds by the Agent. Unless the Borrower or a
Lender, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Agent on or before when such payment is due, the recipient of
such payment shall, on demand by the Agent, repay to the Agent the amount so
made available together with interest thereon in respect of each day during the
period commencing on the date such amount was so made available by the Agent
until the date the Agent recovers such amount at a rate per
22
annum equal to (x) in the case of payment by a Lender, the Federal Funds
Effective Rate for such day for the first Business Day and, thereafter, the
interest rate applicable to the relevant Loan or (y) in the case of payment by
the Borrower, the interest rate applicable to the relevant Loan. Nothing herein
shall be deemed to relieve any Lender or the Borrower, as the case may be, from
its obligations hereunder or to prejudice any rights any party hereto may have
against such Lender or Borrower as a result of any default by such Lender or
Borrower, respectively.
2.20. Facility LCs.
2.20.01. Issuance. The LC Issuer hereby agrees, on the terms
and conditions set forth in this Agreement, to issue standby and
commercial letters of credit (each, a "Facility LC") and to renew,
extend, increase, decrease or otherwise modify each Facility LC
("Modify," and each such action a "Modification"), from time to time
from and including the date hereof and prior to the Facility
Termination Date upon the request of the Borrower; provided that after
giving effect to each such issued or Modified Facility LC (i) the
aggregate amount of the outstanding LC Obligations shall not exceed
$10,000,000 and (ii) the Aggregate Outstanding Credit Exposure shall
not exceed the Aggregate Commitment. No Facility LC shall have an
expiry date later than the earlier of (x) the fifth Business Day prior
to the Facility Termination Date and (y) one year after its issuance.
2.20.02. Participations. Upon the issuance or Modification by
the LC Issuer of a Facility LC in accordance with this Section 2.20,
the LC Issuer shall be deemed, without further action by any party
hereto, to have unconditionally and irrevocably sold to each Lender,
and each Lender shall be deemed, without further action by any party
hereto, to have unconditionally and irrevocably purchased from the LC
Issuer, a participation in such Facility LC (and each Modification
thereof) and the related LC Obligations in proportion to its Pro Rata
Share.
2.20.03. Notice. Subject to Section 2.20.01, the Borrower
shall give the LC Issuer notice prior to 12:00 p.m. noon (Chicago time)
at least three (3) Business Days prior to the proposed date of issuance
or Modification of each Facility LC, specifying the beneficiary, the
proposed date of issuance (or Modification) and the expiry date of such
Facility LC, and describing the proposed terms of such Facility LC and
the nature of the transactions proposed to be supported thereby. Upon
receipt of such notice, the LC Issuer shall promptly notify the Agent,
and the Agent shall promptly notify each Lender, of the contents
thereof and of the amount of such Lender's participation in such
proposed Facility LC. The issuance or Modification by the LC Issuer of
any Facility LC shall, in addition to the conditions precedent set
forth in Article IV (the satisfaction of which the LC Issuer shall have
no duty to ascertain), be subject to the conditions precedent (i) that
such Facility LC shall be satisfactory to the LC Issuer and (ii) that
the Borrower shall have executed and delivered such application
agreement and/or such other instruments and agreements relating to such
Facility LC as the LC Issuer shall have requested (each, a "Facility LC
Application"). In the event of any conflict between the terms of this
Agreement and the terms of any Facility LC Application, the terms of
this Agreement shall control.
23
2.20.04. LC Fees. The Borrower shall pay to the Agent, for the
account of the Lenders ratably in accordance with their respective Pro
Rata Shares, with respect to each Facility LC, a letter of credit fee
at a per annum rate equal to the Applicable Margin for Eurodollar Loans
in effect from time to time on the average daily undrawn stated amount
under such Facility LC, such fee ("LC Fee") to be payable in arrears on
each Payment Date. The Borrower shall also pay to the LC Issuer for its
own account (x) at the time of issuance of each Facility LC, a fronting
fee in an amount to be agreed upon between the LC Issuer and the
Borrower, and (y) documentary and processing charges in connection with
the issuance or Modification of and draws under Facility LCs in
accordance with the LC Issuer's standard schedule for such charges as
in effect from time to time.
2.20.05. Administration; Reimbursement by Lenders. Upon
receipt from the beneficiary of any Facility LC of any demand for
payment under such Facility LC, the LC Issuer shall notify the Agent
and the Agent shall promptly notify the Borrower and each other Lender
as to the amount to be paid by the LC Issuer as a result of such demand
and the proposed payment date (the "LC Payment Date"). The
responsibility of the LC Issuer to the Borrower and each Lender shall
be only to determine that the documents (including each demand for
payment) delivered under each Facility LC in connection with such
presentment shall be in conformity in all material respects with such
Facility LC. The LC Issuer shall endeavor to exercise the same care in
the issuance and administration of the Facility LCs as it does with
respect to letters of credit in which no participations are granted, it
being understood that in the absence of any gross negligence or willful
misconduct by the LC Issuer, each Lender shall be unconditionally and
irrevocably liable without regard to the occurrence of any Default or
any condition precedent whatsoever, to reimburse the LC Issuer on
demand for (i) such Lender's Pro Rata Share of the amount of each
payment made by the LC Issuer under each Facility LC to the extent such
amount is not reimbursed by the Borrower pursuant to Section 2.20.06
below, plus (ii) interest on the foregoing amount to be reimbursed by
such Lender, for each day from the date of the LC Issuer's demand for
such reimbursement (or, if such demand is made after 11:00 a.m.
(Chicago time) on such date, from the next succeeding Business Day) to
the date on which such Lender pays the amount to be reimbursed by it,
at a rate of interest per annum equal to the Federal Funds Effective
Rate for the first three days and, thereafter, at a rate of interest
equal to the rate applicable to Floating Rate Advances.
2.20.06. Reimbursement by Borrower. The Borrower shall be
irrevocably and unconditionally obligated to reimburse the LC Issuer on
the applicable LC Payment Date for any amounts to be paid by the LC
Issuer upon any drawing under any Facility LC, without presentment,
demand, protest or other formalities of any kind; provided that neither
the Borrower nor any Lender shall hereby be precluded from asserting
any claim for direct (but not consequential) damages suffered by the
Borrower or such Lender to the extent, but only to the extent, caused
by (i) the willful misconduct or gross negligence of the LC Issuer in
determining whether a request presented under any Facility LC issued by
it complied with the terms of such Facility LC or (ii) the LC Issuer's
failure to pay under any Facility LC issued by it after the
presentation to it of a request strictly complying with the terms and
conditions of such Facility LC. All such amounts paid by the LC Issuer
and remaining unpaid by the Borrower shall bear interest, payable on
demand, for each day until paid at a
24
rate per annum equal to (x) the rate applicable to Floating Rate
Advances for such day if such day falls on or before the applicable LC
Payment Date and (y) the sum of two percent (2%) per annum plus the
rate applicable to Floating Rate Advances for such day if such day
falls after such LC Payment Date. The LC Issuer will pay to each Lender
ratably in accordance with its Pro Rata Share all amounts received by
it from the Borrower for application in payment, in whole or in part,
of the Reimbursement Obligation in respect of any Facility LC issued by
the LC Issuer, but only to the extent such Lender has made payment to
the LC Issuer in respect of such Facility LC pursuant to Section
2.20.05. Subject to the terms and conditions of this Agreement
(including without limitation the submission of a Borrowing Notice in
compliance with Section 2.09 and the satisfaction of the applicable
conditions precedent set forth in Article IV), the Borrower may request
an Advance hereunder for the purpose of satisfying any Reimbursement
Obligation.
2.20.07. Obligations Absolute. The Borrower's obligations
under this Section 2.20 shall be absolute and unconditional under any
and all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower may have or have had against the
LC Issuer, any Lender or any beneficiary of a Facility LC. The Borrower
further agrees with the LC Issuer and the Lenders that the LC Issuer
and the Lenders shall not be responsible for, and the Borrower's
Reimbursement Obligation in respect of any Facility LC shall not be
affected by, among other things, the validity or genuineness of
documents or of any endorsements thereon, even if such documents should
in fact prove to be in any or all respects invalid, fraudulent or
forged, or any dispute between or among the Borrower, any of its
Affiliates, the beneficiary of any Facility LC or any financing
institution or other party to whom any Facility LC may be transferred
or any claims or defenses whatsoever of the Borrower or of any of its
Affiliates against the beneficiary of any Facility LC or any such
transferee. The LC Issuer shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Facility
LC. The Borrower agrees that any action taken or omitted by the LC
Issuer or any Lender under or in connection with each Facility LC and
the related drafts and documents, if done without gross negligence or
willful misconduct, shall be binding upon the Borrower and shall not
put the LC Issuer or any Lender under any liability to the Borrower.
Nothing in this Section 2.20.07 is intended to limit the right of the
Borrower to make a claim against the LC Issuer for damages as
contemplated by the proviso to the first sentence of Section 2.20.06.
2.20.08. Actions of LC Issuer. The LC Issuer shall be entitled
to rely, and shall be fully protected in relying, upon any Facility LC,
draft, writing, resolution, notice, consent, certificate, affidavit,
letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or
Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by the LC Issuer. The LC Issuer
shall be fully justified in failing or refusing to take any action
under this Agreement unless it shall first have received such advice or
concurrence of the Required Lenders as it reasonably deems appropriate
or it shall first be indemnified to its reasonable satisfaction by the
Lenders against any and all liability and expense which may be incurred
by it by reason of taking or continuing to take any such action.
Notwithstanding any other
25
provision of this Section 2.20, the LC Issuer shall in all cases be
fully protected in acting, or in refraining from acting, under this
Agreement in accordance with a request of the Required Lenders, and
such request and any action taken or failure to act pursuant thereto
shall be binding upon the Lenders and any future holders of a
participation in any Facility LC.
2.20.09. Indemnification. The Borrower hereby agrees to
indemnify and hold harmless each Lender, the LC Issuer and the Agent,
and their respective directors, officers, agents and employees from and
against any and all claims and damages, losses, liabilities, costs or
expenses which such Lender, the LC Issuer or the Agent may incur (or
which may be claimed against such Lender, the LC Issuer or the Agent by
any Person whatsoever) by reason of or in connection with the issuance,
execution and delivery or transfer of or payment or failure to pay
under any Facility LC or any actual or proposed use of any Facility LC,
including, without limitation, any claims, damages, losses,
liabilities, costs or expenses which the LC Issuer may incur by reason
of or in connection with (i) the failure of any other Lender to fulfill
or comply with its obligations to the LC Issuer hereunder (but nothing
herein contained shall affect any rights the Borrower may have against
any defaulting Lender) or (ii) by reason of or on account of the LC
Issuer issuing any Facility LC which specifies that the term
"Beneficiary" included therein includes any successor by operation of
law of the named Beneficiary, but which Facility LC does not require
that any drawing by any such successor Beneficiary be accompanied by a
copy of a legal document, satisfactory to the LC Issuer, evidencing the
appointment of such successor Beneficiary; provided that the Borrower
shall not be required to indemnify any Lender, the LC Issuer or the
Agent for any claims, damages, losses, liabilities, costs or expenses
to the extent, but only to the extent, caused by (x) the willful
misconduct or gross negligence of the LC Issuer in determining whether
a request presented under any Facility LC complied with the terms of
such Facility LC or (y) the LC Issuer's failure to pay under any
Facility LC after the presentation to it of a request strictly
complying with the terms and conditions of such Facility LC. Nothing in
this Section 2.20.09 is intended to limit the obligations of the
Borrower under any other provision of this Agreement.
2.20.10. Lenders' Indemnification. Each Lender shall, ratably
in accordance with its Pro Rata Share, indemnify the LC Issuer, its
affiliates and their respective directors, officers, agents and
employees (to the extent not reimbursed by the Borrower) against any
cost, expense (including reasonable counsel fees and disbursements),
claim, demand, action, loss or liability (except such as result from
such indemnitees' gross negligence or willful misconduct or the LC
Issuer's failure to pay under any Facility LC after the presentation to
it of a request strictly complying with the terms and conditions of the
Facility LC) that such indemnitees may suffer or incur in connection
with this Section 2.20 or any action taken or omitted by such
indemnitees hereunder.
2.20.11. Facility LC Collateral Account. The Borrower agrees
that it will, upon the request of the Agent or the Required Lenders and
until the final expiration date of any Facility LC and thereafter as
long as any amount is payable to the LC Issuer or the Lenders in
respect of any Facility LC, maintain a special collateral account
pursuant to arrangements satisfactory to the Agent (the "Facility LC
Collateral Account") at the Agent's office at the address specified
pursuant to Article XIII, in the name of such Borrower but under the
sole
26
dominion and control of the Agent, for the benefit of the Lenders and
in which such Borrower shall have no interest other than as set forth
in Section 8.01. The Borrower hereby pledges, assigns and grants to the
Agent, on behalf of and for the ratable benefit of the Lenders and the
LC Issuer, a security interest in all of the Borrower's right, title
and interest in and to all funds which may from time to time be on
deposit in the Facility LC Collateral Account to secure the prompt and
complete payment and performance of the Obligations. The Agent will
invest any funds on deposit from time to time in the Facility LC
Collateral Account in certificates of deposit of Bank One having a
maturity not exceeding 30 days. Nothing in this Section 2.20.11 shall
either obligate the Agent to require the Borrower to deposit any funds
in the Facility LC Collateral Account or limit the right of the Agent
to release any funds held in the Facility LC Collateral Account in each
case other than as required by Section 8.01.
2.20.12. Rights as a Lender. In its capacity as a Lender, the
LC Issuer shall have the same rights and obligations as any other
Lender.
2.21. Replacement of Lender. If the Borrower is required pursuant to
Section 3.01, 3.02 or 3.05 to make any additional payment to any Lender or if
any Lender's obligation to make or continue, or to convert Floating Rate
Advances into, Eurodollar Advances shall be suspended pursuant to Section 3.03
(any Lender so affected an "Affected Lender"), the Borrower may elect, if such
amounts have been paid within ninety days of such election or continue to be
charged or such suspension is still effective, to replace such Affected Lender
as a Lender party to this Agreement; provided that no Default or Unmatured
Default shall have occurred and be continuing at the time of such replacement;
and provided further that, concurrently with such replacement, (i) another bank
or other entity which is reasonably satisfactory to the Borrower and the Agent
shall agree, as of such date, to purchase for cash the Advances and other
Obligations due to the Affected Lender pursuant to an Assignment Agreement and
to become a Lender for all purposes under this Agreement and to assume all
obligations of the Affected Lender to be terminated as of such date and to
comply with the requirements of Section 12.03 applicable to assignments, and
(ii) the Borrower shall pay to such Affected Lender in same day funds on the day
of such replacement all interest, fees and other amounts then accrued but unpaid
to such Affected Lender by the Borrower hereunder to and including the date of
termination, including without limitation payments due to such Affected Lender
under Sections 3.01, 3.02, 3.04 and 3.05. Nothing herein shall be deemed to
relieve any Lender or the Borrower, as the case may be, from its obligations
hereunder or to prejudice any rights any party hereto may have against such
Lender or Borrower as a result of any default by such Lender or Borrower,
respectively.
ARTICLE III
CHANGE IN CIRCUMSTANCES
3.01. Yield Protection. On or after the date hereof, if the adoption of
any law or any governmental or quasi-governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law), or any change
after the date hereof in the interpretation or administration thereof by any
governmental or quasi-governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or after the date
hereof compliance by any
27
Lender or applicable Lending Installation or the LC Issuer with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency:
(i) subjects any Lender or any applicable Lending Installation or
the LC Issuer to any Taxes, or changes the basis of taxation
of payments (other than with respect to Excluded Taxes) to any
Lender or the LC Issuer in respect of its Eurodollar Loans,
Facility LCs or participations therein, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender or any
applicable Lending Installation or the LC Issuer (other than
reserves and assessments taken into account in determining the
interest rate applicable to Eurodollar Advances), or
(iii) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Installation
or the LC Issuer of making, funding or maintaining its
Eurodollar Loans, or of issuing or participating in Facility
LCs or reduces any amount receivable by any Lender or any
applicable Lending Installation or the LC Issuer in connection
with its Eurodollar Loans, Facility LCs or participations
therein, or requires any Lender or any applicable Lending
Installation or the LC Issuer to make any payment calculated
by reference to the amount of Eurodollar Loans, Facility LCs
or participations therein held or interest or LC Fees received
by it, by an amount deemed material by such Lender or the LC
Issuer, as the case may be;
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation or the LC Issuer, as the case may be, of making
or maintaining its Eurodollar Loans or Commitment, or of issuing or
participating in Facility LCs or to reduce the return received by such Lender or
applicable Lending Installation or the LC Issuer, as the case may be, in
connection with such Eurodollar Loans, Commitment, Facility LCs or
participations therein, then, within five (5) Business Days of demand by such
Lender or the LC Issuer, the Borrower shall pay such Lender or LC Issuer, as the
case may be, such additional amount or amounts as will compensate such Lender or
the LC Issuer, for such increased cost or reduction in amount received. A
certificate of the Lender (i) stating that the compensation sought to be
recovered hereunder is generally being charged to other customers of such Lender
and (ii) setting forth in reasonable detail such amount or amounts as shall be
necessary to compensate to such Letter for any of the foregoing, shall be
conclusive absent manifest error. The Borrower shall not be obligated to pay
reimbursement compensation to any Lender for additional costs under this Section
3.01 incurred or accrued more than two hundred seventy (270) days prior to the
date that such Lender or the Agent notifies the Borrower thereof.
3.02. Changes in Capital Adequacy Regulations. If a Lender or the LC
Issuer determines the amount of capital required or expected to be maintained by
such Lender or the LC Issuer, any Lending Installation of such Lender or the LC
Issuer or any corporation controlling such Lender or the LC Issuer is increased
as a result of a Change (defined below), then, within five (5) Business Days of
demand by such Lender or the LC Issuer, the Borrower shall pay such Lender or
the LC Issuer the amount necessary to compensate for any shortfall in the rate
of return on the portion
28
of such increased capital which such Lender or the LC Issuer determines is
attributable to this Agreement, its Outstanding Credit Exposure or its
Commitment to make Loans and issue or participate in Facility LCs, as the case
may be, hereunder (after taking into account such Lender's or the LC Issuer's
policies as to capital adequacy). A certificate of the Lender (i) stating that
the compensation sought to be recovered hereunder is generally being charged to
other customers of such Lender and (ii) setting forth in reasonable detail such
amount or amounts as shall be necessary to compensate to such Letter for such
Change, shall be conclusive absent manifest error. The Borrower shall not be
obligated to pay reimbursement compensation to any Lender for additional costs
under this Section 3.02 incurred or accrued more than two hundred seventy (270)
days prior to the date that such Lender or the Agent notifies the Borrower
thereof. "Change" means (i) any change after the date hereof in the Risk-Based
Capital Guidelines (defined below) or (ii) any adoption of or change in any
other law, governmental or quasi-governmental rule, regulation, policy,
guideline, interpretation, or directive (whether or not having the force of law)
after the date hereof which affects the amount of capital required or expected
to be maintained by any Lender or the LC Issuer or any Lending Installation or
any corporation controlling any Lender or the LC Issuer. "Risk-Based Capital
Guidelines" means (i) the risk-based capital guidelines in effect in the United
States on the date hereof, including transition rules, and (ii) the
corresponding capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled "International Convergence
of Capital Measurements and Capital Standards," including transition rules, and
any amendments to such regulations adopted prior to the date hereof.
3.03. Availability of Types of Advances. If any Lender determines that
maintenance of its Eurodollar Loans at a suitable Lending Installation would
violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Advances are not
available or (ii) the interest rate applicable to Eurodollar Advances does not
accurately reflect the cost of making or maintaining Eurodollar Advances, then
the Agent shall suspend the availability of Eurodollar Advances and require any
affected Eurodollar Advances to be repaid or converted to Floating Rate
Advances, subject to the payment of any funding indemnification amounts required
by Section 3.04.
3.04. Funding Indemnification. If any payment of a Eurodollar Advance
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss in the nature of breakage costs, expense or cost incurred by it resulting
therefrom, including, without limitation, any loss, expense or cost in
liquidating or employing deposits acquired to fund or maintain such Eurodollar
Advance.
3.05. Taxes. (i) All payments by the Borrower to or for the account of
any Lender, the LC Issuer or the Agent hereunder or under any Note or Facility
LC Application shall be made free and clear of and without deduction for any and
all Taxes. If the Borrower shall be required by law to deduct any Taxes from or
in respect of any sum payable hereunder to any Lender, the LC Issuer or the
Agent, (a) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section 3.05) such
29
Lender or the Agent (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (b) the Borrower shall
make such deductions, (c) the Borrower shall pay the full amount deducted to the
relevant authority in accordance with applicable law and (d) the Borrower shall
furnish to the Agent the original copy of a receipt evidencing payment thereof
within 30 days after such payment is made.
(ii) In addition, the Borrower hereby agrees to pay any present or
future stamp or documentary taxes and any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or under
any Note or Facility LC Application, or from the execution or delivery of, or
otherwise with respect to, this Agreement or any Note or Facility LC Application
("Other Taxes").
(iii) The Borrower hereby agrees to indemnify the Agent, the LC Issuer
and each Lender for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed on amounts payable under this
Section 3.05) paid by the Agent, the LC Issuer or such Lender and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto. Payments due under this indemnification shall be made within 30 days of
the date the Agent, the LC Issuer or such Lender makes demand therefor pursuant
to Section 3.06.
(iv) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof (each a "Non-U.S. Lender") agrees that it
will, not less than ten (10) Business Days after the date hereof, (i) deliver to
each of the Borrower and the Agent two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, certifying in either case that such
Lender is entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes, and (ii) deliver to each
of the Borrower and the Agent a United States Internal Revenue Form W-8 or W-9,
as the case may be, and certify that it is entitled to an exemption from United
States backup withholding tax. Each Non-U.S. Lender further undertakes to
deliver to each of the Borrower and the Agent (x) renewals or additional copies
of such form (or any successor form) on or before the date that such form
expires or becomes obsolete, and (y) after the occurrence of any event requiring
a change in the most recent forms so delivered by it, such additional forms or
amendments thereto as may be reasonably requested by the Borrower or the Agent.
All forms or amendments described in the preceding sentence shall certify that
such Lender is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes, unless an
event (including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form or amendment with
respect to it and such Lender advises the Borrower and the Agent that it is not
capable of receiving payments without any deduction or withholding of United
States federal income tax.
(v) For any period during which a Non-U.S. Lender has failed to provide
the Borrower with an appropriate form pursuant to clause (iv), above (unless
such failure is due to a change in treaty, law or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
occurring subsequent to the date on which a form originally was required to be
provided), such Non-U.S. Lender shall not be entitled to indemnification under
this Section 3.05 with respect to Taxes imposed by the United States; provided
that, should a Non-U.S. Lender which is otherwise
30
exempt from or subject to a reduced rate of withholding tax become subject to
Taxes because of its failure to deliver a form required under clause (iv),
above, the Borrower shall take such steps as such Non-U.S. Lender shall
reasonably request to assist such Non-U.S. Lender to recover such Taxes.
(vi) Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any Note
pursuant to the law of any relevant jurisdiction or any treaty shall deliver to
the Borrower (with a copy to the Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law as will permit such payments to be made without withholding or at
a reduced rate.
(vii) If the U.S. Internal Revenue Service or any other governmental
authority of the United States or any other country or any political subdivision
thereof asserts a claim that the Agent did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form
was not delivered or properly completed, because such Lender failed to notify
the Agent of a change in circumstances which rendered its exemption from
withholding ineffective, or for any other reason), such Lender shall indemnify
the Agent fully for all amounts paid, directly or indirectly, by the Agent as
tax, withholding therefor, or otherwise, including penalties and interest, and
including taxes imposed by any jurisdiction on amounts payable to the Agent
under this subsection, together with all costs and expenses related thereto
(including attorneys fees and time charges of attorneys for the Agent, which
attorneys may be employees of the Agent). The obligations of the Lenders under
this Section 3.05(vii) shall survive the payment of the Obligations and
termination of this Agreement.
3.06. Lender Statements; Survival of Indemnity. To the extent
reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its Eurodollar Loans to reduce any liability of the
Borrower to such Lender under Sections 3.01, 3.02 and 3.05 or to avoid the
unavailability of Eurodollar Advances under Section 3.03, so long as such
designation is not, in the judgment of such Lender, disadvantageous to such
Lender. Each Lender shall deliver a written statement of such Lender to the
Borrower (with a copy to the Agent) as to the amount due, if any, under Section
3.01, 3.02, 3.04 or 3.05. Such written statement shall set forth in reasonable
detail the calculations upon which such Lender determined such amount and shall
be final, conclusive and binding on the Borrower in the absence of manifest
error. Determination of amounts payable under such Sections in connection with a
Eurodollar Loan shall be calculated as though each Lender funded its Eurodollar
Loan through the purchase of a deposit of the type and maturity corresponding to
the deposit used as a reference in determining the Eurodollar Rate applicable to
such Loan, whether in fact that is the case or not. Unless otherwise provided
herein, the amount specified in the written statement of any Lender shall be
payable on demand after receipt by the Borrower of such written statement. The
obligations of the Borrower under Sections 3.01, 3.02, 3.04 and 3.05 shall
survive payment of the Obligations and termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT
4.01. Conditions Precedent to Effectiveness. The obligations of each
Lender under this Agreement are subject to the conditions that the Borrower has
furnished to the Agent with sufficient copies for the Lenders, each in form and
substance satisfactory to the Agent, the following:
31
(i) This Agreement duly executed by the Borrower, the Lenders and
the Agent.
(ii) The Notes requested by the Lenders pursuant to Section 2.14,
each payable to the order of one such requesting Lender.
(iii) The Guaranties.
(iv) The Security Agreements.
(v) The Stock Pledge Agreements, in each case together with the
stock certificates and instruments described in the schedules
thereto endorsed in blank (or in the case of stock
certificates, accompanied by appropriate stock powers).
(vi) The Note Pledge Agreements, together with the intercompany
promissory notes and other instruments described in the
schedules thereto, in each case duly endorsed to the order of
the Agent.
(vii) Copies of the certificate of incorporation of the Borrower,
together with all amendments, and certificates of existence
and good standing, each certified by the appropriate
governmental officer in its jurisdiction of incorporation.
(viii) A certificate of the Secretary of the Borrower certifying (a)
copies of the resolutions of the Board of Directors of the
Borrower approving this Agreement, the Notes, the Collateral
Documents of the Borrower and the other Loan Documents of the
Borrower and of all documents evidencing other necessary
corporate action and governmental approvals, if any, with
respect to the foregoing; and (b) that attached thereto are
true and complete copies of the by-laws of the Borrower.
(ix) An incumbency certificate, executed by the Secretary of the
Borrower, which shall identify by name and title and bear the
signatures of Authorized Officers and any other officers of
the Borrower authorized to sign the Loan Documents to which
the Borrower is a party, upon which certificate the Agent and
the Lenders shall be entitled to rely until informed of any
change in writing by the Borrower.
(x) Copies of the articles or certificate of incorporation of each
Obligor (other than the Borrower), together with all
amendments, and certificates of existence and good standing,
each certified by the appropriate governmental officer in its
jurisdiction of incorporation.
(xi) A certificate of the Secretary of each Obligor (other than the
Borrower) certifying (a) copies of the resolutions of the
Board of Directors or such Obligor approving the Loan
Documents of such Obligor and of all documents evidencing
other necessary corporate action and governmental approvals,
if any, with respect to the foregoing; and (b) that attached
thereto are true and complete copies of the by-laws of such
Obligor.
32
(xii) An incumbency certificate for each Obligor (other than the
Borrower), executed by the Secretary of such Obligor, which
shall identify by name and title and bear the signatures of
officers of such Obligor authorized to sign the Loan Documents
to which such Obligor is a party, upon which certificate the
Agent and the Lenders shall be entitled to rely until informed
of any change in writing by such Obligor.
(xiii) A certificate, signed by the chief financial officer of the
Borrower, (a) stating that no Default or Unmatured Default has
occurred and is continuing, and (b) indicating that after
giving effect to this Agreement and the other Loan Documents,
the Borrower and each Obligor is solvent and is able to pay
its debts and liabilities as they become due and will not be
left with unreasonably small capital with which to engage in
its respective business.
(xiv) A written opinion of in-house counsel to the Borrower and the
other Obligors, addressed to the Agent and the Lenders in form
and substance reasonably satisfactory to the Agent and the
Lenders.
(xv) Written money transfer instructions, in substantially the form
of Exhibit E, addressed to the Agent and signed by an
Authorized Officer, together with such other related money
transfer authorizations as the Agent may have reasonably
requested.
(xvi) An insurance binder evidencing appropriate liability and
casualty insurance for each Obligor.
(xvii) Evidence of payment of fees owing to the Lenders, including
payment of an amendment fee to each Lender in an amount equal
to 0.50% times the Commitment of such Lender.
(xviii) Such other documents as any Lender or its counsel may
reasonably request.
4.02. Each Credit Extension. The obligation of each Lender or the LC
Issuer to make any Credit Extension hereunder is subject to the further
condition precedent that upon the effectiveness of the proposed Credit
Extension, the following statements shall be true and correct:
(i) There exists no Default or Unmatured Default, and no Default or
Unmatured Default would result from the proposed Credit Extension or the
application of proceeds therefrom.
(ii) The representations and warranties contained in Article V are true
and correct as of such Credit Extension Date except to the extent any such
representation or warranty is stated to relate solely to an earlier date, in
which case such representation or warranty shall have been true and correct on
and as of such earlier date.
Each Borrowing Notice, Conversion/Continuation Notice, or request for
the issuance or Modification of a Facility LC with respect to each such Credit
Extension shall constitute a representation and warranty by the Borrower that
the conditions contained in Sections 4.02(i) and 4.02(ii) will have been
satisfied as of the applicable Credit Extension Date.
33
ARTICLE V
REPRESENTATIONS AND WARRANTIES
In order to induce the Agent and the Lenders to enter into this
Agreement and to make the Advances provided for herein, the Borrower for itself
and each of its Subsidiaries, on or as of the occurrence of each Credit
Extension (except to the extent such representation or warranty expressly relate
to an earlier date), represents and warrants to the Agent and the Lenders that:
5.01. Existence and Standing. Each of the Borrower and its Subsidiaries
is a corporation, partnership (in the case of Subsidiaries only) or limited
liability company duly and properly incorporated or organized, as the case may
be, validly existing and (to the extent such concept applies to such entity) in
good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite authority to conduct its business in each
jurisdiction in which its business is conducted.
5.02. Authorization and Validity. Each Obligor has the power and
authority and legal right to execute and deliver the Loan Documents to which it
is a party and to perform its obligations thereunder. The execution and delivery
by each Obligor of the Loan Documents to which it is a party and the performance
of its obligations thereunder have been duly authorized by proper corporate
proceedings, and the Loan Documents to which each Obligor is a party constitute
legal, valid and binding obligations of such Obligor enforceable against such
Obligor in accordance with their terms, except as enforceability may be limited
by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally.
5.03. No Conflict; Government Consent. Neither the execution and
delivery by any Obligor of the Loan Documents to which it is a party, nor the
consummation of the transactions therein contemplated, nor compliance with the
provisions thereof will violate (i) any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on the Borrower or any of its
Subsidiaries or (ii) the Borrower's or any Subsidiary's articles or certificate
of incorporation, partnership agreement, certificate of partnership, articles or
certificate of organization, by-laws, or operating or other management
agreement, as the case may be, or (iii) the provisions of any indenture,
instrument or agreement to which the Borrower or any of its Subsidiaries is a
party or is subject, or by which it, or its Property, is bound, or conflict with
or constitute a default thereunder, or result in, or require, the creation or
imposition of any Lien in, of or on the Property of the Borrower or any of its
Subsidiaries pursuant to the terms of any such indenture, instrument or
agreement. No order, consent, adjudication, approval, license, authorization, or
validation of, or filing, recording or registration with, or exemption by, or
other action in respect of any governmental or public body or authority, or any
subdivision thereof, which has not been obtained by the Borrower or any of its
Subsidiaries, is required to be obtained by the Borrower or any of its
Subsidiaries in connection with the execution and delivery of the Loan
Documents, the borrowings under this Agreement, the payment and performance by
the Borrower of the Obligations or the legality, validity, binding effect or
enforceability of any of the Loan Documents.
5.04. Financial Statements. The consolidated financial statements of
the Borrower and its Subsidiaries heretofore delivered to the Lenders were
prepared in accordance with generally accepted
34
accounting principles in effect on the date such statements were prepared and
fairly present the consolidated financial condition and operations of the
Borrower and its Subsidiaries at such date and the consolidated results of their
operations for the period then ended.
5.05. Material Adverse Change. Since December 31, 2000 there has been
no change in the business, Property, operations, performance, condition
(financial or otherwise) or results of operations of the Borrower and its
Subsidiaries which could have a Material Adverse Effect.
5.06. Taxes. The Borrower and its Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to be
filed and have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries, except such
taxes, if any, as are being contested in good faith and as to which adequate
reserves have been provided in accordance with GAAP and as to which no Lien
exists. No tax liens have been filed and no claims are being asserted with
respect to any such taxes. The charges, accruals and reserves on the books of
the Borrower and its Subsidiaries in respect of any taxes or other governmental
charges are adequate. If any Subsidiary of the Borrower is a limited liability
company, each such limited liability company qualifies for partnership tax
treatment under United States federal tax law.
5.07. Litigation and Contingent Obligations. There is no litigation,
arbitration, governmental investigation, proceeding or inquiry pending or, to
the knowledge of any of their officers, threatened against or affecting the
Borrower or any of its Subsidiaries which could have a Material Adverse Effect
or which seeks to prevent, enjoin or delay the making of any Credit Extension.
Other than any liability incident to any litigation, arbitration or proceeding
which could not have a Material Adverse Effect, the Borrower and its
Subsidiaries have no material contingent obligations not provided for or
disclosed in the financial statements referred to in Section 5.04.
5.08. Subsidiaries. Schedule III contains an accurate list of all
Subsidiaries of the Borrower as of the date hereof, setting forth their
respective jurisdictions of organization and the percentage of their respective
capital stock or other ownership interests owned by the Borrower or other
Subsidiaries. All of the issued and outstanding shares of capital stock or other
ownership interests of such Subsidiaries have been (to the extent such concepts
are relevant with respect to such ownership interests) duly authorized and
issued and are fully paid and non-assessable.
5.09. ERISA. To the extent that none of the following could have a
Material Adverse Effect, (i) the Unfunded Liabilities of all Single Employer
Plans neither in the aggregate exceed $1,000,000 nor could have a Material
Adverse Effect; (ii) neither the Borrower nor any other member of the Controlled
Group has incurred, or is expected to incur, any withdrawal liability to
Multiemployer Plans either in excess of $1,000,000 in the aggregate or which
could have a Material Adverse Effect; (iii) each Plan complies in all material
respects with all applicable requirements of law and regulations, no Reportable
Event has occurred with respect to any Plan, neither the Borrower nor any other
member of the Controlled Group has withdrawn from any Plan or initiated steps to
do so, and no steps have been taken to reorganize or terminate any Plan.
5.10. Accuracy of Information. No information, exhibit or report
furnished by the Borrower or any of its Subsidiaries to the Agent or to any
Lender in connection with the negotiation
35
of, or compliance with, the Loan Documents contained any material misstatement
of fact or omitted to state a material fact or any fact necessary to make the
statements contained therein, together with all exhibits, reports and other
information furnished by the Borrower and its Subsidiaries to the Agent and the
Lenders, taken as a whole, not misleading.
5.11. Regulation U. Margin stock (as defined in Regulation U)
constitutes less than twenty-five percent (25%) of the value of those assets of
the Borrower and its Subsidiaries which are subject to any limitation on sale,
pledge, or other restriction hereunder.
5.12. Material Agreements. Neither the Borrower nor any Subsidiary is a
party to any agreement or instrument or subject to any charter or other
corporate restriction which could have a Material Adverse Effect. Neither the
Borrower nor any Subsidiary is in default in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in (i)
any agreement to which it is a party, which default could have a Material
Adverse Effect or (ii) any one or more agreements or instruments evidencing or
governing Material Indebtedness.
5.13. Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property except for any failure
to comply with any of the foregoing which could not have a Material Adverse
Effect.
5.14. Ownership of Properties. Except as set forth on Schedule V, on
the date hereof, the Borrower and its Subsidiaries will have good title, free of
all Liens other than those permitted by Section 6.15, to all of the Property and
assets reflected in the Borrower's most recent consolidated financial statements
provided to the Agent as owned by the Borrower and its Subsidiaries.
5.15. Plan Assets; Prohibited Transactions. The Borrower is not an
entity deemed to hold "plan assets" within the meaning of 29 C.F.R. Section
2510.3-101 of an employee benefit plan (as defined in Section 3(3) of ERISA)
which is subject to Title I of ERISA or any plan (within the meaning of Section
4975 of the Code), and neither the execution of this Agreement nor the making of
any Credit Extension hereunder gives rise to a prohibited transaction within the
meaning of Section 406 of ERISA or Section 4975 of the Code.
5.16. Environmental Matters. In the ordinary course of its business,
the officers of the Borrower consider the effect of Environmental Laws on the
business of the Borrower and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Borrower
due to Environmental Laws. On the basis of this consideration, the Borrower has
concluded that Environmental Laws do not have a Material Adverse Effect. Neither
the Borrower nor any Subsidiary has received any notice to the effect that its
operations are not in compliance with any of the requirements of applicable
Environmental Laws or are the subject of any federal or state investigation
evaluating whether any remedial action is needed to respond to a release of any
toxic or Hazardous Substance into the environment, which non-compliance or
remedial action could have a Material Adverse Effect.
36
5.17. Investment Company Act. Neither the Borrower nor any Subsidiary
is an "investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
5.18. Public Utility Holding Company Act. Neither the Borrower nor any
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.19. Permitted Senior Subordinated Debt. The Obligations constitute
senior indebtedness which is entitled to the benefits of the subordination
provisions of all outstanding Permitted Senior Subordinated Debt.
5.20. Solvency. (i) As of the date hereof, (a) the fair value of the
business of the Borrower and its Subsidiaries on a consolidated basis, will
exceed the debts and liabilities, subordinated, contingent or otherwise, of the
Borrower and its Subsidiaries on a consolidated basis; (b) the present fair
saleable value of the Property of the Borrower and its Subsidiaries on a
consolidated basis will be greater than the amount that will be required to pay
the probable liability of the Borrower and its Subsidiaries on a consolidated
basis on their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured; (c)
the Borrower and its Subsidiaries on a consolidated basis expect to be able to
pay their debts and liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (d) the Borrower and its
Subsidiaries on a consolidated basis believe that they do not have unreasonably
small capital with which to conduct the businesses in which they are engaged as
such businesses are now conducted and are proposed to be conducted after the
date hereof.
(ii) The Borrower does not intend to, or to permit any of its
Subsidiaries to, and does not believe that it or any of its Subsidiaries will,
incur debts beyond its ability to pay such debts as they mature, taking into
account the timing of and amounts of cash to be received by it or any such
Subsidiary and the timing of the amounts of cash to be payable on or in respect
of its Indebtedness or the Indebtedness of any such Subsidiary.
5.21. General Purpose of Facility. The Borrower warrants and represents
to the Agent the LC Issuer and the Lenders and all other future owners and
holders of this Agreement, the Notes and the other Loan Documents, that all
Credit Extensions are and will be for business, commercial, investment or other
similar purpose and not primarily for personal, family, household or
agricultural use, as such terms are used in the Texas Finance Code.
ARTICLE VI
COVENANTS
So long as any Reimbursement Obligation or any other amount payable by
the Borrower hereunder or under any Note shall remain unpaid or any Lender shall
have any obligation to lend hereunder, and until all of the Commitments and all
of the Letters of Credit are terminated, unless the Required Lenders shall
otherwise consent in writing:
37
6.01. Financial and Other Reporting. The Borrower will maintain, for
itself and each Subsidiary, a system of accounting established and administered
in accordance with generally accepted accounting principles, and furnish to the
Lenders:
(i) Within ninety (90) days after the close of each of its fiscal
years, an unqualified audit report certified by independent certified public
accountants acceptable to the Lenders, prepared in accordance with GAAP on a
consolidated and consolidating basis (consolidating statements need not be
certified by such accountants and need not cover cash flow reporting) for itself
and its Subsidiaries, including balance sheets as of the end of such period,
related profit and loss and reconciliation of surplus statements, and a
statement of cash flows, accompanied by any management letter prepared by said
accountants.
(ii) Within forty-five (45) days after the close of the first three
quarterly periods of each of its fiscal years, for itself and its Subsidiaries,
consolidated and consolidating unaudited balance sheets as at the close of each
such period and consolidated and consolidating profit and loss and
reconciliation of surplus statements and a statement of cash flows for the
period from the beginning of such fiscal year to the end of such quarter, all
certified by its chief financial officer (consolidating statements need not
cover cash flow reporting).
(iii) As soon as available, but in any event within ninety (90) days
after the beginning of each fiscal year of the Borrower, a copy of the plan and
forecast (including a projected consolidated balance sheet, income statement and
funds flow statement) of the Borrower for such fiscal year.
(iv) Together with the financial statements required under Sections
6.01(i) and 6.01(ii), a compliance certificate in substantially the form of
Exhibit D signed by an Authorized Officer of the Borrower showing the
calculations necessary to determine compliance with this Agreement and stating
that no Default or Unmatured Default exists, or if any Default or Unmatured
Default exists, stating the nature and status thereof, and including a report of
Consolidated Capital Expenditures (with Consolidated Capital Expenditures of a
maintenance nature separately identified and reported) for the then
most-recently ended four fiscal quarters.
(v) Within 270 days after the close of each fiscal year, a statement of
the Unfunded Liabilities of each Single Employer Plan, certified as correct by
an actuary enrolled under ERISA.
(vi) As soon as possible and in any event within five (5) Business Days
after the Borrower knows that any Reportable Event has occurred with respect to
any Plan, a statement, signed by the chief financial officer of the Borrower,
describing said Reportable Event and the action which the Borrower proposes to
take with respect thereto.
(vii) As soon as possible and in any event within five (5) Business
Days after receipt by the Borrower, a copy of (a) any notice or claim to the
effect that the Borrower or any of its Subsidiaries is or may be liable to any
Person as a result of the release by the Borrower, any of its Subsidiaries, or
any other Person of any toxic or hazardous waste or substance into the
environment, and (b) any notice alleging any violation of any federal, state or
local environmental, health or safety law or regulation by the Borrower or any
of its Subsidiaries, which, in either case, could have a Material Adverse
Effect.
38
(viii) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular reports which the
Borrower or any of its Subsidiaries files with the Securities and Exchange
Commission.
(ix) Such other information (including non-financial information) of
the Borrower or any of its Subsidiaries as the Agent or any Lender may from time
to time reasonably request.
6.02. Use of Proceeds. The Borrower will, and will cause each
Subsidiary to, use the proceeds of the Credit Extension for general corporate
purposes and, for Permitted Acquisitions and for intercompany loans to increase
the working capital of any Subsidiary of the Borrower that is an Obligor. The
Borrower will not, nor will it permit any Subsidiary to, use any of the proceeds
of the Advances (i) to purchase or carry any "margin stock" (as defined in
Regulation U) or to extend credit to any Person for that purpose or (ii) in any
manner which violates or results in a violation of any law or regulation,
including without limitation, any regulation of the Board of Governors of the
Federal Reserve System or the Securities Exchange Act of 1934, in each case as
now or hereafter in effect.
6.03. Notice of Default. The Borrower will, and will cause each
Subsidiary to, give prompt notice in writing to the Agent of the occurrence of
any Default or Unmatured Default, and (ii) of any development, financial or
otherwise which could have a Material Adverse Effect.
6.04. Conduct of Business. The Borrower will, and will cause each
Subsidiary to, (i) carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted and do all things necessary to remain duly incorporated or organized,
validly existing and (to the extent such concept applies to such entity) in good
standing as a domestic corporation, partnership or limited liability company in
its jurisdiction of incorporation or organization, as the case may be and, (ii)
except where the failure to do so could have a Material Adverse Effect, maintain
all requisite authority to conduct its business in each jurisdiction in which
its business is conducted.
6.05. Taxes. The Borrower will, and will cause each Subsidiary to,
timely file complete and correct United States federal and applicable foreign,
state and local tax returns required by law and pay when due all taxes,
assessments and governmental charges and levies upon it or its income, profits
or Property, except those which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves have been set aside in
accordance with GAAP. At any time that any Subsidiary of the Borrower is
organized as a limited liability company, each such limited liability company
will qualify for partnership tax treatment under United States federal tax law.
6.06. Insurance. The Borrower will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
substantially all their Property in such amounts and covering such risks as is
consistent with sound business practice, and the Borrower will furnish to any
Lender upon request full information as to the insurance carried.
6.07. Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to
39
which it may be subject which could have a Material Effect including, without
limitation, all Environmental Laws.
6.08. Maintenance of Properties. The Borrower will, and will cause each
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
substantially all of its Property in good repair, working order and condition,
and make all necessary and proper repairs, renewals and replacements so that its
business carried on in connection therewith may, in all material respect, be
properly conducted at all times.
6.09. Inspection. The Borrower will, and will cause each Subsidiary to,
permit the Agent and the Lenders, by their respective representatives and
agents, to inspect any of the Property, books and financial records of the
Borrower and each Subsidiary, to examine and make copies of the books of
accounts and other financial records of the Borrower and each Subsidiary, and
upon reasonable prior notice to discuss the affairs, finances and accounts of
the Borrower and each Subsidiary with, and to be advised as to the same by,
their respective officers at such times during normal business hours and
intervals as the Agent or any Lender may designate.
6.10. Dividends. The Borrower will not, nor will it permit any
Subsidiary to, declare or pay any dividends or make any Distribution on its
Capital Stock (other than dividends payable in its own Capital Stock) or redeem,
repurchase or otherwise acquire or retire any of its Capital Stock at any time
outstanding, except that (i) any Subsidiary of the Borrower may declare and pay
dividends and make Distributions (a) to a Wholly-Owned Subsidiary of the
Borrower that is a Guarantor if no Default or Unmatured Default would result
from such declaration, payment or making, or (b) to the Borrower, and (ii) the
Borrower (x) may declare and pay dividends on Borrower Preferred Stock to the
holders thereof if no Default or Unmatured Default exists at the time of such
declaration or payment and if no Default or Unmatured Default would result from
such declaration or payment or (y) may make Distributions in the manner
expressly specified in clause (ii) and (iii) of Section 2.02.
6.11. Indebtedness. The Borrower will not, nor will it permit any
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:
(i) the Loans, the Reimbursement Obligations and other
Indebtedness arising under this Agreement and the Loan
Documents.
(ii) current liabilities incurred in the ordinary course of
business.
(iii) trade payables in the ordinary course of business.
(iv) Permitted Senior Subordinated Debt.
(iii) Indebtedness arising under Related Rate Hedging Agreements.
(v) (a) Indebtedness arising out of Capitalized Leases, (b)
purchase money Indebtedness representing the portion of the
purchase price of Property acquired by the Borrower or such
Subsidiary which may be secured by Liens permitted by Section
6.15(vii), (c) Indebtedness assumed by the Borrower in
connection with a Permitted
40
Acquisition and (d) unsecured Indebtedness, in the aggregate
for clauses (a) through (d), inclusive, of this Section
6.11(v), of $5,000,000 in the aggregate outstanding at any
time.
(vi) Indebtedness not exceeding $5,000,000 in the aggregate at any
time acquired in Permitted Acquisition and released within 30
days from the close of Acquisition in which such Indebtedness
was acquired.
(vii) Capitalized Lease Obligations arising under Permitted Sale and
Leaseback Transactions.
6.12. Merger. The Borrower will not, nor will it permit any Subsidiary
to, merge or consolidate with or into any other Person, or sell, convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired), except that (i) a Subsidiary may merge into the
Borrower or a Wholly-Owned Subsidiary and (ii) the Target of the Permitted
Acquisition may merge into a Wholly-Owned Subsidiary, in each case if
immediately prior to and after giving effect to such merger no event has
occurred and is continuing, or would result, which constitutes a Default or
Unmatured Default.
6.13. Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property to any other
Person, except:
(i) Sales of inventory in the ordinary course of business.
(ii) Sales of worn-out or obsolete equipment in the normal
course of business, if no Default exists at the time of such sale.
(iii) Replacement of equipment in the normal course of
business with other equipment at least as useful and beneficial to the
Borrower and its Subsidiaries and their respective businesses as the
equipment replaced if no Default exists at the time of such replacement
and an Acceptable Security Interest exists in such other equipment at
the time of and at all times after such replacement.
(iv) Leases, sales or other dispositions of its Property that
do not exceed $100,000 for any single item of such Property and that,
together with all other Property of the Borrower and its Subsidiaries
previously leased, sold or disposed of (other than Property described
in clauses (i) through (iii) of this Section 6.13) during the
twelve-month period ending with the month in which any such lease, sale
or other disposition occurs, do not exceed $100,000 in the aggregate.
(v) Permitted Sale and Leaseback Transactions.
6.14. Investments and Acquisitions. The Borrower will not, nor will it
permit any Subsidiary to, make or suffer to exist any Investments (including
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or to create any
41
Subsidiary or to become or remain a partner in any partnership or joint venture,
or to make any Acquisition of any Person, except (i) Cash Equivalent
Investments, (ii) existing Investments in Subsidiaries and other Investments in
existence on the date hereof and described in Schedule III, (iii) Wholly-Owned
Subsidiaries in compliance with Section 6.18, and (iv) Permitted Acquisitions
not described on Schedule III.
6.15. Liens. The Borrower will not, nor will it permit any Subsidiary
to, create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or
levies on its Property if the same shall not at the time be delinquent
or thereafter can be paid without penalty, or are being contested in
good faith and by appropriate proceedings and for which adequate
reserves in accordance with GAAP shall have been set aside on its
books.
(ii) Liens imposed by law, such as carriers', warehousemen's
and mechanics' liens and other similar liens arising in the ordinary
course of business which secure payment of obligations not more than 60
days past due or which are being contested in good faith by appropriate
proceedings and for which adequate reserves shall have been set aside
on its books.
(iii) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions, or other
social security or retirement benefits, or similar legislation.
(iv) Rights of set off arising under common law or by statute.
(v) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a nature
generally existing with respect to properties of a similar character
and which do not in any material way affect the marketability of the
same or interfere with the use thereof in the business of the Borrower
or its Subsidiaries.
(vi) Liens existing on the date hereof and listed on Schedule
V and renewals and extensions thereof.
(vii) Liens securing the Indebtedness permitted by clauses
(a), (b) and (c) of Section 6.11(v) and placed on Property,
contemporaneously with the purchase thereof, by the Borrower or any of
its Subsidiaries to secure all of a portion of the purchase price
therefor, provided that such Lien shall not extend to any other
Property of the Borrower or its Subsidiaries.
(viii) Liens in favor of the Agent, for the benefit of the
Lenders, granted pursuant to any Collateral Document.
(ix) UCC protective filings with respect to personal property
permitted to be leased hereunder by the Borrower or its Subsidiaries in
the ordinary course of business.
42
(x) Liens securing judgments and orders which do not exceed
$1,000,000 in the aggregate at any time and which, individually or in
the aggregate, could not have a Material Adverse Effect.
6.16. Sale of Accounts. The Borrower will not, nor will it permit any
Subsidiary to, sell or otherwise dispose of any notes receivable or accounts
receivable, with or without recourse.
6.17. Affiliates. The Borrower will not, and will not permit any
Subsidiary to, directly or indirectly (i) enter into any transaction (including,
without limitation, the purchase or sale of any Property or service) with, or
make any payment or transfer to, any Affiliate or (ii) make any material
arrangement or other material transaction with or for the benefit of any
Affiliate, in each case except in the ordinary course of business and pursuant
to the reasonable requirements of the Borrower's or such Subsidiary's business
and upon fair and reasonable terms no less favorable to the Borrower or such
Subsidiary than the Borrower or such Subsidiary would obtain in a comparable
arms-length transaction with a Person not an Affiliate.
6.18. New Subsidiaries. Contemporaneously with the creation or
acquisition of any direct or indirect Subsidiary of the Borrower (a "New
Subsidiary"), the Borrower shall, or shall cause the parent of such New
Subsidiary to:
(a) grant or cause to be granted to the Agent, pursuant to
Note Pledge Agreements and Stock Pledge Agreements, an Acceptable
Security Interest in (i) all Capital Stock and other Investments in
such New Subsidiary;
(b) cause each such New Subsidiary to guaranty the payment and
performance of the Obligations by executing and delivering to the Agent
a Guaranty; and
(c) cause each such New Subsidiary to execute and deliver to
the Agent a Security Agreement and such other Collateral Documents as
the Agent may reasonably request to grant the Agent and the Lenders an
Acceptable Security Interest on all personal property of such New
Subsidiary.
6.19. Amendments to Material Agreements. The Borrower will not, and
will not permit any Subsidiary to amend, waive, terminate or otherwise modify,
or to cancel or breach any term or provision of, any Material Agreement, except
the amendment, waiver or modification of those, but only those terms and
provisions whose amendment, waiver or modification thereunder are clearly
beneficial to the Borrower and its Subsidiaries and could not have an adverse
effect on the performance of any Obligation or on any right or benefit available
to the Agent, the LC Issuer or any Lender.
6.20. Permitted Senior Subordinated Debt. The Borrower will not, and
will not permit any Subsidiary to, make any amendment or modification to the
indenture, note or other agreement evidencing or governing any Permitted Senior
Subordinated Debt, or directly or indirectly voluntarily prepay, defease or in
substance defease, purchase, redeem, retire or otherwise acquire, any Permitted
Senior Subordinated Debt, except (i) promptly upon the issuance of Capital
Stock, net proceeds
43
therefrom applied as permitted in accordance with Section 2.02(ii) and (ii) any
amendment or modification allowed under Section 6.19.
6.21. Sale and Leaseback Transactions and other Off-Balance Sheet
Liabilities. The Borrower will not, nor will it permit any Subsidiary to, enter
into or suffer to exist any (i) Sale and Leaseback Transaction other than
Permitted Sale and Leaseback Transactions or (ii) any other transaction pursuant
to which it incurs or has incurred Off-Balance Sheet Liabilities, except for
Related Rate Hedging Obligations.
6.22. Contingent Obligations. The Borrower will not, nor will it permit
any Subsidiary to, make or suffer to exist any Contingent Obligation (including,
without limitation, any Contingent Obligation with respect to the obligations of
a Subsidiary), except (i) by endorsement of instruments for deposit or
collection in the ordinary course of business, (ii) the Reimbursement
Obligations, (iii) each Guaranty of the Obligations, and (iv) as permitted by
Section 6.25.
6.23. Letters of Credit. The Borrower will not, nor will it permit any
Subsidiary to, apply for or become liable upon or in respect of any Letter of
Credit other than Facility LCs.
6.24. No Lien Restriction. The Borrower will not, nor will it permit
any Subsidiary to, enter into any contract or agreement which in any way limits
or restricts the Borrower or any of its Subsidiaries from granting an Acceptable
Security Interest on any Property or from granting a Lien on its Property to
secure a Related Rate Hedging Agreement.
6.25. Financial Contracts. The Borrower will not, nor will it permit
any Subsidiary to, enter into or remain liable upon any Financial Contract,
except Rate Hedging Agreements permitted hereunder.
6.26. Financial Covenants.
6.26.01. Total Debt to EBITDA Ratio. The Borrower
will not permit the ratio, determined as of the end of each of
its fiscal quarters for the then most- recently ended four
fiscal quarters, of (i) Consolidated Funded Total Debt to (ii)
Consolidated EBITDA to be greater than 3.50 to 1.0.
6.26.02. Senior Debt to EBITDA Ratio. The Borrower
will not permit the ratio, determined as of the end of each of
its fiscal quarters for the then most- recently ended four
fiscal quarters, of (i) Consolidated Senior Total Debt to (ii)
Consolidated EBITDA to be greater than 2.25 to 1.0.
6.26.03. Fixed Charge Coverage Ratio. The Borrower
will not permit the ratio, determined as of the end of each of
its fiscal quarters for the then most- recently ended four
fiscal quarters, of (i) Consolidated EBITDA minus the sum of
Consolidated Cash Taxes and Consolidated Capital Expenditures
other than Discretionary Capital Expenditures, to (ii)
Consolidated Cash Interest Expense, plus current maturities of
principal Indebtedness, plus Scheduled Preferred Dividend
Payments, plus one seventh (1/7th) of the Aggregate
Outstanding Credit Exposure,
44
all calculated for the Borrower and its Subsidiaries on a
consolidated basis, to be less than 1.25 to 1.0.
6.26.04. Minimum Net Worth. The Borrower will at all
times maintain Consolidated Net Worth of not less than the sum
of (i) $56,977,000 plus (ii) seventy-five percent (75%) of
Consolidated Net Income earned in each fiscal quarter
beginning with the quarter ending March 31, 2001 (without
deduction for losses) plus (iii) one hundred percent (100%) of
the net proceeds realized from each sale of any common stock,
preferred stock or other equity of the Borrower and any of its
Subsidiaries; provided, however, that the required
Consolidated Net Worth shall be adjusted dollar-for-dollar for
any non-cash write-downs of goodwill specifically associated
with any authoritative accounting pronouncements derived from
the FASB Exposure Draft originally issued September 7, 1999.
6.27. Capital Expenditures. The Borrower will not, nor will it permit
any Subsidiary to, pay or incur Consolidated Capital Expenditures for the then
most-recently ended four fiscal quarters in excess of the lesser of (i)
$12,000,000 or (ii) two percent (2%) of consolidated revenues of the Borrower
for the then most-recently ended four fiscal quarters.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
7.01. Misrepresentation. Any representation or warranty made or deemed
made by or on behalf of the Borrower or any of its Subsidiaries to the Lenders,
the LC Issuer or the Agent under or in connection with this Agreement, any
Credit Extension, or any certificate or information delivered in connection with
this Agreement or any other Loan Document shall be false in any material respect
on the date as of which made or deemed made.
7.02. Nonpayment of Obligations. Nonpayment of principal of any Loan
when due, nonpayment of any Reimbursement Obligation within one (1) Business Day
after the same becomes due, or nonpayment of interest upon any Loan or of any
commitment fee, LC Fee or other obligations under any of the Loan Documents
within five days after the same becomes due.
7.03. Certain Covenants. The breach by the Borrower of any of the terms
or provisions either of Section 6.02, or any of Sections 6.10 through 6.26,
inclusive.
7.04. Other Breach. The breach by the Borrower (other than a breach
which constitutes a Default under another Section of this Article VII) of any of
the terms or provisions of this Agreement which is not remedied within thirty
(30) days after written notice from the Agent or any Lender.
7.05. Other Indebtedness. Failure of the Borrower or any of its
Subsidiaries, or any Obligor to pay when due any Indebtedness aggregating in
excess of $1,000,000 ("Material Indebtedness"); or the default by the Borrower
or any of its Subsidiaries or any Obligor in the
45
performance of any term, provision or condition contained in any agreement under
which any such Material Indebtedness was created or is governed, or any other
event shall occur or condition exist, the effect of which default or event is to
cause, or to permit the holder or holders of such Material Indebtedness to
cause, such Material Indebtedness to become due prior to its stated maturity; or
any Material Indebtedness of the Borrower or any of its Subsidiaries or any
Obligor shall become due and payable or required to be prepaid or repurchased
(other than by a regularly scheduled payment) prior to the stated maturity
thereof; or the Borrower or any of its Subsidiaries or any Obligor shall not
pay, or admit in writing its inability to pay, its debts generally as they
become due.
7.06. Bankruptcy, Reorganization, etc. The Borrower or any of its
Subsidiaries or any Obligor shall (i) have an order for relief entered with
respect to it under the Federal bankruptcy laws as now or hereafter in effect,
(ii) make an assignment for the benefit of creditors, (iii) apply for, seek,
consent to, or acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any Property with an
aggregate value exceeding $1,000,000, (iv) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in effect
or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed against it, (v)
take any corporate or partnership action to authorize or effect any of the
foregoing actions set forth in this Section 7.06 or (vi) fail to contest in good
faith any appointment or proceeding described in Section 7.07.
7.07. Appointment of Receiver. Without the application, approval or
consent of the Borrower, any of its Subsidiaries or any Obligor, a receiver,
trustee, examiner, liquidator or similar official shall be appointed for the
Borrower, any of its Subsidiaries or any Obligor or any Property with an
aggregate value exceeding $1,000,000, or a proceeding described in Section
7.06(iv) shall be instituted against the Borrower, any of its Subsidiaries or
any Obligor and such appointment continues undischarged or such proceeding
continues undismissed or unstayed for a period of 60 consecutive days.
7.08. Seizure of Property. Any court, government or governmental
agency shall condemn, seize or otherwise appropriate, or take custody or control
of, all or any portion of the Property of the Borrower and its Subsidiaries or
any Obligor which, when taken together with all other Property of the Borrower
and its Subsidiaries or any Obligor so condemned, seized, appropriated, or taken
custody or control of, during the twelve-month period ending with the month in
which any such action occurs, has an aggregate value in excess of $1,000,000.
7.09. Judgment. The Borrower or any of its Subsidiaries shall fail
within 30 days to pay, bond or otherwise discharge one or more (i) judgments or
orders for the payment of money in excess of $1,000,000 (or the equivalent
thereof in currencies other than U.S. Dollars) in the aggregate, or (ii)
nonmonetary judgments or orders which, individually or in the aggregate, could
have a Material Adverse Effect, which judgment(s), in any such case, is/are not
stayed on appeal or otherwise being appropriately contested in good faith.
46
7.10. Excessive Unfunded ERISA Liabilities. The Unfunded Liabilities of
all Single Employer Plans shall exceed in the aggregate $1,000,000 or any
Reportable Event which could have a Material Adverse Effect shall occur in
connection with any Plan.
7.11. Withdrawal Liability. The Borrower or any other member of the
Controlled Group shall have been notified by the sponsor of a Multiemployer Plan
that it has incurred withdrawal liability to such Multiemployer Plan in an
amount which, when aggregated with all other amounts required to be paid to
Multiemployer Plans by the Borrower or any other member of the Controlled Group
as withdrawal liability (determined as of the date of such notification),
exceeds $1,000,000 or could have a Material Adverse Effect.
7.12. Reorganization of Multiemployer Plan. The Borrower or any other
member of the Controlled Group shall have been notified by the sponsor of a
Multiemployer Plan that such Multiemployer Plan is in reorganization or is being
terminated, within the meaning of Title IV of ERISA, if as a result of such
reorganization or termination (i) the aggregate annual contributions of the
Borrower and the other members of the Controlled Group (taken as a whole) to all
Multiemployer Plans which are then in reorganization or being terminated have
been or will be increased over the amounts contributed to such Multiemployer
Plans for the respective plan years of each such Multiemployer Plan immediately
preceding the plan year in which the reorganization or termination occurs by an
amount exceeding $1,000,000 or (ii) such reorganization or termination could
have a Material Adverse Effect.
7.13. Environmental Release or Violation. The Borrower or any of its
Subsidiaries shall (i) be the subject of any proceeding or investigation
pertaining to the release by the Borrower, any of its Subsidiaries or any other
Person of any toxic or Hazardous Substance into the environment, or (ii) violate
any Environmental Law, which, in the case of an event described in clause (i) or
clause (ii), could have a Material Adverse Effect.
7.14. Change of Control. The occurrence of a Change in Control other
than pursuant to an IPO of the Borrower.
7.15. Unremedied Default. The occurrence of any "default", as defined
in any Loan Document (other than this Agreement) or the breach of any of the
terms or provisions of any Loan Document (other than this Agreement), which
default or breach continues beyond any period of grace therein provided.
7.16. Guaranty. Any Guaranty shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the invalidity
or unenforceability of any Guaranty, or any Guarantor shall fail to comply with
any of the terms or provisions of any Guaranty to which it is a party, or any
Guarantor shall deny that it has any further liability under any Guaranty to
which it is a party, or shall give notice to such effect.
7.17. Lack of Acceptable Security Interest. Any Collateral Document
shall for any reason fail to create an Acceptable Security Interest in any
collateral purported to be covered thereby, except as permitted by the terms of
any Collateral Document, or any Collateral Document shall fail to remain in full
force or effect or any action shall be taken to discontinue or to assert the
invalidity or
47
unenforceability of any Collateral Document, or the Borrower or any Pledgor
shall fail to comply with any of the terms or provisions of any Collateral
Document.
7.18. ERISA Misrepresentation. The representations and warranties set
forth in Section 5.15 (entitled "Plan Assets; Prohibited Transactions") shall at
any time not be true and correct.
7.19. Breach of Rate Hedging Obligation, etc. The Borrower or any of
its Subsidiaries shall fail to pay when due any Rate Hedging Obligation,
obligation under a Sale and Leaseback Transaction or Contingent Obligation, or
the breach by the Borrower or any of its Subsidiaries of any term, provision or
condition contained in any Rate Hedging Agreement, any Sale and Leaseback
Transaction or any Contingent Obligation, and such non-payment or breach could
have a Material Adverse Effect, or a default (however so named) by the Borrower
or any of its Subsidiaries of any term, provision or condition contained in any
Related Rate Hedging Agreement.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.01. Acceleration; Facility LC Collateral Account. (i) If any Default
described in Section 7.06 or 7.07 occurs with respect to the Borrower, the
obligations of the Lenders to make Loans hereunder and the obligation and power
of the LC Issuer to issue Facility LCs shall automatically terminate and the
Obligations shall immediately become due and payable without any election or
action on the part of the Agent, the LC Issuer or any Lender, and the Borrower
will be and become thereby unconditionally obligated, without any further
notice, act or demand, to pay to the Agent an amount in immediately available
funds, which funds shall be held in the Facility LC Collateral Account, equal to
the difference of (x) the amount of LC Obligations at such time minus (y) the
amount on deposit in the Facility LC Collateral Account at such time which is
free and clear of all rights and claims of third parties and has not been
applied against the Obligations (such difference, the "Collateral Shortfall
Amount"). If any other Default occurs, the Required Lenders (or the Agent with
the consent of the Required Lenders) may (a) terminate or suspend the
obligations of the Lenders to make Loans hereunder, or declare the Obligations
to be due and payable, or both, whereupon the Obligations shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which the Borrower hereby expressly waives, and (b) upon notice
to the Borrower and in addition to the continuing right to demand payment of all
amounts payable under this Agreement, make demand on the Borrower to pay, and
the Borrower will, forthwith upon such demand and without any further notice or
act, pay to the Agent the Collateral Shortfall Amount, which funds shall be
deposited in the Facility LC Collateral Account.
(ii) If at any time while any Default is continuing, the Agent
determines that the Collateral Shortfall Amount as such time is greater than
zero, the Agent may make demand on the Borrower to pay, and the Borrower will,
forthwith upon such demand and without any further notice or act, pay to the
Agent the Collateral Shortfall Amount, which funds shall be deposited in the
Facility LC Collateral Account.
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(iii) The Agent may at any time or from time to time after funds are
deposited in the Facility LC Collateral Account, apply such funds to the payment
of the Obligations and any other amounts as shall from time to time have become
due and payable by the Borrower to the Lenders or the LC Issuer under the Loan
Documents.
(iv) At any time which any Default is continuing, neither the Borrower
nor any Person claiming on behalf of or through the Borrower shall have any
right to withdraw any of the funds held in the Facility LC Collateral Account.
After all of the Obligations have been indefeasibly paid in full and the
Aggregate Commitment has been terminated, any funds remaining in the Facility LC
Collateral Account shall be returned by the Agent to the Borrower or paid to
whomever may be legally entitled thereto at such time.
(v) If, within thirty (30) days after acceleration of the maturity of
the Obligations or termination of the obligations of the Lenders to make Loans
and the obligation and power of the LC Issuer to issue Facility LCs hereunder as
a result of any Default (other than any Default as described in Section 7.06 or
7.07 with respect to the Borrower) and before any judgment or decree for the
payment of the Obligations due shall have been obtained or entered, the Required
Lenders (in their sole discretion) shall so direct, the Agent shall, by notice
to the Borrower, rescind and annul such acceleration and/or termination.
8.02. Other Remedies. If any Default occurs, the Agent may, and upon
the request of the Required Lenders shall, proceed to protect and enforce the
rights of the Agent and the Lenders by suit in equity, by action at law or both,
whether for the specific performance of any covenant or agreement contained in
this Agreement or in any other Loan Document or in aid of the exercise of any
power granted in this Agreement or pursuant to any other Loan Document; or may
proceed to enforce the payment of any amounts outstanding hereunder, under the
Notes and under the other Loan Documents in the manner set forth herein and
therein; or may proceed to foreclose upon any Lines granted pursuant to the
Collateral Documents and other Loan Documents in the manner set forth therein,
it being the intention that no remedy conferred herein or in any other Loan
Document is to be exclusive of any other remedy, and each and every remedy
contained herein or in any other Loan Document shall be cumulative and shall be
in addition to every other remedy given hereunder and under the other Loan
Documents, or now or hereafter existing at law or in equity or by statue or
otherwise.
8.03. Amendments. Subject to the provisions of this Article VIII, the
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of all of the Lenders:
(i) Extend the final maturity of any Loan, or extend the expiry
date of any Facility LC to a date after the Facility
Termination Date or forgive all or any portion of the
principal amount thereof or any Reimbursement Obligation
related thereto, or reduce the rate or extend the time of
payment of interest or fees thereon or Reimbursement
Obligations related thereto.
49
(ii) Reduce the percentage specified in the definition of Required
Lenders.
(iii) Extend the Facility Termination Date, or reduce the amount or
extend the payment date for, the mandatory payments required
under Section 2.02, or increase the amount of the Aggregate
Commitment, the Commitment of any Lender hereunder or the
commitment to issue Facility LCs, or permit the Borrower to
assign its rights under this Agreement.
(iv) Amend this Section 8.03.
(v) Release any guarantor of any Credit Extension or, except as
provided in the Collateral Documents, release any Lien (a) on
Capital Stock of any Subsidiary comprising Collateral or (b)
on any material portion of the Collateral.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent, and no amendment of any
provision relating to the LC Issuer shall be effective without the written
consent of the LC Issuer. The Agent may waive payment of the fee required under
Section 12.03.02 without obtaining the consent of any other party to this
Agreement.
8.04. Preservation of Rights. No delay or omission of the Lenders, the
LC Issuer or the Agent to exercise any right under the Loan Documents shall
impair such right or be construed to be a waiver of any Default or an
acquiescence therein, and the making of a Credit Extension notwithstanding the
existence of a Default or the inability of the Borrower to satisfy the
conditions precedent to such Credit Extension shall not constitute any waiver or
acquiescence. Any single or partial exercise of any such right shall not
preclude other or further exercise thereof or the exercise of any other right,
and no waiver, amendment or other variation of the terms, conditions or
provisions of the Loan Documents whatsoever shall be valid unless in writing
signed by the Lenders required pursuant to Section 8.03, and then only to the
extent in such writing specifically set forth. All remedies contained in the
Loan Documents or by law afforded shall be cumulative and all shall be available
to the Agent, the LC Issuer and the Lenders until the Obligations have been paid
in full and all of the Commitments have been terminated.
ARTICLE IX
GENERAL PROVISIONS
9.01. Survival of Representations. All representations and warranties
of the Borrower contained in this Agreement shall survive the making of the
Credit Extensions herein contemplated.
9.02. Governmental Regulation. Anything contained in this Agreement to
the contrary notwithstanding, neither the LC Issuer nor any Lender shall be
obligated to extend credit to the Borrower in violation of any limitation or
prohibition provided by any applicable statute or regulation.
9.03. Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.
50
9.04. Entire Agreement. The Loan Documents embody the entire agreement
and understanding among the Borrower, the Agent, the LC Issuer and the Lenders
and supersede all prior agreements and understandings among the Borrower, the
Agent, the LC Issuer and the Lenders relating to the subject matter thereof
other than the fee letter described in Section 10.13.
9.05. Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any of
its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer any
right or benefit upon any Person other than the parties to this Agreement and
their respective successors and assigns, provided, however, that the parties
hereto expressly agree that the Arranger shall enjoy the benefits of the
provisions of Sections 9.06, 9.11 and 10.11 to the extent specifically set forth
therein and shall have the right to enforce such provisions on its own behalf
and in its own name to the same extent as if it were a party to this Agreement.
9.06. Expenses; Indemnification. (i) The Borrower shall reimburse the
Agent and the Arranger for any costs, internal charges and out-of-pocket
expenses (including attorneys' fees and time charges of attorneys for the Agent,
which attorneys may be employees of the Agent) paid or incurred by the Agent or
the Arranger in connection with the preparation, negotiation, execution,
delivery, syndication, review, amendment, modification, and (excluding internal
charges prior to an Unmatured Default) administration of the Loan Documents. The
Borrower also agrees to reimburse the Agent, the Arranger, the LC Issuer and the
Lenders for any costs, internal charges and out-of-pocket expenses (including
attorneys' fees and time charges of attorneys for the Agent, the Arranger, the
LC Issuer and the Lenders, which attorneys may be employees of the Agent, the
Arranger, the LC Issuer or the Lenders) paid or incurred by the Agent, the
Arranger, the LC Issuer or any Lender in connection with the collection and
enforcement of the Loan Documents. Expenses being reimbursed by the Borrower
under this Section 9.06 include, without limitation, costs and expenses incurred
in connection with the Reports described in the following sentence. The Borrower
acknowledges that from time to time Bank One may prepare and may distribute to
the Lenders (but shall have no obligation or duty to prepare or to distribute to
the Lenders) certain audit reports (the "Reports") pertaining to the Borrower's
assets for internal use by Bank One from information furnished to it by or on
behalf of the Borrower, after Bank One has exercised its rights of inspection
pursuant to this Agreement.
(ii) THE BORROWER HEREBY FURTHER AGREES TO INDEMNIFY THE AGENT, THE
ARRANGER, THE LC ISSUER AND EACH LENDER, ITS DIRECTORS, OFFICERS AND EMPLOYEES
AGAINST ALL LOSSES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, LIABILITIES AND
EXPENSES (INCLUDING, WITHOUT LIMITATION, ALL EXPENSES OF LITIGATION OR
PREPARATION THEREFOR WHETHER OR NOT THE AGENT, THE ARRANGER, THE LC ISSUER OR
ANY LENDER IS A PARTY THERETO) WHICH ANY OF THEM MAY PAY OR INCUR ARISING OUT OF
OR RELATING TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, THE TRANSACTIONS
CONTEMPLATED HEREBY OR THE DIRECT OR INDIRECT APPLICATION OR PROPOSED
APPLICATION OF THE PROCEEDS OF ANY CREDIT EXTENSION HEREUNDER, INCLUDING WITHOUT
LIMITATION,
51
THOSE ARISING OUT OF ORDINARY NEGLIGENCE, EXCEPT TO THE EXTENT THAT THEY ARE
DETERMINED IN A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT
JURISDICTION TO HAVE RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
THE PARTY SEEKING INDEMNIFICATION. The obligations of the Borrower under this
Section 9.06 shall survive the termination of this Agreement.
9.07. Numbers of Documents. All statements, notices, closing documents,
and requests hereunder shall be furnished to the Agent with sufficient
counterparts so that the Agent may furnish one to each of the Lenders.
9.08. Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP.
9.09.
Credit Agreement Controls. In the event of any conflict or
inconsistencies among this Agreement and any of the other Loan Documents, the
terms and provisions of this Agreement shall prevail and control.
9.10. Severability of Provisions. Any provision in any Loan Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
9.11. Nonliability of Lenders. The relationship between the Borrower on
the one hand and the Lenders, the LC Issuer and the Agent on the other hand
shall be solely that of borrower and lender. Neither the Agent, the Arranger,
the LC Issuer nor any Lender shall have any fiduciary responsibilities to the
Borrower. Neither the Agent, the Arranger, the LC Issuer nor any Lender
undertakes any responsibility to the Borrower to review or inform the Borrower
of any matter in connection with any phase of the Borrower's business or
operations. The Borrower agrees that neither the Agent, the Arranger, the LC
Issuer nor any Lender shall have liability to the Borrower (whether sounding in
tort, contract or otherwise) for losses suffered by the Borrower in connection
with, arising out of, or in any way related to, the transactions contemplated
and the relationship established by the Loan Documents, or any act, omission or
event occurring in connection therewith, unless it is determined in a final non-
appealable judgment by a court of competent jurisdiction that such losses
resulted from the gross negligence or willful misconduct of the party from which
recovery is sought. Neither the Agent, the Arranger, the LC Issuer nor any
Lender shall have any liability with respect to, and the Borrower hereby waives,
releases and agrees not to xxx for, any special, indirect or consequential
damages suffered by the Borrower in connection with, arising out of, or in any
way related to the Loan Documents or the transactions contemplated thereby.
9.12. Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to its Affiliates and to other Lenders and
their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (iii) to regulatory
officials, (iv) to
52
any Person as requested pursuant to or as required by law, regulation, or legal
process, (v) to any Person in connection with any legal proceeding to which such
Lender is a party, (vi) to such Lender's direct or indirect contractual
counterparties in swap agreements or to legal counsel, accountants and other
professional advisors to such counterparties, and (vii) permitted by Section
12.04.
9.13. Nonreliance. Each Lender hereby represents that it is not relying
on or looking to any margin stock (as defined in Regulation U of the Board of
Governors of the Federal Reserve System) for the repayment of the Credit
Extensions provided for herein.
ARTICLE X
THE AGENT
10.01. Appointment; Nature of Relationship. Bank One, NA is hereby
appointed by each of the Lenders as its contractual representative (herein
referred to as the "Agent") hereunder and under each other Loan Document, and
each of the Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
X. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the contractual representative
of the Lenders with only those duties as are expressly set forth in this
Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, (ii) is a "representative" of the Lenders within
the meaning of Section 9-105 of the Uniform Commercial Code and (iii) is acting
as an independent contractor, the rights and duties of which are limited to
those expressly set forth in this Agreement and the other Loan Documents. Each
of the Lenders hereby agrees to assert no claim against the Agent on any agency
theory or any other theory of liability for breach of fiduciary duty, all of
which claims each Lender hereby waives.
10.02. Powers. The Agent shall have and may exercise such powers under
the Loan Documents as are specifically delegated to the Agent by the terms of
each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
10.03. General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
to the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
10.04. No Responsibility for Loans, Recitals, etc. Neither the Agent
nor any of its directors, officers, agents or employees shall be responsible for
or have any duty to ascertain, inquire into, or verify (a) any statement,
warranty or representation made in connection with any Loan Document
53
or any borrowing hereunder; (b) the performance or observance of any of the
covenants or agreements of any obligor under any Loan Document, including,
without limitation, any agreement by an obligor to furnish information directly
to each Lender; (c) the satisfaction of any condition specified in Article IV,
except receipt of items required to be delivered solely to the Agent; (d) the
existence or possible existence of any Default or Unmatured Default; (e) the
validity, enforceability, effectiveness, sufficiency or genuineness of any Loan
Document or any other instrument or writing furnished in connection therewith;
(f) the value, sufficiency, creation, perfection or priority of any Lien in any
collateral security; or (g) the financial condition of the Borrower or any
guarantor of any of the Obligations or of any of the Borrower's or any such
guarantor's respective Subsidiaries. The Agent shall have no duty to disclose to
the Lenders information that is not required to be furnished by the Borrower to
the Agent at such time, but is voluntarily furnished by the Borrower to the
Agent (either in its capacity as Agent or in its individual capacity).
10.05. Action on Instructions of Lenders. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, hereunder and under
any other Loan Document in accordance with written instructions signed by the
Required Lenders, and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders. The Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN
OR IN ANY OTHER LOAN DOCUMENT, EACH OF THE AGENT AND THE LC ISSUER SHALL BE
FULLY JUSTIFIED IN FAILING OR REFUSING TO TAKE ANY ACTION HEREUNDER AND UNDER
ANY OTHER LOAN DOCUMENT UNLESS IT SHALL FIRST BE INDEMNIFIED TO ITS SATISFACTION
BY THE LENDERS AGAINST ANY AND ALL LIABILITY, LOSSES, DAMAGES JUDGMENTS, COSTS,
EXPENSES AND DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER WHICH MAY BE IMPOSED
UPON, INCURRED BY OR ASSERTED AGAINST SUCH AGENT OR LC ISSUER IN ANY WAY
RELATING TO OR ARISING OUT OF ITS TAKING OR CONTINUING TO TAKE ANY ACTION.
10.06. Employment of Agents and Counsel. The Agent may execute any of
its duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
10.07. Reliance on Documents; Counsel. The Agent shall be entitled to
rely upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
10.08. Agent's Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments
54
have been terminated, in proportion to their Commitments immediately prior to
such termination) (i) for any amounts not reimbursed by the Borrower for which
the Agent is entitled to reimbursement by the Borrower under the Loan Documents,
(ii) for any other expenses incurred by the Agent on behalf of the Lenders, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents (including, without limitation, for any
expenses incurred by the Agent in connection with any dispute between the Agent
and any Lender or between two or more of the Lenders) and (iii) for any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind and nature whatsoever which may 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 document delivered in connection
therewith or the transactions contemplated thereby (including, without
limitation, for any such amounts incurred by or asserted against the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders), or the enforcement of any of the terms of the Loan
Documents or of any such other documents, provided that (i) no Lender shall be
liable for any of the foregoing to the extent any of the foregoing is found in a
final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the Agent and (ii)
any indemnification required pursuant to Section 3.05(vii) shall,
notwithstanding the provisions of this Section 10.08, be paid by the relevant
Lender in accordance with the provisions thereof. The obligations of the Lenders
under this Section 10.08 shall survive payment of the Obligations and
termination of this Agreement.
10.09. Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Unmatured Default
hereunder unless the Agent has received written notice from a Lender or the
Borrower referring to this Agreement describing such Default or Unmatured
Default and stating that such notice is a "notice of default". In the event that
the Agent receives such a notice, the Agent shall give prompt notice thereof to
the Lenders.
10.10. Rights as a Lender. In the event the Agent is a Lender, the
Agent shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Commitment and its Loans as any Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent and
its Affiliates may accept deposits from, lend money to, and generally engage in
any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person. The Agent, in its
individual capacity, is not obligated to remain a Lender.
10.11. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, the Arranger or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arranger or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.
55
10.12. Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders. Upon any such
resignation or removal, the Borrower (if no Default or Unmatured Default shall
exist) and the Required Lenders shall have the right to appoint, on behalf of
the Borrower and the Lenders, a successor Agent. If no successor Agent shall
have been so appointed by the Borrower (if applicable) and the Required Lenders
within thirty days after the resigning Agent's giving notice of its intention to
resign, then the resigning Agent may appoint, on behalf of the Borrower and the
Lenders, a successor Agent. Notwithstanding the previous sentence, the Agent may
at any time without the consent of the Borrower or any Lender, appoint any of
its Affiliates which is a commercial bank as a successor Agent hereunder. If the
Agent has resigned or been removed and no successor Agent has been appointed,
the Lenders may perform all the duties of the Agent hereunder and the Borrower
shall make all payments in respect of the Obligations to the applicable Lender
and for all other purposes shall deal directly with the Lenders. No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings 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 resigning or removed Agent. Upon
the effectiveness of the resignation or removal of the Agent, the resigning or
removed Agent shall be discharged from its duties and obligations hereunder and
under the Loan Documents. After the effectiveness of the resignation or removal
of an Agent, the provisions of this Article X shall continue in effect for the
benefit of such Agent in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent hereunder and under the other Loan
Documents. In the event that there is a successor to the Agent by merger, or the
Agent assigns its duties and obligations to an Affiliate pursuant to this
Section 10.12, then the term "Corporate Base Rate" as used in this Agreement
shall mean the prime rate, base rate or other analogous rate of the new Agent.
10.13. Agent's Fee. The Borrower agrees to pay to the Agent and the LC
Issuer, for their own respective accounts, the fees agreed to by the Borrower
pursuant to that certain fee letter agreement dated April 17, 2001 among the
Borrower, the Arranger and Bank One, NA, or as otherwise agreed from time to
time.
10.14. Delegation to Affiliates. The Borrower and the Lenders agree
that the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles IX and X.
10.15. Execution of Collateral Documents. The Lenders hereby empower
and authorize the Agent to execute and deliver to the Borrower on their behalf
the Collateral Documents and all related financing statements and any financing
statements, agreements, documents or instruments as shall be necessary or
appropriate to effect the purposes of the Collateral Documents.
56
10.16. Collateral Releases. The Lenders hereby empower and authorize
the Agent to execute and deliver to the Borrower on their behalf any agreements,
documents or instruments as shall be necessary or appropriate to effect any
releases of Collateral which shall be permitted by the terms hereof or of any
other Loan Document or which shall otherwise have been approved by the Required
Lenders (or, if required by the terms of Section 8.03, all of the Lenders) in
writing, and in each case all other action reasonably incidental thereto.
10.17. Documentary Agent. The Lender that is the Documentation Agent
shall not have any right, power, obligation, liability, responsibility or duty
under this Agreement other than those applicable to all Lenders generally.
Without limiting the foregoing, no Lender shall have or be deemed to have a
fiduciary relationship with any other Lender. Each Lender hereby makes the same
acknowledgments with respect to such Lenders as it makes with respect to the
Agent in Section 10.11.
10.18. Highest Lawful Rate. Each provision in this Agreement and each
other Loan Document is expressly limited so that in no event whatsoever shall
the amount paid, or otherwise agreed to be paid, to the Agent, the LC Issuer or
any Lender for the use, forbearance or detention of the money to be loaned under
this Agreement or any Loan Document or otherwise (including any sums paid as
required by any covenant or obligation contained herein or in any other Loan
Document which is for the use, forbearance or detention of such money), exceed
that amount of money which would cause the effective rate of interest to exceed
the Highest Lawful Rate, and all amounts owed under this Agreement and each
other Loan Document shall be held to be subject to reduction to the effect that
such amounts so paid or agreed to be paid which are for the use, forbearance or
detention of money under this Agreement or such Loan Document shall in no event
exceed that amount of money which would cause the effective rate of interest to
exceed the Highest Lawful Rate. Anything in this Agreement, any Note or any
other Loan Document to the contrary notwithstanding, if the Borrower shall ever
be required to pay interest on any Note at a rate in excess of the Highest
Lawful Rate, or if the effective rate of interest which would otherwise be
payable under this Agreement, any Note or any other Loan Document would exceed
the Highest Lawful Rate, or if the holder of any Note shall receive any unearned
interest or shall receive monies that are deemed to constitute interest which
would increase the effective rate of interest payable by the Borrower under this
Agreement, such Note and the other Loan Documents to a rate in excess of the
Highest Lawful Rate, then (i) the amount of interest which would otherwise be
payable by the Borrower under this Agreement, such Note and other Loan Documents
shall be reduced to the amount allowed under applicable law, and (ii) any
unearned interest paid by the Borrower or any interest paid by the Borrower in
excess of the Highest Lawful Rate shall be in the first instance credited on the
principal of such Note with the excess thereof, if any, refunded to the Company.
It is further agreed that, without limitation of the foregoing, all calculations
of the rate of interest contracted for, charged or received by the Agent, the LC
Issuer or any Lender under the Notes or under this Agreement or the other Loan
Documents made for the purpose of determining whether such rate exceeds the
Highest Lawful Rate applicable to the Agent, the LC Issuer or any Lender shall
be made, to the extent permitted by usury laws applicable to the Agent, the LC
Issuer or any Lender (now or hereafter enacted), by amortizing, prorating and
spreading during the period of the full stated term of the Loans and the Notes
all interest at any time contracted for, charged or received by the Agent, the
LC Issuer or such Lender in connection therewith. If at any time and from time
to time, (i) the amount of interest payable to the Agent, the LC Issuer or any
Lender on any date shall be computed at the Highest Lawful Rate
57
pursuant to this Section 10.18 and (ii) in respect of any subsequent interest
computation period the amount of interest otherwise payable to the Agent, the LC
Issuer or any Lender would be less than the amount of interest payable to the
Agent, the LC Issuer or such Lender, as the case may be, computed at the Highest
Lawful Rate, then the amount of interest payable to the Agent, the LC Issuer or
such Lender, as the case may be, in respect of such subsequent interest
computation period shall continue to be computed at the Highest Lawful Rate
until the total amount of interest payable to the Agent, the LC Issuer or such
Lender, as the case may be, shall equal the total amount of interest which would
have been payable to the Agent, the LC Issuer or such Lender if the total amount
of interest had been computed without giving effect to this Section 10.18.
10.19. Chapter 346 Inapplicable. The Borrower agrees, pursuant to
Chapter 346 ("Chapter 346") of the Texas Finance Code, that Chapter 346 (which
relates to open-end line of credit revolving loan accounts) shall not apply to
the Obligations and that none of the Notes nor any Credit Extension shall be
governed by Chapter 346 or subject to its provisions in any manner whatsoever.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.01. Setoff. In addition to, and without limitation of, any rights of
the Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any Affiliate of any Lender to or for the credit or account of the Borrower may
be offset and applied toward the payment of the Obligations owing to such
Lender, whether or not the Obligations, or any part hereof, shall then be due.
11.02. Ratable Payments. If any Lender, whether by setoff or otherwise,
has payment made to it upon its Outstanding Credit Exposure (other than payments
received pursuant to Section 3.01, 3.02, 3.04 or 3.05) in a greater proportion
than that received by any other Lender, such Lender agrees, promptly upon
demand, to purchase a portion of the Aggregate Outstanding Credit Exposure held
by the other Lenders so that after such purchase each Lender will hold its Pro
Rata Share of the Aggregate Outstanding Credit Exposure. If any Lender, whether
in connection with setoff or amounts which might be subject to setoff or
otherwise, receives collateral or other protection for its Obligations or such
amounts which may be subject to setoff, such Lender agrees, promptly upon
demand, to take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to their respective Pro Rata
Shares of the Aggregate Outstanding Credit Exposure. In case any such payment is
disturbed by legal process, or otherwise, appropriate further adjustments shall
be made.
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ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.01. Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.03. Notwithstanding clause (ii) of this Section 12.01, any
Lender may at any time, without the consent of the Borrower or the Agent, assign
all or any portion of its rights under this Agreement and any Note to a Federal
Reserve Bank; provided, however, that no such assignment to a Federal Reserve
Bank shall release the transferor Lender from its obligations hereunder. The
Agent may treat the Person which made any Loan or which holds any Note as the
owner thereof for all purposes hereof unless and until such Person complies with
Section 12.03 in the case of an assignment thereof or, in the case of any other
transfer, a written notice of the transfer is filed with the Agent. Any assignee
or transferee of the rights to any Loan or any Note agrees by acceptance of such
transfer or assignment to be bound by all the terms and provisions of the Loan
Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the owner of the
rights to any Loan (whether or not a Note has been issued in evidence thereof),
shall be conclusive and binding on any subsequent holder, transferee or assignee
of the rights to such Loan.
12.02. Participations.
12.02.1. Permitted Participants; Effect. Any Lender may, in
the ordinary course of its business and in accordance with applicable
law, at any time sell to one or more Eligible Institutions
("Participants") participating interests in any Outstanding Credit
Exposure of such Lender, any Note held by such Lender, any Commitment
of such Lender or any other interest of such Lender under the Loan
Documents. In the event of any such sale by a Lender of participating
interests to a Participant, such Lender's obligations under the Loan
Documents shall remain unchanged, such Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations, such Lender shall remain the owner of its Outstanding
Credit Exposure and the holder of any Note issued to it in evidence
thereof for all purposes under the Loan Documents, all amounts payable
by the Borrower under this Agreement shall be determined as if such
Lender had not sold such participating interests, and the Borrower and
the Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under the Loan
Documents.
12.02.2. Voting Rights. Each Lender shall retain the sole
right to approve, without the consent of any Participant, any
amendment, modification or waiver of any provision of the Loan
Documents other than any amendment, modification or waiver with respect
to any Credit Extension or Commitment in which such Participant has an
interest which forgives principal, interest, fees or any Reimbursement
Obligation or reduces the interest rate or fees payable with respect to
any such Credit Extension or Commitment, extends the Facility
Termination Date, postpones any date fixed for any regularly-scheduled
payment of principal of or interest on, any Loan in which such
Participant has an interest, or any regularly scheduled payment of fees
on any such Credit Extension or Commitment,
59
releases any guarantor of any such Credit Extension or, except in
accordance with the terms hereof, release any Lien (a) on Capital Stock
of any Subsidiary comprising Collateral or (b) on any material portion
of the Collateral, if any, securing any such Credit Extension.
12.02.3. Benefit of Setoff. The Borrower agrees that each
Participant shall be deemed to have the right of setoff provided in
Section 11.01 in respect of its participating interest in amounts owing
under the Loan Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under the
Loan Documents, provided that each Lender shall retain the right of
setoff provided in Section 11.01 with respect to the amount of
participating interests sold to each Participant. The Lenders agree to
share with each Participant, and each Participant, by exercising the
right of setoff provided in Section 11.01, agrees to share with each
Lender, any amount received pursuant to the exercise of its right of
setoff, such amounts to be shared in accordance with Section 11.02 as
if each Participant were a Lender.
12.03. Assignments.
12.03.01. Permitted Assignments. Any Lender may, in accordance
with applicable law, at any time assign to one or more Eligible
Institutions ("Purchasers") all or any part of its rights and
obligations under the Loan Documents. Such assignment ("Assignment
Agreement") shall be substantially in the form of Exhibit J or in such
other form as may be agreed to by the parties thereto. The consent of
the Borrower and the Agent shall be required prior to an assignment
becoming effective with respect to a Purchaser which is not a Lender or
an Affiliate thereof; provided, however, that if a Default has occurred
and is continuing, the consent of the Borrower shall not be required.
Such consent shall not be unreasonably withheld or delayed. Each such
assignment with respect to a Purchaser which is not a Lender or an
Affiliate thereof shall (unless each of the Borrower and the Agent
otherwise consents) be in an amount not less than the lesser of (i)
$5,000,000 or (ii) the remaining amount of the assigning Lender's
Commitment (calculated as at the date of such assignment) or
outstanding Loans (if the applicable Commitment has been terminated).
12.03.02. Effect; Effective Date. Upon (i) delivery to the
Agent of an assignment, together with any consents required by Section
12.03.01, and (ii) payment of a $3,500 fee to the Agent for processing
such assignment (unless such fee is waived by the Agent), such
assignment shall become effective on the effective date specified in
such assignment. The assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make the
purchase of the Commitment and Outstanding Credit Exposure under the
applicable assignment agreement constitutes "plan assets" as defined
under ERISA and that the rights and interests of the Purchaser in and
under the Loan Documents will not be "plan assets" under ERISA. On and
after the effective date of such assignment, such Purchaser shall for
all purposes be a Lender party to this Agreement and any other Loan
Document executed by or on behalf of the Lenders and shall have all the
rights and obligations of a Lender under the Loan Documents, to the
same extent as if it were an original party hereto, and no further
consent or action by the Borrower, the Lenders or the Agent shall be
required to release the transferor Lender with respect to the
percentage of the Aggregate Commitment and Outstanding Credit Exposure
assigned to such Purchaser. Upon
60
the consummation of any assignment to a Purchaser pursuant to this
Section 12.03.02, the transferor Lender, the Agent and the Borrower
shall, if the transferor Lender or the Purchaser desires that its Loans
be evidenced by Notes, make appropriate arrangements so that new Notes
or, as appropriate, replacement Notes are issued to such transferor
Lender and new Notes or, as appropriate, replacement Notes, are issued
to such Purchaser, in each case in principal amounts reflecting their
respective Commitments, as adjusted pursuant to such assignment.
12.04. Dissemination of Information. The Borrower authorizes each
Lender to disclose to any Participant or Purchaser or any other Eligible
Institution acquiring an interest in the Loan Documents by operation of law
(each a "Transferee") and any prospective Transferee any and all information in
such Lender's possession concerning the creditworthiness of the Borrower and its
Subsidiaries, including without limitation any information contained in any
Reports; provided that each Transferee and prospective Transferee agrees to be
bound by Section 9.11 of this Agreement.
12.05. Tax Treatment. If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 3.05(iv).
ARTICLE XIII
NOTICES
13.01. Notices. Except as otherwise permitted by Section 2.15 with
respect to Borrowing Notices and Conversion/Continuation Notices, all notices,
requests and other communications to any party hereunder shall be in writing
(including electronic transmission, facsimile transmission or similar writing)
and shall be given to such party: (x) in the case of the Borrower or the Agent,
at its address or facsimile number set forth on the signature pages hereof, (y)
in the case of any Lender, at its address or facsimile number set forth in the
Lending Installation Schedule or (z) in the case of any party, at such other
address or facsimile number as such party may hereafter specify for the purpose
by notice to the Agent and the Borrower in accordance with the provisions of
this Section 13.01. Each such notice, request or other communication shall be
effective (i) if given by facsimile transmission, when transmitted to the
facsimile number specified in this Section 13.01 and confirmation of receipt is
received, (ii) if given by mail, 72 hours after such communication is deposited
in the mails with first class postage prepaid, addressed as aforesaid, or (iii)
if given by any other means, when delivered (or, in the case of electronic
transmission, received) at the address specified in this Section 13.01; provided
that notices to the Agent under Article II shall not be effective until
received.
13.02. Change of Address. The Borrower, the Agent and any Lender may
each change the address for service of notice upon it by a notice in writing to
the other parties hereto.
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ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Agent and the Lenders, the LC Issuer and each party has notified the Agent by
facsimile transmission or telephone that it has taken such action.
ARTICLE XV
CHOICE OF LAW; CONSENTS; WAIVER OF JURY TRIAL
15.01. Choice of Law. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAW (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF
TEXAS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
15.02. Consent to Jurisdiction. THE BORROWER HEREBY IRREVOCABLY SUBMITS
TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR STATE COURT
SITTING IN HOUSTON, TEXAS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE
AGENT, THE LC ISSUER OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN
THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER
AGAINST THE AGENT, THE LC ISSUER OR ANY LENDER OR ANY AFFILIATE OF THE AGENT,
THE LC ISSUER OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE
BROUGHT ONLY IN A COURT IN HOUSTON, TEXAS.
15.03. Waiver of Jury Trial. THE BORROWER, THE AGENT, THE LC ISSUER AND
EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN
DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
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ARTICLE XVI
AMENDMENT AND RESTATEMENT
16.01. Amendment and Restatement. This Agreement amends and restates in
its entirety that certain
Credit Agreement dated as of March 31, 1999 executed
by and among Borrower, Credit Lyonnais New York Branch, as Documentation Agent,
and Bank One, NA (formerly known as The First National Bank of Chicago), as LC
Issuer and as Agent, and certain lenders therein named.
IN WITNESS WHEREOF, the Borrower, the Lenders, the LC Issuer and the
Agent have executed this Agreement as of the date first above written.
AMERICAN PLUMBING & MECHANICAL, INC.
By:
----------------------------------------
Xxxxxxx X. Xxxxx, Treasurer
Address: 0000 Xxxxx Xxxxx Xxxx.
Xxxxx Xxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
00
XXXX XXX, XX,
Xxxxxxxxxxxx, as LC Issuer and as Agent
By:
----------------------------------------
Xxxx Xxxxxxxx, Vice President
Commitment:
Address: Bank One, NA
$25,000,000 000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxx Xxxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
64
CREDIT LYONNAIS NEW YORK BRANCH
Individually and as Documentation Agent
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Commitment:
$25,000,000
00
XXXXX XXXX XX XXXXXXXXXX, N.A.
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Commitment:
$20,000,000
66
FLEET NATIONAL BANK
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Commitment:
$10,000,000
67
COMERICA BANK
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Commitment:
$7,500,000
68
BAY VIEW FINANCIAL CORPORATION
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Commitment:
$7,500,000
69
