EXHIBIT 10.1
CREDIT AGREEMENT
among
INTEGRATED ELECTRICAL SERVICES, INC.,
as Borrower,
THE FINANCIAL INSTITUTIONS
NAMED IN THIS CREDIT AGREEMENT,
as Banks,
U. S. BANK NATIONAL ASSOCIATION,
as Syndication Agent,
BANK OF SCOTLAND,
as Managing Agent,
LaSALLE BANK NATIONAL ASSOCIATION,
as Documentation Agent,
and
BANK ONE, NA,
as Administrative Agent
Dated as of February 27, 2004
Sole Bookrunner and Lead Arranger:
Bank One Capital Markets, Inc.
ARTICLE 1 DEFINITIONS AND ACCOUNTING TERMS.......................... 1
1.1 Certain Defined Terms........................................ 1
1.2 Computation of Time Periods.................................. 20
1.3 Accounting Terms; Preparation of Financials.................. 20
1.4 Types........................................................ 21
1.5 Interpretation............................................... 21
ARTICLE 2 CREDIT FACILITIES......................................... 23
2.1 Term Loan Facility........................................... 23
2.2 Revolving Loan Facility...................................... 25
2.3 Letter of Credit Facility.................................... 28
2.4 Swing Line Facility.......................................... 32
2.5 Fees......................................................... 34
2.6 Interest..................................................... 35
2.7 Breakage Costs............................................... 38
2.8 Increased Costs.............................................. 39
2.9 Illegality................................................... 40
2.10 Market Failure............................................... 40
2.11 Payment Procedures and Computations.......................... 41
2.12 Taxes........................................................ 43
2.13 Change of Lending Office..................................... 44
ARTICLE 3 CONDITIONS PRECEDENT...................................... 45
3.1 Conditions Precedent to Initial Extension of Credit.......... 45
3.2 Conditions Precedent to Each Extension of Credit............. 46
ARTICLE 4 REPRESENTATIONS AND WARRANTIES............................ 46
4.1 Organization................................................. 47
4.2 Authorization................................................ 47
4.3 Enforceability............................................... 48
4.4 Absence of Conflicts and Approvals........................... 48
4.5 Investment Companies......................................... 48
4.6 Public Utilities............................................. 48
4.7 Financial Condition.......................................... 48
4.8 Condition of Assets.......................................... 49
4.9 Litigation................................................... 49
4.10 Subsidiaries................................................. 49
4.11 Laws and Regulations......................................... 49
4.12 Environmental Compliance..................................... 50
4.13 ERISA........................................................ 50
4.14 Taxes........................................................ 50
4.15 True and Complete Disclosure................................. 51
4.16 Senior Indebtedness.......................................... 51
4.17 Certain Documents............................................ 51
ARTICLE 5 COVENANTS................................................. 51
5.1 Organization................................................. 51
5.2 Reporting.................................................... 52
5.3 Inspection................................................... 54
5.4 Use of Proceeds.............................................. 54
5.5 Financial Covenants.......................................... 54
5.6 Debt......................................................... 56
5.7 Liens........................................................ 56
5.8 Other Obligations............................................ 56
5.9 Corporate Transactions and Asset Sales....................... 57
5.10 Distributions................................................ 58
5.11 Transactions with Affiliates................................. 58
5.12 Insurance.................................................... 59
5.13 Investments.................................................. 59
5.14 Lines of Business............................................ 59
5.15 Compliance with Laws......................................... 60
5.16 Environmental Compliance..................................... 60
5.17 ERISA Compliance............................................. 60
5.18 Payment of Certain Claims.................................... 60
5.19 Subsidiaries................................................. 61
5.20 Changes in Fiscal Periods.................................... 61
5.21 Negative Pledge Clauses...................................... 61
5.22 Subordinated Debt Payments................................... 61
ARTICLE 6 DEFAULT AND REMEDIES...................................... 61
6.1 Events of Default............................................ 61
6.2 Termination of Commitments................................... 63
6.3 Acceleration of Credit Obligations........................... 64
6.4 Cash Collateralization of Letters of Credit.................. 64
6.5 Default Interest............................................. 64
6.6 Right of Setoff; Adjustments................................. 64
6.7 Actions Under Credit Documents............................... 65
6.8 Remedies Cumulative.......................................... 65
6.9 Application of Payments...................................... 65
ARTICLE 7 THE ADMINISTRATIVE AGENT.................................. 66
7.1 Appointment; Nature of Relationship.......................... 66
7.2 Powers....................................................... 67
7.3 General Immunity............................................. 67
7.4 No Responsibility for Loans, Recitals, etc................... 67
7.5 Acting on Instructions of Banks.............................. 67
7.6 Employment of Agents and Counsel............................. 68
7.7 Reliance on Documents; Counsel............................... 68
7.8 Administrative Agent's Reimbursement and Indemnification..... 68
7.9 Notice of Default............................................ 69
7.10 Rights as a Bank............................................. 69
7.11 Bank Credit Decision......................................... 69
7.12 Successor Administrative Agent............................... 70
7.13 Administrative Agent and Arranger Fees....................... 70
7.14 Delegation to Affiliates..................................... 71
7.15 Execution of Collateral Documents............................ 71
7.16 Collateral Releases.......................................... 71
7.17 Syndication and Documentation Agents......................... 71
ARTICLE 8 BENEFIT OF AGREEMENT; ASSIGNMENT; PARTICIPATIONS.......... 71
8.1 Successors and Assigns....................................... 71
8.2 Participations............................................... 72
8.3 Assignments.................................................. 73
8.4 Dissemination of Information................................. 74
8.5 Tax Treatment................................................ 74
ARTICLE 9 MISCELLANEOUS............................................. 74
9.1 Expenses..................................................... 74
9.2 Indemnification.............................................. 75
9.3 Modifications, Waivers, and Consents......................... 75
9.4 Survival of Agreements....................................... 76
9.5 Notice....................................................... 76
9.6 CHOICE OF LAW................................................ 76
9.7 Submission To Jurisdiction; Waivers.......................... 76
9.8 WAIVER OF JURY TRIAL......................................... 77
9.9 Counterparts................................................. 77
9.10 No Further Agreements........................................ 77
9.11 2001 Credit Agreement........................................ 77
EXHIBITS:
Exhibit A Form of Compliance Certificate
Exhibit B-1 Form of Revolving Loan Borrowing Request
Exhibit B-2 Form of Term Loan Borrowing Request
Exhibit C Form of Continuation/Conversion Request
Exhibit D-1 Form of Revolving Loan Note
Exhibit D-2 Form of Term Loan Note
Exhibit D-3 Form of Swing Line Note
Exhibit E Form of Assignment and Acceptance
Exhibit F Closing Documents List
Exhibit G Form of Joinder Agreement
Exhibit H Form of Acquisition Certificate
Exhibit I Joinder Deliveries
SCHEDULES:
Schedule I-A Commitments
Schedule I-B Administrative Information (Borrower; Administrative Agent; Banks)
Schedule II Disclosures (Existing Subsidiaries)
Schedule III Restricted Payment Terms (Qualified Preferred Stock)
Schedule IV Good Standing Exceptions
CREDIT AGREEMENT
This Credit Agreement dated as of February 27, 2004, is among
INTEGRATED ELECTRICAL SERVICES, INC., a Delaware corporation, as Borrower, the
financial institutions named herein, as Banks, U. S. BANK NATIONAL ASSOCIATION,
as syndication agent, BANK OF SCOTLAND, as managing agent, LaSALLE BANK NATIONAL
ASSOCIATION, as documentation agent, and BANK ONE, NA, with its main office in
Chicago, Illinois, as administrative agent.
The Borrower, the financial institutions (collectively, the "Prior
Banks") party thereto, Credit Lyonnais and The Bank of Nova Scotia, as
syndication agents, Toronto Dominion (Texas), Inc., as documentation agent, and
JPMorgan Chase Bank, as administrative agent (in such capacity, the "Prior
Administrative Agent") are parties to that certain Credit Agreement (as
heretofore amended and supplemented, the "2001 Credit Agreement") dated as of
May 22, 2001. Pursuant to the terms of the 2001 Credit Agreement, the Prior
Administrative Agent has resigned in favor of the Administrative Agent, and by
their execution of this Agreement the Banks have appointed the Administrative
Agent as the successor to the Prior Administrative Agent, the Administrative
Agent has accepted such appointment and the Borrower has consented thereto; the
Administrative Agent therefore has succeeded to all of the rights, powers and
obligations of the Prior Administrative Agent under the 2001 Credit Agreement.
Further, the Borrower, the Banks and the Administrative Agent have agreed to (a)
amend and restate the 2001 Credit Agreement in its entirety and (b) release, on
the terms set forth herein, each of the Prior Banks (other than any Prior Bank
which is also a Bank) and the Prior Administrative Agent from its obligations
under the 2001 Credit Agreement; provided that the Prior Administrative Agent
shall continue to enjoy all of its rights (including indemnities) under the 2001
Credit Agreement with respect to its actions in such capacity before the date
hereof.
The parties hereto agree to amend and restate the 2001 Credit Agreement
in its entirety as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1 Certain Defined Terms. As used in this Agreement, the following terms
shall have the following meanings (unless otherwise indicated, such meanings to
be equally applicable to both the singular and plural forms of the terms
defined):
"Acquisition" means the direct or indirect purchase or acquisition,
whether in one or more related transactions, of any Person or group of Persons
or any related group of assets, liabilities, or securities of any Person or
group of Persons.
"Acquisition Certificate" means an acquisition certificate executed by
a Responsible Officer of the Borrower in substantially the form of Exhibit H.
"Administrative Agent" means Bank One, NA, together with its
affiliates, as the arranger of the Commitments and as the administrative agent
for the Banks under this Agreement and the other Credit Documents, together with
any of its successors.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such Person or any Subsidiary of such Person. The
term "control" (including the terms "controlled by" or "under common control
with") means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a Person, whether through
ownership, by contract, or otherwise.
"Agreement" means this Credit Agreement.
"Applicable Lending Office" means, with respect to each Bank and for
any particular type of transaction, the office of such Bank set forth in
Schedule I-B to this Agreement (or in the applicable Assignment and Acceptance
by which such Bank joined this Agreement) as its applicable lending office for
such type of transaction or such other office of such Bank as such Bank may from
time to time specify in writing to the Borrower and the Administrative Agent for
such particular type of transaction.
"Applicable Margin" means, with respect to interest rates and letter of
credit fees and as of any date of its determination, an amount equal to the
percentage amount set forth in the table below opposite the applicable Total
Debt to EBITDA ratio ("X" in the table below), measured as provided in Section
5.5(b)(ii), of the Borrower for the four fiscal quarters then most recently
ended:
Applicable Margin
Total Debt LIBOR Tranches and Applicable Margin
to EBITDA Letter of Credit Fee Prime Rate Tranche
-------------------- -------------------- ------------------
X < or = 2.25 1.75% 0%
2.25 < X < or = 2.75 2.00% 0%
2.75 < X < or = 3.25 2.25% 0%
3.25 < X < or = 3.75 2.50% .25%
3.75 < X 2.75% .50%
The foregoing ratio and resulting Applicable Margin shall be based upon
Schedule C of the most recent Compliance Certificate delivered to the
Administrative Agent pursuant to Section 5.2(a) or Section 5.2(b) (provided that
for the period from the date of this Agreement until the date six months after
the Closing Date, the Total Debt to EBITDA ratio shall be deemed to be greater
than 3.75 and the Applicable Margin shall be set accordingly).
Any adjustments to the Applicable Margin shall become effective on the
5th Business Day following the Administrative Agent's receipt of a Compliance
Certificate; provided, however, that if any such Compliance Certificate is not
delivered when required hereunder, the Applicable Margin shall be deemed to be
the maximum percentage amount in each table until such Compliance Certificate is
received by the Administrative Agent.
Upon any change in the Applicable Margin, the Administrative Agent
shall promptly notify the Borrower and the Banks of the new Applicable Margin.
"Approved Fund" means any Fund that is administered or managed by (a) a
Bank, (b) an Affiliate of a Bank or (c) an entity or an Affiliate of an entity
that administers or manages a Bank.
"Arranger" means Banc One Capital Markets, Inc.
"Asset Sale" means, with respect to any Person, any sale, transfer or
other disposition (including any loss, destruction or condemnation) of any
property, other than (a) the sale of inventory in the ordinary course of
business; (b) the transfer of property between Restricted Entities; (c) any
disposition of property in connection with the acquisition of property of a
similar kind and character, provided that the fair market value of such acquired
property shall be at least equal to the fair market value of such disposed
property, and (d) the sale of assets (collectively, the "Tesla Assets") by Tesla
Power and Automation, L.P. and Tesla Power Properties, L.P.; provided that the
Banks hereby direct the Administrative Agent to release its Liens on that part
of the Tesla Assets covered by the Security Documents upon the sale thereof if
and only if no Default has then occurred and is continuing or would result
therefrom.
"Assignment and Acceptance" means an Assignment and Acceptance in
substantially the form of Exhibit E executed by an assignor Bank, an assignee
Bank, and (if applicable) the Administrative Agent and/or the Borrower, in
accordance with Section 8.3.
"Available Revolving Loan Commitments" means an amount equal to the
excess, if any, of (a) the Revolving Loan Commitments then in effect over (b)
the aggregate outstanding principal amount of the Revolving Loan Borrowings plus
the aggregate outstanding principal amount of the Swing Line Loans plus the
Letter of Credit Exposure.
"Bankruptcy Event of Default" has the meaning set forth in Section
6.1(h).
"Banks" means the lenders listed as Banks on the signature pages of
this Agreement and each Purchaser that shall become a party to this Agreement
pursuant to Section 8.3.
"Base Rate" means, for any day, the fluctuating rate per annum of
interest equal to the greater of (a) the Prime Rate in effect on such day or (b)
the Federal Funds Rate in effect on such day plus 0.50%.
"Board" means the Board of Governors of the Federal Reserve System of
the United States (or any successor).
"Borrower" means Integrated Electrical Services, Inc., a Delaware
corporation.
"Borrowings" means the collective reference to the Term Loan Borrowings
and the Revolving Loan Borrowings.
"Business Day" means any Monday through Friday during which commercial
banks are open for business in Houston, Texas, and, if the applicable Business
Day relates to any LIBOR Tranche, on which dealings are carried on in the London
interbank market.
"Capital Expenditures" means, with respect to any Person and any period
of its determination, the consolidated expenditures of such Person during such
period that are required to be included in or are reflected by the consolidated
property, plant, or equipment accounts of such Person, or any similar fixed
asset or long term capitalized asset accounts of such Person, on the
consolidated balance sheet of such Person in conformity with generally accepted
accounting principles.
"Capital Lease" means, with respect to any Person, any lease of any
property by such Person which would, in accordance with generally accepted
accounting principles, be required to be classified and accounted for as a
capital lease on the balance sheet of such Person.
"Capital Lease Obligations" means, as to any Person, the obligations of
such Person to pay rent or other amounts under any Capital Lease.
"Change of Control" means, with respect to the Borrower, (a) the direct
or indirect acquisition after the date hereof by any Person or related Persons
constituting a group of (i) beneficial ownership of issued and outstanding
shares of Voting Securities of the Borrower, the result of which acquisition is
that such Person or such group possesses 35% or more of the combined voting
power of all then issued and outstanding Voting Securities of the Borrower or
(ii) the power to elect, appoint, or cause the election or appointment of at
least a majority of the members of the board of directors of the Borrower, or
(b) the individuals who, at the beginning of any period of 12 consecutive
months, constitute the Borrower's board of directors (together with any new
director whose election by the Borrower's board of directors or whose nomination
for election by the Borrower's stockholders entitled to vote thereon was
approved by a vote of at least a majority of the directors then still in office
who either were directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason (other
than death or disability) to constitute a majority of the Borrower's board of
directors then in office.
"Closing Date" means the date on which the conditions precedent set
forth in Section 3.1 shall have been satisfied, which date is February 27, 2004.
"Collateral" means any property (whether real or personal, tangible or
intangible, or mixed) subject to a Lien in favor of the Administrative Agent
pursuant to any Security Document.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor statute.
"Commitment" means, as to any Bank, the sum of the Term Loan Commitment
and the Revolving Loan Commitment of such Bank.
"Commitment Fee Rate" means, as of any date of its determination, an
amount equal to the percentage amount set forth in the table below opposite the
applicable Total Debt to EBITDA ratio ("X" in the table below), measured as
provided in Section 5.5(b)(ii), of the Borrower for the four fiscal quarters
then most recently ended:
Total Debt Commitment
to EBITDA Fee Rate
-------------------- ----------
X < or = 2.25 0.375%
2.25 < X < or = 2.75 0.375%
2.75 < X < or = 3.25 0.500%
3.25 < X < or = 3.75 0.500%
3.75 < X 0.500%
The foregoing ratio and resulting Commitment Fee Rate shall be based
upon Schedule C of the most recent Compliance Certificate delivered to the
Administrative Agent pursuant to Section 5.2(a) or Section 5.2(b) (provided that
for the period from the date of this Agreement until the date six months after
the Closing Date, the Total Debt to EBITDA ratio shall be deemed to be greater
than 3.75 and the Commitment Fee Rate shall be set accordingly).
Any adjustments to the Commitment Fee Rate shall become effective on
the 5th Business Day following the Administrative Agent's receipt of a
Compliance Certificate; provided, however, that if any such Compliance
Certificate is not delivered when required hereunder, the Commitment Fee Rate
shall be deemed to be the maximum percentage amount in the table until such
Compliance Certificate is received by the Administrative Agent.
Upon any change in the Commitment Fee Rate, the Administrative Agent
shall promptly notify the Borrower and the Banks of the new Commitment Fee Rate.
"Commonly Controlled Entity" means, with respect to any Person, any
other Person which is under common control with such Person within the meaning
of Section 414 of the Code.
"Compliance Certificate" means a compliance certificate executed by a
Responsible Officer of the Borrower in substantially the form of Exhibit A,
including the following attached Schedules:
Schedule A: The applicable financial reports provided under
Section 5.2(a) or 5.2(b) ending on the date of the computation of the
financial covenants.
Schedule B: A schedule of any adjustments to the financial
reports in Schedule A to the Compliance Certificate, listed on a
company-by-company basis, that are requested by the Borrower to reflect
the financial results of Acquisitions made prior to the end of the
applicable period, together with the supporting financial reports of
the Acquisitions from which the Borrower prepared such adjustments,
prepared in accordance with Section 1.3(c) and otherwise in a form
acceptable to the Administrative Agent.
Schedule C: The computation of the financial covenants under
this Agreement that are based upon the financial reports in Schedule A
or Schedule B, as applicable, to the Compliance Certificate, in a form
acceptable to the Administrative Agent.
"Contemplated Senior Subordinated Note Retirement" means the purchase,
redemption, defeasance or retirement of Senior Subordinated Notes (a) in an
aggregate outstanding principal amount of no more than $100,000,000 and (b) to
be consummated by no later than 180 days after the Closing Date.
"Continuation/Conversion Request" means a Continuation/Conversion
Request in substantially the form of Exhibit C executed by a Responsible Officer
of the Borrower and delivered to the Administrative Agent.
"Contract Status Report" means a report, in form and substance
acceptable to the Administrative Agent, detailing the status of each contract of
any Restricted Entity which contract has a value equal to or greater than
$7,500,000.
"Credit Documents" means this Agreement, the Term Loan Notes, the
Revolving Loan Notes, the Swing Line Note, the Letter of Credit Documents, the
Guaranty, the Security Documents, the Interest Hedge Agreements, and each other
agreement, instrument, or document executed at any time in connection with this
Agreement.
"Credit Obligations" means all principal and interest (including
interest accruing after the maturity of the loans made hereunder and interest
accruing after the filing of any petition in bankruptcy, or the commencement of
any insolvency, reorganization or like proceeding, relating to the Borrower,
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding) and fees, reimbursements, indemnifications, and other amounts
now or hereafter owed by the Borrower to the Administrative Agent and the Banks
(or with respect to the Interest Hedge Agreements, any Affiliates of the Banks)
under this Agreement, the Term Loan Notes, the Revolving Loan Notes, the Swing
Line Note, the Letter of Credit Documents, and the other Credit Documents and
any increases, extensions, and rearrangements of those obligations under any
amendments, supplements, and other modifications of the documents and agreements
creating those obligations.
"Credit Parties" means the Borrower and the Guarantors.
"Debt" means, with respect to any Person, without duplication, (a) indebtedness
of such Person for borrowed money, (b) obligations of such Person evidenced by
bonds, debentures, notes, or other similar instruments, (c) obligations of such
Person to pay the deferred purchase price of property or services (other than
trade debt and normal operating liabilities incurred in the ordinary course of
business), (d) obligations of such Person as lessee under Capital Leases, (e)
obligations of such Person under or relating to letters of credit, (f)
obligations of such Person under or relating to guaranties, purchase agreements,
or other assurances in favor of obligees of the kinds of indebtedness and
obligations referred to in clauses (a) through (e) of this definition, (g)
nonrecourse indebtedness or obligations of others of the kinds referred to in
clauses (a) through (f) of this definition secured by any Lien on or in respect
of any property of such Person, and (h) obligations of such Person evidenced by
preferred stock or other equity interests in such Person which provide for
mandatory redemption, mandatory payment of dividends, or similar rights to the
payment of money; provided, however, that in each instance such term shall not
mean or include any Debt in respect of which monies sufficient to pay and
discharge the same in full (either on the expressed date of maturity thereof or
on such earlier date as such Debt may be duly
called for redemption and payment) shall be deposited with the trustee under the
appropriate Senior Subordinated Note Indenture, if relevant, or otherwise a
depository, agency or trustee acceptable to the Administrative Agent, in each
case in trust for the payment thereof. For the purposes of determining the
amount of any Debt, the amount of any Debt described in clauses (e) and (f) of
this definition shall be valued at the maximum amount of the contingent
liability thereunder, the amount of any Debt described in clause (g) that is not
covered by clause (e) or (f) shall be valued at the lesser of the amount of the
Debt secured or the book value of the property securing such Debt, and the
amount of any Debt described in clause (h) shall be valued at the stated
redemption value of such Debt as of the date of determination.
"Default" means (a) an Event of Default or (b) any event or condition
which with notice or lapse of time or both would, unless cured or waived, become
an Event of Default.
"Default Rate" means, with respect to any amount due hereunder, a per
annum interest rate equal to (a) if such amount is either outstanding principal
accruing interest based upon a rate established elsewhere in this Agreement or
accrued but unpaid interest thereon, the sum of (i) the interest rate
established elsewhere in this Agreement from time to time for such principal
amount, including any Applicable Margin, plus (ii) 2.00% per annum or (b) in all
other cases, the Base Rate in effect from time to time plus the Applicable
Margin for the Prime Rate Tranche in effect from time to time plus 2.00% per
annum.
"Derivatives" means any swap, hedge, cap, collar, or similar
arrangement providing for the exchange of risks related to price changes in any
commodity, including money.
"Dollars" or "$" means lawful money of the United States of America.
"EBITDA" means, with respect to any Person and for any period of its
determination, the consolidated net income (excluding any extraordinary gains or
losses and all non-cash items, including depreciation, amortization and
non-recurring charges) of such Person for such period, plus the Interest Expense
and income taxes of such Person for such period, provided that, notwithstanding
anything herein to the contrary, for the purposes of calculating EBITDA, the
following shall be disregarded: (a) impairment to goodwill calculated in
accordance with FASB Statement No. 142, Goodwill and Other Intangibles; (b) the
prepayment premium due under the Senior Subordinated Note Indentures in
connection with the Contemplated Senior Subordinated Note Retirement, and (c)
losses from the write-down or write-off of the value of future (to the extent
made pursuant to current commitments heretofore disclosed to the Banks in
writing) and current investments in Energy Photovoltaics, Inc. and Entertech
Capital Partners II L.P.
"Eligible Junior Interests Sales" means all Junior Interests Sales
except (a) to the extent that the proceeds thereof are used to purchase, redeem,
retire or defease Senior Subordinated Notes; (b) the issuance or sale of the
Borrower's capital stock (including treasury stock) in connection with the
exercise of an option by an ESOP or by a beneficiary of an ESOP pursuant to the
terms of such ESOP, and (c) the issuance or sale of the Borrower's capital stock
(including treasury stock) pursuant to an ESOP.
"Environmental Law" means all federal, state, and local laws, rules,
regulations, ordinances, orders, decisions, agreements, and other requirements
now or hereafter in effect
relating to the pollution, destruction, loss, or injury of the environment, the
presence of any contaminant in the environment, the protection, cleanup,
remediation, or restoration of the environment, the creation, handling,
transportation, use, or disposal of any waste product in the environment,
exposure of persons to any contaminant, waste, or hazardous substance in the
environment, and the health and safety of employees in relation to their
environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ESOP" means (a) the IES, Inc. 1997 Director's Stock Plan; (b) the IES,
Inc. 1997 Incentive Compensation Plan; (c) the IES, Inc. 1997 Stock Plan; (d)
the IES, Inc. Employee Stock Repurchase Plan, and (e) similar successor employee
benefit stock plans.
"Eurocurrency Reserve Requirements" means for any day as applied to a
LIBOR Tranche, the aggregate (without duplication) of the maximum rates
(expressed as a decimal fraction) of reserve requirements in effect on such day
(including basic, supplemental, marginal and emergency reserves) under any
regulations of the Board or other governmental authority having jurisdiction
with respect thereto dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board) maintained by a member bank of the Federal Reserve
System.
"Eurodollar Base Rate" means, for any LIBOR Tranche for any Interest
Period therefor, the applicable British Bankers' Association LIBOR rate for
deposits in Dollars as reported by any generally recognized financial
information service as of 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period, and having a maturity equal to such
Interest Period, provided that, if no such British Bankers' Association LIBOR
rate is available to the Administrative Agent, the applicable LIBOR for the
relevant Interest Period shall instead be the rate determined by the
Administrative Agent to be the rate at which the Administrative Agent (in its
individual capacity) or one of its Affiliate banks offers to place deposits in
Dollars with first class banks in the 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 the Administrative Agent's (acting in its
individual capacity) ratable share of such LIBOR Tranche and having a maturity
equal to such Interest Period.
"Event of Default" has the meaning specified in Section 6.1.
"Facilities" means each of (a) the Term Loan Commitments and the Term
Loan made thereunder and (b) the Revolving Loan Commitments and the extensions
of credit made thereunder.
"Federal Funds Rate" means, for any period, a fluctuating per annum
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations at approximately
10:00 a.m., Houston time, for any such day on such transactions received by the
Administrative Agent from three different Federal funds brokers of recognized
standing selected by it in its sole discretion.
"Fee Letter" means the letter agreement dated January 22, 2004 among
the Borrower, Bank One, NA and the Arranger.
"Financial Statements" means the audited annual financial statements of
the Borrower for the period ending September 30, 2003, including the
consolidated balance sheets of the Borrower as of the end of such fiscal year
and the consolidated statements of income, stockholders' equity, and cash flows
for such fiscal year, as contained in the Form 10 K filed by the Borrower with
the Securities and Exchange Commission for the period ending on such date.
"Fixed Charges" means, with respect to any Person and as of the last
day of any fiscal quarter, the sum of (a) the current maturities of Debt (other
than the Revolving Loan, if relevant) of such Person as of such date plus (b)
principal payments on the Senior Subordinated Notes (not including (x) principal
payments made with the proceeds of Junior Interests Sales and (y) principal
payments in connection with the Contemplated Senior Subordinated Note
Retirement) and the Subordinated Debt for the preceding four fiscal quarters
then ending plus (c) Interest Expense of such Person for the preceding four
fiscal quarters then ending.
"Fund" means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"Guarantors" means (a) the Subsidiaries of the Borrower that have
executed or joined in the Guaranty and (b) any future Subsidiaries of the
Borrower that join the Guaranty pursuant to Section 5.19.
"Guaranty" means the Guaranty dated as of May 22, 2001, made by the
Subsidiaries of the Borrower in favor of the Administrative Agent guaranteeing
the Credit Obligations.
"Hazardous Materials" means any substance or material identified as a
hazardous substance pursuant to the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended and as now or hereafter in
effect; any substance or material regulated as a hazardous waste pursuant to the
Resource Conservation and Recovery Act of 1976, as amended and as now or
hereafter in effect; and any substance or material designated as a hazardous
substance or hazardous waste pursuant to any other Environmental Law.
"Highest Lawful Rate" means the maximum lawful interest rate, if any,
that at any time or from time to time may be contracted for, charged, or
received under the laws applicable to the relevant Bank which are presently in
effect or, to the extent allowed by law, under such applicable laws which may
hereafter be in effect and which allow a higher maximum nonusurious interest
rate than applicable laws now allow. On each day, if any, that Texas law
establishes the Highest Lawful Rate, the Highest Lawful Rate shall be the
"weekly ceiling" (as defined in the Texas Credit Code) for that day.
"Interest Expense" means, with respect to any Person and for any period
of its determination, the consolidated interest expense of such Person during
such period excluding the amortization of debt issuance costs.
"Interest Hedge Agreements" means any swap, hedge, cap, collar, or
similar arrangement between the Borrower and any Bank (or any Affiliate of any
Bank).
"Interest Period" means, with respect to each LIBOR Tranche, the period
commencing on the date of such LIBOR Tranche and ending on the last day of the
period selected by the Borrower pursuant to the provisions below. The duration
of each such Interest Period shall be one, two, three, or six months, in each
case as the Borrower may select in the applicable Term Loan Borrowing Request,
Revolving Loan Borrowing Request or Continuation/Conversion Request (unless
there shall exist any Default or Event of Default, in which case the Borrower
may only select one month Interest Periods); provided, however, that:
a. whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next succeeding Business Day;
provided that if such extension would cause the last day of such Interest Period
to occur in the next following calendar month, the last day of such Interest
Period shall occur on the next preceding Business Day;
b. any Interest Period which begins on the last Business Day
of the calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar month in which it would have
ended if there were a numerically corresponding day in such calendar month; and
c. the Borrower may not select an Interest Period for any
LIBOR Tranche which ends after the Revolving Loan Maturity Date or after the
date final payment is due on the Term Loan, as the case may be.
"Interim Financial Statements" means the consolidated financial
statements of the Borrower dated as of December 31, 2003, including the
consolidated balance sheets of the Borrower as of the end of such fiscal quarter
and the consolidated statements of income and cash flows for such fiscal quarter
and for the fiscal year to date period ending on the last day of such fiscal
quarter.
"Issuing Bank" means Bank One, NA.
"Joinder Agreement" has the meaning set forth in Section 5.19.
"Junior Interests Sale" means, with respect to any Person, (a) the
issuance of capital stock (including the sale of treasury stock), partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person; (b) the
issuance of any warrants, options or other rights entitling the holder thereof
to purchase or acquire any such equity interest, and (c) the issuance of any
Senior Subordinated Notes or Subordinated Debt, in each case except where both
the issuer and the recipient are Restricted Entities.
"Letter of Credit" means any commercial or standby letter of credit
issued by the Issuing Bank for the account of the Borrower pursuant to the terms
of this Agreement.
"Letter of Credit Application" means the Issuing Bank's standard form
letter of credit application for either a commercial or standby letter of
credit, as the case may be, which has been executed by the Borrower and accepted
by the Issuing Bank in connection with the issuance of a Letter of Credit.
"Letter of Credit Application Amendment" means the Issuing Bank's
standard form application to amend a letter of credit for either a commercial or
standby letter of credit, as the case may be, which has been executed by the
Borrower and accepted by the Issuing Bank in connection with the increase or
extension of a Letter of Credit.
"Letter of Credit Collateral Account" means a special cash collateral
account pledged to the Administrative Agent containing cash deposited pursuant
to Section 2.3(d) or 6.4 to be maintained with the Administrative Agent in
accordance with Section 2.3(g).
"Letter of Credit Documents" means all Letters of Credit, Letter of
Credit Applications, Letter of Credit Application Amendments, and agreements,
documents, and instruments entered into in connection with or relating thereto.
"Letter of Credit Exposure" means, as of any date of its determination,
the aggregate outstanding undrawn amount of all then outstanding Letters of
Credit plus the aggregate then outstanding amount of the reimbursement
obligations of the Borrower under the Letter of Credit Applications and this
Agreement.
"LIBOR" means, for any LIBOR Tranche for any Interest Period therefor,
a rate per annum determined in accordance with the following formula (rounded
upward to the nearest 1/100th of 1%):
Eurodollar Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"LIBOR Tranche" means any Tranche which bears interest based upon the
LIBOR, as determined in accordance with Section 2.6.
"Lien" means any mortgage, lien, pledge, charge, deed of trust,
security interest, encumbrance, or other type of preferential arrangement to
secure or provide for the payment of any obligation of any Person, whether
arising by contract, operation of law, or otherwise (including any title
retention for such purposes under any conditional sale agreement, any Capital
Lease, or any other title transfer or retention agreement).
"Loan Advances" means the collective reference to the Term Loan
Advances and the Revolving Loan Advances.
"Majority Banks" means, at any time, Banks holding more than 50% of the
sum of (a) the aggregate then-unpaid principal amount of the Term Loan Notes
held by the Banks (or, if no such principal amount is then outstanding and the
Term Loan Borrowing has not been made, the aggregate amount of the Term Loan
Commitments at such time) and (b) the aggregate amount of the Revolving Loan
Commitments at such time (or, if the Revolving Loan Commitments have
been terminated, the aggregate then-unpaid principal amount of the Revolving
Loan Notes held by the Banks and the Letter of Credit Exposure of the Banks at
such time).
"Material Adverse Change" means any material adverse change in the
business, assets, liabilities (actual or contingent), operations or condition
(financial or otherwise) of the Borrower and its Subsidiaries on a consolidated
basis.
"Mortgages" means a mortgage, deed of trust, security deed or other
instrument, in form and substance satisfactory to the Administrative Agent,
creating a Lien on certain real property of the Borrower and its Subsidiaries
located in Maryland, South Carolina, Tennessee and Texas to secure the Credit
Obligations.
"Net EBITDA" means, with respect to any Person and for any period of
its determination, EBITDA minus cash tax expense minus $12,000,000 minus
Restricted Payments, in each case of such Person for such period and determined
on a consolidated basis.
"Net Worth" means, with respect to any Person and as of any date of its
determination, the excess of (a) the assets of such Person over (b) the
liabilities of such Person, provided that, notwithstanding anything herein to
the contrary, for the purposes of calculating Net Worth, (x) impairments to
goodwill calculated in accordance with FASB Statement No. 142, Goodwill and
Other Intangibles, and (y) losses from the write-down or write-off of the value
of future (to the extent made pursuant to current commitments heretofore
disclosed to the Banks in writing) and current investments in Energy
Photovolaics, Inc. and Entertech Capital Partners II L.P. shall be disregarded.
"Other Taxes" has the meaning set forth in Section 2.12(b).
"Partnership Pledge Agreement" means the Pledge Agreement dated as of
May 22, 2001, made by the respective limited and general partners of each
limited partnership Subsidiary of the Borrower, in favor of the Administrative
Agent granting the Administrative Agent a security interest in the partnership
interests of such partners in such limited partnerships, to secure the Credit
Obligations.
"Permitted Debt" means all of the following Debt:
a. Debt in the form of the Credit Obligations;
b. Debt in the form of indebtedness for borrowed money and
letters of credit owed by any Subsidiary of the Borrower prior to the
acquisition of such Subsidiary by the Borrower in an Acquisition transaction, or
owed by any Person that is the subject of any Acquisition assumed by the
Borrower or any Subsidiary of the Borrower in connection with such Acquisition,
provided that with respect to any such indebtedness, arrangements satisfactory
to the Administrative Agent for the repayment of such indebtedness within 90
days following the closing of the Acquisition are made prior to the closing of
the Acquisition and such arrangements are executed;
c. Debt in the form of (i) purchase money indebtedness and
Capital Leases and (ii) other Debt, which Debt under clauses (i) and (ii),
together are in an aggregate outstanding amount not to exceed $3,500,000;
d. Debt in the form of Subordinated Debt and the Senior
Subordinated Notes;
e. Debt in the form of Qualified Preferred Stock;
f. Debt in the form of reimbursement obligations for Surety
Bonds procured in the ordinary course of business; and
g. renewals, extensions and refinancings of the Debt described
above in the same or lesser principal amount on similar terms and conditions and
in any event no less favorable to the interests of the Banks.
"Permitted Investments" means all of the following investments:
a. investments (including investments in the form of loans) in
wholly owned Subsidiaries of the Borrower;
b. investments in the form of loans, guaranties, open
accounts, and other extensions of trade credit in the ordinary course of
business;
c. investments in commercial paper, bankers' acceptances, loan
participation agreements, and other similar investments, in each case, maturing
in twelve months or less from the date of issuance and which, at the time of
acquisition are rated A 2 or better by Standard & Poor's Ratings Services and P
2 or better by Xxxxx'x Investors Service, Inc.;
d. investments in direct obligations of the United States, or
investments in any Person which investments are guaranteed by the full faith and
credit of the United States, in either case maturing in twelve months or less
from the date of acquisition thereof and repurchase agreements having a term of
less than one year and fully collateralized by such obligations which are
entered into with banks or trust companies described in clause (e) below or
brokerage companies having net worth in excess of $250,000,000;
e. investments in time deposits or certificates of deposit
maturing within one year from the date such investment is made, issued by a bank
or trust company organized under the laws of the United States or any state
thereof having capital, surplus, and undivided profits aggregating at least
$250,000,000 or a foreign branch thereof and whose long term certificates of
deposit are, at the time of acquisition thereof, rated A 2 by Standard & Poor's
Ratings Services or Prime 2 by Xxxxx'x Investors Service, Inc.;
f. investments in money market funds which invest solely in
the types of investments described in paragraphs (c) through (e) above;
g. loans and advances to directors, officers, and employees of
the Credit Parties made in the ordinary course of business in an aggregate
outstanding amount not to exceed $1,000,000;
h. acquisitions permitted by Section 5.9(c)(ii);
i. purchases of the Borrower's capital stock permitted by
Section 5.10; and
j. other investments (including loans and advances), not to
exceed $10,000,000 in the aggregate in any fiscal year of the Borrower.
"Permitted Liens" means all of the following Liens:
a. Liens securing the Credit Obligations;
b. Liens securing purchase money debt, Capital Leases, and
assumed or acquired indebtedness for borrowed money and letters of credit
permitted under clause (b) of the definition of Permitted Debt, provided that no
such Lien is spread to cover any property not (i) purchased in connection with
the incurrence of such Debt, in the case of purchase money debt, or (ii) covered
by such Lien at the time of the assumption or acquisition of the indebtedness
secured thereby, in the case of assumed or acquired indebtedness for borrowed
money and letters of credit; and
c. Liens arising in the ordinary course of business which are
not incurred in connection with the borrowing of money, the obtaining of
advances or credit, or payment of legal judgments and which do not materially
detract from the value of any Restricted Entity's assets or materially interfere
with any Restricted Entity's business, including such (i) Liens for taxes,
assessments, or other governmental charges or levies not yet due or that are
being contested in good faith by appropriate proceedings, provided that adequate
reserves with respect thereto are maintained on the books of the Borrower or its
Subsidiaries; (ii) Liens in connection with worker's compensation, unemployment
insurance, or other social security, old age pension, or public liability
obligations not yet due or that are being contested in good faith by appropriate
proceedings; (iii) Liens in the form of legal or equitable encumbrances deemed
to exist by reason of negative pledge covenants and other covenants or
undertakings of like nature; (iv) Liens in the form of vendors', carriers',
warehousemen's, repairmen's, mechanics', workmen's, materialmen's, construction,
or other like Liens arising by operation of law in the ordinary course of
business or incident to the construction or improvement of any property,
including liens on such property securing reimbursement obligations for Surety
Bonds procured in the ordinary course of business; and (v) Liens in the form of
zoning restrictions, easements, licenses, and other restrictions on the use of
real property or minor irregularities in title thereto which do not materially
impair the use of such property in the operation of the business of the
applicable Restricted Entity or the value of such property.
"Person" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture, or other entity, or a government or
any political subdivision or agency thereof, or any trustee, receiver,
custodian, or similar official.
"Plan" means any (a) employee welfare benefit plan under Section 3(1)
of ERISA, (b) employee pension benefit plan under Section 3(2) of ERISA, (c)
multiemployer plan under Section 4001(a)(3) of ERISA, and (d) employee
individual account benefit plan under Section 3(2) of ERISA, in each case, in
which each Restricted Entity or any of their respective
Commonly Controlled Entities is or would be deemed to be an "employer" as
defined in Section 3(5) of ERISA.
"Pledge Agreements" means, collectively (i) the Stock Pledge Agreement,
(ii) the Partnership Pledge Agreement, and (iii) any future agreements granting
the Administrative Agent a security interest in capital stock, partnership
interests, or other membership interests of any Subsidiary (direct or indirect)
of the Borrower, in each case, to secure the Credit Obligations.
"Prepayment Proceeds" means (a) all net cash proceeds (including, if
applicable, cash proceeds received over time as and when the same are received)
from an Asset Sale to the extent such proceeds, plus the net cash proceeds from
all other Asset Sales received during the 12 months before such receipt of
proceeds from such Asset Sale, exceeds $5,000,000 and (b) 75% of all net cash
proceeds (including, if applicable, cash proceeds received over time as and when
the same are received) from Eligible Junior Interest Sales.
"Prime Rate" means, for any day, the fluctuating per annum interest
rate in effect on such day equal to the rate of interest publicly announced by
the Administrative Agent as its prime rate, whether or not the Borrower has
notice thereof.
"Prime Rate Borrowing" shall mean that portion of any Borrowing which
bears interest based upon the Base Rate as determined in accordance with Section
2.6.
"Prime Rate Tranche" shall mean the Tranche which bears interest based
upon the Base Rate, as determined in accordance with Section 2.6.
"Prohibited Transaction" means any transaction set forth in Section 406
of ERISA or Section 4975 of the Code.
"Projections" has the meaning set forth in Section 5.2(f).
"Purchaser" has the meaning set forth in Section 8.3.
"Qualified Preferred Stock" means, with respect to the Borrower and as
of any date of its issuance, any shares of preferred stock of the Borrower that
(a) are issued after the date of this Agreement, (b) provide for their mandatory
redemption on a date, if at all, that is on or after the first anniversary of
the latest scheduled maturity of any of the Credit Obligations at the time
issued, and (c) provide in the applicable certificate of designation for the
redemption of such shares and for the blockage of Restricted Payments in respect
of such shares during the existence of a Default or an Event of Default (i) on
the terms and conditions set forth on Schedule III, or (ii) on terms approved by
the Administrative Agent and the Majority Banks in their sole discretion, all
such provisions to be in form and content satisfactory to the Administrative
Agent and the Majority Banks in their sole discretion.
"ratable share" or "pro rata share" means, with respect to any Bank and
as of any date of its determination, either (a) until the Closing Date, the
ratio of such Bank's Commitment at such time to the aggregate Commitments at
such time or (b) thereafter, the ratio of such Bank's aggregate outstanding Term
Loan Advance and/or such Bank's Revolving Loan Commitment at such time (or, if
the Revolving Loan Commitments have been terminated, Revolving Loan
Advances and share of the Letter of Credit Exposure at such time) to the
aggregate outstanding Term Loan Advances and/or Revolving Loan Commitments at
such time (or, if the Revolving Loan Commitments have been terminated, Revolving
Loan Advances and Letter of Credit Exposure at such time), in each case as the
context may require.
"Refunded Swing Line Loans" has the meaning set forth in Section
2.4(c)(i).
"Refunding Date" has the meaning set forth in Section 2.4(c)(ii).
"Related Parties" means, with respect to any Person, such Person's
stockholders, directors, officers, employees, agents, Affiliates, successors,
and assigns, and their respective stockholders, directors, officers, employees,
and agents, and, with respect to any Person that is an individual, such Person's
family relations and heirs.
"Reportable Event" means any of the events set forth in Section 4043 of
ERISA.
"Responsible Officer" means, with respect to any Person, such Person's
Chief Executive Officer, President, Chief Financial Officer, Secretary, Chief
Accounting Officer, or any other officer of such Person designated by any of the
foregoing in writing from time to time.
"Restricted Entities" means the Borrower and each Subsidiary of the
Borrower.
"Restricted Payment" means the declaration or making by any Person of
any (a) dividends; (b) purchase, redemption, retirement, or other acquisition
for value any of its capital stock now or hereafter outstanding, or any
distribution of assets to its stockholders as such, whether in cash, assets, or
in obligations of it; (c) allocation or other setting apart of any sum for the
payment of any dividend or distribution on, or for the purchase, redemption, or
retirement of, any shares of its capital stock; or (d) making of any other
distribution by reduction of capital or otherwise in respect of any shares of
its capital stock; in each case, other than any such dividends, distributions,
and payments payable solely in such Person's common stock.
"Revolving Loan" means the aggregate outstanding principal amount of
the Revolving Loan Borrowings.
"Revolving Loan Advance" means the outstanding principal from a Bank
which represents such Bank's ratable share of a Revolving Loan Borrowing.
"Revolving Loan Borrowing" means any aggregate amount of principal
advanced on the same day and pursuant to the same Revolving Loan Borrowing
Request under the revolving loan facility created in Section 2.2.
"Revolving Loan Borrowing Request" means a Revolving Loan Borrowing
Request in substantially the form of Exhibit B-1 executed by a Responsible
Officer of the Borrower and delivered to the Administrative Agent.
"Revolving Loan Commitment" means, for any Bank, the amount set forth
opposite such Bank's name on Schedule I-A as its Revolving Loan Commitment, or
if such Bank has entered into any Assignment and Acceptance since the date of
this Agreement, as set forth for such Bank
as its Revolving Loan Commitment in the Register maintained by the
Administrative Agent pursuant to Section 8.3(d), in each case as such amount may
be reduced pursuant to Section 2l.2(e) or terminated pursuant to Section 6.2.
"Revolving Loan Maturity Date" means the date four years after the
Closing Date.
"Revolving Loan Note" means a promissory note of the Borrower payable
to the order of a Bank, in substantially the form of Exhibit D-1, evidencing the
indebtedness of the Borrower to such Bank resulting from Revolving Loan Advances
made by such Bank to the Borrower.
"Revolving Loan Percentage" means, as to any Bank at any time, the
percentage which such Bank's Revolving Loan Commitment then constitutes of the
aggregate Revolving Loan Commitments or, at any time after the Revolving Loan
Commitments shall have expired or terminated, the percentage which the aggregate
principal amount of such Bank's Revolving Loan Advances then outstanding
constitutes of the aggregate principal amount of the Revolving Loan Advances
then outstanding.
"Security Agreement" means the Security Agreement dated as of May 22,
2001, made by the Borrower and the Subsidiaries of the Borrower in favor of the
Administrative Agent granting the Administrative Agent a security interest in
the receivables, equipment, inventory and other personal property of each such
Credit Party to secure the Credit Obligations.
"Security Documents" means the Security Agreement, the Pledge
Agreements, the Mortgages and any other document creating or consenting to Liens
in favor of the Administrative Agent securing Credit Obligations.
"Senior Debt" means all Debt of the Borrower and the Subsidiaries of
the Borrower other than Debt in the form of Subordinated Debt and the Senior
Subordinated Notes.
"Senior Subordinated Note Indentures" means (i) the Indenture, dated as
of January 28, 1999, among the Borrower, certain of its Subsidiaries and U.S.
Bank Corporate Trust, successor in interest to State Street Bank and Trust
Company, as trustee, together with all instruments and other agreements entered
into by the Borrower or such Subsidiaries in connection therewith, and (ii) the
indenture(s) entered into by the Borrower and others in connection with the
issuance of other Senior Subordinated Notes, together with all instruments and
other agreements entered into by the Borrower and/or such Subsidiaries in
connection therewith.
"Senior Subordinated Notes" means the outstanding 9 3/8% Senior
Subordinated Notes due 2009 issued by the Borrower, together with the subsidiary
guarantees thereof.
"Stock Pledge Agreement" means the Pledge Agreement dated as of May 22,
2001, as the same has been supplemented by Joinder Agreements prior to the date
hereof, made by Borrower and certain Subsidiaries of Borrower in favor of the
Administrative Agent granting the Administrative Agent a security interest in
the capital stock or membership interests, as applicable, of each Subsidiary
(whether direct or indirect) of Borrower, to secure the Credit Obligations.
"Subordinated Debt" means, with respect to the Borrower and as of any
date of its issuance, any unsecured indebtedness for borrowed money, other than
the Senior Subordinated Notes, for which the Borrower is directly and primarily
obligated that (a) arises after the date of this Agreement, (b) does not have
any stated maturity before the date six months following the latest maturity of
any of the Credit Obligations at the time incurred, (c) has terms that are no
more restrictive than the terms of the Credit Documents, which terms shall in
any event (i) prohibit the acceleration of such indebtedness without 5 days'
prior written notice to the Administrative Agent, (ii) not include a
cross-default provision to other indebtedness (other than to a principal payment
default of such other indebtedness), (iii) not include any financial covenants
other than the type described in Section 5.5 and (iv) with respect any such
financial covenants, be at least 20% less restrictive on the Borrower and its
Subsidiaries than those contained herein, and (d) is expressly subordinated to
the Credit Obligations (i) on the terms and conditions no less restrictive on
the holders thereof than the subordination terms applicable to the Senior
Subordinated Notes, or (ii) on terms approved by the Administrative Agent and
the Majority Banks in their sole discretion, including payment subordination,
remedy subordination, and related terms satisfactory to the Administrative Agent
and the Majority Banks in their sole discretion.
"Subordinated Debt Indenture" means any indenture or like agreement
entered into by the Borrower in connection with the issuance of Subordinated
Debt, together with all instruments and other agreements entered into by the
Borrower in connection therewith.
"Subsidiary" means, with respect to any Person, any other Person, a
majority of whose outstanding Voting Securities (other than directors'
qualifying shares) shall at any time be owned by such Person or one or more
Subsidiaries of such person.
"Surety Bond" means any surety bond, insurance policy, indemnity
agreement, guaranty, letter of credit or other instrument provided by a third
party (that is, excluding an Affiliate of the obligor) to an obligee to assure
the payment by and/or performance of an obligor.
"Swing Line Borrowing" means any aggregate amount of principal advanced
on the same day and pursuant to the same notice under the swing line facility
created in Section 2.4.
"Swing Line Commitment" means the obligation of the Swing Line Lender
to make Swing Line Loans pursuant to Section 2.4 in an aggregate principal
amount at any one time outstanding not to exceed $10,000,000.
"Swing Line Lender" means Bank One, NA.
"Swing Line Loan" has the meaning set forth in Section 2.4(a).
"Swing Line Note" means the promissory note of the Borrower payable to
the order of the Swing Line Lender, in substantially the form of Exhibit D-3,
evidencing the indebtedness of the Borrower to the Swing Line Lender resulting
from Swing Line Loans made by the Swing Line Lender to the Borrower.
"Swing Line Participation Amount" has the meaning set forth in Section
2.4(c)(ii).
"Term Loan" means the aggregate outstanding principal amount of the
Term Loan Borrowing.
"Term Loan Advance" means the outstanding principal from a Bank which
represents such Bank's ratable share of the Term Loan Borrowing.
"Term Loan Borrowing" means the aggregate amount of principal advanced
pursuant to the Term Loan Borrowing Request under the term loan facility created
in Section 2.1.
"Term Loan Borrowing Request" means the Term Loan Borrowing Request in
substantially the form of Exhibit B-2 executed by a Responsible Officer of the
Borrower and delivered to the Administrative Agent.
"Term Loan Commitment" means, for any Bank, the amount set forth
opposite such Bank's name on Schedule I-A as its Term Loan Commitment, or if
such Bank has entered into any Assignment and Acceptance since the date of this
Agreement, as set forth for such Bank as its Term Loan Commitment in the
Register maintained by the Administrative Agent pursuant to Section 8.3(d), in
each case as such amount may be terminated pursuant to Section 6.2.
"Term Loan Note" means a promissory note of the Borrower payable to the
order of a Bank, in substantially the form of Exhibit D-2, evidencing the
indebtedness of the Borrower to such Bank resulting from the Term Loan Advance
made by such Bank to the Borrower.
"Term Loan Percentage" means, as to any Bank at any time, the
percentage which such Bank's Term Loan Commitment then constitutes of the
aggregate Term Loan Commitments (or, at any time after the Closing Date, the
percentage which the aggregate principal amount of such Bank's Term Loan Advance
then outstanding constitutes of the aggregate principal amount of the Term Loan
Advances then outstanding).
"Total Debt" means all Debt of the Borrower and the Subsidiaries of the
Borrower.
"Tranche" means any tranche of principal outstanding under the Term
Loan or the Revolving Loan accruing interest on the same basis, whether created
in connection with new advances of principal under the Revolving Loan pursuant
to Section 2.6(a)(i) or by the continuation or conversion of existing tranches
of principal under the Term Loan or the Revolving Loan pursuant to Section
2.6(a)(ii), and shall include the Prime Rate Tranche or any LIBOR Tranche.
"Type" has the meaning set forth in Section 1.4.
"Unbonded Accounts Receivable" means, with respect to any Person, the
accounts receivable of such Person, determined on a consolidated basis and net
of allowances, excluding accounts receivable arising under contracts where the
account obligee has caused to be provided to the account debtor a Surety Bond.
"Voting Securities" means (a) with respect to any corporation, any
capital stock of the corporation having general voting power under ordinary
circumstances to elect directors of such corporation, (b) with respect to any
partnership, any partnership interest having general voting
power under ordinary circumstances to elect the general partner or other
management of the partnership, and (c) with respect to any other Person, such
ownership interests in such Person having general voting power under ordinary
circumstances to elect the management of such Person, in each case irrespective
of whether at the time any other class of stock, partnership interests, or other
ownership interest might have special voting power or rights by reason of the
happening of any contingency.
1.2 Computation of Time Periods.
In this Agreement in the computation of periods of time from a specified date to
a later specified date, the word "from" means "from and including" and the words
"to" and "until" each means "to but excluding."
1.3 Accounting Terms; Preparation of Financials.
a. All accounting terms, definitions, ratios, and other tests described herein
shall be construed in accordance with United States generally accepted
accounting principles applied on a consistent basis with those applied in the
preparation of the Financial Statements, except as expressly set forth in this
Agreement. In the event that any Accounting Change (as defined below) shall
occur and such change results in a change in the method of calculation of
financial covenants, standards or terms in this Agreement, then the Borrower and
the Administrative Agent agree to enter into negotiations in order to amend such
provisions of this Agreement so as to reflect equitably such Accounting Changes
with the desired result that the criteria for evaluating the Borrower's
financial condition shall be the same after such Accounting Changes as if such
Accounting Changes had not been made. Until such time as such an amendment shall
have been executed and delivered by the Borrower, the Administrative Agent and
the Majority Banks, all financial covenants, standards and terms in this
Agreement shall continue to be calculated or construed as if such Accounting
Changes had not occurred. "Accounting Changes" refers to changes in accounting
principles required by the promulgation of any rule, regulation, pronouncement
or opinion by the Financial Accounting Standards Board of the American Institute
of Certified Public Accountants or, if applicable, the Securities and Exchange
Commission.
b. The Restricted Entities shall prepare their financial statements in
accordance with United States generally accepted accounting principles applied
on a consistent basis with those applied in the preparation of the Financial
Statements, unless otherwise approved in writing by the Administrative Agent.
c. The Borrower shall calculate the Applicable Margin and compliance with the
financial covenants under this Agreement in Schedule C of the Compliance
Certificate. Where expressly permitted in this Agreement, the Borrower may elect
to base such calculations upon the financial reports in Schedule B of such
Compliance Certificate. In such case the accounting terms, definitions, ratios,
and other tests used in making such calculation shall be construed as required
by paragraph (a) above except that the consolidated financial results of the
Borrower shall be deemed to be the adjusted consolidated financial results of
the Borrower set forth in Schedule B of the Compliance Certificate. Unless
otherwise expressly permitted in this Agreement, the Borrower shall calculate
the Applicable Margin or compliance with a financial covenant under
this Agreement based upon the financial reports in Schedule A of a Compliance
Certificate. In such case the accounting terms, definitions, ratios, and other
tests used in making such calculation shall be construed as required by
paragraph (a) above. When calculating the Applicable Margin or compliance with a
financial covenant under this Agreement based upon the financial reports in
Schedule B of the Compliance Certificate, the Borrower shall prepare such
calculations in accordance with the following provisions:
i. The Borrower may select one or more Acquisitions for
inclusion in the adjustments permitted in Schedule B or C of the
Compliance Certificate; provided that if the inclusion of any
Acquisition results in an increase in the consolidated EBITDA of the
Borrower over the consolidated EBITDA of the Borrower required to be
reported in Schedule A of the Compliance Certificate, then the Borrower
must include all Acquisitions which would cause a decrease in the
consolidated EBITDA of the Borrower in Schedule B and C of the
Compliance Certificate.
ii. No Acquisition may be included in Schedule B or C of the
Compliance Certificate at the request of the Borrower unless the
financial reports of the acquired Person or assets from which Schedule
B and C are prepared are (A) audited financial reports prepared by an
independent certified public accounting firm, or (B) with respect to
unaudited financial reports, are otherwise approved by the Majority
Banks (provided that no Bank may condition such approval upon its
receipt of a fee, however denominated).
1.4 Types.
The "Type" of a Tranche refers to the determination whether such tranche is a
LIBOR Tranche or the Prime Rate Tranche.
1.5 Interpretation.
Article, Section, Schedule, and Exhibit references are to this Agreement, unless
otherwise specified. All references to instruments, documents, contracts, and
agreements are references to such instruments, documents, contracts, and
agreements as the same may be amended, supplemented, and otherwise modified from
time to time, unless otherwise specified. The word "including" shall mean
"including but not limited to." The word "or" shall mean "and/or" wherever
necessary to prevent interpretation of any provision against the Administrative
Agent or the Banks. Whenever the Borrower has an obligation under this Agreement
and the other Credit Documents the expense of complying with that obligation
shall be an expense of the Borrower unless otherwise specified. Whenever any
determination is to be made by the Administrative Agent or any Bank, such
determination shall be in such Person's sole discretion unless otherwise
specified in this Agreement. If any provision in this Agreement or the other
Credit Documents is held to be illegal, invalid, not binding, or unenforceable,
such provision shall be fully severable and this Agreement and the other Credit
Documents shall be construed and enforced as if such illegal, invalid, not
binding, or unenforceable provision had never comprised a part of this Agreement
or the other Credit Documents, and the remaining provisions shall remain in full
force and effect. This Agreement and the other Credit Documents have been
reviewed and negotiated by sophisticated parties with access to legal counsel
and shall not be
construed against the drafter. In the event of a conflict between this Agreement
and any other Credit Documents, this Agreement shall control.
ARTICLE 2
CREDIT FACILITIES
2.1 Term Loan Facility
a. Term Loan Commitments. Each Bank severally agrees, on the terms and
conditions set forth in this Agreement and for the purposes set forth in Section
5.4, to make a Term Loan Advance to the Borrower as such Bank's ratable share of
the Term Loan Borrowing requested by the Borrower on the Closing Date, provided
that the aggregate outstanding principal amount of the Term Loan Advance made by
such Bank shall not exceed such Bank's Term Loan Commitment. The Term Loan
Borrowing made on the Closing Date shall initially be a Prime Rate Borrowing,
but may be immediately converted to a LIBOR Tranche in accordance with Section
2.6(a). The indebtedness of the Borrower to the Banks resulting from the Term
Loan Advances made by the Banks shall be evidenced by Term Loan Notes made by
the Borrower.
b. Method of Advancing.
i. The Term Loan Borrowing shall be made pursuant to a Term Loan
Borrowing Request given by the Borrower to the Administrative Agent in writing
or by telecopy not later than 11:00 a.m. (local time at the Applicable Lending
Office of the Administrative Agent) on the anticipated Closing Date. The Term
Loan Borrowing Request shall be fully completed and shall specify the
information required therein, and shall be irrevocable and binding on the
Borrower. Upon receipt of the Term Loan Borrowing Request by the Administrative
Agent, the Administrative Agent shall promptly forward notice of the Term Loan
Borrowing to the Banks. Each Bank shall, before 1:00 p.m. (local time at the
Applicable Lending Office of the Administrative Agent) on the anticipated
Closing Date, make available from its Applicable Lending Office to the
Administrative Agent at the Administrative Agent's Applicable Lending Office, in
immediately available funds, such Bank's ratable share of the Term Loan
Borrowing. Subject to the satisfaction of all applicable conditions precedent,
after receipt by the Administrative Agent of such funds, the Administrative
Agent shall, by 4:00 p.m. (local time at the Applicable Lending Office of the
Administrative Agent), on the Closing Date make the Term Loan Borrowing
available to the Borrower in immediately available funds at any account of
Borrower which is designated in writing by the Borrower to the Administrative
Agent.
ii. Unless the Administrative Agent shall have received notice from a
Bank before the anticipated Closing Date that such Bank shall not make available
to the Administrative Agent such Bank's ratable share of the Term Loan
Borrowing, the Administrative Agent may assume that such Bank has made its
ratable share of the Term Loan Borrowing available to the Administrative Agent
on the Closing Date in accordance with paragraph (i) above, and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that such
Bank shall not have so made its ratable share of the Term Loan Borrowing
available to the Administrative Agent, such Bank agrees that it shall pay
interest on such amount for each day from the date such amount is made available
to the Borrower by the Administrative Agent until the date such amount is paid
to the Administrative Agent by such Bank at the Federal Funds Rate in effect
from time to time, provided that with respect to such Bank if such amount is not
paid by such Bank by the end of the second day after the Administrative Agent
makes such amount available to the Borrower, the interest rates specified above
shall be increased by a per annum amount equal to 2.00% on the
third day and shall remain at such increased rate thereafter. Interest on such
amount shall be due and payable by such Bank upon demand by the Administrative
Agent. If such Bank shall pay to the Administrative Agent such amount and
interest as provided above, such amount so paid shall constitute such Bank's
Term Loan Advance as part of the Term Loan Borrowing for all purposes of this
Agreement even though not made on the same day as the other Term Loan Advances
comprising the Term Loan Borrowing. In the event that such Bank has not repaid
such amount by the end of the fifth day after such amount was made available to
the Borrower, the Borrower agrees to repay to the Administrative Agent on demand
such amount, together with interest on such amount for each day from the date
such amount was made available to the Borrower until the date such amount is
repaid to the Administrative Agent at the interest rate charged to the Borrower
for the Term Loan Borrowing under the terms of this Agreement.
iii. The failure of any Bank to make available its ratable share of the
Term Loan Borrowing shall not relieve any other Bank of its obligation, if any,
to make available its ratable share of the Term Loan Borrowing. No Bank shall be
responsible for the failure of any other Bank to honor such other Bank's
obligations hereunder, including any failure to make available any funds as part
of the Term Loan Borrowing.
c. Prepayment.
i. The Borrower may prepay the outstanding principal amount of the Term
Loan pursuant to written notice given by the Borrower to the Administrative
Agent in writing or by telecopy not later than (A) 1:00 p.m. (local time at the
Applicable Lending Office of the Administrative Agent) on the third Business Day
before the date of the proposed prepayment, in the case of the prepayment of any
portion of the Term Loan which is comprised of LIBOR Tranches, or (B) 11:00 a.m.
(local time at the Applicable Lending Office of the Administrative Agent) on the
same Business Day of the proposed prepayment, in the case of the prepayment of
any portion of the Term Loan comprised solely of the Prime Rate Tranche. Each
such notice shall specify the principal amount and Tranche or Tranches of the
Term Loan which shall be prepaid, the date of the prepayment, and shall be
irrevocable and binding on the Borrower. Prepayments of the Term Loan shall be
made in integral multiples of $500,000, in the case of prepayments of any LIBOR
Tranches, or $100,000 in the case of prepayments of the Prime Rate Tranche. If
the prepayment would cause the aggregate outstanding principal amount of any
LIBOR Tranche comprising all or any part of the Term Loan or the aggregate
outstanding principal amount of the Prime Rate Tranche comprising all or any
part of the Term Loan, to be less than $1,000,000, in the case of any such LIBOR
Tranche, or $1,000,000, in the case of the Prime Rate Tranche, the prepayment
must be in an amount equal to the entire outstanding principal amount of such
LIBOR Tranche under the Term Loan or the entire outstanding principal amount of
the Prime Rate Tranche under the Term Loan, as the case may be. Upon receipt of
any notice of prepayment, the Administrative Agent shall give prompt notice of
the intended prepayment to the Banks. For each such notice given by the
Borrower, the Borrower shall prepay the Term Loan in the specified amount on the
specified date as set forth in such notice. The Borrower shall have no right to
prepay any principal amount of the Term Loan except as provided in this Section
2.1(c)(i); provided that the Borrower shall be obligated to prepay the Term Loan
as provided in Section 2.1(c)(ii).
ii. Upon any Asset Sale or Junior Interests Sale by any Restricted
Entity consummated before the payment in full of the Term Loan, the Borrower
shall use the Prepayment Proceeds to prepay, on the date of the receipt of such
proceeds, (A) first, the principal of the Prime Rate Tranche with respect to the
Term Loan; (B) second, the principal of and unpaid accrued interest on the LIBOR
Tranches of the Term Loan, selected in such order as to minimize the costs to be
paid by the Borrower pursuant to Section 2.7 (and such costs shall be in
addition to the mandatory prepayment due under this Section 2.1(c)(ii)); (C)
third, the unpaid accrued interest on the Prime Rate Tranche with respect to the
Term Loan, and (D), fourth, the unpaid principal of and accrued interest on the
Revolving Loan as required by Section 2.2(c)(ii); none of the requirements of
Section 2.1(c)(i) with respect to the prepayment of the Term Loan shall be
applicable to mandatory prepayments under this Section 2.1(c)(ii).
iii. Each voluntary prepayment of principal under the Term Loan
pursuant to Section 2.1(c)(i) shall be accompanied by payment of all accrued but
unpaid interest on the principal amount prepaid, and each voluntary or mandatory
prepayment of principal under the Term Loan pursuant to this Section 2.1(c)
shall be accompanied by payment of and any amounts required to be paid pursuant
to Section 2.7 as a result of such prepayment. The amount of each voluntary or
mandatory principal prepayment under the Term Loan pursuant to this Section
2.1(c) shall be applied to the then-remaining principal installments of the Term
Loan in inverse order of maturity. Amounts prepaid on account of the Term Loan
may not be reborrowed.
d. Repayment.
The Term Loan Advance of each Bank shall mature in (1) 16 quarterly
installments, each of which shall be in an amount equal to such Bank's Term Loan
Percentage multiplied by $1,785,714.29, the first of such quarterly installments
to be due and payable on May 28, 2004 and the remaining quarterly installments
to be due and payable on the last Business Day of each August, November,
February and May thereafter, and (2) a final installment equal to the
then-unpaid principal balance of such Bank's Term Loan Advance, which shall be
due and payable on the fourth anniversary of the Closing Date.
2.2 Revolving Loan Facility.
a. Revolving Loan Commitments. Each Bank severally agrees, on the terms and
conditions set forth in this Agreement and for the purposes set forth in Section
5.4, to make Revolving Loan Advances to the Borrower as such Bank's ratable
share of Revolving Loan Borrowings requested by the Borrower from time to time
on any Business Day during the period from the date of this Agreement until the
Revolving Loan Maturity Date; provided that the aggregate outstanding principal
amount of Revolving Loan Advances made by such Bank plus such Bank's ratable
share of the aggregate outstanding principal amount of the Swing Line Loans plus
such Bank's ratable share of the Letter of Credit Exposure shall not exceed such
Bank's Revolving Loan Commitment. Revolving Loan Borrowings must be made in an
amount equal to or greater than $1,000,000, in the case of any Revolving Loan
Borrowing comprised of a LIBOR Tranche, or $1,000,000, in the case of any Prime
Rate Borrowing, and be made in multiples of $500,000, in the case of any
Revolving Loan Borrowing comprised of a LIBOR Tranche, or $100,000, in the case
of any Prime Rate Borrowing. Any Revolving Loan Borrowing made on the Closing
Date shall initially be a Prime Rate Borrowing, but may be immediately converted
to a LIBOR Tranche in accordance with Section 2.6(a). Within the limits
expressed in this Agreement, the
Borrower may from time to time borrow, prepay, and reborrow Revolving Loan
Borrowings. The indebtedness of the Borrower to the Banks resulting from the
Revolving Loan Advances made by the Banks shall be evidenced by Revolving Loan
Notes made by the Borrower.
b. Method of Advancing.
i. Each Revolving Loan Borrowing shall be made pursuant to a Revolving Loan
Borrowing Request given by the Borrower to the Administrative Agent in writing
or by telecopy not later than the time required pursuant to Section 2.6(a)(i) to
select the interest rate basis for the Revolving Loan Borrowing. Each Revolving
Loan Borrowing Request shall be fully completed and shall specify the
information required therein, and shall be irrevocable and binding on the
Borrower. Upon receipt of the Revolving Loan Borrowing Request by the
Administrative Agent, the Administrative Agent shall promptly forward notice of
the Revolving Loan Borrowing to the Banks. Each Bank shall, before 1:00 p.m.
(local time at the Applicable Lending Office of the Administrative Agent) on the
date of the requested Revolving Loan Borrowing, make available from its
Applicable Lending Office to the Administrative Agent at the Administrative
Agent's Applicable Lending Office, in immediately available funds, such Bank's
ratable share of such Revolving Loan Borrowing. Subject to the satisfaction of
all applicable conditions precedent, after receipt by the Administrative Agent
of such funds, the Administrative Agent shall, by 4:00 p.m. (local time at the
Applicable Lending Office of the Administrative Agent), on the date requested
for such Revolving Loan Borrowing make such Revolving Loan Borrowing available
to the Borrower in immediately available funds at any account of Borrower which
is designated in writing by the Borrower to the Administrative Agent.
ii. Unless the Administrative Agent shall have received notice from a Bank
before the date of any Revolving Loan Borrowing that such Bank shall not make
available to the Administrative Agent such Bank's ratable share of such
Revolving Loan Borrowing, the Administrative Agent may assume that such Bank has
made its ratable share of such Revolving Loan Borrowing available to the
Administrative Agent on the date of such Revolving Loan Borrowing in accordance
with paragraph (i) above and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower on such date a corresponding amount.
If and to the extent that such Bank shall not have so made its ratable share of
such Revolving Loan Borrowing available to the Administrative Agent, such Bank
agrees that it shall pay interest on such amount for each day from the date such
amount is made available to the Borrower by the Administrative Agent until the
date such amount is paid to the Administrative Agent by such Bank at the Federal
Funds Rate in effect from time to time, provided that with respect to such Bank
if such amount is not paid by such Bank by the end of the second day after the
Administrative Agent makes such amount available to the Borrower, the interest
rates specified above shall be increased by a per annum amount equal to 2.00% on
the third day and shall remain at such increased rate thereafter. Interest on
such amount shall be due and payable by such Bank upon demand by the
Administrative Agent. If such Bank shall pay to the Administrative Agent such
amount and interest as provided above, such amount so paid shall constitute such
Bank's Revolving Loan Advance as part of such Revolving Loan Borrowing for all
purposes of this Agreement even though not made on the same day as the other
Revolving Loan Advances comprising such Revolving Loan Borrowing. In the event
that such Bank has not repaid such amount by the end
of the fifth day after such amount was made available to the Borrower, the
Borrower agrees to repay to the Administrative Agent on demand such amount,
together with interest on such amount for each day from the date such amount was
made available to the Borrower until the date such amount is repaid to the
Administrative Agent at the interest rate charged to the Borrower for such
Revolving Loan Borrowing under the terms of this Agreement.
iii. The failure of any Bank to make available its ratable share of any
Revolving Loan Borrowing shall not relieve any other Bank of its obligation, if
any, to make available its ratable share of such Revolving Loan Borrowing. No
Bank shall be responsible for the failure of any other Bank to honor such other
Bank's obligations hereunder, including any failure to make available any funds
as part of any Revolving Loan Borrowing.
c. Prepayment.
i. The Borrower may prepay the outstanding principal amount of the Revolving
Loan pursuant to written notice given by the Borrower to the Administrative
Agent in writing or by telecopy not later than (A) 1:00 p.m. (local time at the
Applicable Lending Office of the Administrative Agent) on the third Business Day
before the date of the proposed prepayment, in the case of the prepayment of any
portion of the Revolving Loan which is comprised of LIBOR Tranches, or (B) 11:00
a.m. (local time at the Applicable Lending Office of the Administrative Agent)
on the same Business Day of the proposed prepayment, in the case of the
prepayment of any portion of the Revolving Loan comprised solely of the Prime
Rate Tranche. Each such notice shall specify the principal amount and Tranche or
Tranches of the Revolving Loan which shall be prepaid, the date of the
prepayment, and shall be irrevocable and binding on the Borrower. Prepayments of
the Revolving Loan shall be made in integral multiples of $500,000, in the case
of prepayments of any LIBOR Tranches, or $100,000 in the case of prepayments of
the Prime Rate Tranche. If the prepayment would cause the aggregate outstanding
principal amount of any LIBOR Tranche comprising all or any part of the
Revolving Loan or the aggregate outstanding principal amount of the Prime Rate
Tranche comprising all or any part of the Revolving Loan, to be less than
$1,000,000, in the case of any such LIBOR Tranche, or $1,000,000, in the case of
the Prime Rate Tranche, the prepayment must be in an amount equal to the entire
outstanding principal amount of such LIBOR Tranche under the Revolving Loan or
the entire outstanding principal amount of the Prime Rate Tranche under the
Revolving Loan, as the case may be. Upon receipt of any notice of prepayment,
the Administrative Agent shall give prompt notice of the intended prepayment to
the Banks. For each such notice given by the Borrower, the Borrower shall prepay
the Revolving Loan in the specified amount on the specified date as set forth in
such notice. The Borrower shall have no right to prepay any principal amount of
the Revolving Loan except as provided in this Section 2.2(c)(i).
ii. Upon any Asset Sale or Junior Interests Sale by any Restricted Entity, the
Borrower shall use the Prepayment Proceeds remaining after the payment in full
of the Term Loan (if required by Section 2.1(c)(ii)) to prepay, on the date of
the receipt of such proceeds, (A) first, the principal of the Prime Rate Tranche
with respect to the Revolving Loan; (B) second, the principal of and unpaid
accrued interest on the LIBOR Tranches of the Revolving Loan, selected in such
order as to minimize the costs to be paid by the Borrower pursuant to Section
2.7 (and such costs shall be in addition to the mandatory prepayment due under
this Section 2.1(c)(ii)),
and (C) third, the unpaid accrued interest on the Prime Rate Tranche with
respect to the Revolving Loan, with any proceeds remaining thereafter to be
retained by the Restricted Entities; none of the requirements of Section
2.2(c)(i) with respect to the prepayment of the Revolving Loan shall be
applicable to mandatory prepayments under this Section 2.2(c)(ii).
iii. Each prepayment of principal of any LIBOR Tranche under the Revolving Loan
pursuant to this Section 2.2(c) shall be accompanied by payment of all accrued
but unpaid interest on the principal amount prepaid and any amounts required to
be paid pursuant to Section 2.7 as a result of such prepayment.
d. Repayment.
The Borrower shall pay to the Administrative Agent for the ratable benefit of
the Banks the aggregate outstanding principal amount of the Revolving Loan on
the Revolving Loan Maturity Date.
e. Reduction of Commitments.
The Borrower shall have the right, upon at least three Business Days'
irrevocable notice to the Administrative Agent, to terminate in whole or reduce
ratably in part the Available Revolving Loan Commitments; provided that each
partial reduction shall be in the aggregate amount of $5,000,000 or in integral
multiples of $5,000,000 in excess thereof. Any reduction or termination of the
Revolving Loan Commitments pursuant to this Section 2.2(e) shall be permanent,
with no obligation of the Banks to reinstate such Revolving Loan Commitments,
and the commitment fees provided for in Section 2.5(a) shall thereafter be
computed on the basis of the Revolving Loan Commitments, as so reduced.
2.3 Letter of Credit Facility.
a. Commitment for Letters of Credit.
The Issuing Bank shall, on the terms and conditions set forth in this Agreement
and for the purposes set forth in Section 5.4, issue, increase, and extend
Letters of Credit at the request of the Borrower from time to time on any
Business Day during the period from the date of this Agreement until the
Revolving Loan Maturity Date, provided that (1) the aggregate outstanding
principal amount of Revolving Loan Borrowings plus the aggregate outstanding
principal amount of the Swing Line Loans plus the Letter of Credit Exposure
shall not exceed the aggregate amount of the Revolving Loan Commitments then in
effect and (2) the Issuing Bank shall not issue any Letter of Credit if it has
received unrevoked notice from the Majority Banks that a Default has occurred
and the Issuing Bank should not issue Letters of Credit in the future (and if
the Issuing Bank issues any letter of credit in contravention of such notice,
such letter of credit shall not be a "Letter of Credit" for purposes of this
Agreement). No Letter of Credit may have an expiration date later than 12 months
after its issuance date, and each Letter of Credit which is self-extending
beyond its expiration date must be cancelable upon no more than 30 days notice
prior to each extension period given by the Issuing Bank to the beneficiary of
such Letter of Credit. No Letter of Credit may have an expiration date later
than the date five Business Days before the then-scheduled Revolving Loan
Maturity Date. Each Letter of Credit must be in form and substance acceptable to
the Issuing Bank. The indebtedness of the Borrower to the Issuing
Bank resulting from Letters of Credit requested by the Borrower shall be
evidenced by the Letter of Credit Applications made by the Borrower.
b. Requesting Letters of Credit.
Each Letter of Credit shall be issued, increased, or extended pursuant to a
Letter of Credit Application or Letter of Credit Application Amendment, as
applicable, given by the Borrower to the Issuing Bank in writing or by telecopy
promptly confirmed in writing, such Letter of Credit Application or Letter of
Credit Application Amendment being given not later than 1:00 p.m. (local time at
the Applicable Lending Office of the Administrative Agent) on the third Business
Day before the date of the proposed issuance, increase, or extension of the
Letter of Credit. Each Letter of Credit Application or Letter of Credit
Application Amendment shall be fully completed and shall specify the information
required therein (including the proposed form of the Letter of Credit or change
thereto), and shall be irrevocable and binding on the Borrower. Upon receipt by
the Issuing Bank of the Letter of Credit Application or Letter of Credit
Application Amendment, the Issuing Bank shall give prompt notice thereof to the
Administrative Agent, and the Administrative Agent shall promptly inform the
Banks of the proposed Letter of Credit or change thereto. Subject to the
satisfaction of all applicable conditions precedent, the Issuing Bank shall, by
4:00 p.m. (local time at the Applicable Lending Office of the Administrative
Agent), on the date requested by the Borrower for the issuance, increase, or
extension of such Letter of Credit issue, increase, or extend such Letter of
Credit to the specified beneficiary. Upon the date of the issuance, increase, or
extension of a Letter of Credit, the Issuing Bank shall be deemed to have sold
to each other Bank and each other Bank shall be deemed to have purchased from
the Issuing Bank a ratable participation in the related Letter of Credit or
change thereto. The Issuing Bank shall notify the Administrative Agent of each
Letter of Credit issued, increased, or extended and the date and amount of each
Bank's participation in such Letter of Credit, and the Administrative Agent
shall in turn notify the Banks.
c. Reimbursements for Letters of Credit.
i. With respect to any Letter of Credit and in accordance with the
related Letter of Credit Application, the Borrower agrees to pay to the Issuing
Bank on demand fees due with respect to such Letter of Credit as specified in
Section 2.5(b). If the Borrower does not pay upon demand of the Issuing Bank any
amount due to the Issuing Bank under any Letter of Credit Application, in
addition to any rights the Issuing Bank may have under such Letter of Credit
Application, the Issuing Bank may upon written notice to the Administrative
Agent request the satisfaction of such obligation by the making of a Revolving
Loan Borrowing. Concurrently with such notice to the Administrative Agent, the
Issuing Bank will use reasonable efforts to provide like notice to the Borrower,
provided that failure to provide such notice to the Borrower at such time shall
not invalidate the effectiveness of such request for a Revolving Loan Borrowing.
Upon such request, the Borrower shall be deemed to have requested the making of
a Revolving Loan Borrowing in the amount of such obligation and the transfer of
the proceeds thereof to the Issuing Bank. Such Revolving Loan Borrowing shall be
a Prime Rate Borrowing. The Administrative Agent shall promptly forward notice
of such Revolving Loan Borrowing to the Borrower and the Banks, and each Bank
shall, in accordance with the procedures of Section 2.2(b), other than
limitations on the size of Revolving Loan Borrowings, and notwithstanding the
failure of any conditions precedent, make available such Bank's ratable share of
such Revolving Loan Borrowing to the Administrative Agent, and the
Administrative Agent shall promptly
deliver the proceeds thereof to the Issuing Bank for application to such Bank's
ratable share of the obligations under such Letter of Credit. The Borrower
hereby unconditionally and irrevocably authorizes, empowers, and directs the
Issuing Bank to make such requests for Revolving Loan Borrowings on behalf of
the Borrower, and the Banks to make Revolving Loan Advances to the
Administrative Agent for the benefit of the Issuing Bank in satisfaction of such
obligations. The Administrative Agent and each Bank may record and otherwise
treat the making of such Revolving Loan Borrowings as the making of Revolving
Loan Borrowings to the Borrower under this Agreement as if requested by the
Borrower. Nothing herein is intended to release the Borrower's obligations under
any Letter of Credit Application, but only to provide an additional method of
payment therefor. The making of any Revolving Loan Borrowing under this Section
2.3(c) shall not constitute a cure or waiver of any Default or Event of Default,
other than the payment Default or Event of Default which is satisfied by the
application of the amounts deemed advanced hereunder, caused by the Borrower's
failure to comply with the provisions of this Agreement or any Letter of Credit
Application.
ii. If prior to the time a Revolving Loan Advance would have otherwise
been made pursuant to Section 2.3(c)(i), a Bankruptcy Event of Default shall
have occurred and be continuing with respect to the Borrower or if for any other
reason, as determined by the Issuing Bank in its sole discretion, Revolving Loan
Advances may not be made as contemplated by Section 2.3(c)(i), each Bank shall,
on the date such Revolving Loan Advance was to have been made pursuant to the
notice referred to in Section 2.3(c)(i), pay to the Issuing Bank such Bank's
ratable share of the obligations under such Letter of Credit.
iii. Whenever, at any time after the Issuing Bank has made payment
under any Letter of Credit and has received from any Bank its ratable share of
such payment in accordance with this Section 2.3(c), the Issuing Bank receives
any payment related to such Letter of Credit (whether directly from the Borrower
or otherwise, including proceeds of Collateral applied thereto by the Issuing
Bank), or any payment of interest on account thereof, the Issuing Bank will
distribute to such Bank its ratable share thereof; provided, however, that in
the event that any such payment received by the Issuing Bank shall be required
to be returned by the Issuing Bank, such Bank shall return to the Issuing Bank
the portion thereof previously distributed by the Issuing Bank to it.
iv. Each Bank's obligation to make the Revolving Loan Advances referred
to in Section 2.3(c)(i) and to purchase participating interests pursuant to
Section 2.3(b) shall be absolute and unconditional and shall not be affected by
any circumstance, including (a) any setoff, counterclaim, recoupment, defense or
other right that such Bank or the Borrower may have against the Issuing Bank,
the Borrower or any other Person for any reason whatsoever; (b) the occurrence
or continuance of a Default or an Event of Default or the failure to satisfy any
of the other conditions specified in Section 3; (c) any adverse change in the
condition (financial or otherwise) of the Borrower; (d) any breach of this
Agreement or any other Credit Document by the Borrower, any other Credit Party
or any other Bank; or (e) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing.
d. Prepayments of Letters of Credit.
In the event that any Letters of Credit shall be outstanding according to their
terms after the Revolving Loan Maturity Date, the Borrower shall pay to the
Administrative Agent an amount
equal to the Letter of Credit Exposure allocable to such Letters of Credit to be
held in the Letter of Credit Collateral Account and applied in accordance with
paragraph (g) below.
e. Obligations Unconditional.
The obligations of the Borrower and each Bank under this Agreement and the
Letter of Credit Applications to make payments as required to reimburse the
Issuing Bank for draws under Letters of Credit and to make other payments due in
respect of Letters of Credit shall be unconditional and irrevocable, and shall
be paid strictly in accordance with the terms of this Agreement and the Letter
of Credit Applications under all circumstances, including: (i) any lack of
validity or enforceability of any Letter of Credit Document; (ii) any amendment,
waiver, or consent to departure from any Letter of Credit Document; (iii) the
existence of any claim, set off, defense, or other right which the Borrower or
any Bank may have at any time against any beneficiary or transferee of any
Letter of Credit (or any Persons for whom any such beneficiary or any such
transferee may be acting), the Issuing Bank, or any other person or entity,
whether in connection with the transactions contemplated in this Agreement or
any unrelated transaction; (iv) any statement or any other document presented
under such Letter of Credit proving to be forged, fraudulent, invalid, or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect; or (v) payment by the Issuing Bank under any Letter of Credit
against presentation of a draft or certificate which does not comply with the
terms of such Letter of Credit; provided, however, that nothing contained in
this paragraph (e) shall be deemed to constitute a waiver of any remedies of the
Borrower or any Bank in connection with the Letters of Credit or the Borrower's
or such Bank's rights under paragraph (f) below.
f. Liability of Issuing Bank.
The Issuing Bank shall not be liable or responsible for: (i) the use which may
be made of any Letter of Credit or any acts or omissions of any beneficiary or
transferee in connection therewith; (ii) the validity, sufficiency, or
genuineness of documents related to Letters of Credit, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent, or forged; (iii) payment by the Issuing Bank
against presentation of documents which do not strictly comply with the terms of
a Letter of Credit, including failure of any documents to bear any reference or
adequate reference to the relevant Letter of Credit; or (iv) any other
circumstances whatsoever in making or failing to make payment under any Letter
of Credit (INCLUDING THE ISSUING BANK'S OWN NEGLIGENCE); except that the Issuing
Bank shall be liable to the Borrower or any Bank to the extent of any direct, as
opposed to consequential, damages suffered by the Borrower or such Bank which
the Borrower or such Bank proves were caused by (A) the Issuing Bank's gross
negligence or willful misconduct in determining whether documents presented
under a Letter of Credit comply with the terms of such Letter of Credit, (B) the
Issuing Bank's willful failure to make or delay in making lawful payment under
any Letter of Credit after the presentation to it of documentation strictly
complying with the terms and conditions of such Letter of Credit or the Issuing
Bank's payment of greater than the maximum amount permitted under any Letter of
Credit, or (C) the Issuing Bank's negligence in the handling of money.
g. Letter of Credit Collateral Account.
i. If the Borrower is required to deposit funds in the Letter of Credit
Collateral Account pursuant to Section 2.3(d) or 6.4, then the Borrower and the
Administrative Agent shall
establish the Letter of Credit Collateral Account, and the Borrower shall
execute any documents and agreements, including the Administrative Agent's
standard form assignment of deposit accounts, that the Administrative Agent
reasonably requests in connection therewith to establish the Letter of Credit
Collateral Account and grant the Administrative Agent a first priority security
interest in such account and the funds therein. The Borrower hereby pledges to
the Administrative Agent and grants the Administrative Agent a security interest
in the Letter of Credit Collateral Account, whenever established, all funds held
in the Letter of Credit Collateral Account from time to time, and all proceeds
thereof as security for the payment of the Credit Obligations.
ii. Funds held in the Letter of Credit Collateral Account shall be held
as cash collateral for obligations with respect to Letters of Credit and
promptly applied by the Administrative Agent at the request of the Issuing Bank
to any reimbursement or other obligations under Letters of Credit that exist or
occur. To the extent that any surplus funds are held in the Letter of Credit
Collateral Account above the Letter of Credit Exposure, during the existence of
an Event of Default the Administrative Agent may (A) hold such surplus funds in
the Letter of Credit Collateral Account as cash collateral for the Credit
Obligations or (B) apply such surplus funds to any Credit Obligations in
accordance with Section 6.9. If no Default exists, the Administrative Agent
shall release to the Borrower at the Borrower's written request any funds held
in the Letter of Credit Collateral Account above the amounts required by Section
2.3(d).
iii. Funds held in the Letter of Credit Collateral Account shall be
invested in money market funds of the Administrative Agent or in another
investment if mutually agreed upon by the Borrower and the Administrative Agent,
but the Administrative Agent shall have no other obligation to make any other
investment of the funds therein. The Administrative Agent shall exercise
reasonable care in the custody and preservation of any funds held in the Letter
of Credit Collateral Account and shall be deemed to have exercised such care if
such funds are accorded treatment substantially equivalent to that which the
Administrative Agent accords its own property, it being understood that the
Administrative Agent shall not have any responsibility for taking any necessary
steps to preserve rights against any parties with respect to any such funds.
2.4 Swing Line Facility.
a. Commitment.
i. Subject to the terms and conditions hereof, the Swing Line Lender
agrees to make a portion of the credit otherwise available to the Borrower under
the Revolving Loan Commitments from time to time during the period from the date
of this Agreement until the Revolving Loan Maturity Date by making swing line
loans ("Swing Line Loans") to the Borrower; provided that (1) the aggregate
principal amount of Swing Line Loans outstanding at any time shall not exceed
the Swing Line Commitment then in effect (notwithstanding that the Swing Line
Loans outstanding at any time, when aggregated with the Swing Line Lender's
other outstanding Revolving Loan Advances, may exceed the Swing Line Commitment
then in effect); (2) the Borrower shall not request, and the Swing Line Lender
shall not make, any Swing Line Loan if, after giving effect to the making of
such Swing Line Loan, the aggregate amount of the Available Revolving Loan
Commitments would be less than zero, and (3) the Swing Line Lender shall not
make any Swing Line Loan if it has received unrevoked notice from the Majority
Banks
stating that a Default has occurred and the Swing Line Lender should not make
future Swing Line Loans (and if the Swing Line Lender makes any loan in
contravention of such notice, such loan shall not be a "Swing Line Loan" for
purposes of this Agreement). Within the limits expressed in this Agreement, the
Borrower may use the Swing Line Commitment by borrowing, repaying and
reborrowing, all in accordance with the terms and conditions hereof. Each Swing
Line Loan shall be a Prime Rate Borrowing. The indebtedness of the Borrower to
the Swing Line Lender resulting from the Swing Line Loans made by the Swing Line
Lender shall be evidenced by the Swing Line Note made by the Borrower.
ii. The Borrower shall repay the principal of and accrued interest on
each Swing Line Loan ten Business Days after the making of such Swing Line Loan,
and the Borrower shall repay all principal of and accrued interest on the
outstanding Swing Line Loans on the Revolving Loan Maturity Date.
b. Procedure for Swing Line Borrowing.
Whenever the Borrower desires that the Swing Line Lender make Swing Line Loans
it shall give the Swing Line Lender irrevocable telephonic notice confirmed
promptly in writing (which telephonic notice must be received by the Swing Line
Lender not later than 1:00 p.m. (local time at the Applicable Lending Office of
the Administrative Agent) on the proposed date of the Swing Line Borrowing),
specifying (i) the amount to be borrowed and (ii) the requested date of the
Swing Line Borrowing (which shall be a Business Day during the period from the
date of this Agreement until the Revolving Loan Maturity Date). Each borrowing
under the Swing Line Commitment shall be in an amount equal to $500,000 or a
whole multiple of $100,000 in excess thereof. Not later than 3:00 p.m. (local
time at the Applicable Lending Office of the Administrative Agent) on the date
requested for a Swing Line Borrowing specified in a notice in respect of Swing
Line Loans, the Swing Line Lender shall make available to the Administrative
Agent at the Applicable Lending Office an amount in immediately available funds
equal to the amount of the Swing Line Loan to be made by the Swing Line Lender.
The Administrative Agent shall make the proceeds of such Swing Line Loan
available to the Borrower on such date in immediately available funds at any
account of Borrower which is designated in writing by the Borrower to the
Administrative Agent.
c. Reimbursements for Swing Line Loan Obligations.
i. The Swing Line Lender, at any time and from time to time in its sole
and absolute discretion may, on behalf of the Borrower (which hereby irrevocably
directs the Swing Line Lender to act on its behalf), on one Business Day's
notice given by the Swing Line Lender no later than 12:00 noon (local time at
the Applicable Lending Office of the Administrative Agent) request each Bank to
make, and each Bank hereby agrees to make, a Revolving Loan Advance, in an
amount equal to such Bank's Revolving Loan Percentage of the aggregate amount of
the Swing Line Loans (the "Refunded Swing Line Loans") outstanding on the date
of such notice, to repay the Swing Line Lender. Upon such request, the Borrower
shall be deemed to have requested the making of a Revolving Loan Borrowing in
the amount of such request. Such Revolving Loan Borrowing shall be a Prime Rate
Borrowing. Each Bank shall make the amount of its Revolving Loan Advance
available to the Administrative Agent at the Administrative Agent's Applicable
Lending Office in immediately available funds, not later than 10:00 a.m. (local
time at the Applicable Lending Office of the Administrative Agent) one Business
Day after the date of such notice. The proceeds of such Revolving Loan Borrowing
shall be
immediately made available by the Administrative Agent to the Swing Line Lender
for application by the Swing Line Lender to the repayment of the Refunded Swing
Line Loans. The Borrower irrevocably authorizes the Swing Line Lender to charge
the Borrower's accounts with the Administrative Agent (up to the amount
available in each such account) in order to immediately pay the amount of such
Refunded Swing Line Loans to the extent amounts received from the Banks are not
sufficient to repay in full such Refunded Swing Line Loans.
ii. If prior to the time a Revolving Loan Advance would have otherwise
been made pursuant to Section 2.4(c)(i), a Bankruptcy Event of Default shall
have occurred and be continuing with respect to the Borrower or if for any other
reason, as determined by the Swing Line Lender in its sole discretion, Revolving
Loan Advances may not be made as contemplated by Section 2.4(c)(i), each Bank
shall, on the date such Revolving Loan Advance was to have been made pursuant to
the notice referred to in Section 2.4(c)(i) (the "Refunding Date"), purchase for
cash an undivided participating interest in the then-outstanding Swing Line
Loans by paying to the Swing Line Lender an amount (the "Swing Line
Participation Amount") equal to (a) such Bank's Revolving Loan Percentage times
(b) the sum of the aggregate principal amount of Swing Line Loans then
outstanding that were to have been repaid with such Revolving Loan Borrowing.
iii. Whenever, at any time after the Swing Line Lender has received
from any Bank such Bank's Swing Line Participation Amount, the Swing Line Lender
receives any payment on account of the Swing Line Loans, the Swing Line Lender
will distribute to such Bank its Swing Line Participation Amount (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Bank's participating interest was outstanding and funded and, in the
case of principal and interest payments, to reflect such Bank's pro rata portion
of such payment if such payment is not sufficient to pay the principal of and
interest on all Swing Line Loans then due); provided, however, that in the event
that such payment received by the Swing Line Lender is required to be returned,
such Bank will return to the Swing Line Lender any portion thereof previously
distributed to it by the Swing Line Lender.
iv. Each Bank's obligation to make the Revolving Loan Advances referred
to in Section 2.4(c)(i) and to purchase participating interests pursuant to
Section 2.4(c)(ii) shall be absolute and unconditional and shall not be affected
by any circumstance, including (a) any setoff, counterclaim, recoupment, defense
or other right that such Bank or the Borrower may have against the Swing Line
Lender, the Borrower or any other Person for any reason whatsoever; (b) the
occurrence or continuance of a Default or an Event of Default or the failure to
satisfy any of the other conditions specified in Section 3; (c) any adverse
change in the condition (financial or otherwise) of the Borrower; (d) any breach
of this Agreement or any other Credit Document by the Borrower, any other Credit
Party or any other Bank; or (e) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
2.5 Fees.
a. Commitment Fees.
The Borrower shall pay to the Administrative Agent for the ratable benefit of
the Banks an unused commitment fee of the Commitment Fee Rate per annum on the
average daily amount by which (i) the aggregate amount of the Revolving Loan
Commitments exceeds (ii) the outstanding
principal amount of the Revolving Loan plus the Letter of Credit Exposure. The
unused commitment fee shall accrue from the date of this Agreement and be due
and payable in arrears on the last day of each calendar quarter and on the
Revolving Loan Maturity Date.
b. Fees for Letters of Credit.
For each Letter of Credit issued by the Issuing Bank, the Borrower shall pay to
the Administrative Agent for the ratable benefit of the Banks a letter of credit
fee equal to the Applicable Margin for letter of credit fees per annum on the
face amount of such Letter of Credit for the stated term of such Letter of
Credit, with a minimum fee of $500. In addition, as a condition to the issuance
of each Letter of Credit by the Issuing Bank, the Borrower shall pay to the
Administrative Agent for the benefit of the Issuing Bank a fronting fee of
0.125% on the face amount of such Letter of Credit, with a minimum fee of $500.
Furthermore, the Borrower shall pay to the Administrative Agent for the benefit
of the Issuing Bank any documentary and processing fees in accordance with the
Issuing Bank's standard schedule from time to time in effect with respect to the
issuance, amendment, cancellation, negotiation or transfer of each Letter of
Credit and each drawing made thereunder. The Borrower shall pay each such letter
of credit fee for each Letter of Credit quarterly in arrears within ten days
after when billed therefor by the Issuing Bank.
2.6 Interest.
a. Election of Interest Rate Basis.
The Borrower may select the interest rate basis for the Term Loan and the
Revolving Loan in accordance with the terms of this Section 2.6(a):
i. Under the Revolving Loan Borrowing Request provided to the
Administrative Agent in connection with the making of each Revolving Loan
Borrowing, the Borrower shall select the amount and the Type of the Tranches,
and for each LIBOR Tranche selected, any permitted Interest Period for each such
LIBOR Tranche, which will comprise such Revolving Loan Borrowing, provided that
(A) at no time shall there be more than ten separate LIBOR Tranches outstanding
and (B) each LIBOR Tranche must be in a principal amount equal to or greater
than $1,000,000 and be made in multiples of $500,000, and the Prime Rate Tranche
must be in a principal amount equal to or greater than $1,000,000 and be made in
multiples of $100,000. Such interest rate elections must be provided to the
Administrative Agent in writing or by telecopy not later than 1:00 p.m. (local
time at the Applicable Lending Office of the Administrative Agent) on the third
Business Day before the date of any proposed Revolving Loan Borrowing comprised
of a LIBOR Tranche or 11:00 a.m. (local time at the Applicable Lending Office of
the Administrative Agent) on the same day of any proposed Revolving Loan
Borrowing which is a Prime Rate Borrowing. The Administrative Agent shall
promptly forward copies of such interest rate elections to the Banks. In the
case of any Revolving Loan Borrowing comprised of a LIBOR Tranche, upon
determination by the Administrative Agent, the Administrative Agent shall
promptly notify the Borrower and the Banks of the applicable interest rate for
such Tranche.
ii. With respect to any Tranche, the Borrower may continue or convert
any portion of any LIBOR Tranche or the Prime Rate Tranche to form new LIBOR
Tranches or increase or decrease the amount of the Prime Rate Tranche in
accordance with this paragraph. Each such
continuation or conversion shall be deemed to create a new LIBOR Tranche or
increase or decrease the amount of the Prime Rate Tranche, as applicable, for
all purposes of this Agreement. Each such continuation or conversion shall be
made pursuant to a Continuation/Conversion Request given by the Borrower to the
Administrative Agent in writing or by telecopy not later than 1:00 p.m. (local
time at the Applicable Lending Office of the Administrative Agent) on the third
Business Day before the date of the proposed continuation or conversion. Each
Continuation/Conversion Request shall be fully completed and shall specify the
information required therein, and shall be irrevocable and binding on the
Borrower. The Administrative Agent shall promptly forward notice of the
continuation or conversion to the Banks. In the case of any continuation or
conversion into LIBOR Tranches, upon determination by the Administrative Agent,
the Administrative Agent shall notify the Borrower and the Banks of the
applicable interest rate. Continuations and conversions of LIBOR Tranches shall
be made in integral multiples of $500,000, and continuations and conversions of
the Prime Rate Tranche shall be made in integral multiples of $100,000 (provided
that the Prime Rate Tranche with respect to the Term Loan may be of any size).
No continuation or conversion shall be permitted if such continuation or
conversion would cause the aggregate outstanding principal amount of any LIBOR
Tranche which would remain outstanding to be less than $1,000,000, or the
aggregate outstanding principal amount of the Prime Rate Tranche which would
remain outstanding to be less than $1,000,000 (provided that the Prime Rate
Tranche with respect to the Term Loan may be of any size). At no time shall
there be more than ten separate LIBOR Tranches outstanding. Any conversion of an
existing LIBOR Tranche is subject to Section 2.7. Subject to the satisfaction of
all applicable conditions precedent, the Administrative Agent and the Banks
shall before close of business on the date requested by the Borrower for the
continuation or conversion, make such continuation or conversion.
iii. At the end of the Interest Period for any LIBOR Tranche if the
Borrower has not continued or converted such LIBOR Tranche into new Tranches as
provided for in paragraph (ii) above, the Borrower shall be deemed to have
continued such LIBOR Tranche as a new LIBOR Tranche with an Interest Period of
one month. All of the Prime Rate Tranche shall continue as the Prime Rate
Tranche unless the Borrower converts such Prime Rate Tranche as provided for in
paragraph (ii) above.
b. LIBOR Tranches.
Each LIBOR Tranche with respect to the Revolving Loan shall bear interest during
its Interest Period at a per annum interest rate equal to the sum of the LIBOR
for such Tranche plus the Applicable Margin for LIBOR Tranches in effect from
time to time. Each LIBOR Tranche with respect to the Term Loan shall bear
interest during its Interest Period at a per annum interest rate equal to the
sum of the LIBOR for such Tranche plus 0.25% plus the Applicable Margin for
LIBOR Tranches in effect from time to time. The Borrower shall pay to the
Administrative Agent for the ratable benefit of the Banks all accrued but unpaid
interest on each LIBOR Tranche on the last day of the applicable Interest Period
for such LIBOR Tranche (and with respect to LIBOR Tranches with Interest Periods
of greater than three months, on the date which is three months after the first
day of the Interest Period for such LIBOR Tranche), when required upon
prepayment as specified elsewhere in this Agreement, on any date when such LIBOR
Tranche is prepaid or repaid in full, and on the Revolving Loan Maturity Date.
c. Prime Rate Tranche.
The Prime Rate Tranche shall bear interest at a per annum interest rate equal to
the Base Rate in effect from time to time plus the Applicable Margin for the
Prime Rate Tranche in effect from time to time. The Borrower shall pay to the
Administrative Agent for the ratable benefit of the Banks all accrued but unpaid
interest on the aggregate outstanding principal amount of the Prime Rate Tranche
on the last day of each calendar quarter, when required upon prepayment as
specified elsewhere in this Agreement, on any date the Prime Rate Tranche is
prepaid or repaid in full, and on the Revolving Loan Maturity Date.
d. Usury Protection.
i. If, with respect to any Bank and the Borrower, the effective rate of
interest contracted for by such Bank with the Borrower under the Credit
Documents, including the stated rates of interest contracted for hereunder and
any other amounts contracted for under the Credit Documents which are deemed to
be interest, at any time exceeds the Highest Lawful Rate, then the outstanding
principal amount of the loans made by such Bank to the Borrower hereunder shall
bear interest at a rate which would make the effective rate of interest on the
loans made by such Bank to the Borrower under the Credit Documents equal the
Highest Lawful Rate until the difference between the amounts which would have
been due by the Borrower to such Bank at the stated rates and the amounts which
were due by the Borrower to such Bank at the Highest Lawful Rate (the "Lost
Interest") has been recaptured by such Bank. If, when the loans made hereunder
are repaid in full, the Lost Interest has not been fully recaptured by such Bank
pursuant to the preceding sentence, then, to the extent permitted by law, the
interest rates charged by such Bank to the Borrower hereunder shall be
retroactively increased such that the effective rate of interest on the loans
made by such Bank to the Borrower under the Credit Documents was at the Highest
Lawful Rate since the effectiveness of this Agreement to the extent necessary to
recapture the Lost Interest not recaptured pursuant to the preceding sentence
and, to the extent allowed by law, the Borrower shall pay to such Bank the
amount of the Lost Interest remaining to be recaptured by such Bank.
ii. In calculating all sums paid or agreed to be paid to any Bank by
the Borrower for the use, forbearance, or detention of money under the Credit
Documents, (x) such amounts shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread in equal parts throughout the term of
the Credit Documents; (y) the parties shall, to the maximum extent
not prohibited by applicable law, characterize any nonprincipal payment as an
expense, fee or premium rather than interest, and (z) the parties shall exclude
voluntary prepayments and the effects thereof.
iii. The parties hereto expressly agree, pursuant to Chapter 346
("Chapter 346") of the Texas Credit Code, that Chapter 346 (which relates to
open-end line of credit revolving loan accounts) shall not apply to any Credit
Document or any Credit Obligation, and that none of the same shall be governed
by Chapter 346 or subject to its provisions in any manner whatsoever.
iv. NOTWITHSTANDING THE FOREGOING OR ANY OTHER TERM IN THIS AGREEMENT
AND THE CREDIT DOCUMENTS TO THE CONTRARY, it is the intention of each Bank and
the Borrower to conform strictly to any applicable usury laws. Accordingly, if
any Bank contracts for, charges, or receives any consideration from the Borrower
which constitutes interest in excess of the Highest Lawful Rate, then any such
excess shall be canceled automatically and, if previously paid, shall at such
Bank's option be applied to the outstanding amount of the loans made hereunder
by such Bank to the Borrower or be refunded to the Borrower.
2.7 Breakage Costs.
If (i) any payment of principal on or any conversion of any LIBOR Tranche is
made on any date other than the last day of the Interest Period for such LIBOR
Tranche, whether as a result of any voluntary or mandatory prepayment (other
than a prepayment upon the occurrence of any event subject to Section 2.9 or
2.10), any acceleration of maturity, or any other cause, (ii) any payment of
principal on any LIBOR Tranche is not made when due, or (iii) any LIBOR Tranche
is not borrowed, converted, or prepaid in accordance with the respective notice
thereof provided by the Borrower to the Administrative Agent, whether as a
result of any failure to meet any applicable conditions precedent for borrowing,
conversion, or prepayment, the permitted cancellation of any request for
borrowing, conversion, or prepayment, the failure of the Borrower to provide the
respective notice of borrowing, conversion, or prepayment, or any other cause
not specified above which is created by the Borrower, then the Borrower shall
pay to each Bank upon demand any amounts required to compensate such Bank for
any losses, costs, or expenses, including lost profits and administrative
expenses, which are reasonably allocable to such action, including losses,
costs, and expenses related to the liquidation or redeployment of funds acquired
or designated by such Bank to fund or maintain such Bank's ratable share of such
LIBOR Tranche or related to the reacquisition or redesignation of funds by such
Bank to fund or maintain such Bank's ratable share of such LIBOR Tranche
following any liquidation or redeployment of such funds caused by such action.
Such Bank need not prove matched funding of any particular funds, and a
certificate as to the amount of such loss, cost, or expense detailing the
calculation thereof and certifying that such Bank customarily charges such
amounts to its other customers in similar circumstances submitted by such Bank
to the Borrower shall be conclusive and binding for all purposes, absent
manifest error. Notwithstanding anything herein to the contrary, until the date
180 days after the Closing Date, the Borrower shall reimburse each Bank for all
losses, costs and expenses of the type described in this Section 2.7 incurred by
such Bank in connection with the syndication of the Facilities by the
Administrative Agent in its sole discretion and the addition of new Banks.
2.8 Increased Costs.
a. Cost of Funds.
If due to either (i) any introduction of, change in, or change in the
interpretation of, any law or regulation, in each case, after the date of this
Agreement or (ii) compliance with any guideline or request from any central bank
or other governmental authority having appropriate jurisdiction (whether or not
having the force of law) given after the date of this Agreement, there shall be
any increase in the costs of any Bank attributable to (x) committing to make any
Term Loan Advance or Revolving Loan Advance or obtaining funds for the making,
funding, or maintaining of such Bank's ratable share of any LIBOR Tranche in the
relevant interbank market or (y) committing to make Letters of Credit or
issuing, funding, or maintaining Letters of Credit (including any increase in
any applicable reserve requirement specified by the Board, including those for
emergency, marginal, supplemental, or other reserves), then the Borrower shall
pay to such Bank upon demand any amounts required to compensate such Bank for
such increased costs, such amounts being due and payable upon demand by such
Bank. A certificate as to the cause and amount of such increased cost detailing
the calculation of such cost and certifying that such Bank customarily charges
such amounts to its other customers in similar circumstances submitted by such
Bank to the Borrower shall be conclusive and binding for all purposes, absent
manifest
error. No Bank may make any claim for compensation under this Section 2.8(a) for
increased costs incurred more than 90 days prior to the delivery of any such
certificate.
b. Capital Adequacy.
If, due to either (i) any introduction of, change in, or change in the
interpretation of, any law or regulation, in each case, after the date of this
Agreement or (ii) compliance with any guideline or request from any central bank
or other governmental authority having appropriate jurisdiction (whether or not
having the force of law) given after the date of this Agreement, there shall be
any increase in the capital requirements of any Bank or its parent or holding
company attributable to (x) committing to make Term Loan Advances or Revolving
Loan Advances or making, funding, or maintaining Term Loan Advances or Revolving
Loan Advances or (y) committing to make Letters of Credit or issuing, funding,
or maintaining Letters of Credit, as such capital requirements are allocated by
such Bank, then the Borrower shall pay to such Bank upon demand any amounts
required to compensate such Bank or its parent or holding company for such
increase in costs (including an amount equal to any reduction in the rate of
return on assets or equity of such Bank or its parent or holding company), such
amounts being due and payable upon demand by such Bank. A certificate as to the
cause and amounts detailing the calculation of such amounts and certifying that
such Bank customarily charges such amounts to its other customers in similar
circumstances submitted by such Bank to the Borrower shall be conclusive and
binding for all purposes, absent manifest error. No Bank may make any claim for
compensation under this Section 2.8(b) for increased costs incurred more than 90
days prior to the delivery of any such certificate.
2.9 Illegality.
Notwithstanding any other provision in this Agreement, if it becomes unlawful
for any Bank to obtain deposits or other funds for making or funding such Bank's
ratable share of any LIBOR Tranche in the relevant interbank market, such Bank
shall so notify the Borrower and the Administrative Agent, such Bank's
commitment to create LIBOR Tranches shall be suspended until such condition has
passed, all LIBOR Tranches applicable to such Bank shall be converted to the
Prime Rate Tranche as of the end of each applicable Interest Period or earlier
if necessary, and all subsequent requests for LIBOR Tranches shall be deemed to
be requests for Prime Rate Borrowings or continuations and conversions of the
Prime Rate Tranche, as applicable, with respect to such Bank.
2.10 Market Failure.
Notwithstanding any other provision in this Agreement, if the Administrative
Agent determines that: (a) quotations of interest rates for the relevant
deposits referred to in the definition of "LIBOR" are not being provided in the
relevant amounts, or maturities for purposes of determining the rate of interest
referred to in the definition of "LIBOR" or (b) the relevant rates of interest
referred to in the definition of "LIBOR" which are used as the basis to
determine the rate of interest for LIBOR Tranches will not adequately cover the
cost to any Bank of making or maintaining such Bank's ratable share of any LIBOR
Tranche, then if the Administrative Agent so notifies the Borrower, the Banks'
commitments to create LIBOR Tranches shall be suspended
until such condition has passed, all LIBOR Tranches shall be converted to the
Prime Rate Tranche as of the end of each applicable Interest Period or earlier
if necessary, and all subsequent requests for LIBOR Tranches shall be deemed to
be requests for Prime Rate Borrowings or continuations and conversions of the
Prime Rate Tranche, as applicable, with respect to such Bank.
2.11 Payment Procedures and Computations.
a. Payment Procedures.
Time is of the essence in this Agreement and the Credit Documents. All payments
hereunder shall be made in Dollars. The Borrower shall make each payment under
this Agreement and under the Term Loan Notes, the Revolving Loan Notes and the
Swing Line Note not later than 12:00 noon (local time at the Applicable Lending
Office of the Administrative Agent) on the day when due to the Administrative
Agent at the Administrative Agent's Applicable Lending Office in immediately
available funds. All payments by the Borrower hereunder shall be made without
any offset, abatement, withholding, deduction, counterclaim, or reduction. Upon
receipt of payment from the Borrower of any principal, interest, or fees due to
the Banks, the Administrative Agent shall promptly after receipt thereof
distribute to the Banks their ratable share of such payments for the account of
their respective Applicable Lending Offices. If and to the extent that the
Administrative Agent shall not have so distributed to any Bank its ratable share
of such payments, the Administrative Agent agrees that it shall pay interest on
such amount for each day after the day when such amount is made available to the
Administrative Agent by the Borrower until the date such amount is paid to such
Bank by the Administrative Agent at the Federal Funds Rate in effect from time
to time, provided that if such amount is not paid by the Administrative Agent by
the end of the third day after the Borrower makes such amount available to the
Administrative Agent, the interest rates specified above shall be increased by a
per annum amount equal to 2.00% on the fourth day and shall remain at such
increased rate thereafter. Interest on such amount shall be due and payable by
the Administrative Agent upon demand by such Bank. Upon receipt of other amounts
due solely to the Administrative Agent, the Issuing Bank, the Swing Line Lender,
or a specific Bank, the Administrative Agent shall distribute such amounts to
the appropriate party to be applied in accordance with the terms of this
Agreement.
b. Administrative Agent Reliance.
Unless the Administrative Agent shall have received written notice from the
Borrower prior to any date on which any payment is due to the Banks that the
Borrower shall not make such payment in full, the Administrative Agent may
assume that the Borrower has made such payment in full to the Administrative
Agent on such date, and the Administrative Agent may, in reliance upon such
assumption, cause to be distributed to each Bank on such date an amount equal to
the amount then due such Bank. If and to the extent the Borrower shall not have
so made such payment in full to the Administrative Agent, each Bank shall repay
to the Administrative Agent forthwith on demand such amount distributed to such
Bank, together with interest thereon from the date such amount is distributed to
such Bank until the date such Bank repays such amount to the Administrative
Agent, at an interest rate equal to, the Federal Funds Rate in effect from time
to time, provided that with respect to such Bank, if such amount is not repaid
by such Bank by the end of the second day after the date of the Administrative
Agent's
demand, the interest rates specified above shall be increased by a per annum
amount equal to 2.00% on the third day after the date of the Administrative
Agent's demand and shall remain at such increased rate thereafter.
c. Sharing of Payments.
Each Bank agrees that if it should receive any payment (whether by voluntary
payment, by realization upon security, by the exercise of the right of setoff or
banker's lien, by counterclaim or cross action, by the enforcement of any right
under the Credit Documents, or otherwise) in respect of any obligation of the
Borrower to pay principal, interest, fees, or any other obligation incurred
under the Credit Documents in a proportion greater than the total amount of such
principal, interest, fees, or other obligation then owed and due by the Borrower
to such Bank bears to the total amount of principal, interest, fees, or other
obligation then owed and due by the Borrower to all of the Banks immediately
prior to such receipt, then such Bank receiving such excess payment shall
purchase for cash without recourse from the other Banks an interest in the
obligations of the Borrower to such Banks in such amount as shall result in a
participation by all of the Banks, in proportion with the Banks' respective pro
rata shares, in the aggregate unpaid amount of principal, interest, fees, or any
such other obligation, as the case may be, owed by the Borrower to all of the
Banks; provided that if all or any portion of such excess payment is thereafter
recovered from such Bank, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, in proportion with the Banks'
respective pro rata shares, but without interest.
d. Authority to Charge Accounts.
The Administrative Agent, if and to the extent payment owed to the
Administrative Agent or any Bank is not made when due, may charge from time to
time against any account of the Borrower with the Administrative Agent any
amount so due. The Administrative Agent agrees promptly to notify the Borrower
after any such charge and application made by the Administrative Agent, provided
that the failure to give such notice shall not affect the validity of such
charge and application.
e. Computation Methods.
Unless expressly provided for in this Agreement, (i) all computations of
interest based on the Prime Rate (including the Base Rate, when applicable)
shall be made on the basis of a 365/366 day year, as the case may be, (ii) all
computations of interest based on the Federal Funds Rate (including the Base
Rate, when applicable) shall be made on the basis of a 360 day year, (iii) all
computations of interest based upon the LIBOR shall be made on the basis of a
360 day year, and (iv) all computations of fees shall be made on the basis of a
360 day year, in each case for the actual number of days (including the first
day, but excluding the last day) occurring in the period for which such interest
or fees are payable. Each determination by the Administrative Agent of an
interest rate or fee shall be conclusive and binding for all purposes, absent
manifest error.
f. Payment Dates.
Whenever any payment shall be stated to be due on a day other than a Business
Day, such payment shall be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of payment
of interest or fees, as the case may be. If
the time for payment for an amount payable is not specified in this Agreement or
in any other Credit Document, the payment shall be due and payable on demand by
the Administrative Agent or the applicable Bank.
2.12 Taxes.
a. No Deduction for Certain Taxes.
Any and all payments by the Borrower shall be made free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges, or withholdings, and all liabilities with respect thereto, other than
taxes imposed on the income of, and franchise taxes imposed in lieu of net
income taxes on, the Administrative Agent, any Bank, or the Applicable Lending
Office thereof by any jurisdiction in which any such entity is a present or
former citizen or resident or any political subdivision of such jurisdiction
(other than any such connection arising solely from the Administrative Agent,
such Bank, or the Applicable Lending Office having executed, delivered or
performed its obligations or received a payment under, or enforced, this
Agreement or any other Letter of Credit Document) (all such nonexcluded taxes,
levies, imposts, deductions, charges, withholdings, and liabilities being
hereinafter referred to as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes or Other Taxes from or in respect of any sum payable to the
Administrative Agent, any Bank, or the Applicable Lending Office thereof, (i)
the sum payable shall be increased as may be necessary so that, after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.12), such Person receives an amount equal to the sum it
would have received had no such deductions been made; (ii) the Borrower shall
make such deductions; and (iii) the Borrower shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable law.
b. Other Taxes.
The Borrower agrees to pay any present or future stamp or documentary taxes or
any other excise or property taxes, charges, or similar levies ("Other Taxes")
which arise from any payment made or from the execution, delivery, or
registration of, or otherwise with respect to, this Agreement or the other
Credit Documents (other than those which become due as a result of any Bank
joining this Agreement as a result of any Assignment and Acceptance, which shall
be paid by the Bank which becomes a Bank hereunder as a result of such
Assignment and Acceptance).
c. Foreign Bank Withholding Exemption.
Each Bank and Issuing Bank that is not a "US Person" as defined in Section
7701(a)(30) of the Code agrees that it shall deliver to the Borrower and the
Administrative Agent (i) two duly completed copies of United States Internal
Revenue Service Form X-0XXX, X-0XXX or other applicable form, as the case may
be, certifying in each case that such Bank is entitled to receive payments under
this Agreement, the Term Loan Notes and the Revolving Loan Notes payable to it,
without deduction or withholding of any United States federal income taxes, (ii)
if applicable, a statement indicating that such Bank is entitled to the
"portfolio interest" exception under Section 871(h) or 881(c)(3) of the Code,
and (iii) any other governmental forms which are necessary or required under an
applicable tax treaty or otherwise by law to reduce or eliminate any withholding
tax, which have been reasonably requested by the Borrower. Each Bank which
delivers to the Borrower and the Administrative Agent a Form W-8BEN or W-8ECI
pursuant to the immediately preceding sentence further undertakes to deliver to
the Borrower and the Administrative Agent two further copies of Form W-8BEN or
W-8ECI, or other applicable forms, or other manner of certification, as the case
may be, on or before the date that any such form expires or becomes obsolete or
after the occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower and the Administrative Agent, and
such extensions or renewals thereof as may reasonably be requested by the
Borrower and the Administrative Agent certifying in the case of a Form W-8BEN or
W-8ECI that such Bank is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes. If
an event (including without limitation any change in treaty, law or regulation)
has occurred prior to the date on which any delivery required by the preceding
sentence would otherwise be required which renders all such forms inapplicable
or which would prevent any Bank from duly completing and delivering any such
form with respect to it and such Bank advises the Borrower and the
Administrative Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax, such Bank shall
not be required to deliver such forms. The Borrower shall withhold tax at the
rate and in the manner required by the laws of the United States with respect to
payments made to a Bank failing to provide the requisite Internal Revenue
Service forms in a timely manner. Each Bank which fails to provide to the
Borrower in a timely manner such forms shall reimburse the Borrower upon demand
for any penalties paid by the Borrower as a result of any failure of the
Borrower to withhold the required amounts that are caused by such Bank's failure
to provide the required forms in a timely manner. Notwithstanding any other
provision of this paragraph, a Non U.S. Bank shall not be required to deliver
any form pursuant to this paragraph that such Non U.S. Bank is not legally able
to deliver.
2.13 Change of Lending Office.
a. Each Bank agrees that if it makes any demand for payment under Section 2.8 or
is required to pay additional amounts pursuant to Section 2.12(a), or if any
adoption or change of the type described in Section 2.9 shall occur with respect
to it, it will if requested by the Borrower use reasonable efforts (consistent
with its internal policy and legal and regulatory restrictions and so long as
such efforts would not be disadvantageous to it, as determined in its sole
discretion) to designate a different lending office for any loan made hereunder
affected if the making of such a designation would reduce or obviate the need
for the Borrower to make payments under Section 2.8 or 2.12(a), or would
eliminate or reduce the effect of any adoption or change described in Section
2.9.
b. If any Bank (including any participant Bank under Section 8.2) shall assert
that any adoption or change of the type described in Section 2.9 hereof has
occurred with respect to it, or if any Bank (including any participant Bank
under Section 8.2) requests compensation under Section 2.8, or if the Borrower
is required to pay any additional amount to any Bank or any authority for the
account of any Bank pursuant to Section 2.12, then the Borrower may, at its
expense and effort, upon notice to such Bank and the Administrative Agent,
require such Bank to, and such Bank promptly shall, assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 8.2 (provided that the Borrower shall be obligated to pay the
administrative fee referred to therein) and subject to Section 2.7 (as if such
assignment
were a prepayment by the Borrower)), all its interests, rights, and obligations
under this Agreement to an assignee that shall assume such obligations (which
assignee may be another Bank, if a Bank accepts such assignment); provided that
(i) if such assignee is not a Bank or an Affiliate thereof, the Borrower shall
have received the prior written consent of the Administrative Agent, the Swing
Line Lender and the Issuing Bank (which consents shall not unreasonably be
withheld or delayed), (ii) such Bank shall have received payment of an amount
equal to the aggregate outstanding principal of such Bank's Term Loan Advances
and Revolving Loan Advances and its participations in Letters of Credit, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (at least to the extent of such outstanding principal) and the
Borrower (in the case of all other amounts), (iii) in the case of any such
assignment resulting from a claim for compensation under Section 2.8 or payment
required to be made pursuant to Section 2.12, such assignment will result in a
reduction in such compensation or payments compared to the compensation or
payments payable to the assigning Bank, (iv) such assignment does not conflict
with any requirement of law, (v) no Event of Default shall have occurred and be
continuing at the time of such assignment, (vi) prior to any such assignment,
such Bank shall have taken no action under Section 2.13(a) so as to eliminate
the continued need for payment of amounts owing pursuant to Section 2.8 or
2.12(a), (vii) until such time as such assignment shall be consummated, the
Borrower shall pay all additional amounts (if any) required pursuant to Section
2.8 or 2.12(a), as the case may be, and (viii) any such assignment shall not be
deemed to be a waiver of any rights that the Borrower, the Administrative Agent
or any other Bank shall have against the replaced Bank. A Bank shall not be
required to make any such assignment and delegation if, prior thereto, as a
result of a waiver by such Bank or otherwise, the circumstances entitling the
Borrower to require such assignment and delegation no longer exist or cease to
apply.
ARTICLE 3
CONDITIONS PRECEDENT
3.1 Conditions Precedent to Initial Extension of Credit.
The obligation of each Bank to make the initial extension of credit under this
Agreement (not including any extension of credit under the 2001 Credit
Agreement), including the making of any Term Loan Advance or Revolving Loan
Advance and the issuance of any Letter of Credit, and the obligation of the
Swing Line Lender to make any Swing Line Loan shall be subject to the following
conditions precedent:
a. Documents.
The Borrower shall have delivered or shall have caused to be delivered the
documents and other items listed on Exhibit F, together with any other documents
requested by the Administrative Agent to document the agreements and intent of
the Credit Documents, each in form and with substance satisfactory to the
Administrative Agent (provided that if some or all of the Mortgages are not
delivered by the Closing Date, the delivery of such Mortgage(s) as a condition
precedent shall be deemed waived but it shall be an Event of Default if
substantially all Mortgages have not been executed and delivered to the
Administrative Agent, together with all documents related thereto as the
Administrative Agent may require, within 90 days after the Closing Date);
b. Material Adverse Change.
No Material Adverse Change shall have occurred since December 31, 2003;
c. 2001 Credit Agreement.
The Administrative Agent shall have received satisfactory evidence that all
obligations owing to any Prior Bank (which is not a Bank) and the Prior
Administrative Agent shall have been paid in full and each letter of credit
issued pursuant to the 2001 Credit Agreement has either been terminated or
cancelled or the issuer thereof has accepted a Letter of Credit as security
therefor;
d. Fee Letter.
The Borrower shall have paid all amounts due under the Fee Letter by the Closing
Date; and
e. Defeasance of Senior Subordinated Notes.
The Borrower shall have delivered or caused to be delivered to the
Administrative Agent evidence satisfactory to the Administrative Agent that,
after giving effect to the Loan Advances to be made on the Closing Date, Senior
Subordinated Notes with an aggregate principal amount of $50,000,000 will be
defeased in accordance with the terms of the Senior Subordinated Note
Indentures.
3.2 Conditions Precedent to Each Extension of Credit.
The obligation of each Bank to make any extension of credit under this
Agreement, including the making of any Term Loan Advance or Revolving Loan
Advance and the issuance, increase, or extension of any Letter of Credit, and
the obligation of the Swing Line Lender to make any Swing Line Loan shall be
subject to the further conditions precedent that on the date of such extension
of credit:
a. Representations and Warranties.
As of the date of the making of any extension of credit hereunder, the
representations and warranties contained in each Credit Document shall be (i) if
qualified as to materiality, true and correct or (ii) if not so qualified, true
and correct in all material respects, on and as of such date as if made on and
as of such date; and
b. Default.
As of the date of the making of any extension of credit hereunder, there shall
exist no Default or Event of Default, and the making of the extension of credit
would not cause a Default or Event of Default.
Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in this
Section 3.2 have been satisfied.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Administrative Agent and
each Bank, and with each request for any extension of credit hereunder,
including the making of any Term Loan
Advance or Revolving Loan Advance, and the issuance, increase, or extension of
any Letter of Credit, and the making of any Swing Line Loan, again represents
and warrants to the Administrative Agent and each Bank, as follows:
4.1 Organization.
As of the date of this Agreement, each Restricted Entity (a) is duly organized,
validly existing, and in good standing (or, with respect to any entity listed on
Schedule IV, shall be in good standing within 30 days after the date of this
Agreement) under the laws of such Person's respective jurisdiction of
organization and (b) is duly licensed, qualified to do business, and in good
standing in each jurisdiction in which such Person is organized, owns property,
or conducts operations to the extent that any failure to be so licensed,
qualified, or in good standing in accordance with this clause (b) could
reasonably be expected to cause a Material Adverse Change.
4.2 Authorization.
The execution, delivery, and performance by each Credit Party of the Credit
Documents to which such Credit Party is a party and the consummation of the
transactions contemplated thereby (a) do not contravene the organizational
documents of such Credit Party, (b) have been duly authorized by all necessary
organizational action of each Credit Party, and (c) are within each Credit
Party's organizational powers.
4.3 Enforceability.
Each Credit Document to which any Credit Party is a party has been duly executed
and delivered by each Credit Party which is a party to such Credit Document and
constitutes the legal, valid, and binding obligation of each such Credit Party,
enforceable against each such Credit Party in accordance with such Credit
Document's terms, except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws at the time in effect affecting the
rights of creditors generally and subject to the availability of equitable
remedies.
4.4 Absence of Conflicts and Approvals.
The execution, delivery, and performance by each Credit Party of the Credit
Documents to which such Credit Party is a party and the consummation of the
transactions contemplated thereby, (a) do not result in any violation or breach
of any provisions of, or constitute a default under, any note, indenture, credit
agreement, security agreement, credit support agreement, or other similar
agreement to which such Credit Party is a party or any other material contract
or agreement to which such Credit Party is a party, (b) do not violate any law
or regulation binding on or affecting such Credit Party, (c) do not require any
authorization, approval, or other action by, or any notice to or filing with,
any governmental authority or any other Person, and (d) do not result in or
require the creation or imposition of any Lien prohibited by this Agreement.
4.5 Investment Companies.
No Restricted Entity or Affiliate thereof is an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
4.6 Public Utilities.
No Restricted Entity or Affiliate thereof 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. No Restricted
Entity or Affiliate thereof is a regulated public utility.
4.7 Financial Condition.
a. The Borrower has delivered to the Administrative Agent the Financial
Statements, including therein the consolidated balance sheet of the Borrower and
consolidated statement of income for the periods shown therein, which accurately
and completely, in all material respects, present fairly the financial condition
of Borrower as of such date and for such periods. The Borrower has further
delivered to the Administrative Agent the Interim Financial Statements, and the
Interim Financial Statements are accurate and complete in all material respects
and present fairly the financial condition of Borrower as of their date and for
their period in accordance with generally accepted accounting principles, as
applicable to interim financial reports.
b. As of the date of the Financial Statements, there were no material contingent
obligations, liabilities for taxes, unusual forward or long term commitments, or
unrealized or anticipated losses of the Borrower or any of the Borrower's
Subsidiaries, except as disclosed in the Financial Statements and the Interim
Financial Statements, and adequate reserves for such items have been made in
accordance with generally accepted accounting principles. No Material Adverse
Change has occurred since the date of the Financial Statements. No Default
exists.
4.8 Condition of Assets.
Each Restricted Entity has good and indefeasible title to substantially all of
its owned property and valid leasehold rights in all of its leased property, as
reflected in the financial statements most recently provided to the
Administrative Agent free and clear of all Liens except Permitted Liens. Each
Restricted Entity possesses and has properly approved, recorded, and filed,
where applicable, all permits, licenses, patents, patent rights or licenses,
trademarks, trademark rights, trade names rights, and copyrights which are
useful in the conduct of its business and which the failure to possess could
reasonably be expected to cause a Material Adverse Change. The material
properties used in the operations of each Restricted Entity are in good repair,
working order, and condition, normal wear and tear excepted. The properties of
each Restricted Entity have not been adversely affected as a result of any fire,
explosion, earthquake, flood, drought, windstorm, accident, strike or other
labor disturbance, embargo, requisition or taking of property or cancellation of
contracts, permits, or concessions by a governmental authority, riot, activities
of armed forces, or acts of God or of any public enemy in any manner which
(after giving effect to any insurance proceeds) could reasonably be expected to
cause a Material Adverse Change.
4.9 Litigation.
There are no actions, suits, or proceedings pending or, to the knowledge of the
Borrower, threatened against any Restricted Entity at law, in equity, or in
admiralty, or by or before any governmental department, commission, board,
bureau, agency, instrumentality, domestic or foreign, or any arbitrator which
could reasonably be expected to cause a Material Adverse Change.
4.10 Subsidiaries.
As of the date of this Agreement, (a) the Borrower has no Subsidiaries except as
disclosed in Schedule II, which sets forth the name, organizational number (if
any) and jurisdiction of organization of each Subsidiary and, as to each such
Subsidiary, the number of shares, units or interests (if any) and percentage of
each class of equity owned by any Credit Party, (b) the Borrower has no
Subsidiaries which have not been disclosed in writing to the Administrative
Agent and (c) there are no outstanding subscriptions, options, warrants, calls,
rights or other agreements or commitments (other than stock options granted to
employees or directors and directors' qualifying shares) of any nature relating
to any capital stock of the Borrower or any Subsidiary, except as created by the
Credit Documents.
4.11 Laws and Regulations.
Each Restricted Entity is in compliance with all federal, state, and local laws
and regulations which are applicable to the operations and property of such
Person where the failure to comply with the same could reasonably be expected to
cause a Material Adverse Change. No part of the proceeds of any Loan Advances,
and no other extensions of credit hereunder, will be used for "buying" or
"carrying" any "margin stock" within the respective meanings of each of the
quoted terms under Regulation U of the Board as now and from time to time
hereafter in effect or for any purpose that violates the provisions of the
Regulations of the Board.
4.12 Environmental Compliance.
Each Restricted Entity has been and is in compliance with all Environmental Laws
and has obtained and is in compliance with all related permits necessary for the
ownership and operation of any such Person's properties, in each case, where the
failure to be in compliance with the same could reasonably be expected to cause
a Material Adverse Change. Each Restricted Entity has not received notice of and
has not been investigated for any violation or alleged violation of any
Environmental Law in connection with any such Person's presently or previously
owned properties which currently threaten action or suggest liabilities which
could reasonably be expected to cause a Material Adverse Change. Each Restricted
Entity (a) does not and has not created, handled, transported, used, or disposed
of any Hazardous Materials on or about any such Person's properties (nor has any
such Person's properties been used for those purposes); (b) has never been
responsible for the release of any Hazardous Materials into the environment in
connection with any such Person's operations and has not contaminated any
properties with Hazardous Materials, and (c) does not and has not owned any
properties contaminated by any Hazardous Materials, in each case in any manner
which could reasonably be expected to cause a Material Adverse Change.
4.13 ERISA.
Each Restricted Entity and each of their respective Commonly Controlled Entities
are in compliance with all provisions of ERISA, the Code and other federal,
state or local law with respect to any Plan to the extent that the failure to be
in compliance could reasonably be expected to cause a Material Adverse Change.
No Restricted Entity nor any of their respective Commonly Controlled Entities
participates in or during the past five years has participated in any employee
pension benefit plan covered by Title IV of ERISA or any multiemployer plan
under Section 4001(a)(3) of ERISA. No Restricted Entity nor any of their
respective Commonly Controlled Entities has any liability with respect to any
Plan. With respect to the Plans of the Restricted Entities, no Reportable Event
or Prohibited Transaction has occurred and exists that could reasonably be
expected to cause a Material Adverse Change.
4.14 Taxes.
Each Restricted Entity has filed all United States federal, state, and local
income tax returns and all other domestic and foreign tax returns which are
required to be filed by such Person and has paid, or provided for the payment
before the same became delinquent of, all taxes due pursuant to such returns or
pursuant to any assessment received by such Person except for tax payments being
contested in good faith, for which adequate reserves have been established and
reported in
accordance with generally accepted accounting principals, and which could not
reasonably be expected to cause a Material Adverse Change. The charges,
accruals, and reserves on the books of the Restricted Entities in respect of
taxes are adequate in accordance with generally accepted accounting principles.
4.15 True and Complete Disclosure.
All factual information furnished by or on behalf of any Credit Party in writing
to the Administrative Agent or any Bank in connection with the Credit Documents
and the transactions contemplated thereby is true and accurate in all material
respects on the date as of which such information was dated or certified and
does not contain any untrue statement of material fact or omit to state any
material fact necessary to make the statements contained therein not misleading.
All projections, estimates, and pro forma financial information furnished by any
Credit Party were prepared on the basis of assumptions, data, information,
tests, or conditions believed to be reasonable at the time such projections,
estimates, and pro forma financial information were furnished.
4.16 Senior Indebtedness.
The Credit Obligations constitute "Senior Indebtedness" (or any other defined
term having a similar purpose) of the Borrower under and as defined in the
Senior Subordinated Note Indentures and any Subordinated Debt Indenture. The
obligations of each Guarantor under the Guaranty constitute "Guarantor Senior
Indebtedness" (or any other defined term having a similar purpose) of such
Guarantor under and as defined in the Senior Subordinated Note Indentures and
any Subordinated Debt Indenture.
4.17 Certain Documents.
The Borrower has delivered to the Administrative Agent a complete and correct
copy of the Senior Subordinated Note Indentures and any Subordinated Debt
Indenture, in each case including any amendments, supplements or modifications
with respect to any of the foregoing.
ARTICLE 5
COVENANTS
Until the Administrative Agent and the Banks receive irrevocable
payment of the Credit Obligations and have terminated this Agreement and each
other Credit Document, and all Letters of Credit have expired or been cancelled,
the Borrower shall comply with and cause compliance with the following
covenants:
5.1 Organization.
The Borrower shall cause each Restricted Entity to (a) maintain itself as an
entity duly organized, validly existing, and in good standing under the laws of
such Person's respective jurisdiction of organization and (b) be duly licensed,
qualified to do business, and in good standing in each jurisdiction in which
such Person is organized, owns property, or conducts operations and which
requires such licensing or qualification where failure to be so licensed,
qualified, or in good standing as required by this clause (b) could reasonably
be expected to cause a Material Adverse
Change; provided, however, that nothing in this Section 5.1 shall be interpreted
to be violated as a result of a transaction permitted by Section 5.9.
Reporting. The Borrower shall furnish to the Administrative Agent (and the
Administrative Agent shall promptly thereafter furnish to each Bank) all of the
following:
a. Annual Reports.
As soon as available and in any event not later than 90 days after the end of
each fiscal year of the Borrower, (i) a copy of the annual financial statements
for such fiscal year for the Borrower, including therein the consolidated
balance sheets of the Borrower as of the end of such fiscal year and the
consolidated statements of income, stockholders' equity, and cash flows for the
Borrower for such fiscal year and all notes thereto, setting forth the
consolidated financial position and results of the Borrower for such fiscal
year, accompanied by the unqualified opinion of a nationally recognized
certified public accounting firm to the effect that such financial statements
fairly present the consolidated financial condition of the Borrower as of the
date thereof and the result of its consolidated operations for the period
covered thereby in accordance with generally accepted accounting principles,
consistently applied, and without expressing any doubt as to the ability of the
Borrower or any of its Subsidiaries to continue as a going concern, (ii) a
completed Compliance Certificate duly certified by a Responsible Officer of the
Borrower, and (iii) a completed Contract Status Report duly certified by a
Responsible Officer of the Borrower;
b. Quarterly Reports.
As soon as available and in any event not later than 45 days after the end of
each of the first three fiscal quarters of the Borrower of each year, and in
each case in form and substance acceptable to the Administrative Agent, (i) a
copy of the internally prepared consolidated financial statements of the
Borrower for such fiscal quarter and for the fiscal year to date period ending
on the last day of such fiscal quarter, including therein the consolidated
balance sheets of the Borrower as of the end of such fiscal quarter and the
consolidated statements of income, and cash flows for such fiscal quarter and
for such fiscal year to date period, setting forth the consolidated financial
position and results of the Borrower for such fiscal quarter and fiscal year to
date period, all in reasonable detail and duly certified by a Responsible
Officer of the Borrower as having been prepared in accordance with generally
accepted accounting principles, including those applicable to interim financial
reports which permit normal year end adjustments and do not require complete
financial notes, (ii) a completed Compliance Certificate duly certified by a
Responsible Officer of the Borrower, and (iii) a completed Contract Status
Report duly certified by a Responsible Officer of the Borrower;
c. Semi-annual Subsidiary Update.
As soon as available and in any event not later than 45 days after the end of
the second fiscal quarter of the Borrower of each year and 90 days after the end
of the fourth fiscal quarter of the Borrower of each year, an update of the
information included in Schedule II, including all Subsidiaries acquired by the
Borrower since the previous update of such scheduled information.
d. Acquisition Information.
As soon as available prior to the closing of any Acquisition requiring approval
of the Majority Banks, and on or prior to the closing of any Acquisition not
requiring such approval, a completed
Acquisition Certificate duly certified by a Responsible Officer of the Borrower,
which the Administrative Agent shall forward to the Banks for any Acquisition
requiring approval of the Majority Banks (and prior to the consummation of the
Acquisition, the Borrower shall, upon request by the Administrative Agent, make
available to the Administrative Agent at the Borrower's offices in Houston,
Texas, the acquisition documents regarding the acquired assets, including
schedules reflecting litigation liabilities, environmental liabilities, and
other assumed liabilities, and any other information regarding the acquired
assets as the Administrative Agent may reasonably request);
e. SEC Filings.
As soon as available and in any event not later than 30 days after the filing or
delivery thereof, copies of all financial statements, reports, and proxy
statements which the Borrower shall have sent to its stockholders generally and
copies of all regular and periodic reports, if any, which any Restricted Entity
shall have filed with the Securities and Exchange Commission;
f. Consolidated Budget and Projections.
As soon as available, and in any event no later than 45 days after the end of
each fiscal year of the Borrower, a detailed consolidated budget for the
following fiscal year (including a projected consolidated balance sheet of the
Borrower and its Subsidiaries as of the end of the following fiscal year, the
related consolidated statements of projected cash flow, projected changes in
financial position and projected income and a description of the underlying
assumptions applicable thereto), and, within 5 days after the availability
thereof, significant revisions, if any, of such budget and projections with
respect to such fiscal year (collectively, the "Projections"), which Projections
shall in each case be accompanied by a certificate of a Responsible Officer of
the Borrower stating that such Projections are based on reasonable estimates,
information and assumptions and made in good faith;
g. Defaults.
Promptly, but in any event within 5 Business Days after the discovery thereof, a
notice of any facts known to a Responsible Officer of the Borrower which
constitute a Default, together with a statement of a Responsible Officer of the
Borrower setting forth the details of such facts and the actions which the
Borrower has taken and proposes to take with respect thereto (and the
Administrative Agent shall, promptly upon receipt from the Borrower of a notice
pursuant to this Section 5.2(g), forward a copy of such notice to each Bank);
h. Litigation.
Promptly, but in any event within 10 Business Days after notice of commencement
thereof, notice of all actions, suits, and proceedings before or brought by any
court or governmental department, commission, board, bureau, agency, or
instrumentality, domestic or foreign, affecting any Restricted Entity which, if
determined adversely, could reasonably be expected to cause a Material Adverse
Change;
i. Material Agreement Default.
Promptly, but in any event within 10 Business Days after a Responsible Officer
of the Borrower obtains knowledge thereof, notice of any breach by any
Restricted Entity of any contract or agreement which breach could reasonably be
expected to cause a Material Adverse Change;
j. Material Changes.
Prompt written notice of any other condition or event of which a Responsible
Officer of the Borrower has knowledge, which condition or event has resulted in
or could reasonably be expected to cause a Material Adverse Change;
k. Indentures; Senior Subordinated Notes.
(i) As soon as available, a complete and correct copy of each of the Senior
Subordinated Note Indentures and any Subordinated Debt Indenture; and (ii) no
later than 5 Business Days prior to the effectiveness thereof, copies of
substantially final drafts of any proposed amendment, supplement, waiver or
other modification with respect to the Senior Subordinated Note Indentures or
any Subordinated Debt Indenture;
l. Asset Coverage Computation.
Within 25 days after the last day of each calendar month, a computation of the
"Asset Coverage Ratio" in accordance with Section 5.5(e) as of such last day,
duly certified by a Responsible Officer of the Borrower; and
m. Other Information.
Such other information respecting the business operations or property of any
Restricted Entity, financial or otherwise, as the Administrative Agent or the
Majority Banks may from time to time reasonably request.
5.3 Inspection.
The Borrower shall cause each Restricted Entity to permit the Administrative
Agent and the Banks to visit and inspect any of the properties of such
Restricted Entity, to examine all of such Person's books of account, records,
reports, and other papers, to make copies and extracts therefrom, and to discuss
their respective affairs, finances, and accounts with their respective officers,
employees, and independent public accountants all at such reasonable times and
as often as may be reasonably requested, provided that the Borrower is given at
least 3 Business Days' advance notice thereof and reasonable opportunity to be
present when independent public accountants or other third parties are
contacted, and provided further that so long as no Default or Event of Default
exists, the Administrative Agent and the Banks shall not exercise the foregoing
inspection right more often than once in any calendar year.
5.4 Use of Proceeds.
The proceeds of the Revolving Loan Borrowings shall be used by the Borrower for
Acquisitions, working capital needs, Capital Expenditures, and for other lawful
corporate purposes. The proceeds of the Term Loan Borrowing shall be used by the
Borrower in connection with the defeasance of $50,000,000 in principal amount of
Senior Subordinated Notes.
5.5 Financial Covenants.
The Administrative Agent shall determine compliance with the following financial
covenants based upon the applicable Schedule of the most recent Compliance
Certificate delivered to the Administrative Agent pursuant to Section 5.2(a) or
5.2(b).
a. Net Worth.
The Borrower shall not permit the consolidated Net Worth of the Borrower as of
the last day of each fiscal quarter to be less than the sum of (i) $214,045,000;
plus (ii) 50% of the cumulative quarterly consolidated net income of the
Borrower after September 30, 2003, for each fiscal quarter of the Borrower
during which the Borrower has positive consolidated net earnings (disregarding
impairment to goodwill calculated in accordance with FASB Statement No. 142,
Goodwill and Other Intangibles); plus (iii) 100% of the net proceeds received by
Borrower after September 30, 2003, from any sale or issuance of any equity
securities of, or any other additions to capital by, the Borrower or its
Subsidiaries; plus (iv) to the extent that the required consolidated Net Worth
under this Section 5.5(a) was not increased in clauses (i) through (iii) above
as a result of any Acquisition, 100% of any increase in the consolidated Net
Worth of the Borrower resulting from any Acquisition. Compliance with this
paragraph (a) shall be determined in the applicable Compliance Certificate based
upon the adjusted financial reports contained in Schedule A of such Compliance
Certificate.
b. Maximum Leverage Ratios.
i. Maximum Senior Debt to EBITDA Ratio. As of the last day of each
fiscal quarter of the Borrower, the Borrower shall not permit the ratio of (a)
the consolidated Senior Debt of the Borrower as of end of such fiscal quarter to
(b) the consolidated EBITDA of the Borrower for the preceding four fiscal
quarters then ended, to be greater than 2.25 to 1.00.
ii. Maximum Total Debt to EBITDA Ratio. As of the last day of each
fiscal quarter of the Borrower, the Borrower shall not permit the ratio of (a)
the consolidated Total Debt of the Borrower as of end of such fiscal quarter to
(b) the consolidated EBITDA of the Borrower for the preceding four fiscal
quarters then ended, to be greater than (x) 3.85 to 1.00 at any time on or
before December 31, 2006 and (y) 3.60 to 1.00 at any time after December 31,
2006.
Compliance with this paragraph (b) shall be determined in the applicable
Compliance Certificate based upon the adjusted financial reports contained in
Schedule B of such Compliance Certificate.
c. Minimum Fixed Charge Coverage Ratio.
As of the last day of each fiscal quarter, the Borrower shall not permit the
ratio of (i) the consolidated Net EBITDA of the Borrower for the preceding four
fiscal quarters then ended to (ii) the consolidated Fixed Charges of the
Borrower for the preceding four fiscal quarters then ended to be less than 1.35
to 1.00. Compliance with this paragraph (c) shall be determined in the
applicable Compliance Certificate based upon the adjusted financial reports
contained in Schedule B of such Compliance Certificate.
d. Capital Expenditures.
The Borrower shall not permit the consolidated Capital Expenditures (other than
Capital Expenditures that are deemed to occur because of the making of an
Acquisition) of the Borrower during any fiscal year to exceed $20,000,000.
Compliance with this paragraph (d) shall be determined in the applicable
Compliance Certificate based upon the adjusted financial reports contained in
Schedule B of such Compliance Certificate.
e. Asset Coverage Ratio.
As of the last day of each calendar month, the Borrower shall not permit the
ratio of (1) the sum of (i) 85% of consolidated Unbonded Accounts Receivable
plus (ii) 50% of consolidated inventories plus (iii) 50% of consolidated
equipment (net of depreciation and excluding real property interests and
equipment attached to real property) to (2) the sum of (i) the Revolving Loan
plus (ii) the Letter of Credit Exposure plus (iii) the Term Loan plus (iv) the
Swing Line Loan to be less than 1.00 to 1.00. Compliance with this paragraph (e)
shall be determined in the applicable Compliance Certificate based upon the
adjusted financial reports contained in Schedule B of such Compliance
Certificate.
f. Rent and Lease Expense. As of the last day of each fiscal quarter, the
Borrower shall not permit its consolidated rent and lease expense for the
preceding four fiscal quarters then ended, to be greater than $30,000,000.
Compliance with this paragraph (f) shall be determined in the applicable
Compliance Certificate based upon the adjusted financial reports contained in
Schedule B of such Compliance Certificate.
5.6 Debt.
a. The Borrower shall not permit any Restricted Entity to create, assume, incur,
suffer to exist, or in any manner become liable, directly, indirectly, or
contingently in respect of, any Debt other than Permitted Debt.
b. The Borrower shall, as soon as available but in any event not less than 10
Business Days prior to the issuance of any preferred stock or subordinated
indebtedness, deliver to the Administrative Agent a copy of the certificate of
designation or subordinated debt documents, as applicable, together with a
certificate, signed by a Responsible Officer of the Borrower, certifying that
such preferred stock or subordinated indebtedness constitutes Qualified
Preferred Stock or Subordinated Debt pursuant to the terms of this Agreement.
5.7 Liens.
The Borrower shall not permit any Restricted Entity to create, assume, incur, or
suffer to exist any Lien on any of its real or personal property whether now
owned or hereafter acquired, or assign any right to receive its income, except
for Permitted Liens.
5.8 Other Obligations.
The Borrower shall not permit any Restricted Entity to create, incur, assume, or
suffer to exist any obligations in respect of unfunded vested benefits under any
Plan or deferred compensation agreement in an aggregate outstanding amount in
excess of $5,000,000.
The Borrower shall not permit any Restricted Entity to create, incur, assume, or
suffer to exist any obligations in respect of Derivatives, other than
Derivatives used by any Restricted Entity in such Restricted Entity's respective
business operations in aggregate notional quantities not to exceed the
reasonably anticipated consumption of such Restricted Entity of the underlying
commodity for the relevant period, but no Derivatives which are speculative in
nature.
5.9 Corporate Transactions and Asset Sales.
a. The Borrower shall not, without the Majority Banks' consent, permit any
Restricted Entity to (1) merge, consolidate, or amalgamate with another Person,
or liquidate, wind up, or dissolve itself (or take any action towards any of the
foregoing) or (2) make any Acquisition except that:
i. Any Subsidiary of the Borrower may merge, consolidate, or amalgamate
into the Borrower or any wholly owned Subsidiary of the Borrower, or convey,
sell, lease, assign, transfer, or otherwise dispose of any of its assets to the
Borrower or any wholly owned Subsidiary of the Borrower (and if such disposition
transfers all or substantially all of the assets of the transferring Subsidiary,
such Subsidiary may then liquidate, wind up, or dissolve itself); provided that
the Borrower or the wholly owned Subsidiary, as applicable, is the surviving or
acquiring entity; and
ii. The Borrower or any Subsidiary of the Borrower may make any
Acquisition (by purchase or merger) provided that (A) the Borrower or such
Subsidiary of the Borrower is the acquiring or surviving entity, (B) the
aggregate of all consideration (other than common stock of the Borrower) paid by
the Restricted Entities in connection with all Acquisitions during any fiscal
year does not exceed $25,000,000, (C) no Default or Event of Default exists and
the Acquisition would not reasonably be expected to cause a Default or Event of
Default after giving pro forma effect thereto (including any default under
Section 5.5 with respect to historical and future pro forma financial status and
results), and (D) the acquired assets are in substantially the same business as
the Borrower.
b. The Borrower shall not permit any Restricted Entity to use any Collateral in
an unlawful manner or contrary to the terms and conditions of any policy of
insurance thereon. Until the occurrence of an Event of Default, (1) each
Restricted Entity may sell or lease its Inventory (as such term is defined in
the Security Agreement) in the ordinary course of its business; (2) each
Restricted Entity may also use and consume any raw materials or supplies, the
use and consumption of which are necessary to carry on such Restricted Entity's
business; (3) each Restricted Entity may sell or transfer any Collateral in
connection with the acquisition of similar property with a fair market value at
least equal to the fair market value of the disposed property (and the Banks
hereby authorize and direct the Administrative Agent to release its Lien on such
disposed Collateral if such Restricted Entity takes all steps reasonably
required by the Administrative Agent to xxxxx x Xxxx on such acquired property),
and (4) each Restricted Entity may sell or transfer any Collateral, subject to
the provisions of Sections 2.1(c)(ii) and 2.2(c)(ii) (and the Banks hereby
authorize and direct the Administrative Agent to release its Lien on such
Collateral). A sale in the ordinary course of business does not include a
transfer in partial or total satisfaction of a Debt.
5.10 Distributions.
The Borrower shall not (a) declare or pay any dividends; (b) purchase, redeem,
retire, or otherwise acquire for value any of its capital stock now or hereafter
outstanding; (c) make any distribution of assets to its stockholders as such,
whether in cash, assets, or in obligations of it; (d) allocate or otherwise set
apart any sum for the payment of any dividend or distribution on, or for the
purchase, redemption, or retirement of, any shares of its capital stock; or (e)
make any other distribution by reduction of capital or otherwise in respect of
any shares of its capital stock, except that the Borrower may make payments of
dividends on Qualified Preferred Stock; provided, however, that (i) the Borrower
may declare or pay dividends if (x) no Default has then occurred and is
continuing and (y) assuming such dividend had been paid on the last day of the
immediately preceding fiscal quarter, (1) the Total Debt to EBITDA ratio, as
measured in accordance with Section 5.5(b)(ii), would have been no greater than
2.50 to 1 and (2) no Default (including but not limited to any Default under
Section 5.5) would have occurred as of the last day of such quarter and (ii) the
Borrower may purchase, redeem, retire or otherwise acquire for value any of its
capital stock if (x) no Default has then occurred and is continuing and (y)
assuming such transaction had been consummated on the last day of the
immediately preceding fiscal quarter, no Default (including but not limited to
any Default under Section 5.5) would have occurred as of the last day of such
quarter.
5.11 Transactions with Affiliates.
The Borrower shall not permit any Restricted Entity to enter into any
transaction directly or indirectly with or for the benefit of an Affiliate
except transactions with an Affiliate for the leasing of property, the rendering
or receipt of services, or the purchase or sale of inventory or other assets in
the ordinary course of business if the monetary or business consideration
arising from such a transaction would be substantially as advantageous to such
Restricted Entity as the monetary or business consideration which such
Restricted Entity would obtain in a comparable arm's length transaction;
provided that the Restricted Entities may make the investments described in item
(g) of the definition of "Permitted Investments".
5.12 Insurance.
a. The Borrower shall cause each Restricted Entity to maintain insurance with
responsible and reputable insurance companies or associations reasonably
acceptable to the Administrative Agent in such amounts and covering such risks
as are usually carried by companies engaged in similar businesses and owning
similar properties in the same general areas in which such Persons operate. The
Borrower shall deliver to the Administrative Agent certificates evidencing such
policies or copies of such policies at the Administrative Agent's request
following a reasonable period to obtain such certificates taking into account
the jurisdiction where the insurance is maintained.
b. All policies representing insurance of the Restricted Entities shall name the
Administrative Agent and the Banks as loss payee (with respect to casualty
insurance covering Collateral) or additional named insureds (in all other cases)
in a form satisfactory to the Administrative Agent. With respect to any insured
liability suffered by the Administrative Agent or any Bank, all proceeds of such
liability insurance coverage for the Administrative Agent and the Banks shall be
paid as directed by the Administrative Agent to indemnify the Administrative
Agent or the applicable Bank for the liability covered. In the event that
proceeds of property or liability insurance are paid to any Restricted Entity in
violation of the foregoing, the Restricted Entity shall hold the proceeds in
trust for the Administrative Agent, segregate the proceeds from the other funds
of such Restricted Entity, and promptly pay the proceeds to the Administrative
Agent with any necessary endorsement. The Administrative Agent shall have the
right, but not the obligation, during the existence of an Event of Default, to
make proof of loss under, settle and adjust any claim under, and receive the
proceeds under the insurance, and the reasonable expenses incurred by the
Administrative Agent in the adjustment and collection of such proceeds shall be
paid by the Borrower. The Borrower irrevocably appoints the Administrative Agent
as its attorney in fact to take such actions in its name. If the Administrative
Agent does not take such actions, the Borrower may take such actions subject to
the approval of any final action by the Administrative Agent. The Administrative
Agent shall not be liable or responsible for failure to collect or exercise
diligence in the collection of any proceeds.
5.13 Investments.
The Borrower shall not permit any Restricted Entity to make or hold any direct
or indirect investment in any Person, including capital contributions to the
Person, investments in the debt or equity securities of the Person, and loans,
guaranties, trade credit, or other extensions of credit to the Person, except
for Permitted Investments.
5.14 Lines of Business.
The Borrower shall not permit the Restricted Entities to engage in any type of
business not reasonably related to their business as presently and normally
conducted. The parties agree that business entailing the construction,
operation, or ownership of electrical infrastructure, electrical generation,
electrical distribution, distributed generation, communications contracting,
communications servicing, e-commerce ventures and other related ventures,
together with associated financial and risk management activities conducted for
the benefit of the Restricted
Entities in connection with such business, are reasonably related to the
character of the Restricted Entities' business as conducted on the date hereof.
5.15 Compliance with Laws.
The Borrower shall cause each Restricted Entity to comply with all federal,
state, and local laws and regulations which are applicable to the operations and
property of such Persons, in each case, where the failure to comply could
reasonably be expected to cause a Material Adverse Change.
5.16 Environmental Compliance.
The Borrower shall cause each Restricted Entity to comply with all Environmental
Laws and obtain and comply with all related permits necessary for the ownership
and operation of any such Person's properties, in each case, where the failure
to comply could reasonably be expected to cause a Material Adverse Change. The
Borrower shall cause each Restricted Entity to disclose promptly to the
Administrative Agent any notice to or investigation of such Persons for any
violation or alleged violation of any Environmental Law in connection with any
such Person's presently or previously owned properties which represent
liabilities which, if determined adversely to such Restricted Entity, could
reasonably be expected to cause a Material Adverse Change. The Borrower shall
not permit any Restricted Entity to create, handle, transport, use, or dispose
of any Hazardous Materials on or about any such Person's properties; release any
Hazardous Materials into the environment in connection with any such Person's
operations or contaminate any properties with Hazardous Materials; or own
properties contaminated by any Hazardous Materials, in each case in any manner
that could reasonably be expected to cause a Material Adverse Change.
5.17 ERISA Compliance.
The Borrower shall cause each Restricted Entity to (i) comply in all material
respects with all applicable provisions of ERISA, the Code and other federal,
state or local laws and prevent the occurrence of any Reportable Event or
Prohibited Transaction with respect to, or the termination of, any of their
respective Plans, in each case, where the failure to do so could reasonably be
expected to cause a Material Adverse Change and (ii) not create or participate
in any employee pension benefit plan covered by Title IV of ERISA or any
multiemployer plan under Section 4001(a)(3) of ERISA.
5.18 Payment of Certain Claims.
The Borrower shall cause each Restricted Entity to pay and discharge, before the
same shall become delinquent, (a) all taxes, assessments, levies, and like
charges imposed upon any such Person or upon any such Person's income, profits,
or property by authorities having competent jurisdiction prior to the date on
which penalties attach thereto except for tax payments being contested in good
faith for which adequate reserves have been established and reported in
accordance with generally accepted accounting principals which could not
reasonably be expected to cause a Material Adverse Change and (b) all trade
payables and current operating
liabilities, unless the same are less than 90 days past due or are being
contested in good faith, have adequate reserves established and reported in
accordance with generally accepted accounting principals, and could not
reasonably be expected to cause a Material Adverse Change.
5.19 Subsidiaries.
Upon the formation or acquisition of any new Subsidiary, the Borrower shall and
shall cause such Subsidiary to promptly, but in any event within 30 days after
the formation or acquisition of such new Subsidiary (a) execute and deliver to
the Administrative Agent a Joinder Agreement (each, a "Joinder Agreement") in
substantially the form of Exhibit G for the purpose of joining such Subsidiary
as a party to the Guaranty, the Security Agreement, and, if applicable, the
Stock Pledge Agreement or the Partnership Pledge Agreement, and (b) provide to
the Administrative Agent the other certificates, documents, and items listed on
Exhibit I.
5.20 Changes in Fiscal Periods.
The Borrower shall not permit the fiscal year of the Borrower to end on a day
other than September 30 or change the Borrower's method of determining fiscal
quarters.
5.21 Negative Pledge Clauses.
The Borrower shall not enter into or suffer to exist or become effective any
agreement that prohibits or limits the ability of any Restricted Entity to
create, incur, assume or suffer to exist any Lien upon any of its property or
revenues, whether now owned or hereafter acquired, to secure its obligations
under the Credit Documents to which it is a party other than (a) this Agreement
and the other Credit Documents and (b) any agreements governing any purchase
money Liens or Capital Lease Obligations otherwise permitted hereby (in which
case, any prohibition or limitation shall only be effective against the assets
financed thereby).
5.22 Subordinated Debt Payments.
The Borrower shall not make any payment of principal, interest or premium on the
Senior Subordinated Notes or any Subordinated Debt (not including the defeasance
of the Senior Subordinated Notes as provided in Section 3.1(e)) unless no
Default has then occurred and is continuing or would result therefrom.
ARTICLE 6
DEFAULT AND REMEDIES
6.1 Events of Default.
The failure to deliver the Mortgages as set forth in the proviso of Section
3.1(a) and each of the following shall be an "Event of Default" for the purposes
of this Agreement and for each of the Credit Documents:
a. Payment Failure.
The Borrower (i) fails to pay when due any principal amounts due under this
Agreement or any other Credit Document or (ii) fails to pay when due any
interest, fees, reimbursements, indemnifications, or other amounts due under
this Agreement or any other Credit Document and such failure has not been cured
within five Business Days;
b. False Representation.
Any written representation or warranty made by any Credit Party or any
Responsible Officer thereof in this Agreement or in any other Credit Document
proves to have been false or erroneous in any material respect at the time it
was made or deemed made;
c. Breach of Covenant.
(i) Any breach by the Borrower of any of the covenants contained in Sections
5.1(a) (with respect to the Borrower), 5.2, 5.3, 5.4, 5.5, 5.6, 5.7, 5.8, 5.9,
5.10, 5.13, 5.19 or 5.22 or (ii) any breach by any Credit Party of any other
covenants contained in this Agreement, or any other Credit Document and such
breach is not cured within 30 days following the earlier of knowledge of such
breach by a Responsible Officer of such Credit Party or the receipt of written
notice thereof from the Administrative Agent;
d. Security and Support Documents.
Any Security Document shall at any time and for any reason (other than one
within the reasonable control of any Bank) cease to create the Lien on the
property purported to be subject to such agreement in accordance with the terms
of such agreement, or cease to be in full force and effect, or shall be
contested by any party thereto;
e. Guaranty.
(i) The Guaranty shall at any time and for any reason cease to be in full force
and effect with respect to any Guarantor (except as permitted under Section 5.9
hereof) or shall be contested by any Guarantor, or any Guarantor shall deny it
has any further liability or obligation thereunder, or (ii) any breach by any
Guarantor of any of the covenants contained in Section 1 of the Guaranty;
f. Material Debt Default.
(i) Any principal, interest, fees, or other amounts due on any Debt of any
Restricted Entity (other than the Credit Obligations) is not paid when due,
whether by scheduled maturity, required prepayment, acceleration, demand, or
otherwise, and such failure is not cured within the applicable grace period, if
any, and the aggregate amount of all Debt of such Persons so in default exceeds
$2,000,000; (ii) any other event shall occur or condition shall exist under any
agreement or instrument relating to any Debt of any such Person (other than the
Credit Obligations) the effect of which is to accelerate or to permit the
acceleration of the maturity of any such Debt, whether or not any such Debt is
actually accelerated, and such event or condition shall not be cured within the
applicable grace period, if any, and the aggregate amount of all Debt of such
Persons so in default exceeds $2,000,000; or (iii) any Debt of any such Person
shall be declared to be due and payable, or required to be prepaid (other than
by a regularly scheduled prepayment) prior to the stated maturity thereof, and
the aggregate amount of all Debt of such Persons so accelerated exceeds
$2,000,000;
g. Material Agreement Default; Material Plan Event.
(i) There shall occur any breach by any Restricted Entity of any contract or
agreement which breach could reasonably be expected to cause a Material Adverse
Change and such breach is not cured within the applicable grace period, if any;
or (ii) there shall occur or exist an event with respect to any Plan which could
in the sole judgment of the Administrative Agent reasonably be expected to have
a Material Adverse Change;
h. Bankruptcy and Insolvency.
(i) There shall have been filed against any Restricted Entity or any such
Person's properties, without such Person's consent, any petition or other
request for relief seeking an arrangement, receivership, reorganization,
liquidation, or similar relief under bankruptcy or other laws for the relief of
debtors, and such request for relief (A) remains in effect for 60 or more days,
whether or not consecutive, or (B) is approved by a final nonappealable order,
or (ii) any such Person consents to or files any petition or other request for
relief of the type described in clause (i) above seeking relief from creditors,
makes any assignment for the benefit of creditors or other arrangement with
creditors, or admits in writing such Person's inability to pay such Person's
debts as they become due (the occurrence of any Event of Default under clause
(i) or (ii) of this paragraph being a "Bankruptcy Event of Default");
i. Adverse Judgment.
The aggregate outstanding amount of judgments against the Restricted Entities
not discharged or stayed pending appeal or other court action within 30 days
following entry is greater than $2,000,000;
j. Change of Control.
There shall occur any Change of Control; or
k. Senior Subordinated Notes Default.
(i) There shall occur any default or event of default (and such event or
condition is not cured within the applicable grace period, if any), however
denominated, under the Senior Subordinated Notes or either Senior Subordinated
Note Indenture or any Subordinated Debt or any Subordinated Debt Indenture; (ii)
any modification shall be made to the subordination provisions or economic terms
of the Senior Subordinated Notes or either Senior Subordinated Note Indenture or
any Subordinated Debt or any Subordinated Debt Indenture without the prior
written consent of the Majority Banks; or (iii) any "Change of Control Offer"
(or any other defined term having a similar purpose) as defined in either Senior
Subordinated Note Indenture or any Subordinated Debt Indenture shall occur.
6.2 Termination of Commitments.
Upon the occurrence of any Bankruptcy Event of Default, all of the Commitments
of the Administrative Agent and the Banks hereunder shall terminate. During the
existence of any Event of Default other than a Bankruptcy Event of Default, the
Administrative Agent shall at the request of the Majority Banks declare by
written notice to the Borrower all of the Commitments of the Administrative
Agent and the Banks hereunder terminated, whereupon the same shall immediately
terminate.
6.3 Acceleration of Credit Obligations.
Upon the occurrence of any Bankruptcy Event of Default, the aggregate
outstanding principal amount of all loans made hereunder, all accrued interest
thereon, and all other Credit Obligations shall immediately and automatically
become due and payable. During the existence of any Event of Default other than
a Bankruptcy Event of Default, the Administrative Agent shall at the request of
the Majority Banks declare by written notice to the Borrower the aggregate
outstanding principal amount of all loans made hereunder, all accrued interest
thereon, and all other Credit Obligations to be immediately due and payable,
whereupon the same shall immediately become due and payable. In connection with
the foregoing, except for the notice provided for above in this Article 6, the
Borrower waives notice of any Default or Event of Default, grace, notice of
intent to accelerate, notice of acceleration, presentment, demand, notice of
nonpayment, protest, and all other notices.
6.4 Cash Collateralization of Letters of Credit.
Upon the occurrence of any Bankruptcy Event of Default, the Borrower shall pay
to the Administrative Agent an amount equal to the Letter of Credit Exposure to
be held in the Letter of Credit Collateral Account for disposition in accordance
with Section 2.3(g). During the existence of any Event of Default other than a
Bankruptcy Event of Default, the Administrative Agent shall at the request of
the Majority Banks require by written notice to the Borrower that the Borrower
pay to the Administrative Agent an amount equal to the Letter of Credit Exposure
to be held in the Letter of Credit Collateral Account for disposition in
accordance with Section 2.3(g), whereupon the Borrower shall pay to the
Administrative Agent such amount for such purpose.
6.5 Default Interest.
If any Event of Default exists based upon a default in the payment of any
amounts owing hereunder, the Administrative Agent shall at the request of the
Majority Banks declare by written notice to the Borrower that the Credit
Obligations specified in such notice shall bear interest beginning on the date
specified in such notice until paid in full at the applicable Default Rate for
such Credit Obligations, whereupon the Borrower shall pay such interest to the
Administrative Agent for the benefit of the Administrative Agent and the Banks,
as applicable, upon demand by the Administrative Agent. If any other Event of
Default exists, the Administrative Agent shall at the request of the Majority
Banks declare by written notice to the Borrower that, unless such Event of
Default is cured to the satisfaction of the Administrative Agent and the
Majority Banks on or before the 30th day following the occurrence of such Event
of Default, the Credit Obligations specified in such notice shall bear interest
beginning on such 30th day until paid in full at the applicable Default Rate for
such Credit Obligations, whereupon the Borrower shall, if such Event of Default
is not cured by such date, pay such interest to the Administrative Agent for the
benefit of the Administrative Agent and the Banks, as applicable, upon demand by
the Administrative Agent after such date.
6.6 Right of Setoff; Adjustments.
a. During the existence of an Event of Default, each of the Administrative Agent
and the Banks is hereby authorized at any time, to the fullest extent permitted
by law, to set off and apply any indebtedness owed by the Administrative Agent
or such Bank to the Borrower against any and all of the obligations of the
Borrower under this Agreement and the other Credit Documents, irrespective of
whether or not the Administrative Agent or such Bank shall have made any demand
under this Agreement or the other Credit Documents and although such obligations
may be contingent and unmatured. Each of the Administrative Agent and the Banks
agrees promptly to notify the Borrower after any such setoff and application
made by such party provided that the failure to give such notice shall not
affect the validity of such setoff and application.
b. Each Bank agrees that if any Bank (a "benefited Bank") shall at any time
receive any payment of all or part of its Loan Advances, or interest thereon, or
receive any collateral in respect thereof (whether voluntarily or involuntarily,
by set-off or otherwise) in a greater proportion than any such payment to or
collateral received by any other Bank, if any, in respect of such other Loan
Advances, or interest thereon, such benefited Bank shall purchase for cash from
the other Banks a participating interest in such portion of each such other
Bank's Loan Advances, or shall provide such other Banks with the benefits of any
such collateral, or the proceeds thereof, as shall be necessary to cause such
benefited Bank to share the excess payment or benefits of such collateral or
proceeds ratably with each of the Banks; provided, however, that if all or any
portion of such excess payment or benefits is thereafter recovered from such
benefited Bank, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest. The
Borrower agrees that each Bank so purchasing a portion of another Bank's Loan
Advances may exercise all rights of payment (including, without limitation,
rights of set-off) with respect to such portion as fully as if such Bank were
the direct holder of such portion.
6.7 Actions Under Credit Documents.
Following an Event of Default, the Administrative Agent shall at the request of
the Majority Banks take any and all actions permitted under the other Credit
Documents, including the Guaranty and the Security Documents.
6.8 Remedies Cumulative.
No right, power, or remedy conferred to the Administrative Agent or the Banks in
this Agreement and the other Credit Documents, or now or hereafter existing at
law, in equity, by statute, or otherwise, shall be exclusive, and each such
right, power, or remedy shall to the full extent permitted by law be cumulative
and in addition to every other such right, power, or remedy. No course of
dealing and no delay in exercising any right, power, or remedy conferred to the
Administrative Agent or the Banks in this Agreement and the other Credit
Documents, or now or hereafter existing at law, in equity, by statute, or
otherwise, shall operate as a waiver of or otherwise prejudice any such right,
power, or remedy.
6.9 Application of Payments.
Prior to the Revolving Loan Maturity Date or any acceleration of the Credit
Obligations, all payments made hereunder shall be applied to the Credit
Obligations as directed by the Borrower, subject to the rules regarding the
application of payments to certain Credit Obligations provided for hereunder and
in the other Credit Documents. Following the Revolving Loan Maturity Date or any
acceleration of the Credit Obligations, all payments and collections shall be
applied to the Credit Obligations in the following order:
First, to the payment of the costs, expenses, reimbursements (other
than reimbursement obligations with respect to draws under Letters of Credit),
and indemnifications of the Administrative Agent that are due and payable under
the Credit Documents;
Then, ratably to the payment of the costs, expenses, reimbursements
(other than reimbursement obligations with respect to draws under Letters of
Credit), and indemnifications of the Banks that are due and payable under the
Credit Documents;
Then, ratably to the payment of all outstanding principal of all loans
made hereunder, all reimbursement obligations for draws under Letters of Credit,
all accrued but unpaid interest and fees under this Agreement and all
obligations then due and payable under Interest Hedge Agreements;
Then, ratably to the payment of any other amounts due and owing with
respect to the Credit Obligations; and
Finally, any surplus held by the Administrative Agent and remaining
after payment in full of all the Credit Obligations and reserve for Credit
Obligations not yet due and payable shall be promptly paid over to the Borrower
or to whomever may be lawfully entitled to receive such surplus. All
applications shall be distributed in accordance with Section 2.11(a).
ARTICLE 7
THE ADMINISTRATIVE AGENT
7.1 Appointment; Nature of Relationship.
Bank One, NA is hereby appointed by each of the Banks as its contractual
representative hereunder and under each other Credit Document, and each of the
Banks irrevocably authorizes the Administrative Agent to act as the contractual
representative of such Bank with the rights and duties expressly set forth
herein and in the other Credit Documents. The Administrative Agent agrees to act
as such contractual representative upon the express conditions contained in this
Article. Notwithstanding the use of the defined term "Administrative Agent," it
is expressly understood and agreed that the Administrative Agent shall not have
any fiduciary responsibilities to any Bank by reason of this Agreement or any
other Credit Document and that the Administrative Agent is merely acting as the
contractual representative of the Banks with only those duties as are expressly
set forth in this Agreement and the other Credit Documents. In its capacity as
the Banks' contractual representative, the Administrative Agent (i) does not
hereby assume any fiduciary duties to any of the Banks, (ii) is a
"representative" of the Banks within the meaning of the term "secured party" as
defined in the Texas 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 Credit Documents. Each of
the Banks hereby
agrees to assert no claim against the Administrative Agent on any agency theory
or any other theory of liability for breach of fiduciary duty, all of which
claims each Bank hereby waives.
7.2 Powers.
The Administrative Agent shall have and may exercise such powers under the
Credit Documents as are specifically delegated to the Administrative Agent by
the terms of each thereof, together with such powers as are reasonably
incidental thereto. The Administrative Agent shall have no implied duties to the
Banks, or any obligation to the Banks to take any action thereunder except any
action specifically provided by the Credit Documents to be taken by the
Administrative Agent.
7.3 General Immunity.
Neither the Administrative Agent nor any of its directors, officers, agents or
employees shall be liable to the Borrower, the Banks or any Bank for any action
taken or omitted to be taken by it or them hereunder or under any other Credit
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 (IT BEING THE INTENTION OF THIS PROVISION THAT THERE
SHALL BE NO LIABILITY ARISING SOLELY OUT OF OR BY REASON OF THE NEGLIGENCE OF
ANY OF THE PARTIES BEING REIMBURSED).
7.4 No Responsibility for Loans, Recitals, etc.
Neither the Administrative 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 Credit Document or any borrowing hereunder; (b) the performance or
observance of any of the covenants or agreements of any obligor under any Credit
Document, including, without limitation, any agreement by an obligor to furnish
information directly to each Bank; (c) the satisfaction of any condition
specified in Article 3, except receipt of items required to be delivered solely
to the Administrative Agent; (d) the existence or possible existence of any
Default or Event of Default; (e) the validity, enforceability, effectiveness,
sufficiency or genuineness of any Credit 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; or (g) the financial
condition of the Borrower or any guarantor of any of the Credit Obligations or
of any of the Borrower's or any such guarantor's respective Subsidiaries. The
Administrative Agent shall have no duty to disclose to the Banks information
that is not required to be furnished by the Borrower to the Administrative Agent
at such time, but is voluntarily furnished by the Borrower to the Administrative
Agent (either in its capacity as Administrative Agent or in its individual
capacity).
7.5 Acting on Instructions of Banks.
The Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder and under any other Credit Document in
accordance with written instructions
signed by the Majority Banks, and such instructions and any action taken or
failure to act pursuant thereto shall be binding on all of the Banks. The Banks
hereby acknowledge that the Administrative 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 Credit Document unless it shall be requested in
writing to do so by the Majority Banks. The Administrative Agent shall be fully
justified in failing or refusing to take any action hereunder and under any
other Credit Document unless it shall first be indemnified to its satisfaction
by the Banks pro rata against any and all liability, cost and expense that it
may incur by reason of taking or continuing to take any such action.
7.6 Employment of Agents and Counsel.
The Administrative Agent may execute any of its duties as Administrative Agent
hereunder and under any other Credit Document by or through employees, agents,
and attorneys in fact and shall not be answerable to the Banks, 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 Administrative Agent shall be entitled to advice of counsel
concerning the contractual arrangement between the Administrative Agent and the
Banks and all matters pertaining to the Administrative Agent's duties hereunder
and under any other Credit Document.
7.7 Reliance on Documents; Counsel.
The Administrative Agent shall be entitled to rely upon any notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex, electronic mail
message, 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 Administrative
Agent, which counsel may be employees of the Administrative Agent. For purposes
of determining compliance with the conditions specified in Article 3, each Bank
that has signed this Agreement shall be deemed to have consented to, approved or
accepted or to be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to a
Bank unless the Administrative Agent shall have received notice from such Bank
prior to the applicable date specifying its objection thereto.
7.8 Administrative Agent's Reimbursement and Indemnification.
Each Bank agrees to reimburse and indemnify the Administrative Agent for such
Bank's ratable share of (i) any amounts not reimbursed by the Borrower for which
the Administrative Agent is entitled to reimbursement by the Borrower under the
Credit Documents, (ii) any other expenses incurred by the Administrative Agent
on behalf of the Banks, in connection with the preparation, execution, delivery,
administration and enforcement of the Credit Documents (including, without
limitation, for any expenses incurred by the Administrative Agent in connection
with any dispute between the Administrative Agent and any Bank or between two or
more of the Banks) and (iii) 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 Administrative Agent in any way relating to or arising out of the
Credit
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 Administrative Agent in connection
with any dispute between the Administrative Agent and any Bank or between two or
more of the Banks), or the enforcement of any of the terms of the Credit
Documents or of any such other documents, provided that (i) no Bank 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 Administrative
Agent (IT BEING THE INTENTION OF THIS PROVISION THAT SUCH INDEMNIFICATION
OBLIGATION WILL BE APPLICABLE REGARDLESS OF WHETHER CAUSED IN WHOLE OR IN PART
BY THE NEGLIGENCE OF ANY OF THE PARTIES BEING INDEMNIFIED) and (ii) any
indemnification required pursuant to Section 2.11(b) shall, notwithstanding the
provisions of this Section, be paid by the relevant Bank in accordance with the
provisions thereof. The obligations of the Banks under this Section shall
survive payment of the Credit Obligations and termination of this Agreement.
7.9 Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received written notice from a Bank or the Borrower
referring to this Agreement describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Banks.
7.10 Rights as a Bank.
In the event the Administrative Agent is a Bank, the Administrative Agent shall
have the same rights and powers hereunder and under any other Credit Document
with respect to its Commitment and its Loan Advances as any Bank and may
exercise the same as though it were not the Administrative Agent, and the term
"Bank" or "Banks" shall, at any time when the Administrative Agent is a Bank,
unless the context otherwise indicates, include the Administrative Agent in its
individual capacity. The Administrative 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 Credit 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 Administrative Agent, in its individual capacity, is
not obligated to remain a Bank.
7.11 Bank Credit Decision.
Each Bank acknowledges that it has, independently and without reliance upon the
Administrative Agent, the Arranger or any other Bank 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 Credit Documents. Each Bank also acknowledges
that it will, independently and without reliance upon the Administrative
Agent, the Arranger or any other Bank 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 Credit Documents.
7.12 Successor Administrative Agent.
The Administrative Agent may resign at any time after a Default has occurred and
remained uncured for 60 days by giving written notice thereof to the Banks and
the Borrower, such resignation to be effective upon the appointment of a
successor Administrative Agent or, if no successor Administrative Agent has been
appointed, forty-five days after the retiring Administrative Agent gives notice
of its intention to resign. The Administrative Agent may be removed at any time
with or without cause by written notice received by the Administrative Agent
from the Majority Banks, such removal to be effective on the date specified by
the Majority Banks. Upon any such resignation or removal, the Majority Banks
shall have the right to appoint, on behalf of the Borrower and the Banks, a
successor Administrative Agent. If no successor Administrative Agent shall have
been so appointed by the Majority Banks within thirty days after the resigning
Administrative Agent's giving notice of its intention to resign, then the
resigning Administrative Agent may appoint, on behalf of the Borrower and the
Banks, a successor Administrative Agent. Notwithstanding the previous sentence,
the Administrative Agent may at any time without the consent of the Borrower or
any Bank, appoint any of its Affiliates which is a commercial bank as a
successor Administrative Agent hereunder. If the Administrative Agent has
resigned or been removed and no successor Administrative Agent has been
appointed, the Banks may perform all the duties of the Administrative Agent
hereunder and the Borrower shall make all payments in respect of the Credit
Obligations to the applicable Bank and for all other purposes shall deal
directly with the Banks. No successor Administrative Agent shall be deemed to be
appointed hereunder until such successor Administrative Agent has accepted the
appointment. Any such successor Administrative Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the resigning or removed Administrative Agent. Upon the effectiveness of the
resignation or removal of the Administrative Agent, the resigning or removed
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the Credit Documents. After the effectiveness of the
resignation or removal of an Administrative Agent, the provisions of this
Article shall continue in effect for the benefit of such Administrative Agent in
respect of any actions taken or omitted to be taken by it while it was acting as
the Administrative Agent hereunder and under the other Credit Documents. In the
event that there is a successor to the Administrative Agent by merger, or the
Administrative Agent assigns its duties and obligations to an Affiliate pursuant
to this Section, then the term "Prime Rate" as used in this Agreement shall mean
the prime rate, base rate or other analogous rate of the new Administrative
Agent.
7.13 Administrative Agent and Arranger Fees.
The Borrower agrees to pay to the Administrative Agent and the Arranger, for
their respective accounts, the fees agreed to by the Borrower, the
Administrative Agent and the Arranger pursuant to the Fee Letter or as otherwise
agreed from time to time.
7.14 Delegation to Affiliates.
The Borrower and the Banks agree that the Administrative 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
Administrative Agent is entitled under this Agreement.
7.15 Execution of Collateral Documents.
The Banks hereby empower and authorize the Administrative Agent to execute and
deliver to the Borrower on their behalf the Security Documents and all related
agreements, documents or instruments as shall be necessary or appropriate to
effect the purposes of the Security Documents.
7.16 Collateral Releases.
The Banks hereby empower and authorize the Administrative Agent to execute and
deliver to the Restricted Entities on behalf of the Banks 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 Credit Document or which shall otherwise have been approved by the
Majority Banks (or, if required by the terms of this Agreement, all of the
Banks) in writing.
7.17 Syndication, Managing and Documentation Agents.
None of the Syndication, Managing and Documentation Agents shall have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than those applicable to all Banks as such. Without limiting the foregoing, none
of the Syndication, Managing and Documentation Agents shall have or be deemed to
have a fiduciary relationship with any Bank. Each Bank hereby makes the same
acknowledgments with respect to such Banks as it makes with respect to the
Administrative Agent in Section 7.11.
ARTICLE 8
BENEFIT OF AGREEMENT; ASSIGNMENT; PARTICIPATIONS
8.1 Successors and Assigns.
The terms and provisions of the Credit Documents shall be binding upon and inure
to the benefit of the Borrower and the Banks and their respective successors and
assigns permitted hereby, except that (i) the Borrower shall not have the right
to assign its rights or obligations under the Credit Documents without the prior
written consent of each Bank, (ii) any assignment by any Bank must be made in
compliance with Section 8.3, and (iii) any transfer by participation must
be made in compliance with Section 8.2. Any attempted assignment or transfer by
any party not made in compliance with this Section 8.1 shall be null and void,
unless such attempted assignment or transfer is treated as a participation in
accordance with Section 8.3(b). The parties to this Agreement acknowledge that
clause (ii) of this Section 8.1 relates only to absolute assignments and this
Section 8.1 does not prohibit assignments creating security interests,
including, without limitation, any pledge or assignment by any Bank of all or
any portion of its rights under this Agreement and any note to a Federal Reserve
Bank; provided, however, that no such pledge or assignment creating a security
interest shall release the transferor Bank from its obligations hereunder unless
and until the parties thereto have complied with the provisions of Section 8.3.
The Administrative Agent may treat the Person which made any Loan Advance or
which holds any note as the owner thereof for all purposes hereof unless and
until such Person complies with Section 8.3; provided, however, that the
Administrative Agent may in its discretion (but shall not be required to) follow
instructions from the Person which made any Loan Advance or which holds any note
to direct payments relating to such Loan Advance or note to another Person. Any
assignee of the rights to any Loan Advance or any note agrees by acceptance of
such assignment to be bound by all the terms and provisions of the Credit
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 Advance (whether or not a note has been issued in evidence
thereof), shall be conclusive and binding on any subsequent holder or assignee
of the rights to such Loan Advance.
8.2 Participations.
a. Any Bank may at any time sell to one or more banks or other entities
("Participants") participating interests in any Loan Advance owing to such Bank,
any note held by such Bank, any Commitment of such Bank or any other interest of
such Bank under the Credit Documents. In the event of any such sale by a Bank of
participating interests to a participant, such Bank's obligations under the
Credit Documents shall remain unchanged, such Bank shall remain solely
responsible to the other parties hereto for the performance of such obligations,
such Bank shall remain the owner of its Loan Advances and the holder of any note
issued to it in evidence thereof for all purposes under the Credit Documents,
all amounts payable by the Borrower under this Agreement shall be determined as
if such Bank had not sold such participating interests, and the Borrower and the
Administrative Agent shall continue to deal solely and directly with such Bank
in connection with such Bank's rights and obligations under the Credit
Documents.
Each Bank shall retain the sole right to approve, without the consent of any
participant, any amendment, modification or waiver of any provision of the
Credit Documents other than any amendment, modification or waiver with respect
to any Loan Advance or Commitment in which such participant has an interest
which would require consent of all of the Banks pursuant to the terms of Section
9.3 or of any other Credit Document.
b. The Borrower agrees that each participant shall be deemed to have the right
of setoff provided in Section 6.6 in respect of its participating interest in
amounts owing under the Credit Documents to the same extent as if the amount of
its participating interest were owing directly to it as a Bank under the Credit
Documents, provided that each Bank shall retain the right of setoff provided in
Section 6.6 with respect to the amount of participating interests sold to each
participant. The Banks agree to share with each participant, and each
participant, by exercising
the right of setoff provided in Section 6.6, agrees to share with each Bank, any
amount received pursuant to the exercise of its right of setoff, such amounts to
be shared in accordance with Section 6.2 as if each participant were a Bank. The
Borrower further agrees that each participant shall be entitled to the benefits
of Sections 2.7, 2.9 and 2.12 to the same extent as if it were a Bank and had
acquired its interest by assignment pursuant to Section 8.3, provided that (i) a
participant shall not be entitled to receive any greater payment under Sections
2.7, 2.9 and 2.12 than the Bank who sold the participating interest to such
Participant would have received had it retained such interest for its own
account, unless the sale of such interest to such participant is made with the
prior written consent of the Borrower, and (ii) any participant not incorporated
under the laws of the United States of America or any State thereof agrees to
comply with the provisions of Section 2.17 to the same extent as if it were a
Bank.
8.3 Assignments.
a. Any Bank may at any time assign to one or more banks or other entities
("Purchasers") all or any part of its rights and obligations under the Credit
Documents. Such assignment shall be pursuant to an Assignment and Acceptance or
in such other form as may be agreed to by the parties thereto. Each such
assignment with respect to a Purchaser which is not a Bank or an Affiliate of a
Bank or an Approved Fund shall either be in an amount equal to the entire
applicable Commitment and Loan Advances of the assigning Bank or (unless each of
the Borrower and the Administrative Agent otherwise consents) be in an aggregate
amount (of Revolving Commitment (or, if the Revolving Commitment has been
terminated, outstanding Revolving Loan Advances and Letter of Credit Exposure)
and/or Term Loan Advances) not less than $5,000,000, and if the assignee Bank
retains any interest in the rights and obligations under the Credit Documents,
it shall retain an interest (measured on the same basis) of at least $5,000,000.
The amount of the assignment shall be based on the Commitment or outstanding
Loan Advances (if the Commitment has been terminated) subject to the assignment,
determined as of the date of such assignment or as of the "Trade Date," if the
"Trade Date" is specified in the assignment.
b. The consent of the Borrower shall be required prior to an assignment becoming
effective unless the Purchaser is a Bank or an Affiliate of a Bank or an
Approved Fund, provided that the consent of the Borrower shall not be required
if a Default has occurred and is continuing. The consent of the Administrative
Agent and the Issuing Bank shall be required prior to an assignment becoming
effective unless the Purchaser is a Bank. Any consent required under this
Section 8.3(b) shall not be unreasonably withheld or delayed.
c. Upon (i) delivery to the Administrative Agent of an Assignment and Assumption
Agreement, together with any consents required by Sections 8.2(a) and 8.2(b),
and (ii) payment of a $3,500 fee to the Administrative Agent for processing such
assignment (unless such fee is waived by the Administrative 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 Loans 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 Credit 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 Bank party to this
Agreement and any other Credit Document executed by or on behalf of the Banks
and shall have all the rights and obligations of a Bank under the Credit
Documents, to the same extent as if it were an original party thereto, and the
transferor Bank shall be released with respect to the Commitment and Loan
Advances assigned to such Purchaser without any further consent or action by the
Borrower, the Banks or the Administrative Agent. In the case of an assignment
covering all of the assigning Bank's rights and obligations under this
Agreement, such Bank shall cease to be a Bank hereunder but shall continue to be
entitled to the benefits of, and subject to, those provisions of this Agreement
and the other Credit Documents which survive payment of the Credit Obligations
and termination of the applicable agreement. Any assignment or transfer by a
Bank of rights or obligations under this Agreement that does not comply with
this Section 8.3 shall be treated for purposes of this Agreement as a sale by
such Bank of a participation in such rights and obligations in accordance with
Section 8.2. Upon the consummation of any assignment to a Purchaser pursuant to
this Section 8.3(c) the transferor Bank, the Administrative Agent and the
Borrower shall, if the transferor Bank 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 Bank 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.
d. The Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at one of its offices in Houston, Texas a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Banks, and the Commitments of, and principal
amounts of the Loans owing to, each Bank pursuant to the terms hereof from time
to time (the "Register"). The entries in the Register shall be conclusive, and
the Borrower, the Administrative Agent and the Banks may treat each Person whose
name is recorded in the Register pursuant to the terms hereof as a Bank
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower at any
reasonable time and from time to time upon reasonable prior notice.
8.4 Dissemination of Information.
The Borrower authorizes each Bank to disclose to any participant or Purchaser or
any other Person acquiring an interest in the Credit Documents by operation of
law (each a "Transferee") and any prospective Transferee any and all information
in such Bank's possession concerning the creditworthiness of the Borrower and
its Subsidiaries.
Tax Treatment. If any interest in any Credit Document is transferred to any
Transferee which is not incorporated under the laws of the United States or any
State thereof, the transferor Bank shall cause such Transferee, concurrently
with the effectiveness of such transfer, to comply with the provisions of
Section 2.12.
ARTICLE 9
MISCELLANEOUS
9.1 Expenses.
The Borrower shall pay on demand of the applicable party specified herein (a)
all reasonable out of pocket costs and expenses of the Administrative Agent and
the Issuing Bank in connection with the preparation, execution, delivery,
administration, modification, and amendment of this Agreement and the other
Credit Documents, including the reasonable fees and expenses of outside counsel
for the Administrative Agent and the Issuing Bank, and (b) all out-of-pocket
costs and expenses of the Administrative Agent, the Issuing Bank, and each Bank
in connection with the preservation or enforcement of their respective rights
under this Agreement and the other Credit Documents, whether through
negotiations, legal proceedings, or otherwise, including fees and expenses of
counsel for the Administrative Agent, the Issuing Bank, and each Bank. The
provisions of this Section shall survive the repayment and termination of the
credit provided for under this Agreement and any purported termination of this
Agreement which does not expressly refer to this Section.
9.2 Indemnification.
The Borrower agrees to protect, defend, indemnify, and hold harmless the
Administrative Agent, the Issuing Bank, each Bank, and each of their respective
Related Parties (for the purposes of this Section 8.2, collectively, the
"Indemnified Parties"), from and against all demands, claims, actions, suits,
damages, judgments, fines, penalties, liabilities, and out of pocket costs and
expenses, including reasonable costs of attorneys and related costs of experts
such as accountants (collectively, the "Indemnified Liabilities"), actually
incurred by any Indemnified Party which are related to any litigation or
proceeding relating to this Agreement, the other Credit Documents, or the
transactions contemplated thereunder, INCLUDING ANY INDEMNIFIED LIABILITIES
CAUSED BY ANY INDEMNIFIED PARTY'S OWN NEGLIGENCE, but not Indemnified
Liabilities which are a result of any Indemnified Party's gross negligence or
willful misconduct. The provisions of this Section shall survive the repayment
and termination of the credit provided for under this Agreement and any
purported termination of this Agreement which does not expressly refer to this
Section.
9.3 Modifications, Waivers, and Consents.
No provision of this Agreement, the Term Loan Notes or the Revolving Loan Notes
may be waived, amended, or modified, nor shall any consent required under this
Agreement, the Term Loan Notes or the Revolving Loan Notes be effective, except
pursuant to an agreement or agreements in writing entered into by the Borrower
and the Majority Banks or by the Borrower and the Administrative Agent with the
consent of the Majority Banks; provided that no such agreement shall (a) waive
any of the conditions specified in Section 3.1 or 3.2 without the written
consent of the Administrative Agent, all the Banks, and the Borrower, (b)
increase the Commitment of any Bank without the written consent of such Bank,
(c) forgive or reduce the amount or rate of any principal, interest, or fees
payable under the Credit Documents, or postpone or extend the time for payment
thereof without the written consent of the Administrative Agent, all the Banks,
and the Borrower, (d) extend the scheduled maturities or times of payment
without the written consent of the Administrative Agent, all the Banks, and the
Borrower, (e) release any Guarantor or all or substantially all of the
Collateral (except as
otherwise permitted or required as provided in the definition of "Asset Sale" or
Section 5.9(b)) without the written consent of the Administrative Agent, all the
Banks, and the Borrower, or (f) change the percentage of Banks required to take
any action under this Agreement, the Term Loan Notes, the Revolving Loan Notes,
or the Security Documents, including any amendment of the definition of
"Majority Banks" or this Section 9.3 without the written consent of the
Administrative Agent, all the Banks, and the Borrower. No modification, waiver,
or consent shall, unless in writing and signed by the Administrative Agent, the
Issuing Bank or the Swing Line Lender affect the rights or obligations of the
Administrative Agent, the Issuing Bank or the Swing Line Lender, as the case may
be, under the Credit Documents. The Administrative Agent shall not modify or
waive or grant any consent under any other Credit Document if such action would
be prohibited under this Section 9.3 with respect to the Credit Agreement, the
Term Loan Notes or the Revolving Loan Notes.
9.4 Survival of Agreements.
All representations, warranties, and covenants of the Borrower in this Agreement
and the other Credit Documents shall survive the execution of this Agreement and
the other Credit Documents and any other document or agreement.
9.5 Notice.
All notices and other communications under this Agreement, the Term Loan Notes
and the Revolving Loan Notes shall be in writing and mailed by certified mail
(return receipt requested), telecopied, telexed, hand delivered, or delivered by
a nationally recognized overnight courier, to the address for the appropriate
party specified in Schedule I-B or at such other address as shall be designated
by such party in a written notice to the other parties. Mailed notices shall be
effective when received. Telecopied or telexed notices shall be effective when
transmission is completed or confirmed by telex answerback. Delivered notices
shall be effective when delivered by messenger or courier. Notwithstanding the
foregoing, notices and communications to the Administrative Agent pursuant to
Article 2 or 7 shall not be effective until received by the Administrative
Agent.
9.6 CHOICE OF LAW.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, APPLICABLE FEDERAL LAW AND THE LAW OF THE STATE OF TEXAS.
9.7 Submission To Jurisdiction; Waivers.
The Borrower hereby irrevocably and unconditionally:
a. Submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Credit Documents to which it is a
party, or for recognition and enforcement of any judgment in respect thereof, to
the non-exclusive general jurisdiction of the courts of the State of Texas, the
courts of the United States for the Southern District of Texas, and appellate
courts from any thereof;
b. consents that any such action or proceeding may be brought in such courts and
waives any objection that it may now or hereafter have to the venue of any such
action or proceeding in any such court or that such action or proceeding was
brought in an inconvenient court and agrees not to plead or claim the same;
c. agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower, as the
case may be at its address set forth in Schedule I-B or at such other address of
which the Administrative Agent shall have been notified pursuant thereto; agrees
that nothing herein shall affect the right to effect service of process in any
other manner permitted by law or shall limit the right to xxx in any other
jurisdiction; and waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding referred to in
this Section any special, exemplary, punitive or consequential damages.
9.8 WAIVER OF JURY TRIAL.
THE BORROWER IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THE CREDIT DOCUMENTS OR ANY
TRANSACTIONS RELATING THERETO.
9.9 Counterparts.
This Agreement may be executed in multiple counterparts, and by the parties
hereto on separate counterparts which together shall constitute one and the same
instrument.
9.10 No Further Agreements.
THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS REPRESENT THE FINAL AGREEMENT
AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
9.11 2001 Credit Agreement.
a. The Revolving Loan Notes, the Term Loan Notes and the Swing Line Note have
been given in renewal, extension and modification, and not in extinguishment, of
the credit facilities previously provided to the Borrower pursuant to the 2001
Credit Agreement.
b. From and after the Closing Date, (i) the Prior Banks (other than any Bank
party hereto, and then only to the extent set forth in this Agreement) shall
have no further commitment or obligation to the Borrower as a Bank under this
Agreement and (ii) the Prior Administrative Agent shall cease to be the
Administrative Agent and shall have no further obligation to the Borrower, the
Prior Banks or the Banks in the capacity of "Administrative Agent" under the
2001 Credit Agreement or this Agreement; provided that (x) the Prior
Administrative Agent shall continue to enjoy all of its rights and remedies
(including but not limited to indemnities) as set forth in the 2001 Credit
Agreement with respect to events occurring before the Closing Date and each of
the Prior Banks shall remain obligated to the Prior Administrative Agent with
respect to such rights and remedies with respect to such events, all as if the
2001 Credit Agreement had not been amended and restated by this Agreement but
had instead been terminated effective as of the Closing Date and (y) nothing in
this Section 9.11(b) shall affect any claim, cause of action or other remedy
which any Restricted Entity may have against any Prior Bank, the Prior
Administrative Agent or any other Person under the 2001 Credit Agreement.
c. No letter of credit (each, a "Prior Letter of Credit") issued pursuant to the
2001 Credit Agreement shall be deemed a Letter of Credit, the bank (the "Prior
Issuing Bank") issuing such letters of credit shall not be deemed to be an
Issuing Bank and neither the Prior Letters of Credit or the Prior Issuing Bank
shall be entitled to any status under this Agreement.
d. The Prior Administrative Agent, in its representative capacity and as a Prior
Bank, has executed and delivered that certain Assignment of Debt and Liens and
Resignation of Administrative Agent (the "Assignment") of even date herewith; to
the extent necessary or appropriate, the Borrower hereby consents to the
Assignment.
e. This Agreement is an amendment and restatement of the 2001 Credit Agreement.
EXECUTED as of the date first above written.
BORROWER:
INTEGRATED ELECTRICAL SERVICES, INC.
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
ADMINISTRATIVE AGENT:
BANK ONE, NA,
as Administrative Agent
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
BANKS:
BANK ONE, NA
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
U.S. BANK NATIONAL ASSOCIATION
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
BANK OF SCOTLAND
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
LaSALLE BANK NATIONAL ASSOCIATION
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
XXXXX FARGO BANK, N.A.
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
SOUTHWEST BANK OF TEXAS, N.A.
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
FIRST AMERICAN BANK, SSB HOUSTON
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
ALLIED IRISH BANK, P.L.C.
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
REGIONS BANK
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
FIRST BANK & TRUST
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
HIBERNIA NATIONAL BANK
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
RZB FINANCE LLC
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
