1
Exhibit 10.32
REVOLVING CREDIT
AND
TERM LOAN AGREEMENT
DATED as of March 2, 1999
by and among
MERCURY AIR GROUP, INC.
(the "Borrower")
The Banks listed on Schedule 1 hereto
(the "Banks"),
and
BANKBOSTON, N.A., as Agent
(the "Agent")
with BANCBOSTON XXXXXXXXX XXXXXXXX INC.
having acted as Arranger and Syndication Agent
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TABLE OF CONTENTS
1. DEFINITIONS AND RULES OF INTERPRETATION.......................................1
1.1. Definitions.........................................................1
1.2. Rules of Interpretation.............................................25
2. THE REVOLVING CREDIT FACILITY.................................................26
2.1. Commitment to Lend..................................................26
2.2. Commitment Fee......................................................26
2.3. Reduction of Total Revolving Credit Commitment......................27
2.4. The Revolving Credit Notes..........................................27
2.5. Interest on Revolving Credit Loans..................................28
2.6. Requests for Revolving Credit Loans.................................28
2.6.1. In General.................................................28
2.6.2. Loans to Cover Reimbursement Obligations...................29
2.7. Conversion Options..................................................29
2.7.1. Conversion to Different Type of Revolving Credit Loan......29
2.7.2. Continuation of Type of Revolving Credit Loan..............30
2.7.3. Eurodollar Rate Loans......................................30
2.8. Funds for Revolving Credit Loans....................................30
2.8.1. Funding Procedures.........................................31
2.8.2. Advances by Agent..........................................31
2.9. The Swing Line......................................................32
2.9.1. Advances by Agent..........................................32
2.9.2. Notice of Borrowing........................................32
2.9.3. Interest on Swing Line Loans...............................33
2.9.4. Repayment of Swing Line Loans..............................33
2.9.5. The Swing Line Note........................................34
3. REPAYMENT OF THE REVOLVING CREDIT LOANS.......................................35
3.1. Maturity............................................................35
3.2. Mandatory Repayments of Revolving Credit Loans......................35
3.3. Optional Repayments of Revolving Credit Loans.......................35
4. THE TERM LOAN.................................................................36
4.1. Commitment to Lend..................................................36
4.2. The Term Notes......................................................37
4.3. Schedule of Installment Payments of Principal of Term Loan;
Mandatory Prepayments...............................................37
4.4. Optional Prepayment of Term Loan....................................38
4.5. Interest on Term Loans..............................................39
4.5.1. Interest Rates.............................................39
4.5.2. Payment of Interest........................................39
4.5.3. Notification by Borrower...................................39
4.5.4. Amounts, etc...............................................40
5. LETTERS OF CREDIT.............................................................40
5.1. Letter of Credit Commitments........................................40
5.1.1. Commitment to Issue Letters of Credit......................40
5.1.2. Letter of Credit Applications..............................41
5.1.3. Terms of Letters of Credit.................................41
5.1.4. Reimbursement Obligations of Banks.........................41
5.1.5. Participations of Banks....................................41
5.1.6. Reduction of Letter of Credit Limit........................41
5.2. Reimbursement Obligation of the Borrower............................42
5.3. Letter of Credit Payments...........................................43
5.4. Obligations Absolute................................................43
5.5. Reliance by Issuer..................................................44
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5.6. Letter of Credit Fees...............................................44
6. THE ACQUISITION FACILITY......................................................45
6.1. Commitment to Lend..................................................45
6.2. Commitment Fee......................................................45
6.3. Reduction of Total Acquisition Loan Commitment......................46
6.4. The Acquisition Notes...............................................46
6.5. Interest on Acquisition Loans.......................................46
6.6. Requests for Acquisition Loans......................................47
6.7. Funds for Acquisition Loans.........................................47
6.7.1. Funding Procedures.........................................47
6.7.2. Advances by Agent..........................................48
7. REPAYMENT OF THE ACQUISITION LOANS............................................48
7.1. Maturity............................................................48
7.2. Mandatory Repayments of Acquisition Loans...........................49
7.3. Optional Repayments of Acquisition Loans............................49
8. CERTAIN MANDATORY PREPAYMENTS.................................................49
8.1. Mandatory Prepayments from New Equity...............................49
8.2. Mandatory Prepayments from Additional Indebtedness..................50
8.3. Mandatory Prepayments from Asset Sales..............................50
8.4. Application of Proceeds; Etc........................................50
9. CERTAIN GENERAL PROVISIONS....................................................51
9.1. Closing and Other Fees..............................................51
9.2. Funds for Payments..................................................51
9.2.1. Payments to Agent..........................................51
9.2.2. No Offset, etc.............................................51
9.3. Computations........................................................52
9.4. Inability to Determine Eurodollar Rate..............................52
9.5. Illegality..........................................................52
9.6. Additional Costs, etc...............................................53
9.7. Capital Adequacy....................................................54
9.8. Certificate.........................................................55
9.9. Indemnity...........................................................55
9.10. Interest After Default..............................................55
9.10.1. Overdue Amounts...........................................55
9.10.2. Amounts Not Overdue.......................................55
10. COLLATERAL SECURITY AND GUARANTIES...........................................56
10.1. Security of Borrower................................................56
10.2. Guaranties and Security of Subsidiaries.............................56
10.3. Negative Pledge and Double Negative Pledge..........................56
11. REPRESENTATIONS AND WARRANTIES...............................................56
11.1. Corporate Authority.................................................56
11.1.1. Incorporation; Good Standing..............................56
11.1.2. Authorization.............................................57
11.1.3. Enforceability............................................57
11.2. Governmental Approvals..............................................57
11.3. Title to Properties; Leases.........................................57
11.4. Financial Statements................................................58
11.4.1. Financial Statements......................................58
11.4.2. Projections...............................................58
11.5. No Material Changes, etc............................................58
11.6. Franchises, Patents, Copyrights, etc................................59
11.7. Litigation..........................................................59
11.8. No Materially Adverse Contracts, etc................................59
11.9. Compliance with Other Instruments, Laws, etc........................59
11.10. Tax Status..........................................................60
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11.11. No Event of Default...............................................60
11.12. Holding Company and Investment Company Acts.......................60
11.13. Absence of Financing Statements, etc..............................60
11.14. Perfection of Security Interest...................................60
11.15. Certain Transactions..............................................61
11.16. Employee Benefit Plans............................................61
11.16.1. In General.............................................61
11.16.2. Terminability of Welfare Plans.........................61
11.16.3. Guaranteed Pension Plans...............................61
11.16.4. Multiemployer Plans....................................62
11.17. Use of Proceeds; Regulations U and X..............................62
11.18. Environmental Compliance..........................................63
11.19. Subsidiaries, etc.................................................65
11.20. Bank Accounts.....................................................65
11.21. Subordinated Debt Documents; Bond Documents.......................65
11.22. Disclosure........................................................65
11.23. Fiscal Year.......................................................65
11.24. Solvency..........................................................65
11.25. Chief Executive Offices...........................................66
11.26. Insurance.........................................................66
11.27. Year 2000 Problem.................................................66
11.28. Government Contracts..............................................66
12. AFFIRMATIVE COVENANTS OF THE BORROWER........................................66
12.1. Punctual Payment..................................................67
12.2. Maintenance of Office.............................................67
12.3. Records and Accounts..............................................67
12.4. Financial Statements, Certificates and Information................67
12.5. Notices...........................................................69
12.5.1. Defaults................................................69
12.5.2. Environmental Events....................................69
12.5.3. Notification of Claims against Collateral...............70
12.5.4. Notice of Litigation and Judgments......................70
12.5.5. Notice of Material Adverse Change.......................70
12.6. Corporate Existence; Maintenance of Properties.....................71
12.7. Insurance..........................................................71
12.8. Taxes..............................................................71
12.9. Inspection of Properties and Books, etc............................72
12.9.1. General..................................................72
12.9.2. ...........................................................72
Appraisals.........................................................72
12.9.3. Environmental Assessments................................72
12.9.4. Communications with Accountants..........................73
12.10. Compliance with Laws, Contracts, Licenses, and Permits.............73
12.11. Employee Benefit Plans.............................................74
12.12. Use of Proceeds....................................................74
12.13. Additional Mortgaged Property......................................74
12.14. Bank Accounts......................................................74
12.15. Interest Rate Protection Arrangements..............................74
12.16. Additional Landlord Consents.......................................75
12.17. Further Assurances.................................................75
13. CERTAIN NEGATIVE COVENANTS OF THE BORROWER...................................75
13.1. Restrictions on Indebtedness.......................................75
13.2. Restrictions on Liens..............................................77
13.3. Restrictions on Investments........................................78
13.4. Restricted Payments................................................79
13.5. Merger, Consolidation and Disposition of Assets....................80
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13.5.1. Mergers and Acquisitions................................80
13.5.2. Disposition of Assets...................................80
13.6. Sale and Leaseback................................................80
13.7. Compliance with Environmental Laws................................80
13.8. Employee Benefit Plans............................................81
13.9. Bank Accounts.....................................................82
13.10. Transactions with Affiliates......................................82
13.11. Fiscal Year.......................................................82
13.12. Prohibition on Negative Pledges...................................82
13.13. Restriction of Upstream Limitations...............................82
13.14. Charter Amendments................................................82
13.15. Creation of Subsidiaries..........................................82
13.16. Conduct of Business...............................................83
13.17. Modification of Documents.........................................83
13.18. Prepayment of Other Indebtedness..................................83
14. FINANCIAL COVENANTS OF THE BORROWER.........................................83
14.1. Leverage Ratio....................................................83
14.2. Senior Debt Ratio.................................................84
14.3. Debt Service Coverage Ratio.......................................84
14.4. Consolidated Tangible Net Worth...................................84
14.5. Quick Ratio.......................................................85
14.6. Capital Expenditures..............................................85
14.7. Consolidated Net Income...........................................85
15. CLOSING CONDITIONS..........................................................85
15.1. Loan Documents....................................................85
15.2. Certified Copies of Charter Documents.............................86
15.3. Corporate Action..................................................86
15.4. Incumbency Certificate............................................86
15.5. Validity of Liens.................................................86
15.6. Perfection Certificates and UCC Search Results....................86
15.7. Title Insurance...................................................86
15.8. Landlord Consents.................................................87
15.9. Financial Statements, Projections.................................87
15.10. No Material Adverse Change........................................87
15.11. No Litigation.....................................................87
15.12. No Adverse Information............................................87
15.13. Subordinated Debt Documents and Bond Documents....................88
15.14. Certificates of Insurance.........................................88
15.15. Opinions of Counsel...............................................88
15.16. Payoff Letter.....................................................88
15.17. Disbursement Instructions.........................................88
15.18. Payment of Fees...................................................88
16. CONDITIONS TO ALL BORROWINGS................................................89
16.1. Representations True; No Event of Default.........................89
16.2. No Legal Impediment...............................................89
16.3. Governmental Regulation...........................................90
16.4. Proceedings and Documents.........................................90
16.5. Additional Conditions to Acquisition Loans........................90
17. EVENTS OF DEFAULT; ACCELERATION; ETC........................................90
17.1. Events of Default and Acceleration................................91
17.2. Termination of Commitments........................................95
17.3. Remedies..........................................................95
17.4. Distribution of Collateral Proceeds...............................96
18. SETOFF......................................................................96
19. THE AGENT...................................................................97
19.1. Authorization.....................................................97
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19.2. Employees and Agents...............................................98
19.3. No Liability.......................................................98
19.4. No Representations.................................................99
19.4.1. General..................................................99
19.4.2. Closing Documentation, Etc...............................99
19.5. Payments...........................................................100
19.5.1. Payments to Agent........................................100
19.5.2. Distribution by Agent....................................100
19.5.3. Delinquent Banks.........................................100
19.6. Holders of Notes...................................................101
19.7. Indemnity..........................................................101
19.8. Agent as Bank......................................................101
19.9. Resignation........................................................101
19.10. Notification of Defaults and Events of Default.....................102
19.11. Duties in the Case of Enforcement..................................102
20. EXPENSES.....................................................................102
21. INDEMNIFICATION..............................................................103
22. SURVIVAL OF COVENANTS, ETC...................................................104
23. ASSIGNMENT AND PARTICIPATION.................................................105
23.1. Conditions to Assignment by Banks..................................105
23.2. Certain Representations and Warranties; Limitations; Covenants.....105
23.3. Register...........................................................107
23.4. New Notes..........................................................107
23.5. Participations.....................................................108
23.6. Disclosure.........................................................108
23.7. Assignee or Participant Affiliated with the Borrower...............108
23.8. Miscellaneous Assignment Provisions................................109
23.9. Assignment the Borrower............................................109
24. NOTICES, ETC.................................................................109
25. GOVERNING LAW................................................................110
26. HEADINGS.....................................................................111
27. COUNTERPARTS.................................................................111
28. ENTIRE AGREEMENT, ETC........................................................111
29. WAIVER OF JURY TRIAL.........................................................111
30. CONSENTS, AMENDMENTS, WAIVERS, ETC...........................................111
31. SEVERABILITY.................................................................112
32. CONFIDENTIALITY..............................................................112
33. PRIOR REIMBURSEMENT AGREEMENT SUPERSEDED.....................................113
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Schedules and Exhibits
----------------------
Schedules
---------
Schedule 1 Banks; Commitments; Commitment Percentages; Domestic
Lending Offices; Eurodollar Lending Offices
Schedule 11.3 Title to Properties
Schedule 11.6 Franchises, Patents, Copyrights
Schedule 11.7 Litigation
Schedule 11.18 Environmental Matters
Schedule 11.19 Subsidiaries
Schedule 11.20 Bank Accounts
Schedule 11.25 Chief Executive Offices
Schedule 11.28 Government Contracts
Schedule 13.1 Existing Indebtedness
Schedule 13.2 Existing Liens
Schedule 13.3 Existing Investments
Schedule 15.8 Certain Leaseholds
Exhibits
--------
Exhibit A-1 Form of Revolving Credit Note
Exhibit A-2 Form of Swing Line Note
Exhibit A-3 Form of Term Note
Exhibit A-4 Form of Acquisition Note
Exhibit B Form of Loan Request
Exhibit C Form of Compliance Certificate
Exhibit D Form of Assignment and Acceptance
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REVOLVING CREDIT
AND
TERM LOAN AGREEMENT
This REVOLVING CREDIT AND TERM LOAN AGREEMENT is made as of March 2,
1999, by and among (a) MERCURY AIR GROUP, INC., a New York corporation (the
"Borrower") having its principal place of business at 0000 XxXxxxxxx Xxxxxx, Xxx
Xxxxxxx, Xxxxxxxxxx 00000, (b) BANKBOSTON, N.A., a national banking association
and the other lending institutions listed on Schedule 1 hereto and (c)
BANKBOSTON, N.A., as agent for itself and such other lending institutions.
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. DEFINITIONS. The following terms shall have the meanings set forth
in this Section 1 or elsewhere in the provisions of this Credit Agreement
referred to below:
Acquisition Loan Commitment. With respect to each Bank, the amount set
forth on Schedule 1 hereto as the amount of such Bank's commitment to make
Acquisition Loans to the Borrower, as the same may be reduced from time to time;
or if such commitment is terminated pursuant to the provisions hereof, zero.
Acquisition Loan Commitment Fee. See Section 6.2.
Acquisition Loan Commitment Percentage. With respect to any Bank, the
percentage set forth opposite the name of such Acquisition Loan Bank on Schedule
1 hereto in the column entitled "Acquisition Loan Commitment Percentage".
Acquisition Loans. Loans made or to be made by the Banks to the Borrower
pursuant to Section 6.
Acquisition Loan Note Record. A Record with respect to an Acquisition
Note.
Acquisition Notes. See Section 6.4.
Adjustment Date. The first day of the month immediately following the
month in which a Compliance Certificate is delivered by the Borrower pursuant to
Section 12.4(d).
Affiliate. Any Person that would be considered to be an affiliate of the
Borrower under Rule 144(a) of the Rules and Regulations of the Securities and
Exchange Commission, as in effect on the date hereof, if the Borrower were
issuing securities.
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Agent. BankBoston, N.A., in its capacity as agent for the Banks.
Agent's Fee Letter. See Section 9.1.
Agent's Head Office. The Agent's head office located at 000 Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other location as the Agent may
designate from time to time.
Agent's Special Counsel. Xxxxxxx Xxxx LLP or such other counsel as may
be approved by the Agent.
Aggregate Term Loan Amount. See Section 4.1.
Applicable Margin. For each period commencing on an Adjustment Date
through the date immediately preceding the next Adjustment Date (each a "Rate
Adjustment Period"), the Applicable Margin for each Loan shall be the applicable
percentage set forth below such Loan with respect to the Senior Debt Ratio,
determined as of the end of the fiscal quarter of the Borrower immediately
preceding the date of the applicable Compliance Certificate:
BASE RATE EURODOLLAR RATE
LEVEL SENIOR DEBT RATIO LOANS LOANS
----- ----------------- --------- ---------------
I > 2.75:1.00 0.50% 2.25%
II > 2.25:1.00 and less than 0.25% 2.00%
-
2.75:1.00
III > 1.75:1.00 and less than 0.00% 1.75%
-
2.25:1.00
IV > 1.25:1.00 and less than 0.00% 1.50%
-
1.75:1.00
V < 1.25:1.00 0.00% 1.25%
Notwithstanding the foregoing, (a) until the delivery of the Compliance
Certificate for the fiscal quarter of the Borrower ending on March 31, 1999, the
Applicable Margin shall not be less than the percentage corresponding to Level
III in the table above and (b) if the Borrower fails to deliver any Compliance
Certificate pursuant to Section 12.4(d) hereof, then for the period commencing
on the date such Compliance Certificate was due through the date immediately
preceding the Adjustment Date that occurs immediately following the date on
which
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such Compliance Certificate is delivered, the Applicable Margin shall be
that percentage corresponding to Level I in the table above.
Arranger. BancBoston Xxxxxxxxx Xxxxxxxx Inc.
Asset Disposition. The disposition of any property or asset of the
Borrower or any of its Subsidiaries, whether by sale, lease, transfer or
otherwise, other than (i) the sale of inventory, (ii) the sale or other
disposition of obsolete equipment or (iii) repair or replacement of equipment,
in each case in the ordinary course of business consistent with past practices.
Assignment and Acceptance. See Section 23.1.
Balance Sheet Date. June 30, 1998.
Banks. BKB and the other lending institutions listed on Schedule 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Bank pursuant to Section 23.
Base Rate. The higher of (i) the annual rate of interest announced from
time to time by BKB at its head office in Boston, Massachusetts, as its "base
rate" and (ii) one-half of one percent (1/2%) above the Federal Funds Effective
Rate. For the purposes of this definition, "Federal Funds Effective Rate" shall
mean for any day, the rate per annum equal to the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, 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 that
is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three funds brokers of recognized
standing selected by the Agent. Any change in the Base Rate due to a change in
BKB's "base rate" or the Federal Funds Effective Rate shall be effective on the
effective day of such changes in BKB's "base rate" or the Federal Funds
Effective Rate, as applicable.
Base Rate Loans. Revolving Credit Loans, Swing Line Loans, Acquisition
Loans and all or any portion of the Term Loan bearing interest calculated by
reference to the Base Rate.
BKB. BankBoston, N.A., a national banking association, in its individual
capacity.
Bonds. See definition of the term Bond Documents.
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Bond Documents. Collectively, (i) that certain Indenture of Trust dated
as of April 1, 1998 by and between CEDFA and U.S. Bank Trust National
Association, as Trustee, (ii) that certain Loan Agreement dated as of April 1,
1998 by and between CEDFA and the Borrower, (iii) those certain Variable Rate
Demand Airport Facilities Revenue Bonds, Series 1998 (Mercury Air Group, Inc.
Project) (the "Bonds") and (iv) the other documents and instruments executed in
connection therewith, in each case in the form delivered to the Agent on or
prior to the Closing Date.
Borrower. As defined in the preamble hereto.
Business Day. Any day on which banking institutions in Boston,
Massachusetts, are open for the transaction of banking business and, in the case
of Eurodollar Rate Loans, also a day which is a Eurodollar Business Day.
Capital Assets. Fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and good will); provided that Capital Assets shall not
include any item customarily charged directly to expense or depreciated over a
useful life of twelve (12) months or less in accordance with generally accepted
accounting principles.
Capital Expenditures. For any period, the aggregate of all amounts paid
or indebtedness incurred by the Borrower or any of its Subsidiaries in
connection with the purchase or lease by the Borrower or any of its Subsidiaries
of Capital Assets that would be required to be capitalized and shown on the
balance sheet of such Person in accordance with generally accepted accounting
principles less the Net Cash Proceeds realized by the Borrower or such
Subsidiaries from sales of Capital Assets during such period. For the purpose of
this definition, the purchase price of equipment which is purchased
simultaneously with the trade-in of existing equipment owned by the Borrower or
any of its Subsidiaries or with insurance proceeds shall be included in Capital
Expenditures only to the extent of the gross amount of such purchase price less
the credit granted by the seller of such equipment for such equipment being
traded in at such time, or the amount of such proceeds, as the case may be.
Capitalized Leases. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the discounted future rental payment
obligations under which are required to be capitalized on the balance sheet of
the lessee or obligor in accordance with generally accepted accounting
principles.
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Cash Equivalents. Investments owned by the Borrower or any of its
Subsidiaries of the types described in clauses (a) through (d) of Section 13.3.
CEDFA. The California Economic Development Financing Authority.
CERCLA. See Section 11.18.
Closing Date. The first date on which the conditions set forth in
Sections 15 and 16 have been satisfied and any Revolving Credit Loans, Swing
Line Loans, Acquisition Loans and the Term Loan are to be made or any Letter of
Credit is to be issued hereunder.
Closing Fee Letter. See Section 9.1.
Code. The Internal Revenue Code of 1986.
Collateral. All of the property, rights and interests of the Borrower
and its Subsidiaries that are or are intended to be subject to the security
interests and mortgages created by the Security Documents.
Commitment. With respect to any Bank, its Revolving Credit Commitment,
and/or its Acquisition Commitment, and/or its ratable share of the outstanding
principal amount of the Term Loan, as the context may require.
Commitment Fees. The Revolving Credit Commitment Fee and the Acquisition
Loan Commitment Fee.
Commitment Fee Rate. For each Rate Adjustment Period, the Commitment Fee
Rate shall be the applicable percentage set forth below with respect to the
Senior Debt Ratio, determined as of the end of the fiscal quarter of the
Borrower immediately preceding the date of the applicable Compliance
Certificate:
LEVEL SENIOR DEBT RATIO COMMITMENT FEE RATE
----- ----------------- -------------------
I > 2.75:1.00 0.500%
-
II > 2.25:1.00 and less than 0.425%
-
2.75:1.00
III > 1.75:1.00 and less than 0.375%
-
2.25:1.00
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IV > 1.25:1.00 and less than 0.325%
-
1.75:1.00
V < 1.25:1.00 0.250%
Notwithstanding the foregoing, (a) until the delivery of the Compliance
Certificate for the fiscal quarter of the Borrower ending on March 31, 1999, the
Commitment Fee Rate shall not be less than the percentage corresponding to Level
III in the table above and (b) if the Borrower fails to deliver any Compliance
Certificate pursuant to Section 12.4(d) hereof, then for the period commencing
on the date such Compliance Certificate was due through the date immediately
preceding the Adjustment Date that occurs immediately following the date on
which such Compliance Certificate is delivered, the Commitment Fee Rate shall be
that percentage corresponding to Level I in the table above.
Commitment Percentage. With respect to any Bank, its Revolving Credit
Commitment Percentage, and/or its Acquisition Loan Commitment Percentage, and/or
its ratable share of the outstanding principal amount of the Term Loan, as the
context may require.
Compliance Certificate. See Section 12.4(d).
Consolidated or consolidated. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Borrower and its
Subsidiaries, consolidated in accordance with generally accepted accounting
principles.
Consolidated Current Liabilities. All liabilities and other Indebtedness
of the Borrower and its Subsidiaries on a consolidated basis maturing on demand
or within one (1) year from the date as of which Consolidated Current
Liabilities are to be determined, and such other liabilities as may properly be
classified as current liabilities in accordance with generally accepted
accounting principles.
Consolidated EBITDA. With respect to any Person and for any period, the
Consolidated Net Income of such Person and its Subsidiaries for such period,
after all expenses and other proper charges, plus, without duplication and to
the extent deducted from the calculation of Consolidated Net Income for such
period (a) payment or provision for any income taxes for such period, (b)
interest expense for such period, and (c) depreciation and amortization for such
period, determined on a consolidated basis for such Persons in accordance with
generally accepted accounting principles.
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Consolidated Funded Debt. As at any date of determination, the aggregate
amount of Indebtedness of the Borrower and its Subsidiaries for borrowed money
(including without limitation Indebtedness evidenced by notes or bonds), the
deferred purchase price of assets and Capitalized Leases, in respect of
reimbursement obligations for letters of credit, and all Indebtedness of another
Person guaranteed by the Borrower or any of its Subsidiaries, determined on a
consolidated basis for such Persons in accordance with generally accepted
accounting principles.
Consolidated Net Income. With respect to any Person and for any period,
the consolidated net income (or deficit) of such Person and its Subsidiaries for
such period, after deduction of all expenses, taxes, and other proper charges,
determined on a consolidated basis for such Persons in accordance with generally
accepted accounting principles, after eliminating therefrom all extraordinary
nonrecurring items of income.
Consolidated Quick Assets. All of the assets of the Borrower and its
Subsidiaries on a consolidated basis consisting of (i) cash, (ii) Cash
Equivalents, (iii) good and collectible accounts receivable as determined by the
Borrower in accordance with established practice consistently applied if payable
and outstanding not more than sixty (60) days after the date of the shipment of
goods or the other transaction out of which any such account receivable arose,
and (iv) inventory if and to the extent that the same shall consist of saleable
finished goods ready and available for shipment to purchasers thereof; provided
that accounts receivable shall be taken at their face value less reserves
determined to be sufficient in accordance with generally accepted accounting
principles.
Consolidated Operating Cash Flow. With respect to the Borrower and its
Subsidiaries and for any period, an amount equal to (i) Consolidated EBITDA of
the Borrower and its Subsidiaries for such period, minus (ii) cash payments for
all taxes paid during such period, minus (iii) twenty percent (20%) of
Restricted Capital Expenditures of the Borrower and its Subsidiaries made during
such period.
Consolidated Senior Debt. Consolidated Funded Debt minus the aggregate
outstanding amount of the Subordinated Debt and any other unsecured Indebtedness
of the Borrower and/or any of its Subsidiaries which is subordinated and made
junior to the payment and performance in full of the Obligations on such terms
and conditions and pursuant to such documents and instruments as shall be
acceptable to the Banks and the Agent.
Consolidated Tangible Net Worth. The excess of Consolidated Total Assets
over Consolidated Total Liabilities, and less the sum of:
15
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(a) the total book value of all assets of the Borrower and its
Subsidiaries properly classified as intangible assets under generally accepted
accounting principles, including such items as good will, the purchase price of
acquired assets in excess of the fair market value thereof, trademarks, trade
names, service marks, brand names, copyrights, patents and licenses, and rights
with respect to the foregoing; plus
(b) all amounts representing any write-up in the book value of
any assets of the Borrower and its Subsidiaries resulting from a revaluation
thereof subsequent to the Balance Sheet Data; plus
(c) to the extent otherwise included in the computation of
Consolidated Tangible Net Worth, any subscriptions receivable.
Consolidated Total Assets. All assets of the Borrower and its
Subsidiaries, determined on a consolidated basis in accordance with generally
accepted accounting principles.
Consolidated Total Debt Service. With respect to the Borrower and its
Subsidiaries and for any period, the sum of (i) Consolidated Total Interest
Expense for such period plus (ii) any and all scheduled repayments of principal
during such period in respect of Indebtedness for borrowed money (including
without limitation Indebtedness evidenced by notes or bonds), the deferred
purchase price of assets, or Capitalized Leases.
Consolidated Total Interest Expense. For any period, the aggregate
amount of interest paid or payable in cash by the Borrower and its Subsidiaries
during such period on all Indebtedness of the Borrower and its Subsidiaries
outstanding during all or any part of such period, whether such interest was or
is required to be reflected as an item of expense or capitalized, including
payments consisting of interest in respect of Capitalized Leases and including
commitment fees, letter of credit fees, agency fees, facility fees, balance
deficiency fees and similar fees or expenses in connection with the borrowing of
money.
Consolidated Total Liabilities. All liabilities of the Borrower and its
Subsidiaries as would be required to be shown on a consolidated balance sheet of
such Persons, determined on a consolidated basis in accordance with generally
accepted accounting principles and all Indebtedness of the Borrower and its
Subsidiaries, whether or not so classified.
Conversion Request. A notice given by the Borrower to the Agent of the
Borrower's election to convert or continue a Loan in accordance with Section
2.7, Section 4.5.3, or Section 6.6.
16
-9-
Copyright Memorandum. The Memorandum of Grant of Security Interest in
Copyrights, dated or to be dated on or prior to the Closing Date, made by the
Borrower and/or any of its Subsidiaries in favor of the Agent and in form and
substance satisfactory to the Agent.
Credit Agreement. This Revolving Credit and Term Loan Agreement,
including the Schedules and Exhibits hereto.
Default. Any event which, with the giving of notice or the lapse of
time, or both, would constitute an Event of Default; provided that the entry by
the Borrower into a definitive agreement providing for (i) the sale of all or
substantially all of the assets of the Borrower, (ii) the merger of the Borrower
into, or acquisition of the Borrower by, any other Person, or (iii) any other
event which, if consummated, would constitute an Event of Default under Section
17.1(t), shall not be a Default hereunder so long as (a) the transaction
contemplated by such agreement constitutes a Permitted Sale Event and (b) the
consummation of the transaction contemplated by such agreement shall constitute
an immediate Event of Default hereunder.
Delinquent Bank: See Section 19.5.3.
Dollars or $. Dollars in lawful currency of the United States of
America.
Domestic Lending Office. Initially, the office of each Bank designated
as such in Schedule 1 hereto; thereafter, such other office of such Bank, if
any, located within the United States of America that will be making or
maintaining Base Rate Loans.
Domestic Subsidiary. A Subsidiary of the Borrower organized under the
laws of any state or the District of Columbia of the United States of America.
Drawdown Date. The date on which any Revolving Credit Loan, Swing Line
Loan, Acquisition Loan or all or any portion of the Term Loan is made or is to
be made, and the date on which any (i) Revolving Credit Loan is converted or
continued in accordance with Section 2.7, (ii) any Acquisition Loan is converted
or continued in accordance with Section 6.6, or (iii) all or any portion of the
Term Loan is converted or continued in accordance with Section 4.5.3.
Eligible Assignee. Any of (i) a commercial bank, insurance company or
commercial finance company or other financial institution organized under the
laws of the United States, or any State thereof or the District of Columbia, and
having total assets in excess of $1,000,000,000; (ii) a savings and loan
association or savings bank
17
-10-
organized under the laws of the United States, or any State thereof or the
District of Columbia, and having a net worth of at least $100,000,000,
calculated in accordance with generally accepted accounting principles; (iii) a
commercial bank organized under the laws of any other country which is a member
of the OECD, or a political subdivision of any such country, and having total
assets in excess of $1,000,000,000, provided that such bank is acting through a
branch or agency located in the country in which it is organized or another
country which is also a member of the OECD; (iv) the central bank of any country
which is a member of the OECD; and (v) if, but only if, any Event of Default has
occurred and is continuing, any other bank, insurance company, commercial
finance company or other Person approved by the Agent, such approval not to be
unreasonably withheld.
Employee Benefit Plan. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained of contributed to by the Borrower or any ERISA
Affiliate, other than a Multiemployer Plan.
Environmental Laws. See Section 11.18(a).
ERISA. The Employee Retirement Income Security Act of 1974, as amended.
ERISA Affiliate. Any Person which is treated as a single employer with
the Borrower under Section 414 of the Code.
ERISA Reportable Event. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder as to which the requirement of notice has not been
waived.
Eurocurrency Reserve Rate. For any day with respect to a Eurodollar Rate
Loan, the maximum rate (expressed as a decimal) at which any lender subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.
Eurodollar Business Day. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other Eurodollar interbank market as may be selected by the Agent in its sole
discretion acting in good faith.
18
-11-
Eurodollar Lending Office. Initially, the office of each Bank designated
as such in Schedule 1 hereto; thereafter, such other office of such Bank, if
any, that shall be making or maintaining Eurodollar Rate Loans.
Eurodollar Rate. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (i) the rate per annum at which the
Agent's Eurodollar Lending Office is offered Dollar deposits two Eurodollar
Business Days prior to the beginning of such Interest Period in the interbank
eurodollar market where the eurodollar and foreign currency and exchange
operations of such Eurodollar Lending Office are customarily conducted, for
delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Rate Loan to which such Interest Period applies, divided by (ii) a number equal
to 1.00 minus the Eurocurrency Reserve Rate, if applicable.
Eurodollar Rate Loans. Revolving Credit Loans, Acquisition Loans and all
or any portion of the Term Loan bearing interest calculated by reference to the
Eurodollar Rate.
Event of Default. See Section 17.1.
Excluded Indebtedness. Indebtedness permitted to be incurred pursuant to
the provisions of Section 13.1(a) through Section 13.1(k), inclusive.
Fee Letters. Collectively, the Closing Fee Letter and the Agent's Fee
Letter.
Foreign Subsidiary. A Subsidiary of the Borrower which is not a Domestic
Subsidiary.
generally accepted accounting principles. (i) When used in Section 14,
whether directly or indirectly through reference to a capitalized term used
therein, means (A) principles that are consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, in effect for the fiscal year ended on the Balance Sheet Date, and
(B) to the extent consistent with such principles, the accounting practice of
the Borrower reflected in its financial statements for the year ended on the
Balance Sheet Date, and (ii) when used in general, other than as provided above,
means principles that are (A) consistent with the principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors, as in
effect from time to time, and (B) consistently applied with past financial
statements of the Borrower adopting the same principles, provided that in each
case referred to in this definition of "generally accepted accounting
principles" a certified public accountant would, insofar as the use of such
19
-12-
accounting principles is pertinent, be in a position to deliver an unqualified
opinion (other than a qualification regarding changes in generally accepted
accounting principles) as to financial statements in which such principles have
been properly applied.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower or
any ERISA Affiliate the benefits of which are guaranteed on termination in full
or in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
Guarantor. A Subsidiary of the Borrower that shall have guaranteed the
Obligations pursuant to the Guaranty.
Guaranty. Collectively, the several guaranties of the Obligations made
by the Subsidiaries of the Borrower in favor of the Agent and the Banks, whether
delivered on or after the Closing Date, in each case in form and substance
satisfactory to the Agent.
Hazardous Substances. See Section 11.18(b).
Indebtedness. As to any Person and whether recourse is secured by or is
otherwise available against all or only a portion of the assets of such Person
and whether or not contingent, but without duplication:
(i) every obligation of such Person for money borrowed,
(ii) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, including obligations incurred in connection
with the acquisition of property, assets or businesses,
(iii) every reimbursement obligation of such Person with respect to
letters of credit, bankers' acceptances or similar facilities issued for the
account of such Person,
(iv) every obligation of such Person issued or assumed as the deferred
purchase price of property or services (including securities repurchase
agreements),
(v) every obligation of such Person under any Capitalized Lease,
(vi) every obligation of such Person under any lease (a "synthetic
lease") treated as an operating lease under generally accepted accounting
principles and as a loan or financing for U.S. income tax purposes,
20
-13-
(vii) all sales by such Person of (A) accounts or general intangibles
for money due or to become due, (B) chattel paper, instruments or documents
creating or evidencing a right to payment of money or (C) other receivables
(collectively "receivables"), whether pursuant to a purchase facility or
otherwise, other than in connection with the disposition of the business
operations of such Person relating thereto or a disposition of defaulted
receivables for collection and not as a financing arrangement, and together with
any obligation of such Person to pay any discount, interest, fees, indemnities,
penalties, recourse, expenses or other amounts in connection therewith,
(viii) every obligation of such Person (an "equity related purchase
obligation") to purchase, redeem, retire or otherwise acquire for value any
shares of capital stock of any class issued by such Person, any warrants,
options or other rights to acquire any such shares, or any rights measured by
the value of such shares, warrants, options or other rights,
(ix) every obligation of such Person under any forward contract, futures
contract, swap, option or other financing agreement or arrangement (including,
without limitation, caps, floors, collars and similar agreements), the value of
which is dependent upon interest rates, currency exchange rates, commodities or
other indices (a "derivative contract"),
(x) every obligation in respect of Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent that such Person is liable therefor as a result of such Person's
ownership interest in or other relationship with such entity, except to the
extent that the terms of such Indebtedness provide that such Person is not
liable therefor and such terms are enforceable under applicable law, and
(xi) every obligation, contingent or otherwise, of such Person
guaranteeing, or having the economic effect of guaranteeing or otherwise acting
as surety for, any obligation of a type described in any of clauses (i) through
(x) (the "primary obligation") of another Person (the "primary obligor"), in any
manner, whether directly or indirectly, and including, without limitation, any
obligation of such Person (A) to purchase or pay (or advance or supply funds for
the purchase of) any security for the payment of such primary obligation, (B) to
purchase property, securities or services for the purpose of assuring the
payment of such primary obligation, or (C) to maintain working capital, equity
capital or other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such primary obligation.
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-14-
The "amount" or "principal amount" of any Indebtedness at any time of
determination represented by (u) any Indebtedness, issued at a price that is
less than the principal amount at maturity thereof, shall be the amount of the
liability in respect thereof determined in accordance with generally accepted
accounting principles, (v) any Capitalized Lease shall be the principal
component of the aggregate of the rentals obligation under such Capitalized
Lease payable over the term thereof that is not subject to termination by the
lessee, (w) any sale of receivables shall be the amount of unrecovered capital
or principal investment of the purchaser (other than the Borrower or any of its
wholly-owned Subsidiaries) thereof, excluding amounts representative of yield or
interest earned on such investment, (x) any synthetic lease shall be the
stipulated loss value, termination value or other equivalent amount, (y) any
derivative contract shall be the maximum amount of any termination or loss
payment required to be paid by such Person if such derivative contract were, at
the time of determination, to be terminated by reason of any event of default or
early termination event thereunder, whether or not such event of default or
early termination event has in fact occurred and (z) any equity related purchase
obligation shall be the maximum fixed redemption or purchase price thereof
inclusive of any accrued and unpaid dividends to be comprised in such redemption
or purchase price.
Initial Term Loan Amount. See Section 4.1.
Interest Payment Date. (i) As to any Base Rate Loan, the last day of the
calendar quarter which includes the Drawdown Date thereof and (ii) as to any
Eurodollar Rate Loan in respect of which the Interest Period is (A) 3 months or
less, the last day of such Interest Period and (B) more than 3 months, the date
that is 3 months from the first day of such Interest Period and, in addition,
the last day of such Interest Period.
Interest Period. With respect to each Revolving Credit Loan, each Swing
Line Loan, each Acquisition Loan, or all or any relevant portion of the Term
Loan, (i) initially, the period commencing on the Drawdown Date of such Loan and
ending on the last day of one of the periods set forth below, as selected by the
Borrower in a Loan Request (A) for any Base Rate Loan, the last day of the
calendar quarter and (B) for any Eurodollar Rate Loan, 1, 2, 3 or 6 months
(subject to availability); and (ii) thereafter, each period commencing on the
last day of the next preceding Interest Period applicable to such Revolving
Credit Loan, such Acquisition Loan, or all or such portion of the Term Loan and
ending on the last day of one of the periods set forth above, as selected by the
Borrower in a Conversion Request; provided that all of the foregoing provisions
relating to Interest Periods are subject to the following:
22
-15-
(a) if any Interest Period with respect to a Eurodollar Rate
Loan would otherwise end on a day that is not a Eurodollar Business Day,
that Interest Period shall be extended to the next succeeding Eurodollar
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such
Interest Period shall end on the immediately preceding Eurodollar
Business Day;
(b) if any Interest Period with respect to a Base Rate Loan would
end on a day that is not a Business Day, that Interest Period shall end
on the next succeeding Business Day;
(c) if the Borrower shall fail to give notice as provided in
Section 2.7, Section 4.5.3, or Section 6.6, the Borrower shall be deemed
to have requested a conversion of the affected Eurodollar Rate Loan to a
Base Rate Loan and the continuance of all Base Rate Loans as Base Rate
Loans on the last day of the then current Interest Period with respect
thereto;
(d) any Interest Period relating to any Eurodollar Rate Loan that
begins on the last Eurodollar Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last
Eurodollar Business Day of a calendar month; and
(e) any Interest Period relating to any Eurodollar Rate Loan that
would otherwise extend beyond the Maturity Date shall end on the
Maturity Date.
Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or similar transfers of property to,
or in respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (i) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (ii) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(iii) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption, retirement,
repayment, liquidating dividend or liquidating distribution); (iv) there shall
not be deducted in respect of any Investment any amounts received as earnings on
such Investment, whether as dividends,
23
-16-
interest or otherwise, except that accrued interest included as provided in the
foregoing clause (ii) may be deducted when paid; and (v) there shall not be
deducted from the aggregate amount of Investments any decrease in the value
thereof.
International Standby Practices. With respect to any Letter of Credit
issued after January 1, 1999, International Standby Practices (ISP98) as
promulgated by the Institute of International Banking Law & Practice, Inc., or
any successor code of standby letter of credit practices among banks adopted by
the Agent in the ordinary course of its business as a standby letter of credit
issuer and in effect at the time of issuance of such Letter of Credit.
IRB Letter of Credit. The irrevocable direct pay Letter of Credit No.
50102832 in the original stated amount of $19,281,096 dated April 1, 1998 issued
by BKB for the account of the Borrower in respect of certain obligations of the
Borrower under the Bond Documents.
Letter(s) of Credit. Standby Letters of Credit issued by the Agent from
time to time for the account of the Borrower, including without limitation the
IRB Letter of Credit.
Letter of Credit Application. See Section 5.1.1.
Letter of Credit Fee. See Section 5.6.
Letter of Credit Limit. $20,500,000, as the same my be reduced from time
to time in accordance with Section 5.1.6.
Letter of Credit Participation. See Section 5.1.4.
Leverage Ratio. At the end of each fiscal quarter of the Borrower, the
ratio of Consolidated Funded Debt as at such date to Consolidated EBITDA of the
Borrower and its Subsidiaries for the period of the four fiscal quarters ending
on such date.
Loan Documents. This Credit Agreement, the Notes, the Letter of Credit
Applications, the Letters of Credit, the Fee Letter, the Security Documents and
all of the documents relating to any interest rate protection arrangements
entered into between the Borrower and any Bank.
Loan Request. A written notice in the form of Exhibit B hereto (or
telephonic notice confirmed in writing in the form of Exhibit B hereto) of a
Loan requested pursuant to Section 2.6, Section 2.9, Section 4.1 or Section 6.6.
24
-17-
Loans. The Revolving Credit Loans, the Swing Line Loans, the Acquisition
Loans and the Term Loan.
Majority Banks. As of any date, (i) if there are two or fewer Banks,
such Banks and (ii) if there are more than two Banks, the Banks holding at least
fifty-one percent (51%) of the Notes on such date, and if no such principal is
outstanding, the Banks whose aggregate Commitments constitute at least fifty-one
percent (51%) of the Total Commitment.
Management Investors. Collectively, Xxxxxxx Xxxx and Xxxxxx Xxxxxx and
any of them individually.
Maturity Date. March 2, 2004.
Maximum Drawing Amount. The maximum aggregate amount that the
beneficiaries may at any time draw under all outstanding Letters of Credit, as
such aggregate amount may be reduced from time to time pursuant to the terms of
the Letters of Credit.
Maximum Swing Line Loan Amount. See Section 2.9.1.
Mortgaged Property. Any Real Estate which is or is expected to be
subject to any mortgage in favor of the Agent.
Multiemployer Plan. Any multiemployer plan within the meaning of Section
3(37) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate.
Net Cash Proceeds. If from an Asset Disposition, the cash proceeds
received from such Asset Disposition net of all costs of sale, repayment of any
Indebtedness secured by the properties or assets so disposed of, and taxes paid
or payable as a result thereof by any of the Borrower or any of its
Subsidiaries; if from the issuance of equity, the cash proceeds received on
account of such issuance, net of all costs of sale, underwriting or brokerage
costs and taxes paid or payable on a result thereof by any of the Borrower or
any of its Subsidiaries; and if from the incurrence of Indebtedness, the cash
proceeds received from such incurrence of Indebtedness, net of all costs
incurred and fees and all expenses payable in connection therewith, and taxes
paid or payable as a result thereof, by any of the Borrower or any of its
Subsidiaries.
Notes. The Term Notes, the Acquisition Notes, the Swing Line Note and
the Revolving Credit Notes.
Obligations. All indebtedness, obligations and liabilities of any of the
Borrower or any of its Subsidiaries to any of the Banks, the Swing Line Bank and
the Agent, individually or collectively, existing on the date
25
-18-
of this Credit Agreement or arising thereafter, direct or indirect, joint or
several, absolute or contingent, matured or unmatured, liquidated or
unliquidated, secured or unsecured, arising by contract, operation of law or
otherwise, arising or incurred (i) under this Credit Agreement, any of the other
Loan Documents or pursuant to any interest rate protection arrangements entered
into between the Borrower and any Bank or (ii) in respect of any of the Loans
made or Reimbursement Obligations incurred or any of the Notes, Letter of Credit
Applications, Letters of Credit or such interest rate protection arrangements or
other instruments at any time evidencing any thereof.
OECD. The Organization for Economic Cooperation and Development.
outstanding. With respect to all or any portion of the Loans, the
aggregate unpaid principal thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by Section 4002
of ERISA and any successor entity or entities having similar responsibilities.
Perfection Certificates. The Perfection Certificates, as defined in the
Security Agreements.
Permitted Acquisition. The acquisition of any Person, business,
division, or specified group of assets by the Borrower or any of its
Subsidiaries, provided that each of the following conditions is met with respect
to any such acquisition:
(a) immediately prior to and after, and after giving effect to,
such acquisition, no Default or Event of Default shall then exist;
(b) the aggregate consideration (including, without limitation,
assumption of Indebtedness permitted hereby) paid or to be paid by the
Borrower or any of its Subsidiaries in connection with any one such
acquisition shall not exceed $7,500,000 and paid or to be paid in
connection with all such acquisitions in any period of twelve (12)
consecutive months shall not exceed $10,000,000;
(c) the consideration for such acquisition shall not include the
assumption of Indebtedness by the Borrower or any of its Subsidiaries,
other than Indebtedness (i) in existence prior to the date of such
acquisition, (ii) which was not incurred in connection with or in
contemplation of, such acquisition, (iii) in an aggregate amount for all
such acquisitions not to exceed (together
26
-19-
with other Indebtedness outstanding which is permitted pursuant to
Section 13.1(f) hereof) the amount of Indebtedness permitted pursuant to
Section 13.1(f) hereof, and (iv) on terms and conditions satisfactory to
the Agent and the Majority Banks;
(d) such acquisition shall have been approved by the board of
directors and shareholders, if applicable, of the Person to be acquired;
(e) either (i) such acquisition is the acquisition of assets only
(for use in substantially the same line of business as the line of
business of the Borrower and in which assets the Agent shall have, for
the benefit of the Banks and the Agent, a perfected, first priority
security interest upon the occurrence of such acquisition) or (ii) such
acquisition involves the purchase of the capital stock or other equity
interests of a Person and each of the following conditions is met:
(A) such acquisition is the acquisition of one hundred
percent (100%) of the capital stock of other equity interests of
such Person,
(B) such Person is in substantially the same line of
business as the Borrower, and
(C) as soon as practicable but in any event not later than
thirty (30) days after the occurrence of such acquisition, the
Borrower shall (i) take all steps as may be necessary or
advisable in the opinion of the Agent to pledge to the Agent, for
the benefit of the Banks and the Agent, on a perfected,
first-priority basis, one hundred percent (100%) or, if the
Person so acquired shall become a Foreign Subsidiary, sixty-five
percent (65%), of the capital stock or other equity interests of
such Person so acquired pursuant to a pledge agreement in form
and substance satisfactory to the Agent, which such pledge
agreement shall be a Security Document hereunder, (ii) if such
Person shall become a Domestic Subsidiary, cause such Person to
guaranty all of the Obligations hereunder pursuant to a guaranty
in form and substance satisfactory to the Agent, which such
guaranty shall be a Security Document hereunder, (iii) if such
Person shall become a Domestic Subsidiary, cause such Person to
take all steps as may be necessary or advisable in the opinion of
the Agent to grant to the Agent, for the benefit of the Banks and
the Agent, a first priority, perfected security interest in
substantially all of its assets
27
-20-
(other than in those assets which secure Indebtedness assumed by
the Borrower or any of its Subsidiaries and the lien and
Indebtedness with respect to which is permitted under subsection
(c) of this definition) as collateral security for such
guaranty, pursuant to security documents, mortgages, pledges and
other documents in form and substance satisfactory to the Agent,
each of which documents shall be Security Documents hereunder,
and (iv) cause such Person to deliver to the Banks and the Agent
evidence of proper corporate authorization and legal opinions
with respect to each of the matters and documents set forth in
this clause (C), in each case in form and substance satisfactory
to the Agent and the Majority Banks; and
(f) the Borrower shall have complied with the conditions set
forth in Section 16.5(a) and (b), without regard to whether any
Acquisition Loan is to be borrowed in connection with such acquisition.
Permitted Liens. Liens, security interests and other encumbrances
permitted by Section 13.2.
Permitted Sale Event. A transaction (i) as to which the Agent and the
Banks have been provided with evidence reasonably satisfactory to the Agent and
the Majority Banks that a committed source of financing is available to provide
for the repayment of the Obligations in full at the consummation of such
transaction and (ii) the definitive agreement for which does not provide for
financial penalties payable by the Borrower for failure to consummate such
transaction which, if paid, could have a materially adverse effect on the
business, assets or financial condition of the Borrower or any of its
Subsidiaries.
Person. Any individual, corporation, limited liability company,
partnership, limited liability partnership, trust, unincorporated association,
business, or other legal entity, and any government or any governmental agency
or political subdivision thereof.
Prior Credit Agreement. That certain Credit Agreement dated as of March
14, 1997 by and among the Borrower, the lending institutions defined therein as
Lenders and Sanwa Bank California as Agent for such Lenders, as the same is
amended and in effect immediately prior to the Closing Date.
Prior Reimbursement Agreement. That certain Reimbursement Agreement
dated as of April 1, 1998 by and among the Borrower, the lending institutions
defined therein as Credit Support Providers, BKB as
28
-21-
Issuing Bank and Sanwa Bank California as Agent for such Credit Support
Providers, as the same is amended and in effect immediately prior to the Closing
Date.
Pro Forma Basis. In connection with any proposed Permitted Acquisition,
the calculation of compliance with the financial covenants set forth in Section
14 hereof by the Borrower and its Subsidiaries (including the Person or asset(s)
to be acquired) with reference to the audited historical financial results of
such Person, if available, and if not so available, then with reference to such
management certified financial results of such Person as shall be reasonably
acceptable to the Agent (or, if an acquisition of assets, the financial results
attributable to such assets) and the Borrower and its Subsidiaries for the
applicable Test Period ending immediately prior to the date of such acquisition,
after giving effect on a pro forma basis to such Permitted Acquisition in the
manner described below:
(i) all Indebtedness (whether under this Credit Agreement or
otherwise) and any other balance sheet adjustments incurred or made in
connection with the Permitted Acquisition shall be deemed to have been
incurred or made on the first day of the Test Period, and all
Indebtedness of the Person acquired or to be acquired in such Permitted
Acquisition which was or will have been repaid in connection with the
consummation of the Permitted Acquisition shall be deemed to have been
repaid concurrently with the incurrence of the Indebtedness incurred in
connection with the Permitted Acquisition;
(ii) all Indebtedness assumed to have been incurred pursuant to
the preceding clause (i) shall be deemed to have borne interest at the
sum of (a) the arithmetic mean of (x) the Eurodollar Rate for Eurodollar
Rate Loans having an Interest Period of one month in effect on the first
day of the Test Period and (y) the Eurodollar Rate for Eurodollar Rate
Loans having an Interest Period of one month in effect on the last day
of the Test Period plus (b) the Applicable Margin then in effect (after
giving effect to the Permitted Acquisition on a Pro Forma Basis); and
(iii) other reasonable cost savings, expenses and other income
statement or operating statement adjustments which are attributable to
the change in ownership and/or management resulting from such Permitted
Acquisition as may be approved by the Agent in writing (which approval
shall not be unreasonably withheld) shall be deemed to have been
realized on the first day of the Test Period.
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Real Estate. All real property at any time owned or leased (as lessee or
sublessee) by the Borrower or any of its Subsidiaries.
Record. The grid attached to a Note, or the continuation of such grid,
or any other similar record, including computer records, maintained by any Bank
with respect to any Loan referred to in such Note.
Reimbursement Obligation. The Borrower's obligation to reimburse the
Agent and the Banks on account of any drawing under any Letter of Credit as
provided in Section 5.2.
Release. Any past or present releasing, spilling, leaking, pumping,
pouring, omitting, emptying, discharging, injecting, escaping, disposing, or
dumping.
Restricted Payment. The declaration or payment of any dividend on or in
respect of any shares of any class of capital stock of the Borrower or any of
its Subsidiaries (other than dividends payable solely in shares of common stock
of the Borrower or its Subsidiaries); the purchase, redemption, or other
retirement of any of the Subordinated Debt or of any shares of any class of
capital stock, or of any rights, warrants or options to acquire shares of any
class of capital stock, of the Borrower or any of its Subsidiaries, directly or
indirectly through a Subsidiary of the Borrower or any of its Subsidiaries, or
otherwise; the return of capital by the Borrower or any of its Subsidiaries to
its shareholders as such; or any other distribution on or in respect of any
shares of any class of capital stock of the Borrower or any of its Subsidiaries.
Restricted Capital Expenditures. Capital Expenditures other than (i)
those made or incurred in connection with the making of Permitted Acquisitions;
provided that Capital Expenditures made or incurred with respect to the Person,
business, division or specified group of assets so acquired at any time after
the making of such Permitted Acquisition shall be included within the definition
of Restricted Capital Expenditures and (ii) those made or incurred with the
proceeds of the Bonds pursuant to the terms of the Bond Documents.
Revolving Credit Commitment. With respect to each Bank, the amount set
forth on Schedule 1 hereto as the amount of such Bank's commitment to make
Revolving Credit Loans to, and to participate in the issuance, extension and
renewal of Letters of Credit for the account of, the Borrower, as the same may
be reduced from time to time; or if such commitment is terminated pursuant to
the provisions hereof, zero.
Revolving Credit Commitment Fee. See Section 2.2.
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Revolving Credit Commitment Percentage. With respect to any Bank, the
percentage set forth opposite the name of such Bank on Schedule 1 hereto in the
column entitled "Revolving Credit Commitment Percentage".
Revolving Credit Loans. Revolving credit loans made or to be made by the
Banks to the Borrower pursuant to Section 2.1.
Revolving Credit Note Record. A Record with respect to a Revolving
Credit Note.
Revolving Credit Notes. See Section 2.4.
Second Term Loan Disbursement Date. See Section 4.1.
Security Agreements. The several Security Agreements, dated or to be
dated on or prior to the Closing Date, between, respectively, the Borrower and
each of its Domestic Subsidiaries, and the Agent and in form and substance
satisfactory to the Agent.
Security Documents. The Guaranty, the Security Agreements, the Copyright
Memorandum and the Stock Pledge Agreements.
Senior Debt Ratio. At the end of each fiscal quarter of the Borrower,
the ratio of Consolidated Senior Debt as at such date to Consolidated EBITDA of
the Borrower and its Subsidiaries for the period of four fiscal quarters ending
on such date.
Stock Pledge Agreements. Collectively, the Stock Pledge Agreement, dated
or to be dated on or prior to the Closing Date, between the Borrower and the
Agent, with respect to the capital stock of each of the Subsidiaries of the
Borrower, in each case, in form and substance satisfactory to the Agent.
Subordinated Debt. Unsecured Indebtedness of the Borrower in the
aggregate principal amount of not more than $24,701,631.00, incurred pursuant to
the Subordinated Debt Documents.
Subordinated Debt Documents. Collectively, (i) that certain Indenture
dated as of January 30, 1996 between the Borrower and IBJ Xxxxxxxx Bank & Trust
Company, as Trustee, (ii) those certain 7 3/4% Convertible Subordinated
Debentures due February 1, 2006 in the original aggregate principal amount of
$28,115,000 issued by the Borrower pursuant to such indenture and (iii) the
other documents and instruments executed in connection therewith, in each case
in the form delivered to the Agent on or prior to the Closing Date.
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Subsidiary. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes) of the outstanding Voting Stock.
Swing Line Bank. See Section 2.9.
Swing Line Loan. Swing line loans made or to be made by the Agent to the
Borrower pursuant to Section 2.9.
Swing Line Loan Maturity Date. The date specified by the Borrower in the
Loan Request relating to any Swing Line Loan as the maturity date of such Swing
Line Loan.
Swing Line Note. See Section 2.9.5.
Swing Line Note Record. A Record with respect to a Swing Line Note.
Term Loan. The term loan made or to be made to the Borrower by the Banks
on the Closing Date and on the Second Term Loan Disbursement Date in an
aggregate principal amount not to exceed $25,000,000 pursuant to Section 4.1.
Term Notes. See Section 4.2.
Term Note Record. A Record with respect to a Term Note.
Term Percentage. With respect to each Bank, the percentage set forth on
Schedule 1 hereto opposite such Bank's name in the column entitled "Term
Percentage".
Test Period. In connection with the calculation of the financial
covenants set forth in Section 14 hereof with respect to any Permitted
Acquisition, the period of all fiscal quarters (and any portion of a fiscal
quarter) prior to the date of such Permitted Acquisition included in the
calculation of such financial covenant (or any component thereof).
Total Acquisition Loan Commitment. The sum of the respective Acquisition
Loan Commitments of the Banks, as in effect from time to time.
Total Commitment. The sum of the Total Revolving Credit Commitments, the
Total Acquisition Loan Commitment, and the outstanding principal amount of the
Term Loan.
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Total Revolving Credit Commitment. The sum of the Revolving Credit
Commitments of the Banks, as in effect from time to time.
Type. As to any Revolving Credit Loan, any Acquisition Loan or all or
any portion of the Term Loan, its nature as a Base Rate Loan or a Eurodollar
Rate Loan.
Uniform Customs. With respect to any Letter of Credit, the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500 or any successor version thereto adopted
by the Agent in the ordinary course of its business as a letter of credit issuer
and in effect at the time of issuance of such Letter of Credit.
Unpaid Reimbursement Obligation. Any Reimbursement Obligation for which
the Borrower does not reimburse the Agent and the Banks on the date specified
in, and in accordance with, Section 5.2.
Voting Stock. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.
Year 2000 Compliant. See Section 11.27.
1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Credit
Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted successors
and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by generally accepted accounting principles
applied on a consistent basis by the accounting entity to which they
refer.
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(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of Massachusetts, have
the meanings assigned to them therein, with the term "instrument" being
that defined under Article 9 of the Uniform Commercial Code.
(h) Reference to a particular "Section " refers to that section
of this Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of like
import shall refer to this Credit Agreement as a whole and not to any
particular section or subdivision of this Credit Agreement.
2. THE REVOLVING CREDIT FACILITY.
2.1. COMMITMENT TO LEND. Subject to the terms and conditions set forth
in this Credit Agreement, each of the Banks severally agrees to lend to the
Borrower and the Borrower may borrow, repay and reborrow from time to time
between the Closing Date and the Maturity Date upon notice by the Borrower to
the Agent given in accordance with Section 2.6, such sums as are requested by
the Borrower up to a maximum aggregate amount outstanding (after giving effect
to all amounts requested) at any one time equal to such Bank's Revolving Credit
Commitment minus such Bank's Revolving Credit Commitment Percentage of the sum
of (i) the Maximum Drawing Amount, (ii) all Unpaid Reimbursement Obligations and
(iii) the aggregate principal amount of all Swing Line Loans; provided that the
sum of the outstanding amount of the Revolving Credit Loans (after giving effect
to all amounts requested) plus the Maximum Drawing Amount, all Unpaid
Reimbursement Obligations and the aggregate principal amount of all Swing Line
Loans shall not at any time exceed the Total Revolving Credit Commitment. The
Revolving Credit Loans shall be made pro rata in accordance with each Bank's
Revolving Credit Commitment Percentage. Each request for a Revolving Credit Loan
hereunder shall constitute a representation and warranty by the Borrower that
the conditions set forth in Section 15 and Section 16, in the case of the
initial Revolving Credit Loans to be made on the Closing Date, and Section 16,
in the case of all other Revolving Credit Loans, have been satisfied on the date
of such request.
2.2. COMMITMENT FEE. The Borrower agrees to pay to the Agent for the
accounts of the Banks in accordance with their respective Revolving Credit
Commitment Percentages a commitment fee (the "Revolving Credit Commitment Fee")
at the rate per annum equal to the
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Commitment Fee Rate then in effect on the average daily amount during each
calendar quarter or portion thereof from the Closing Date to the Maturity Date
by which the Total Revolving Credit Commitment minus the sum of the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations exceeds the outstanding
amount of Revolving Credit Loans during such calendar quarter. The Revolving
Credit Commitment Fee shall be payable quarterly in arrears on the first day of
each calendar quarter for the immediately preceding calendar quarter commencing
on the first such date following the date hereof, with a final payment on the
Maturity Date or any earlier date on which the Revolving Credit Commitments
shall terminate.
2.3. REDUCTION OF TOTAL REVOLVING CREDIT COMMITMENT. The Borrower shall
have the right at any time and from time to time upon five (5) Business Days
prior written notice to the Agent to reduce by $1,000,000 or an integral
multiple thereof or terminate entirely the Total Revolving Credit Commitment,
whereupon the Revolving Credit Commitments of the Banks shall be reduced pro
rata in accordance with their respective Revolving Credit Commitment Percentages
of the amount specified in such notice or, as the case may be, terminated.
Promptly after receiving any notice of the Borrower delivered pursuant to this
Section 2.3, the Agent will notify the Banks of the substance thereof. Upon the
effective date of any such reduction or termination, the Borrower shall pay to
the Agent for the respective accounts of the Banks the full amount of any
Revolving Credit Commitment Fee then accrued on the amount of the reduction. No
reduction or termination of the Revolving Credit Commitments may be reinstated.
2.4. THE REVOLVING CREDIT NOTES. The Revolving Credit Loans shall be
evidenced by separate promissory notes of the Borrower in substantially the form
of Exhibit A-1 hereto (each a "Revolving Credit Note"), dated as of the Closing
Date and completed with appropriate insertions. One Revolving Credit Note shall
be payable to the order of each Bank in a principal amount equal to such Bank's
Revolving Credit Commitment or, if less, the outstanding amount of all Revolving
Credit Loans made by such Bank, plus interest accrued thereon, as set forth
below. The Borrower irrevocably authorizes each Bank to make or cause to be
made, at or about the time of the Drawdown Date of any Revolving Credit Loan or
at the time of receipt of any payment of principal on such Bank's Revolving
Credit Note, an appropriate notation on such Bank's Revolving Credit Note Record
reflecting the making of such Revolving Credit Loan or (as the case may be) the
receipt of such payment. The outstanding amount of the Revolving Credit Loans
set forth on such Bank's Revolving Credit Note Record shall be prima facie
evidence of the principal amount thereof owing and unpaid to such Bank, but the
failure to record, or any error in so recording, any such amount on such Bank's
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Revolving Credit Note Record shall not limit or otherwise affect the obligations
of the Borrower hereunder or under any Revolving Credit Note to make payments of
principal of or interest on any Revolving Credit Note when due.
2.5. INTEREST ON REVOLVING CREDIT LOANS. Except as otherwise provided in
Section 9.10,
(a) each Revolving Credit Loan that is a Base Rate Loan shall
bear interest for the period commencing with the Drawdown Date thereof
and ending on the last day of the Interest Period with respect thereto
at a rate per annum equal to the sum of (i) the Base Rate in effect from
time to time plus (ii) the Applicable Margin then in effect with respect
to Base Rate Loans; and
(b) each Revolving Credit Loan that is a Eurodollar Rate Loan
shall bear interest for the period commencing with the Drawdown Date
thereof and ending on the last day of the Interest Period with respect
thereto at a rate per annum equal to the sum of (i) the Eurodollar Rate
determined for such Interest Period plus (ii) the Applicable Margin then
in effect with respect to Eurodollar Rate Loans.
The Borrower promises to pay interest on each Revolving Credit Loan in arrears
on each Interest Payment Date with respect thereto.
2.6. REQUESTS FOR REVOLVING CREDIT LOANS.
2.6.1. IN GENERAL. The Borrower shall deliver to the Agent a Loan
Request with respect to each Revolving Credit Loan requested hereunder
no less than (i) one (1) Business Day prior to the proposed Drawdown
Date of any Base Rate Loan and (ii) three (3) Eurodollar Business Days
prior to the proposed Drawdown Date of any Eurodollar Rate Loan. Each
such notice shall specify (A) the principal amount of the Revolving
Credit Loan requested, (B) the proposed Drawdown Date of such Revolving
Credit Loan, (C) the Interest Period for such Revolving Credit Loan and
(D) the Type of such Revolving Credit Loan. Promptly upon receipt of any
such notice, the Agent shall notify each of the Revolving Credit Banks
thereof. Each Loan Request shall be irrevocable and binding on the
Borrower and shall obligate the Borrower to accept the Revolving Credit
Loan requested from the Banks on the proposed Drawdown Date. Each Loan
Request shall be in a minimum aggregate amount of $1,000,000 or an
integral multiple thereof.
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2.6.2. LOANS TO COVER REIMBURSEMENT OBLIGATIONS. Notwithstanding
the notice and minimum amount requirements set forth in Section 2.6.1,
the Agent shall, unless otherwise instructed by the Majority Banks and
subject to the satisfaction of the conditions set forth herein,
including, without limitation, Section 16 hereof, make Revolving Credit
Loans to the Borrower on the date that any draft presented under any
Letter of Credit is honored by the Agent, or any date on which the Agent
otherwise makes a payment with respect thereto, in an amount sufficient
to pay in full the obligations of the Borrower under Section 5.2 in
respect of the honor of such draft or the making of such payment. The
Borrower hereby requests and authorizes the Agent to make from time to
time such Revolving Credit Loans by means of appropriate entries in the
books and records of the Agent and to notify the Revolving Credit Banks
of the date and amount of any such Revolving Credit Loans. The Borrower
acknowledges and agrees that the making of such Revolving Credit Loans
shall, in each case, be subject in all respects to the provisions of
this Credit Agreement as if they were Revolving Credit Loans covered by
a Loan Request including the limitations set forth in Section 2.1 and
the requirement that the applicable provisions of Section 16 be
satisfied. Absent manifest error on the part of the Agent, all actions
taken by the Agent pursuant to the provisions of this Section 2.6.2
shall be conclusive and binding on the Borrower. Revolving Credit Loans
made pursuant to this Section 2.6.2 shall be Base Rate Loans (subject to
conversion pursuant to Section 2.7 hereof) and shall bear interest at
the rate provided for Revolving Credit Loans in Section 2.5 hereof. Each
of the Banks hereby acknowledges and agrees that a Revolving Credit Loan
made by the Agent pursuant to this Section 2.6.2 shall (i) be subject in
all respects to the provisions of this Credit Agreement (including,
without limitation, Section 2.8 hereof) and (ii) obligate each Bank to
advance to the Agent the amount of such Bank's Revolving Credit
Commitment Percentage of such Revolving Credit Loan.
2.7. CONVERSION OPTIONS.
2.7.1. CONVERSION TO DIFFERENT TYPE OF REVOLVING CREDIT LOAN.
The Borrower may elect from time to time to convert any outstanding
Revolving Credit Loan to a Revolving Credit Loan of another Type,
provided that (i) with respect to any such conversion of a Revolving
Credit Loan to a Base Rate Loan, the Borrower shall give the Agent at
least one (1) Business Day prior written notice of such election; (ii)
with respect to any such conversion of a Base Rate Loan to a Eurodollar
Rate Loan, the Borrower shall give the Agent at least three (3)
Eurodollar Business Days prior written notice of such election; (iii)
with respect to any such conversion of
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a Eurodollar Rate Loan into a Base Rate Loan, such conversion shall only
be made on the last day of the Interest Period with respect thereto; and
(iv) no Loan may be converted into a Eurodollar Rate Loan when any
Default or Event of Default has occurred and is continuing. On the date
on which such conversion is being made, each Bank shall take such action
as is necessary to transfer its Revolving Credit Commitment Percentage
of such Revolving Credit Loans to its Domestic Lending Office or its
Eurodollar Lending Office, as the case may be. All or any part of
outstanding Revolving Credit Loans of any Type may be converted into a
Revolving Credit Loan of another Type as provided herein, provided that
any partial conversion shall be in an aggregate principal amount of
$1,000,000 or a whole multiple thereof. Each Conversion Request relating
to the conversion of a Revolving Credit Loan to a Eurodollar Rate Loan
shall be irrevocable by the Borrower.
2.7.2. CONTINUATION OF TYPE OF REVOLVING CREDIT LOAN. Any
Revolving Credit Loan of any Type may be continued as a Revolving Credit
Loan of the same Type upon the expiration of an Interest Period with
respect thereto by compliance by the Borrower with the notice provisions
contained in Section 2.7.1; provided that no Eurodollar Rate Loan may be
continued as such when any Default or Event of Default has occurred and
is continuing, but shall be automatically converted to a Base Rate Loan
on the last day of the first Interest Period relating thereto ending
during the continuance of any Default or Event of Default of which
officers of the Agent active upon the Borrower's account have actual
knowledge. In the event that the Borrower fails to provide any such
notice with respect to the continuation of any Eurodollar Rate Loan as
such, then such Eurodollar Rate Loan shall be automatically converted to
a Base Rate Loan on the last day of the first Interest Period relating
thereto. The Agent shall notify the Revolving Credit Banks promptly when
any such automatic conversion contemplated by this Section 2.7 is
scheduled to occur.
2.7.3. EURODOLLAR RATE LOANS. Any conversion to or from
Eurodollar Rate Loans shall be in such amounts and be made pursuant to
such elections so that, after giving effect thereto, the aggregate
principal amount of all Eurodollar Rate Loans having the same Interest
Period shall not be less than $1,000,000 or a whole multiple thereof. At
no time with respect to all Loans under this Credit Agreement shall
there be more than five (5) Eurodollar Rate Loans having different
interest periods outstanding.
2.8. FUNDS FOR REVOLVING CREDIT LOANS.
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2.8.1. FUNDING PROCEDURES. Not later than 1:00 p.m. (Boston
time) on the proposed Drawdown Date of any Revolving Credit Loans, each
of the Banks will make available to the Agent, at the Agent's Head
Office, in immediately available funds, the amount of such Bank's
Revolving Credit Commitment Percentage of the amount of the requested
Revolving Credit Loans. Upon receipt from one or more Banks of such
amounts, and upon receipt of the documents required by Sections 15 and
16 and the satisfaction of the other conditions set forth therein, to
the extent applicable, the Agent will make available to the Borrower the
aggregate amount of such Revolving Credit Loans made available to the
Agent by the Banks. The failure or refusal of any Bank to make available
to the Agent at the aforesaid time and place on any Drawdown Date the
amount of its Revolving Credit Commitment Percentage of the requested
Revolving Credit Loans shall not relieve any other Bank from its several
obligation hereunder to make available to the Agent the amount of such
other Bank's Revolving Credit Commitment Percentage of any requested
Revolving Credit Loans.
2.8.2. ADVANCES BY AGENT. The Agent may, unless notified to the
contrary by any Bank prior to a Drawdown Date, assume that such Bank has
made available to the Agent on such Drawdown Date the amount of such
Bank's Revolving Credit Commitment Percentage of the Revolving Credit
Loans to be made on such Drawdown Date, and the Agent may (but it shall
not be required to), in reliance upon such assumption, make available to
the Borrower a corresponding amount. If any Bank makes available to the
Agent such amount on a date after such Drawdown Date, such Bank shall
pay to the Agent on demand an amount equal to the product of (i) the
average computed for the period referred to in clause (iii) below, of
the weighted average interest rate paid by the Agent for federal funds
acquired by the Agent during each day included in such period, times
(ii) the amount of such Bank's Revolving Credit Commitment Percentage of
such Revolving Credit Loans, times (iii) a fraction, the numerator of
which is the number of days that elapse from and including such Drawdown
Date to the date on which the amount of such Bank's Revolving Credit
Commitment Percentage of such Revolving Credit Loans shall become
immediately available to the Agent, and the denominator of which is 365.
A statement of the Agent submitted to such Bank with respect to any
amounts owing under this paragraph shall be prima facie evidence of the
amount due and owing to the Agent by such Bank. If the amount of such
Bank's Revolving Credit Commitment Percentage of such Revolving Credit
Loans is not made available to the Agent by such Bank within three (3)
Business Days following such Drawdown Date, the
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Agent shall be entitled to recover such amount from the Borrower on
demand, with interest thereon at the rate per annum applicable to the
Revolving Credit Loans made on such Drawdown Date.
2.9. THE SWING LINE.
2.9.1. ADVANCES BY AGENT. Subject to the terms and conditions
hereinafter set forth, upon notice by the Borrower made to the Agent in
accordance with Section 2.9.2 hereof, BKB in its capacity as Swing Line
Bank (the "Swing Line Bank") agrees to lend to the Borrower Swing Line
Loans on any Business Day from the Closing Date until the Maturity Date
in an aggregate principal amount not to exceed $5,000,000 (the "Maximum
Swing Line Loan Amount"). Each Swing Line Loan shall be in a minimum
amount equal to $10,000 or integral multiple thereof. Notwithstanding
any other provisions of this Agreement and in addition to the limit set
forth above, at no time shall the aggregate principal amount of all
outstanding Swing Line Loans exceed the Total Revolving Credit
Commitment then in effect minus the sum of (i) the aggregate principal
amount of all Revolving Credit Loans outstanding, and (ii) the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations; provided
however that subject to the limitations set forth in this Section 2.9
from time to time the sum of the aggregate outstanding Swing Line Loans
plus all outstanding Revolving Credit Loans made by BKB plus the Maximum
Drawing Amount of all Letters of Credit and all Unpaid Reimbursement
Obligations may exceed BKB's Revolving Credit Commitment Percentage of
the Total Revolving Credit Commitment then in effect.
2.9.2. NOTICE OF BORROWING. When the Borrower desires the Swing
Line Bank to make a Swing Line Loan, it shall send to the Agent a Loan
Request, which shall set forth the principal amount of the proposed
Swing Line Loan and the Swing Line Loan Maturity Date relating thereto,
which shall in no event be later than the earlier of (i) the tenth
(10th) day following the Drawdown Date of such Swing Line Loan and (ii)
the Maturity Date. Each such Loan Request must be received by the Agent
not later than 2:00 p.m. (Boston time) on the date of the proposed
borrowing. Each Loan Request shall be irrevocable and binding on the
Borrower and shall obligate the Borrower to borrow the Swing Line Loan
from the Swing Line Bank on the proposed Drawdown Date thereof. Upon
satisfaction of the applicable conditions set forth in this Agreement,
on the proposed Drawdown Date the Swing Line Bank shall make the
proposed Swing Line Loan available to the Borrower no later
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than 3:00 p.m. (Boston time) on the proposed Drawdown Date by crediting
the amount of the Swing Line Loan to the Borrower's account maintained
with the Agent at the Head Office; provided that the Swing Line Bank
shall not advance any Swing Line Loans after it has received notice from
any Bank that a Default or Event of Default has occurred and stating
that no new Swing Line Loans are to be made until such Default or Event
of Default has been cured or waived in accordance with the provisions of
this Agreement. The Swing Line Bank shall not be obligated to make any
Swing Line Loans at any time when any Bank is a Delinquent Bank unless
the Swing Line Bank has entered into arrangements satisfactory to it to
eliminate the Swing Line Bank's risk with respect to such Delinquent
Bank, including by cash collateralizing such Delinquent Bank's Revolving
Credit Commitment Percentage of the outstanding Swing Line Loans and any
additional Swing Line Loans to be made.
2.9.3. INTEREST ON SWING LINE LOANS. Each Swing Line Loan shall
be a Base Rate Loan and, except as otherwise provided in Section 9.10
hereof, shall bear interest from the Drawdown Date thereof until repaid
in full at a rate per annum equal to the sum of the Base Rate in effect
from time to time plus the Applicable Margin then in effect with respect
to Base Rate Loans. The Borrower promises to pay interest on each Swing
Line Loan quarterly in arrears on the last day of each calendar quarter.
2.9.4. REPAYMENT OF SWING LINE LOANS. The Borrower shall repay
each outstanding Swing Line Loan on or prior to the Swing Line Loan
Maturity Date relating thereto. Upon notice by the Agent on any Business
Day (whether before or on the Maturity Date), each of the Banks hereby
agrees to make payments to the Agent for the account of the Swing Line
Bank, on the next succeeding Business Day following such notice, in an
amount equal to such Bank's Revolving Credit Commitment Percentage of
the aggregate amount of all Swing Line Loans outstanding. The parties
hereto agree that such payments made to the Agent for the account of the
Swing Line Bank shall constitute Revolving Credit Loans made to the
Borrower hereunder, and shall be Base Rate Loans. The proceeds thereof
shall be applied directly by the Swing Line Bank to such outstanding
Swing Line Loans. Each Bank hereby absolutely, unconditionally and
irrevocably agrees to make such Revolving Credit Loans upon one Business
Day's notice as set forth above, notwithstanding (i) that the amount of
such Revolving Credit
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Loan may not comply with the applicable minimums set forth in Section
2.6.1 hereof, (ii) the failure of the Borrower to meet the conditions
set forth in Sections 15 or 16 hereof, (iii) the occurrence or
continuance of a Default or an Event of Default hereunder, (iv) that the
date of such Loan may fall after the Maturity Date, and (v) the amount
of the Total Revolving Credit Commitment in effect at such time. In the
event that it is impracticable for such amounts to be paid to the Agent
or for the Swing Line Bank or such Revolving Credit Loans to be made for
any reason on the date otherwise required above, then each Bank hereby
agrees that it shall forthwith purchase (as of the date such payment and
such Revolving Credit Loan would have been made, but adjusted for any
payments received from the Borrower on or after such date and prior to
such purchase) from the Swing Line Bank, and the Swing Line Bank shall
sell to each Bank, such participations in the Swing Line Loans
(including all accrued and unpaid interest thereon) outstanding as shall
be necessary to cause the Banks to share in such Swing Line Loans pro
rata based on their respective Revolving Credit Commitment Percentages
(without regard to any termination of the Total Revolving Credit
Commitment) by making available to the Agent for the account of the
Swing Line Bank an amount equal to such Bank's participation in the
Swing Line Loans; provided that (x) all interest payable on the Swing
Line Loans shall be for the account of the Swing Line Bank as a funding
and administrative fee until the date as of which the respective
participation is purchased (unless paid to the Swing Line Bank pursuant
to clause (y) below), and (y) at the time any purchase of such
participation is actually made, the purchasing Bank shall be required to
pay the Swing Line Bank interest on the principal amount of the
participation so purchased for each day from and including the date such
Revolving Credit Loan would otherwise have been made until the date of
payment for such participation at the rate per annum equal to the sum of
the Base Rate plus the Applicable Margin in effect with respect to Base
Rate Loans during such period.
2.9.5. THE SWING LINE NOTE. The obligation of the Borrower to
repay the Swing Line Loans made pursuant to this Agreement and to pay
interest thereon as set forth in this Agreement shall be evidenced by a
promissory note of the Borrower with appropriate insertions
substantially in the form of Exhibit A-2 attached hereto (the "Swing
Line Note"), dated the Closing Date and payable to the order of the
Swing Line Bank in a principal amount stated to be the lesser of (i) the
Maximum Swing Line Loan Amount, or (ii) the aggregate principal amount
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of Swing Line Loans at any time advanced by the Swing Line Bank and
outstanding hereunder. The Borrower irrevocably authorizes the Swing
Line Bank to make or cause to be made, at or about the time of the
Drawdown Date of any Swing Line Loan or at the time of receipt of any
payment of principal on the Swing Line Note, an appropriate notation on
the Swing Line Note Record reflecting the making of such Swing Line Loan
or (as the case may be) the receipt of such payment. The outstanding
amount of the Swing Line Loans set forth on the Swing Line Note Record
shall be prima facie evidence of the principal amount thereof owing and
unpaid to the Swing Line Bank, but the failure to record, or any error
in so recording, any such amount on such Record shall not limit or
otherwise affect the actual amount of the obligations of the Borrower
hereunder or under the Swing Line Note to make payments of principal of
or interest on the Swing Line Note when due.
3. REPAYMENT OF THE REVOLVING CREDIT LOANS.
3.1. MATURITY. The Borrower promises to pay on the Maturity Date, and
there shall become absolutely due and payable on the Maturity Date, all of the
Revolving Credit Loans outstanding on such date, together with any and all
accrued and unpaid interest thereon.
3.2. MANDATORY REPAYMENTS OF REVOLVING CREDIT LOANS. If at any time the
sum of the outstanding principal amount of the Revolving Credit Loans, the
outstanding principal amount of the Swing Line Loans, the Maximum Drawing Amount
and all Unpaid Reimbursement Obligations exceeds the Total Revolving Credit
Commitment, then the Borrower shall immediately pay the amount of such excess to
the Agent for the respective accounts of the Banks for application: first, to
any Unpaid Reimbursement Obligations; second, to the Swing Line Loans; third, to
the Revolving Credit Loans; and fourth, to provide to the Agent cash collateral
for Reimbursement Obligations as contemplated by Section 5.2(b) and (c). In
addition, the Borrower shall prepay the Revolving Credit Loans as and when
required by Section 8, and the Total Revolving Credit Commitment shall be
reduced accordingly. Each payment of any Unpaid Reimbursement Obligations or
prepayment of Revolving Credit Loans shall be allocated among the Banks, in
proportion, as nearly as practicable, to each Reimbursement Obligation or (as
the case may be) the respective unpaid principal amount of each Bank's Revolving
Credit Note, with adjustments to the extent practicable to equalize any prior
payments or repayments not exactly in proportion.
3.3. OPTIONAL REPAYMENTS OF REVOLVING CREDIT LOANS. The Borrower shall
have the right, at its election, to repay the outstanding amount of the
Revolving Credit Loans, as a whole or in part, at any time
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without penalty or premium, provided that all prepayments of Eurodollar Rate
Loans prior to the end of the Interest Period relating thereto shall obligate
the Borrower to pay any breakage costs associated with such Eurodollar Rate
Loans in accordance with Section 9.9 hereof. The Borrower shall give the Agent,
no later than 1:00 p.m., Boston time, at least one (1) Business Day prior
written notice of any proposed prepayment pursuant to this Section 3.3 of Base
Rate Loans, and three (3) Eurodollar Business Days notice of any proposed
prepayment pursuant to this Section 3.3 of Eurodollar Rate Loans, in each case
specifying the proposed date of prepayment of Revolving Credit Loans and the
principal amount to be prepaid. Each such partial prepayment of the Revolving
Credit Loans shall be in an integral multiple of $1,000,000, shall be
accompanied by the payment of accrued interest on the principal prepaid to the
date of prepayment and shall be applied, in the absence of instruction by the
Borrower, first to the principal of Base Rate Loans and then to the principal of
Eurodollar Rate Loans. Each partial prepayment shall be allocated among the
Banks, in proportion, as nearly as practicable, to the respective unpaid
principal amount of each Bank's Revolving Credit Note, with adjustments to the
extent practicable to equalize any prior repayments not exactly in proportion.
4. THE TERM LOAN.
4.1. COMMITMENT TO LEND. Subject to the terms and conditions set forth
in this Credit Agreement, each Bank severally agrees to lend to the Borrower on
the Closing Date the amount of its Term Percentage of the principal amount of
$25,000,000 (the "Aggregate Term Loan Amount"); provided however that at the
request of the Borrower made no later than three (3) Business Days prior to the
Closing Date each Bank severally agrees to lend to the Borrower on the Closing
Date its Term Percentage of such lesser amount in an integral multiple of
$1,000,000 (but not less than $22,000,000) as the Borrower may request (the
"Initial Term Loan Amount"). In the event the portion of the Term Loan advanced
on the Closing Date is less than the Aggregate Term Loan Amount and subject to
the terms and conditions set forth in this Credit Agreement, each Bank severally
agrees to lend to the Borrower, upon not less than three (3) Business Days
notice to the Agent, on a single date (the "Second Term Loan Disbursement Date")
occurring no later than sixty (60) days after the Closing Date the amount of its
Term Percentage of such amount (in an integral multiple of $1,000,000) as may be
requested by the Borrower not to exceed the Aggregate Term Loan Amount less the
Initial Term Loan Amount; provided that in no event shall the sum of (i) the
portion of the Term Loan advanced on the Closing Date and (ii) the portion of
the Term Loan advanced on the Second Term Loan Disbursement Date exceed the
Aggregate Term Loan Amount. In the event the Borrower fails for any reason to
borrow such portion prior to
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sixty (60) days after the Closing Date, or if the Borrower fails to satisfy any
conditions set forth in Section 16 on the proposed Second Term Loan Disbursement
Date, then no further portion of the Term Loan shall be advanced by the Banks
hereunder. Each request for a portion of the Term Loan hereunder shall be made
by delivering a Loan Request to the Agent setting forth the requested amount of
such portion and shall constitute a representation and warranty by the Borrower
that the conditions set forth in Section 15 and Section 16, in the case of the
initial portion of the Term Loan to be made on the Closing Date, and Section 16,
in the case of the portion of the Term Loan to be made on the Second Term Loan
Disbursement Date, have been satisfied on the date of such request.
4.2. THE TERM NOTES. The Term Loan shall be evidenced by separate
promissory notes of the Borrower in substantially the form of Exhibit A-3 hereto
(each a "Term Note"), dated the Closing Date and completed with appropriate
insertions. One Term Note shall be payable to the order of each Bank in a
principal amount equal to such Bank's Term Percentage of the Term Loan and
representing the obligation of the Borrower to pay to such Bank such principal
amount or, if less, such Bank's Term Percentage of the outstanding amount of the
Term Loan, plus interest accrued thereon, as set forth below. The Borrower
irrevocably authorizes each Bank to make or cause to be made a notation on such
Bank's Term Note Record reflecting the original principal amount of such Bank's
Term Percentage of the Term Loan and, at or about the time of such Bank's
receipt of any principal payment on such Bank's Term Note, an appropriate
notation on such Bank's Term Note Record reflecting such payment. The aggregate
unpaid amount set forth on such Bank's Term Note Record shall be prima facie
evidence of the principal amount thereof owing and unpaid to such Bank, but the
failure to record, or any error in so recording, any such amount on such Bank's
Term Note Record shall not affect the obligations of the Borrower hereunder or
under any Term Note to make payments of principal of and interest on any Term
Note when due.
4.3. SCHEDULE OF INSTALLMENT PAYMENTS OF PRINCIPAL OF TERM LOAN;
MANDATORY PREPAYMENTS.
(a) The Borrower promises to pay to the Agent for the account of the
Banks the principal amount of the Term Loan on such dates and in such amounts as
set forth in the table below, with a final payment on the Maturity Date in an
amount equal to the unpaid balance of the Term Loan.
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Principal Amount of
Payment Date Term Loan to be Repaid
6/30/99 $1,000,000
9/30/99 $1,000,000
12/31/99 $1,000,000
3/31/00 $1,000,000
6/30/00 $1,125,000
9/30/00 $1,125,000
12/31/00 $1,125,000
3/31/01 $1,125,000
6/30/01 $1,250,000
9/30/01 $1,250,000
12/31/01 $1,250,000
3/31/02 $1,250,000
6/30/02 $1,375,000
9/30/02 $1,375,000
12/31/02 $1,375,000
3/31/03 $1,375,000
6/30/03 $1,500,000
9/30/03 $1,500,000
12/31/03 $1,500,000
Maturity Date Unpaid balance of Term Loan
(b) The Borrower shall prepay the Term Loan as and when required by
Section 8.
(c) In the event the portion (if any) of Term Loan to be advanced on the
Second Term Loan Disbursement Date is not made for any reason, the scheduled
installments of principal due on the Term Loan as set forth in clause (a) above
shall be reduced in the inverse order of maturity by the amount by which the
Aggregate Term Loan Amount exceeds the Initial Term Loan Amount.
4.4. OPTIONAL PREPAYMENT OF TERM LOAN. The Borrower shall have the right
at any time to prepay the Term Loan on or before the Maturity Date, as a whole,
or in part, upon not less than five (5) Business Days prior written notice to
the Agent, without premium or penalty, provided that (i) each partial prepayment
shall be in the principal amount of $1,000,000 or an integral multiple thereof,
(ii) no portion of the Term Loan bearing interest at the Eurodollar Rate may be
prepaid pursuant to this Section 4.4 except on the last day of the Interest
Period relating thereto unless the Borrower pays any breakage costs associated
therewith in accordance with Section 9.9; and (iii) each partial prepayment
shall
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be allocated among the Banks in proportion, as nearly as practicable, to
the respective outstanding amount of each Bank's Term Note, with adjustments to
the extent practicable to equalize any prior prepayments not exactly in
proportion. Any prepayment of principal of the Term Loan shall include all
interest accrued to the date of prepayment and shall be applied against the
scheduled installments of principal due on the Term Loan in the inverse order of
maturity. No amount repaid with respect to the Term Loan may be reborrowed.
4.5. INTEREST ON TERM LOANS.
4.5.1. INTEREST RATES. Except as otherwise provided in Section
9.10, the Term Loan shall bear interest during each Interest Period
relating to all or any portion of the Term Loan at the following rates:
(i) to the extent that all or any portion of the
Term Loan bears interest during such Interest Period at
the Base Rate, the Term Loan or such portion shall bear
interest during such Interest Period at the rate per annum
equal to the Base Rate in effect from time to time plus
the Applicable Margin then in effect with respect to Base
Rate Loans; and
(ii) to the extent that all or any portion of the Term
Loan bears interest during such Interest Period at the
Eurodollar Rate, the Term Loan or such portion shall bear
interest during such Interest Period at the rate per annum
equal to the Eurodollar rate plus the Applicable Margin
then in effect with respect to Eurodollar Rate Loans.
4.5.2. PAYMENT OF INTEREST. The Borrower promises to pay interest
on the Term Loans or any portion thereof outstanding during each
Interest Period in arrears on each Interest Payment Date applicable to
such Interest Period.
4.5.3. NOTIFICATION BY BORROWER. The Borrower shall notify the
Agent, such notice to be irrevocable, at least three (3) Eurodollar
Business Days prior to the Closing Date and the Second term Loan
Disbursement Date of the Term Loan if all or any portion of the Term
Loan to be borrowed on such date is to bear interest at the Eurodollar
Rate. After the Term Loan has been made, the provisions of Section 2.7
shall apply mutatis mutandis with respect to all or any
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portion of the Term Loan so that the Borrower may have the same interest
rate options with respect to all or any portion of the Term Loan as it
would be entitled to with respect to the Revolving Credit Loans, subject
to the same limitations as apply to Revolving Credit Loans.
4.5.4. AMOUNTS, ETC. Any portion of the Term Loan bearing
interest at the Eurodollar Rate relating to any Interest Period shall be
in the amount of $1,000,000 or an integral multiple thereof. No Interest
Period relating to the Term Loan or any portion thereof bearing interest
at the Eurodollar Rate shall extend beyond the date on which a regularly
scheduled installment payment of the principal of the Term Loan is to be
made unless a portion of the Term Loan at least equal to such
installment payment has an Interest Period ending on such date or is
then bearing interest at the Base Rate.
5. LETTERS OF CREDIT.
5.1. LETTER OF CREDIT COMMITMENTS.
5.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject to the
terms and conditions hereof and the execution and delivery by the
Borrower of a letter of credit application on the Agent's customary form
(a "Letter of Credit Application"), the Agent on behalf of the Banks and
in reliance upon the agreement of the Banks set forth in Section 5.1.4
and upon the representations and warranties of the Borrower contained
herein, agrees, in its individual capacity, to issue, extend and renew
Letters of Credit for the account of the Borrower in such form as may be
requested from time to time by the Borrower and agreed to by the Agent;
provided, however, that, after giving effect to such request, at no time
shall (a) the sum of the aggregate Maximum Drawing Amount and all Unpaid
Reimbursement Obligations exceed the Letter of Credit Limit in effect at
such time, and (b) the sum of (i) the Maximum Drawing Amount on all
Letters of Credit, (ii) all Unpaid Reimbursement Obligations, (iii) the
amount of all Swing Line Loans outstanding, and (iv) the amount of all
Revolving Credit Loans outstanding exceed the Total Revolving Credit
Commitment. The parties hereto hereby acknowledge and agree that the IRB
Letter of Credit shall on the Closing Date be deemed to be, and shall
become, a Letter of Credit outstanding hereunder for the account of the
Borrower, and shall be subject to all of the provisions of this Credit
Agreement relating to Letters of Credit issued hereunder. Each of the
Banks acknowledges that it has made arrangements with the other Banks
satisfactory to it with respect to its pro rata share of any portion of
Letter of Credit Fees relating to periods after the Closing Date paid
prior to the Closing Date by the Borrower in respect of the IRB Letter
of Credit.
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5.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of Credit
Application shall be completed to the satisfaction of the Agent. In the
event that any provision of any Letter of Credit Application shall be
inconsistent with any provision of this Credit Agreement, then the
provisions of this Credit Agreement shall, to the extent of any such
inconsistency, govern.
5.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of Credit issued,
extended or renewed hereunder shall, among other things, (i) provide for
the payment of sight drafts for honor thereunder when presented in
accordance with the terms thereof and when accompanied by the documents
described therein, and (ii) have an expiry date no later than the
earlier of (a) one year after the date of issuance of such Letter of
Credit and (b) the date which is fourteen (14) days (or, if the Letter
of Credit is confirmed by a confirmer or otherwise provides for one or
more nominated persons, forty-five (45) days) prior to the Maturity
Date. Each Letter of Credit so issued, extended or renewed shall be
subject to either the Uniform Customs or the International Standby
Practices.
5.1.4. REIMBURSEMENT OBLIGATIONS OF BANKS. Each Bank severally
agrees that it shall be absolutely liable, without regard to the
occurrence of any Default or Event of Default or any other condition
precedent whatsoever, to the extent of such Bank's Revolving Credit
Commitment Percentage, to reimburse the Agent on demand for the amount
of each draft paid by the Agent under each Letter of Credit to the
extent that such amount is not reimbursed by the Borrower pursuant to
Section 5.2 (such agreement for a Bank being called herein the "Letter
of Credit Participation" of such Bank).
5.1.5. PARTICIPATIONS OF BANKS. Each such payment made by a Bank
shall be treated as the purchase by such Bank of a participating
interest in the Borrower's Reimbursement Obligation under Section 5.2 in
an amount equal to such payment. Each Bank shall share in accordance
with its participating interest in any interest which accrues pursuant
to Section 5.2.
5.1.6. REDUCTION OF LETTER OF CREDIT LIMIT. Upon any reduction in
the stated amount of the IRB Letter of Credit (or any replacement Letter
of Credit issued by the Agent for the account of the Borrower in respect
of its obligations under the Bond Documents) in accordance with the
terms thereof, the Letter of Credit Limit shall be reduced automatically
on the date of such reduction in stated amount by an amount equal to the
amount of such reduction. In the event the IRB Letter of Credit (or such
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replacement Letter of Credit) shall terminate or expire the Letter of
Credit Limit shall be reduced automatically on the date of such
termination or expiration by an amount equal to the face amount thereof
as in effect immediately prior to such termination or expiration. No
reduction of the Letter of Credit Limit hereunder may be reinstated.
5.2. REIMBURSEMENT OBLIGATION OF THE BORROWER. In order to induce the
Agent to issue, extend and renew each Letter of Credit and the Banks to
participate therein, the Borrower hereby agrees to reimburse or pay to the
Agent, for the account of the Agent or (as the case may be) the Banks, with
respect to each Letter of Credit issued, extended or renewed by the Agent
hereunder,
(a) except as otherwise expressly provided in Section 5.2(b) and
(c), on each date that any draft presented under such Letter of Credit
is honored by the Agent, or the Agent otherwise makes a payment with
respect thereto, (i) the amount paid by the Agent under or with respect
to such Letter of Credit, and (ii) the amount of any taxes, fees,
charges or other costs and expenses whatsoever incurred by the Agent or
any Bank in connection with any payment made by the Agent or such Bank
under, or with respect to, such Letter of Credit (it being understood
that such payment to the Agent may, subject to the satisfaction of the
conditions set forth herein, be made from the proceeds of a Revolving
Credit Loan made to the Borrower pursuant to Section 2.6.2),
(b) upon the reduction (but not termination) of the Total
Revolving Credit Commitment to an amount less than the Maximum Drawing
Amount, an amount equal to such difference, which amount shall be held
by the Agent for the benefit of the Banks and the Agent as cash
collateral for all Reimbursement Obligations, and
(c) upon the termination of the Total Revolving Credit
Commitment, or the acceleration of the Reimbursement Obligations with
respect to all Letters of Credit in accordance with Section 17, an
amount equal to the then Maximum Drawing Amount on all Letters of
Credit, which amount shall be held by the Agent for the benefit of the
Banks and the Agent as cash collateral for all Reimbursement
Obligations.
Each such payment shall be made to the Agent at the Agent's Head Office in
immediately available funds or (in the case of clause (a) of this Section 5.2)
from the direct application of the proceeds of a Revolving Credit Loan made
pursuant to Section 2.6.2 hereof. In the event that the obligations of
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the Borrower under Section 5.2(a) can not, in compliance with the provisions of
this Credit Agreement, be satisfied in full by the making of a Revolving Credit
Loan pursuant to Section 2.6.2, the Agent shall so notify the Borrower, in which
case the obligations of the Borrower under Section 5.2(a) shall be immediately
due and payable to the Agent. Interest on any and all amounts remaining unpaid
by the Borrower under this Section 5.2 at any time from the date such amounts
become due and payable (whether as stated in this Section 5.2, by acceleration
or otherwise) until payment in full (whether before or after judgment) shall be
payable to the Agent on demand at the rate specified in Section 9.10 for overdue
principal on the Revolving Credit Loans.
5.3. LETTER OF CREDIT PAYMENTS. If any draft shall be presented or other
demand for payment shall be made under any Letter of Credit, the Agent shall
notify the Borrower of the date and amount of the draft presented or demand for
payment and of the date and time when it expects to pay such draft or honor such
demand for payment. If the Borrower fails to reimburse the Agent as provided in
Section 5.2 on or before the date that such draft is paid or other payment is
made by the Agent, the Agent may at any time thereafter notify the Banks of the
amount of any such Unpaid Reimbursement Obligation. No later than 3:00 p.m.
(Boston time) on the Business Day next following the receipt of such notice,
each Bank shall make available to the Agent, at the Agent's Head Office, in
immediately available funds, such Bank's Revolving Credit Commitment Percentage
of such Unpaid Reimbursement Obligation, together with an amount equal to the
product of (i) the average, computed for the period referred to in clause (iii)
below, of the weighted average interest rate paid by the Agent for federal funds
acquired by the Agent during each day included in such period, times (ii) the
amount equal to such Bank's Revolving Credit Commitment Percentage of such
Unpaid Reimbursement Obligation, times (iii) a fraction, the numerator of which
is the number of days that shall have elapsed from and including the date the
Agent paid the draft presented for honor or otherwise made payment to the date
on which such Bank's Revolving Credit Commitment Percentage of such Unpaid
Reimbursement Obligation shall become immediately available to the Agent, and
the denominator of which is 360. The responsibility of the Agent to the Borrower
and the Banks shall be only to determine that the documents (including each
draft) delivered under each Letter of Credit in connection with such presentment
shall be in conformity in all material respects with such Letter of Credit.
5.4. OBLIGATIONS ABSOLUTE. The Borrower's obligations under this Section
5 shall be absolute and unconditional under any and all circumstances and
irrespective of the occurrence of any Default or Event of Default or any
condition precedent whatsoever or any setoff, counterclaim or
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defense to payment which the Borrower may have or have had against the Agent,
any Bank or any beneficiary of a Letter of Credit. The Borrower further agrees
with the Agent and the Banks that the Agent and the Banks shall not be
responsible for, and the Borrower's Reimbursement Obligations under Section 5.2
shall not be affected by, among other things, the validity or genuineness of
documents or of any endorsements thereon, even if such documents should in fact
prove to be in any or all respects invalid, fraudulent or forged, or any dispute
between or among the Borrower, the beneficiary of any Letter of Credit or any
financing institution or other party to which any Letter of Credit may be
transferred or any claims or defenses whatsoever of the Borrower against the
beneficiary of any Letter of Credit or any such transferee. The Agent and the
Banks shall not be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit. The Borrower agrees that
any action taken or omitted by the Agent or any Bank under or in connection with
each Letter of Credit and the related drafts and documents, if done in good
faith, shall be binding upon the Borrower and shall not result in any liability
on the part of the Agent or any Bank to the Borrower.
5.5. RELIANCE BY ISSUER. To the extent not inconsistent with Section
5.4, the Agent shall be entitled to rely, and shall be fully protected in
relying upon, any Letter of Credit or any draft, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document delivered in connection
with any Letter of Credit believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel, independent accountants and other experts selected
by the Agent. The Agent shall be fully justified in failing or refusing to take
any action under this Agreement unless it shall first have received such advice
or concurrence of the Majority Banks as it reasonably deems appropriate or it
shall first be indemnified to its reasonable satisfaction by the Banks against
any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Agreement in
accordance with a request of the Majority Banks, and such request and any action
taken or failure to act pursuant thereto shall be binding upon the Banks and all
future holders of the Revolving Credit Notes or of Letter of Credit
Participations.
5.6. LETTER OF CREDIT FEES. The Borrower shall, on the date of issuance
or any extension or renewal of any Letter of Credit, pay fees (each a "Letter of
Credit Fee") semiannually in advance, to the Agent in respect of each Letter of
Credit consisting of (i) the Applicable Margin per
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annum then in effect with respect to Eurodollar Rate Loans at the time of
determination multiplied by the face amount of such standby Letter of Credit,
which such fee shall be for the account of the Banks in accordance with their
respective Revolving Credit Commitment Percentages and (ii) a fronting fee equal
to 0.125% per annum of the face amount of such standby Letter of Credit, which
such fee shall be for the account of the Agent. The Borrower shall also pay to
the Agent, for the Agent's own account, on the date of issuance or any extension
or any renewal of any Letter of Credit and at such other time or times as such
charges are customarily made by the Agent, the Agent's customary issuance,
amendment, negotiation or document examination fees in respect of each Letter of
Credit.
6. THE ACQUISITION FACILITY.
6.1. COMMITMENT TO LEND. Subject to the terms and conditions set forth
in this Credit Agreement, each of the Banks severally agrees to lend to the
Borrower from time to time between the Closing Date and the Maturity Date upon
notice by the Borrower to the Agent given in accordance with Section 6.6, such
sums as are requested by the Borrower up to a maximum aggregate amount advanced
(after giving effect to all amounts requested) at any one time equal to such
Bank's Acquisition Loan Commitment, provided that the sum of the amount of the
Acquisition Loans advanced by the Banks to the Borrower (after giving effect to
all amounts requested) shall not exceed the Total Acquisition Loan Commitment.
The Acquisition Loans shall be made pro rata in accordance with each Bank's
Acquisition Loan Commitment Percentage. Each request for a Acquisition Loan
hereunder shall constitute a representation and warranty by the Borrower that
the conditions set forth in Section 15 and Section 16, in the case of the
initial Acquisition Loans to be made on the Closing Date, and Section 16, in the
case of all other Acquisition Loans, have been satisfied on the date of such
request.
6.2. COMMITMENT FEE. The Borrower agrees to pay to the Agent, for the
accounts of the Banks in accordance with their respective Acquisition Loan
Commitment Percentages, a commitment fee (the "Acquisition Loan Commitment Fee")
at the rate per annum equal to the Commitment Fee Rate then in effect on the
average daily amount during each calendar quarter or portion thereof from the
Closing Date to the Maturity Date by which the Total Acquisition Loan Commitment
exceeds the aggregate outstanding amount of Acquisition Loans. Such Acquisition
Loan Commitment Fee shall be payable quarterly in arrears on the first day of
each calendar quarter for the immediately preceding calendar quarter commencing
on the first such date following the date hereof, with a final payment on the
Maturity Date or any earlier date on which the Acquisition Loan Commitments
shall terminate.
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6.3. REDUCTION OF TOTAL ACQUISITION LOAN COMMITMENT. The Borrower shall
have the right at any time and from time to time upon five (5) Business Days
prior written notice to the Agent to reduce by $1,000,000 or an integral
multiple thereof or terminate entirely the Total Acquisition Loan Commitment,
whereupon the Acquisition Loan Commitments of the Banks shall be reduced pro
rata in accordance with their respective Acquisition Loan Commitment Percentages
of the amount specified in such notice, or, as the case may be, terminated.
Promptly after receiving any notice of the Borrower delivered pursuant to this
Section 6.3, the Agent will notify the Banks of the substance thereof. Upon the
effective date of any such reduction or termination, the Borrower shall pay to
the Agent for the respective accounts of the Banks the full amount of any
Acquisition Loan Commitment Fee then accrued on the amount of the reduction. No
reduction or termination of the Acquisition Loan Commitments may be reinstated.
6.4. THE ACQUISITION NOTES. The Acquisition Loans shall be evidenced by
separate promissory notes of the Borrower in substantially the form of Exhibit
A-4 hereto (each an "Acquisition Note"), dated as of the Closing Date and
completed with appropriate insertions. One Acquisition Note shall be payable to
the order of each Bank in a principal amount equal to such Bank's Acquisition
Loan Commitment or, if less, the outstanding amount of Acquisition Loans made by
such Bank, plus interest accrued thereon, as set forth below. The Borrower
irrevocably authorizes each Bank to make or cause to be made, at or about the
time of the Drawdown Date of any Acquisition Loan or at the time of receipt of
any payment of principal on such Bank's Acquisition Note, an appropriate
notation on such Bank's Acquisition Note Record reflecting the making of such
Acquisition Loan or (as the case may be) the receipt of such payment. The
outstanding amount of the Acquisition Loans set forth on such Bank's Acquisition
Note Record shall be prima facie evidence of the principal amount thereof owing
and unpaid to such Bank, but the failure to record, or any error in so
recording, any such amount on such Bank's Acquisition Note Record shall not
limit or otherwise affect the obligations of the Borrower hereunder or under any
Acquisition Note to make payments of principal of interest on any Acquisition
Note when due.
6.5. INTEREST ON ACQUISITION LOANS. Except as otherwise provided in
Section 9.10,
(a) each Acquisition Loan that is a Base Rate Loan shall bear
interest for the period commencing with the Drawdown Date thereof and
ending on the last day of the Interest Period with respect thereto at a
rate per annum equal to the sum of the Base
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Rate in effect from time to time plus the Applicable Margin then in
effect with respect to Base Rate Loans; and
(b) each Acquisition Loan that is a Eurodollar Rate Loan shall
bear interest for the period commencing with the Drawdown Date thereof
and ending on the last day of the Interest Period with respect thereto
at a rate per annum equal to the sum of the Eurodollar Rate plus the
Applicable Margin then in effect with respect to Eurodollar Rate Loans.
The Borrower promises to pay interest on each Acquisition Loan in arrears on
each Interest Payment Date with respect thereto.
6.6. REQUESTS FOR ACQUISITION LOANS. The Borrower shall give to the
Agent written notice in the form of a Loan Request for each Acquisition Loan
requested hereunder no less than (i) one (1) Business Day prior to the proposed
Drawdown Date of any Base Rate Loan and (ii) three (3) Eurodollar Business Days
prior to the proposed Drawdown Date of any Eurodollar Rate Loan. Each such
notice shall specify (A) the principal amount of the Acquisition Loan requested,
(B) the proposed Drawdown Date of such Acquisition Loan, (C) the Interest Period
for such Acquisition Loan and (D) the Type of such Acquisition Loan. Promptly
upon receipt of any such notice, the Agent shall notify each of the Banks
thereof. Each Loan Request shall be irrevocable and binding on the Borrower and
shall obligate the Borrower to accept the Acquisition Loan requested from the
Banks on the proposed Drawdown Date. Each Loan Request with respect to a
Acquisition Loan shall be in a minimum aggregate amount of $1,000,000 or an
integral multiple thereof. After a Acquisition Loan has been made, the
provisions of Section 2.7 shall apply mutatis mutandis with respect to all or
any portion of the Acquisition Loans so that the Borrower may have the same
interest rate options with respect to the Acquisition Loans as it would be
entitled to with respect to the Revolving Credit Loans, subject to the same
limitations as apply to Revolving Credit Loans.
6.7. FUNDS FOR ACQUISITION LOANS.
6.7.1. FUNDING PROCEDURES. Not later than 11:00 a.m. (Boston
time) on the proposed Drawdown Date of any Acquisition Loan, each of the
Banks will make available to the Agent, at the Agent's Head Office, in
immediately available funds, the amount of such Bank's Acquisition Loan
Commitment Percentage of the amount of the requested Acquisition Loan.
Upon receipt from each Bank of such amount, and upon receipt of the
documents required by Sections 15 and 16 and the satisfaction of the
other conditions set forth therein, to the extent applicable, the Agent
will make
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available to the Borrower the aggregate amount of such Acquisition Loans
made available to the Agent by the Banks. The failure or refusal of any
Bank to make available to the Agent at the aforesaid time and place on
any Drawdown Date the amount of its Acquisition Loan Commitment
Percentage of the requested Acquisition Loans shall not relieve any
other Bank from its several obligation hereunder to make available to
the Agent the amount of such other Bank's Acquisition Loan Commitment
Percentage of any requested Acquisition Loans.
6.7.2. ADVANCES BY AGENT. The Agent may, unless notified to the
contrary by any Bank prior to a Drawdown Date, assume that such Bank has
made available to the Agent on such Drawdown Date the amount of such
Bank's Acquisition Loan Commitment Percentage of the Acquisition Loans
to be made on such Drawdown Date, and the Agent may (but it shall not be
required to), in reliance upon such assumption, make available to the
Borrower a corresponding amount. If any Bank makes available to the
Agent such amount on a date after such Drawdown Date, such Bank shall
pay to the Agent on demand an amount equal to the product of (i) the
average computed for the period referred to in clause (iii) below, of
the weighted average interest rate paid by the Agent for federal funds
acquired by the Agent during each day included in such period, times
(ii) the amount of such Bank's Acquisition Loan Commitment Percentage of
such Acquisition Loans, times (iii) a fraction, the numerator of which
is the number of days that elapse from and including such Drawdown Date
to the date on which the amount of such Bank's Acquisition Loan
Commitment Percentage of such Acquisition Loans shall become immediately
available to the Agent, and the denominator of which is 365. A statement
of the Agent submitted to such Bank with respect to any amounts owing
under this paragraph shall be prima facie evidence of the amount due and
owing to the Agent by such Bank. If the amount of such Bank's
Acquisition Loan Commitment Percentage of such Acquisition Loans is not
made available to the Agent by such Bank within three (3) Business Days
following such Drawdown Date, the Agent shall be entitled to recover
such amount from the Borrower on demand, with interest thereon at the
rate per annum applicable to the Acquisition Loans made on such Drawdown
Date.
7. REPAYMENT OF THE ACQUISITION LOANS.
7.1. MATURITY. The Borrower promises to pay on the Maturity Date, and
there shall become absolutely due and payable on the Maturity Date, all of the
Acquisition Loans outstanding on such date, together with any and all accrued
and unpaid interest thereon.
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7.2. MANDATORY REPAYMENTS OF ACQUISITION LOANS. If at any time the
outstanding amount of the Acquisition Loans exceeds the Total Acquisition Loan
Commitment, then the Borrower shall immediately pay the amount of such excess to
the Agent for the respective accounts of the Banks for application to the
Acquisition Loans. In addition, the Borrower shall prepay the Acquisition Loans
as and when required by Section 8, and the Total Acquisition Loan Commitment
shall be reduced accordingly. Each prepayment of Acquisition Loans shall be
allocated among the Banks, in proportion, as nearly as practicable, to the
respective unpaid principal amount of each Bank's Acquisition Note, with
adjustments to the extent practicable to equalize any prior payments or
repayments not exactly in proportion.
7.3. OPTIONAL REPAYMENTS OF ACQUISITION LOANS. The Borrower shall have
the right, at its election, to repay the outstanding amount of the Acquisition
Loans, as a whole or in part, at any time without penalty or premium, provided
that all prepayments of Eurodollar Rate Loans prior to the end of the Interest
Period relating thereto shall obligate the Borrower to pay any breakage costs
associated with such Eurodollar Rate Loans in accordance with Section 9.9
hereof. The Borrower shall give the Agent, no later than 1:00 p.m., Boston time,
at least one (1) Business Day prior written notice of any proposed prepayment
pursuant to this Section 7.3 of Base Rate Loans, and three (3) Eurodollar
Business Days notice of any proposed prepayment pursuant to this Section 7.3 of
Eurodollar Rate Loans, in each case specifying the proposed date of prepayment
of Acquisition Loans and the principal amount to be prepaid. Each such partial
prepayment of the Acquisition Loans shall be in an integral multiple of
$1,000,000 shall be accompanied by the payment of accrued interest on the
principal prepaid to the date of prepayment and shall be applied, in the absence
of instruction by the Borrower, first to the principal of Base Rate Loans and
then to the principal of Eurodollar Rate Loans. Each partial prepayment shall be
allocated among the Banks, in proportion, as nearly as practicable, to the
respective unpaid principal amount of each Bank's Acquisition Note, with
adjustments to the extent practicable to equalize any prior repayments not
exactly in proportion.
8. CERTAIN MANDATORY PREPAYMENTS.
8.1. MANDATORY PREPAYMENTS FROM NEW EQUITY. In the event that the
Borrower shall after the Closing Date sell or issue any shares of its stock,
options or warrants for the purchase of its stock or other equity or equity
instruments (in each case other than (i) stock options or warrants to acquire
stock awarded to employees and directors pursuant to incentive compensation
plans or agreements with such Persons in an aggregate amount for all such
options and warrants not to exceed $250,000, or (ii) stock issued to a seller
party to, and as consideration for, a Permitted Acquisition), then the Borrower
shall, or shall cause
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such Subsidiary to, immediately prepay the Loans in accordance with Section 8.4
in an amount equal to one hundred percent (100%) of the Net Cash Proceeds of
such sale or issuance of new equity.
8.2. MANDATORY PREPAYMENTS FROM ADDITIONAL INDEBTEDNESS. In the event
that, after the Closing Date, the Borrower or any of its Subsidiaries shall
incur any Indebtedness, other than Excluded Indebtedness, then the Borrower
shall, or shall cause such Subsidiary to, immediately prepay the Loans in
accordance with Section 8.4 in an amount equal to one hundred percent (100%) of
the Net Cash Proceeds of the incurrence of such Indebtedness.
8.3. MANDATORY PREPAYMENTS FROM ASSET SALES. Immediately upon the
occurrence of any Asset Disposition or series of Asset Dispositions the Net Cash
Proceeds of which, in any fiscal year of the Borrower, exceed $1,000,000, the
Borrower shall prepay the Loans in accordance with Section 8.4 in an amount
equal to one hundred percent (100%) of the amount by which the Net Cash Proceeds
of such Asset Disposition or series of Asset Dispositions exceeds $1,000,000.
8.4. APPLICATION OF PROCEEDS; ETC. All mandatory prepayments of the
Loans pursuant to this Section 8 shall be applied first to the Term Loan until
repaid in full and shall be applied against the scheduled installments of
principal due thereon in the inverse order of maturity, second to the
outstanding amount of the Acquisition Loans until repaid in full, and third to
the outstanding amount of the Revolving Credit Loans. Upon each such prepayment
of the Acquisition Loans and the Revolving Credit Loans, the Total Acquisition
Loan Commitment or Total Revolving Credit Commitment, as the case may be, shall
be reduced automatically by the amount of such prepayment, whereupon the
respective Acquisition Loan Commitments and Revolving Credit Commitments, as the
case may be, of the Banks shall be reduced pro rata in accordance with their
respective Acquisition Loan Commitment Percentages or Revolving Credit
Commitment Percentages, as the case may be. Any prepayment of principal of the
Loans in accordance with this Section 8.4 shall include all interest accrued to
the date of prepayment. No amount repaid with respect to the Loans in accordance
with this Section 8.4 may be reborrowed.
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9. CERTAIN GENERAL PROVISIONS.
9.1. CLOSING AND OTHER FEES. The Borrower agrees to pay to the Agent for
the account of the Banks the closing fees described in the letter dated as of
the date hereof among the Borrower, the Banks and the Agent (the "Closing Fee
Letter") in accordance with the terms and conditions thereof. The Borrower
further agrees to pay to the Agent and the Arranger the fees described in the
letter dated as of the date hereof among the Agent, the Arranger and the
Borrower (the "Agent's Fee Letter") in accordance with the terms and conditions
thereof.
9.2. FUNDS FOR PAYMENTS.
9.2.1. PAYMENTS TO AGENT. All payments of principal, interest,
Reimbursement Obligations, Commitment Fees, Letter of Credit Fees and
any other amounts due hereunder or under any of the other Loan Documents
shall be made on the due date thereof to the Agent in Dollars, for the
respective accounts of the Banks, the Swing Line Bank and the Agent, at
the Agent's Head Office or at such other location in the Boston,
Massachusetts area that the Agent may from time to time designate, in
each case in immediately available funds not later than 11:00 a.m.
(Boston, Massachusetts, time).
9.2.2. NO OFFSET, ETC. All payments by the Borrower hereunder
and under any of the other Loan Documents shall be made without setoff
or counterclaim and free and clear of and without deduction for any
taxes, levies, imposts, duties, charges, fees, deductions, withholdings,
compulsory loans, restrictions or conditions of any nature now or
hereafter imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein unless the
Borrower is compelled by law to make such deduction or withholding. If
any such obligation is imposed upon the Borrower with respect to any
amount payable by it hereunder or under any of the other Loan Documents,
the Borrower will pay to the Agent, for the account of the Banks or (as
the case may be) the Agent, on the date on which such amount is due and
payable hereunder or under such other Loan Document, such additional
amount in Dollars as shall be necessary to enable the Banks or the Agent
to receive the same net amount which the Banks or the Agent would have
received on such due date had no such obligation been imposed upon the
Borrower. The Borrower will deliver promptly to the Agent certificates
or other valid vouchers for all taxes or other charges deducted from or
paid with respect to payments made by the Borrower hereunder or under
such other Loan Document.
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9.3. COMPUTATIONS. All computations of interest on the Loans (other than
Eurodollar Rate Loans), Commitment Fees and Letter of Credit Fees shall be based
on a 360-day year and paid for the actual number of days elapsed. All
computations of interest on Eurodollar Rate Loans shall be based on a 365-day
year and paid for the actual number of days elapsed. Except as otherwise
provided in the definition of the term "Interest Period" with respect to
Eurodollar Rate Loans, whenever a payment hereunder or under any of the other
Loan Documents becomes due on a day that is not a Business Day, the due date for
such payment shall be extended to the next succeeding Business Day, and interest
shall accrue during such extension. The outstanding principal amount of the
Loans as reflected on the Revolving Credit Note Records, the Swing Line Note
Record, the Acquisition Note Records and the Term Note Records from time to time
shall be considered correct and binding on the Borrower absent manifest error
unless within five (5) Business Days after receipt of any notice by the Borrower
of such outstanding amount, the Borrower shall notify the Agent to the contrary.
9.4. INABILITY TO DETERMINE EURODOLLAR RATE. In the event the Agent
shall determine or be notified by the Majority Banks that adequate and
reasonable methods do not exist for ascertaining the Eurodollar Rate that would
otherwise determine the rate of interest to be applicable to any Eurodollar Rate
Loan during any Interest Period, the Agent shall forthwith give notice of such
determination (which shall be conclusive and binding on the Borrower and the
Banks) to the Borrower and the Banks. In such event (i) any Loan Request or
Conversion Request with respect to Eurodollar Rate Loans shall be automatically
withdrawn and shall be deemed a request for Base Rate Loans, (ii) each
Eurodollar Rate Loan will automatically, on the last day of the then current
Interest Period relating thereto, become a Base Rate Loan, and (iii) the
obligations of the Banks to make Eurodollar Rate Loans shall be suspended until
the Agent or the Majority Banks determines that the circumstances giving rise to
such suspension no longer exist, whereupon the Agent or, as the case may be, the
Agent upon the instruction of the Majority Banks, shall so notify the Borrower
and the Banks.
9.5. ILLEGALITY. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Bank to make or maintain
Eurodollar Rate Loans, such Bank shall forthwith give notice of such
circumstances to the Borrower and the other Banks and thereupon (i) the
commitment of such Bank to make Eurodollar Rate Loans or convert Loans of
another Type to Eurodollar Rate Loans shall forthwith be suspended and (ii) such
Bank's Loans then outstanding as Eurodollar Rate Loans, if any, shall be
converted automatically to Base Rate Loans on the last day of each Interest
Period applicable to such
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Eurodollar Rate Loans or within such earlier period as may be required by law.
The Borrower hereby agrees promptly to pay the Agent for the account of such
Bank, upon demand by such Bank, any additional amounts necessary to compensate
such Bank for any costs incurred by such Bank in making any conversion in
accordance with this Section 9.5, including any interest or fees payable by such
Bank to lenders of funds obtained by it in order to make or maintain its
Eurodollar Rate Loans hereunder.
9.6. ADDITIONAL COSTS, ETC. If any present or future applicable law,
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Bank or the Agent by any central bank or other fiscal,
monetary or other authority (whether or not having the force of law), shall:
(a) subject any Bank or the Agent to any tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature with respect to this
Credit Agreement, the other Loan Documents, any Letters of Credit, such
Bank's Commitments or the Loans (other than taxes based upon or measured
by the income or profits of such Bank or the Agent), or
(b) materially change the basis of taxation (except for changes
in taxes on income or profits) of payments to any Bank of the principal
of or the interest on any Loans or any other amounts payable to any Bank
or the Agent under this Credit Agreement or any of the other Loan
Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement) any
special deposit, reserve, assessment, liquidity, capital adequacy or
other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans
by, or letters of credit issued by, or commitments of an office of any
Bank, or
(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Credit Agreement, the other Loan
Documents, any Letters of Credit, the Loans, such Bank's Commitments, or
any class of loans, letters of credit or commitments of which any of the
Loans or such Bank's Commitments forms a part,
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and the result of any of the foregoing is:
(i) to increase the cost to any Bank of making, funding,
issuing, renewing, extending or maintaining any of the Loans or
such Bank's Commitments or any Letter of Credit, or
(ii) to reduce the amount of principal, interest,
Reimbursement Obligation or other amount payable to such Bank or
the Agent hereunder on account of such Bank's Commitments, any
Letter of Credit or any of the Loans, or
(iii) to require such Bank or the Agent to make any
payment or to forego any interest or Reimbursement Obligation or
other sum payable hereunder, the amount of which payment or
foregone interest or Reimbursement Obligation or other sum is
calculated by reference to the gross amount of any sum receivable
or deemed received by such Bank or the Agent from the Borrower
hereunder,
then, and in each such case, the Borrower will, upon demand made by such Bank or
(as the case may be) the Agent at any time and from time to time and as often as
the occasion therefor may arise, pay to such Bank or the Agent such additional
amounts as will be sufficient to compensate such Bank or the Agent for such
additional cost, reduction, payment or foregone interest or Reimbursement
Obligation or other sum.
9.7. CAPITAL ADEQUACY. If after the date hereof any Bank or the Agent
determines that (i) the adoption of or change in any law, governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law) regarding capital requirements for banks or bank holding companies or any
change in the interpretation or application thereof by a court or governmental
authority with appropriate jurisdiction or (ii) compliance by such Bank or the
Agent or any corporation controlling such Bank or the Agent with any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) of any such entity regarding capital adequacy, has the
effect of reducing the return on such Bank's or the Agent's Commitments with
respect to any Loans or Letters of Credit to a level below that which such Bank
or the Agent could have achieved but for such adoption, change or compliance
(taking into consideration such Bank's or the Agent's then existing policies
with respect to capital adequacy and assuming full utilization of such entity's
capital) by any amount deemed by such Bank or (as the case may be) the Agent to
be material, then such Bank or the Agent may notify the Borrower of such fact.
To the extent that the amount of such reduction in the return on
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capital is not reflected in the Base Rate or the Eurodollar Rate, as the case
may be, the Borrower agrees to pay such Bank or (as the case may be) the Agent
the amount of such reduction in the return on capital as and when such reduction
is determined upon presentation by such Bank or (as the case may be) the Agent
of a certificate in accordance with Section 9.8 hereof. Each Bank shall allocate
such cost increases among its customers in good faith and on an equitable basis.
9.8. CERTIFICATE. A certificate setting forth any additional amounts
payable pursuant to Sections 9.6 or 9.7 and a brief explanation of such amounts
which are due, submitted by any Bank or the Agent to the Borrower, shall be
conclusive, absent manifest error, that such amounts are due and owing.
9.9. INDEMNITY. The Borrower agrees to indemnify each Bank and to hold
each Bank harmless from and against any loss, cost or expense (including any
such loss or expense arising from interest or fees payable by such Bank to
lenders of funds obtained by it in order to maintain its Eurodollar Rate Loans
and including loss of anticipated profits of such Bank) that such Bank may
sustain or incur as a consequence of (i) default by the Borrower in payment of
the principal amount of or any interest on any Eurodollar Rate Loans as and when
due and payable, (ii) default by the Borrower in making a borrowing or
conversion after the Borrower has given (or is deemed to have given) a Loan
Request, notice (in the case of all or any portion of the Term Loans pursuant to
Section 4.5.3) of a Conversion Request, or (iii) the making of any payment of a
Eurodollar Rate Loan or the making of any conversion of any such Loan to a Base
Rate Loan on a day that is not the last day of the applicable Interest Period
with respect thereto.
9.10. INTEREST AFTER DEFAULT.
9.10.1. OVERDUE AMOUNTS. Overdue principal and (to the extent
permitted by applicable law) interest on the Loans and all other overdue
amounts payable hereunder or under any of the other Loan Documents shall
bear interest compounded monthly and payable on demand at a rate per
annum equal to two percent (2%) above the Base Rate until such amount
shall be paid in full (after as well as before judgment).
9.10.2. AMOUNTS NOT OVERDUE. During the continuance of a Default
or an Event of Default the principal of the Loans not overdue shall,
after notice to the Borrower from the Agent, until such Default or Event
of Default has been cured or remedied or such Default or Event of
Default has been waived by the Majority Banks pursuant to Section 30,
bear interest at a rate per annum equal to
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the greater of (i) two percent (2%) above the rate of interest otherwise
applicable to such Loans and (ii) the rate of interest applicable to
overdue principal pursuant to Section 9.10.1.
10. COLLATERAL SECURITY AND GUARANTIES.
10.1. SECURITY OF BORROWER. The Obligations shall be secured by a
perfected first priority security interest (subject only to Permitted Liens
entitled to priority under applicable law) in substantially all of the assets of
the Borrower, whether now owned or hereafter acquired, pursuant to the terms of
the Security Documents to which the Borrower is a party; provided, that the
Borrower shall not be required to pledge to the Agent more than 65% of the
capital stock of any Foreign Subsidiary to the extent that the pledge of more
than 65% of such stock would cause material adverse tax consequences to the
Borrower.
10.2. GUARANTIES AND SECURITY OF SUBSIDIARIES. The Obligations shall be
guaranteed by all of the Domestic Subsidiaries of the Borrower. The obligations
of such Domestic Subsidiaries shall be secured by a perfected first priority
security interest (subject only to Permitted Liens entitled to priority under
applicable law) in substantially all of the assets of each such Domestic
Subsidiary, pursuant to the terms of the Security Documents to which such
Domestic Subsidiaries are a party.
10.3. NEGATIVE PLEDGE AND DOUBLE NEGATIVE PLEDGE. The Borrower will not,
nor will it permit any of its Subsidiaries to, (i) grant any lien, security
interest or other encumbrance to any Person other than the Agent for the benefit
of the Banks, except for Permitted Liens, as further provided in Section 13.2 or
(ii) enter into any covenant or agreement with any Person other than the Banks
and the Agent pursuant to which it agrees not to grant any lien, security
interest or other encumbrance in favor of any other Person, as further provided
in Section 13.12.
11. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Banks and the Agent as
follows:
11.1. CORPORATE AUTHORITY.
11.1.1. INCORPORATION; GOOD STANDING. Each of the Borrower and
its Subsidiaries (i) is a corporation duly organized, validly existing
and in good standing under the laws of its state of incorporation, (ii)
has all requisite corporate power to own its property and conduct its
business as now conducted and as presently contemplated, and (iii) is in
good standing as a foreign corporation and is duly authorized to do
business in each jurisdiction where such qualification is necessary
except where a
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failure to be so qualified would not have a materially adverse effect on
the business, assets or financial condition of the Borrower or such
Subsidiary.
11.1.2. AUTHORIZATION. The execution, delivery and performance of
this Credit Agreement and the other Loan Documents to which the Borrower
or any of its Subsidiaries is a party and the transactions contemplated
hereby and thereby (i) are within the corporate authority of such
Person, (ii) have been duly authorized by all necessary corporate
proceedings, (iii) do not conflict with or result in any breach or
contravention of any provision of law, statute, rule or regulation to
which the Borrower or any of its Subsidiaries is subject or any
judgment, order, writ, injunction, license or permit applicable to the
Borrower or any of its Subsidiaries, except where such conflict would
not have a materially adverse effect on the business, assets or
financial condition of the Borrower and its Subsidiaries (taken as a
whole), (iv) do not conflict with any provision of the corporate charter
or bylaws of the Borrower or any of its Subsidiaries, and (v) do not
conflict with any provision of any agreement of, or other instrument
binding upon, the Borrower or any of its Subsidiaries.
11.1.3. ENFORCEABILITY. The execution and delivery of this
Credit Agreement and the other Loan Documents to which the Borrower or
any of its Subsidiaries is a party will result in valid and legally
binding obligations of such Person enforceable against it in accordance
with the respective terms and provisions hereof and thereof, except as
enforceability is limited by bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or affecting generally the
enforcement of creditors' rights and except to the extent that
availability of the remedy of specific performance or injunctive relief
is subject to the discretion of the court before which any proceeding
therefor may be brought.
11.2. GOVERNMENTAL APPROVALS. The execution, delivery and performance by
the Borrower and any of its Subsidiaries of this Credit Agreement and the other
Loan Documents to which the Borrower or any of its Subsidiaries is a party, the
transactions contemplated hereby and thereby do not require the approval or
consent of, or filing with, any governmental agency or authority other than
those already obtained.
11.3. TITLE TO PROPERTIES; LEASES. Except as indicated on Schedule 11.3
hereto, the Borrower and its Subsidiaries own or lease, as indicated thereon,
all of the assets reflected in the consolidated balance sheet of the Borrower
and its Subsidiaries as at the Balance Sheet Date, subject to no rights of
others, including any mortgages, leases,
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conditional sales agreements, title retention agreements, liens or other
encumbrances except Permitted Liens.
11.4. FINANCIAL STATEMENTS.
11.4.1. FINANCIAL STATEMENTS. There has been furnished to each of
the Banks a consolidated balance sheet of Borrower and its Subsidiaries
as at the Balance Sheet Date and the consolidated statements of income
and cash flows of the Borrower and its Subsidiaries for the fiscal year
ended on such date, certified by Deloitte & Touche LLP. Such balance
sheets, statements of income and cash flows have been prepared in
accordance with generally accepted accounting principles and fairly
present the financial condition of Borrower as at the close of business
on the date thereof and the results of operations for the fiscal year
then ended. There are no contingent liabilities of the Borrower or any
of its Subsidiaries as of such date involving material amounts required
to be shown on such balance sheet, known to the officers of the
Borrower, which were not disclosed in such balance sheets and the notes
related thereto.
11.4.2. PROJECTIONS. The projections of the annual operating
budgets of the Borrower and its Subsidiaries on a consolidated basis,
balance sheets and cash flow statements for the 1999 through 2004 fiscal
years, copies of which have been delivered to each Bank prior to the
Closing Date, and subsequent projections delivered pursuant to Section
12.4(g), have been prepared in good faith based upon reasonable
assumptions with respect to general economic, financial and market
conditions. To the knowledge of the Borrower, no facts exist that
(individually or in the aggregate) would reasonably be expected to
result in any material adverse change in any of such projections. The
projections are based upon estimates and assumptions that the Borrower
believe are reasonable, have been prepared on the basis of the
assumptions stated therein and reflect the reasonable estimates of the
Borrower of the results of operations and other information projected
therein.
11.5. NO MATERIAL CHANGES, ETC. Since the Balance Sheet Date there has
occurred no materially adverse change in the financial condition or business of
the Borrower and its Subsidiaries as shown on or reflected in the consolidated
balance sheet of the Borrower and its Subsidiaries as at the Balance Sheet Date,
or the consolidated statement of income for the fiscal year then ended, other
than changes in the ordinary course of business that have not had any materially
adverse effect on the business or financial condition of the Borrower
individually
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or on the Borrower and its Subsidiaries taken as a whole. Since the Balance
Sheet Date the Borrower has not made any Restricted Payments other than the
repurchase of (i) the Borrower's common stock in the amount of $4,686,000 and
(ii) Subordinated Debt in the principal amount of $4,025,000.
11.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. Except as set forth on
Schedule 11.6, each of the Borrower and its Subsidiaries possesses all
franchises, patents, copyrights, trademarks, trade names, licenses and permits,
and rights in respect of the foregoing, adequate for the conduct of its business
substantially as now conducted without known conflict with any rights of others.
11.7. LITIGATION. Except as set forth in Schedule 11.7 hereto, there are
no actions, suits, proceedings or investigations of any kind pending or
threatened against the Borrower or any of its Subsidiaries before any court,
tribunal or administrative agency or board that, if adversely determined, could
reasonably be expected, either in any case or in the aggregate, to materially
adversely affect the properties, assets, financial condition or business of the
Borrower and its Subsidiaries or materially impair the right of the Borrower and
its Subsidiaries, considered as a whole, to carry on business substantially as
now conducted by them, or result in any substantial liability not adequately
covered by insurance, or for which adequate reserves are not maintained on the
consolidated balance sheet of the Borrower and its Subsidiaries, or which
question the validity of this Credit Agreement or any of the other Loan
Documents, or any action taken or to be taken pursuant hereto or thereto.
11.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. None of the Borrower nor any
of its Subsidiaries is subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation that has or is
expected in the future to have a materially adverse effect on the business,
assets or financial condition of the Borrower or any of its Subsidiaries. None
of the Borrower nor any of its Subsidiaries is a party to any contract or
agreement that has or is expected, in the judgment of the Borrower's officers,
to have any materially adverse effect on the business of the Borrower or any of
its Subsidiaries or on the ability of any such Person to consummate the
transactions contemplated hereby.
11.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. None of the Borrower
nor any of its Subsidiaries is in violation of any provision of its charter
documents, bylaws, or any agreement or instrument to which it may be subject or
by which it or any of its properties may be bound or any decree, order,
judgment, statute, license, rule or regulation, in any of
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the foregoing cases in a manner that could reasonably be expected to result in
the imposition of substantial penalties or materially and adversely affect the
financial condition, properties or business of the Borrower or any of its
Subsidiaries.
11.10. TAX STATUS. The Borrower and its Subsidiaries (i) have made or
filed all federal and state income and all other tax returns, reports and
declarations required by any jurisdiction to which any of them is subject, (ii)
have paid all taxes and other governmental assessments and charges shown or
determined to be due on such returns, reports and declarations, except those
being contested in good faith and by appropriate proceedings and (iii) have set
aside on their books provisions reasonably adequate for the payment of all taxes
for periods subsequent to the periods to which such returns, reports or
declarations apply. There are no unpaid taxes in any material amount claimed to
be due by the taxing authority of any jurisdiction from the Borrower or any of
its Subsidiaries, except those being contested in good faith and for which
adequate reserves with respect thereto have been set aside by such Person, and
the officers of the Borrower know of no basis for any such claim.
11.11. NO EVENT OF DEFAULT. No Default or Event of Default has occurred
and is continuing.
11.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. None of the Borrower
nor any of its Subsidiaries is a "holding company", or a "subsidiary company" of
a "holding company", or an "affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935; nor is any such
Person an "investment company", or an "affiliated company" or a "principal
underwriter" of an "investment company", as such terms are defined in the
Investment Company Act of 1940.
11.13. ABSENCE OF FINANCING STATEMENTS, ETC. Except with respect to
Permitted Liens, there is no financing statement, security agreement, chattel
mortgage, real estate mortgage or other document filed or recorded with any
filing records, registry or other public office, that purports to cover, affect
or give notice of any present or possible future lien on, or security interest
in, any assets or property of the Borrower or any of its Subsidiaries or any
rights relating thereto.
11.14. PERFECTION OF SECURITY INTEREST. All filings, assignments,
pledges and deposits of documents or instruments have been made and all other
actions have been taken that are necessary or advisable, under applicable law,
to establish and perfect the Agent's first-priority security interest in the
Collateral. The Collateral and the Agent's rights with
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respect to the Collateral are not subject to any setoff, claims, withholdings or
other defenses. The Borrower or a Subsidiary is the owner of the Collateral free
from any lien, security interest, encumbrance and any other claim or demand,
except for Permitted Liens.
11.15. CERTAIN TRANSACTIONS. None of the officers, directors, or
employees of the Borrower or any of its Subsidiaries is presently a party to any
transaction with the Borrower or any of its Subsidiaries (other than for
services as employees, officers and directors), including any contract,
agreement or other arrangement relating to the payment of management fees or
providing for the furnishing of services to or by, providing for rental of real
or personal property to or from, or otherwise requiring payments to or from any
officer, director or such employee or, to the knowledge of the Borrower, any
corporation, partnership, trust or other entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director,
trustee or partner.
11.16. EMPLOYEE BENEFIT PLANS.
11.16.1. IN GENERAL. Each Employee Benefit Plan and each
Guaranteed Pension Plan has been maintained and operated in compliance
in all material respects with the provisions of ERISA and, to the extent
applicable, the Code, including but not limited to the provisions
thereunder respecting prohibited transactions and the bonding of
fiduciaries and other persons handling plan funds as required by Section
412 of ERISA. The Borrower has heretofore delivered to the Agent the
most recently completed annual report, Form 5500, with all required
attachments, and actuarial statement required to be submitted under
Section 103(d) of ERISA, with respect to each Guaranteed Pension Plan.
11.16.2. TERMINABILITY OF WELFARE PLANS. No Employee Benefit Plan
which is an employee welfare benefit plan within the meaning of Section
3(1) or Section 3(2)(B) of ERISA, provides benefit coverage subsequent
to termination of employment, except as required by Title I, Part 6 of
ERISA, or applicable state insurance laws. The Borrower or an ERISA
Affiliate, as appropriate, may terminate each such Plan at any time (or
at any time subsequent to the expiration of any applicable bargaining
agreement) in the discretion of the Borrower or such ERISA Affiliate
without liability to any Person, other than for claims arising prior to
termination.
11.16.3. GUARANTEED PENSION PLANS. Each contribution required to
be made to a Guaranteed Pension Plan, whether required to be made to
avoid the incurrence of an accumulated funding deficiency, the notice or
lien provisions of Section 302(f) of ERISA,
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or otherwise, has been timely made. No waiver of an accumulated funding
deficiency or extension of amortization periods has been received with
respect to any Guaranteed Pension Plan and none of the Borrower nor any
ERISA Affiliate is obligated to or has posted security in connection
with an amendment to a Guaranteed Pension Plan pursuant to Section 307
of ERISA or Section 401(a)(29) of the Code. No liability to the PBGC
(other than required insurance premiums, all of which have been paid)
has been incurred by the Borrower or any ERISA Affiliate with respect to
any Guaranteed Pension Plan and there has not been any ERISA Reportable
Event, or any other event or condition which presents a material risk of
termination of any Guaranteed Pension Plan by the PBGC. Based on the
latest valuation of each Guaranteed Pension Plan (which in each case, if
required by ERISA, occurred within twelve months of the date of this
representation), and on the actuarial methods and assumptions employed
for that valuation, the aggregate benefit liabilities of all such
Guaranteed Pension Plans within the meaning of Section 4001 of ERISA did
not exceed the aggregate value of the assets of all such Guaranteed
Pension Plans, disregarding for this purpose the benefit liabilities and
assets of any Guaranteed Pension Plan with assets in excess of benefit
liabilities.
11.16.4. MULTIEMPLOYER PLANS. Neither the Borrower nor any ERISA
Affiliate has incurred any material liability (including secondary
liability) to any Multiemployer Plan as a result of a complete or
partial withdrawal from such Multiemployer Plan under Section 4201 of
ERISA or as a result of a sale of assets described in Section 4204 of
ERISA. Neither the Borrower nor any ERISA Affiliate has been notified
that any Multiemployer Plan is in reorganization or insolvent under and
within the meaning of Section 4241 or Section 4245 of ERISA or that any
Multiemployer Plan intends to terminate or has been terminated under
Section 4041A of ERISA.
11.17. USE OF PROCEEDS; REGULATIONS U AND X. The proceeds of the Term
Loan will be used solely to fund the repayment of the Borrower's Indebtedness
under the Prior Credit Agreement and certain other existing Indebtedness
(including lease financings) of the Borrower and certain Subsidiaries. The
proceeds of the Revolving Credit Loans will be used solely for working capital
and general corporate purposes and to cover Reimbursement Obligations in
accordance with Section 2.6.2. The proceeds of the Acquisition Loans will be
used solely to fund (i) the purchase price of Permitted Acquisitions, (ii)
Restricted Capital Expenditures otherwise permitted under this Credit Agreement,
and (iii) the repurchase or redemption of up to $7,000,000 in respect of the
Subordinated Debt. The Borrower will obtain Letters of Credit solely for working
capital purposes and, in the case of the IRB Letter of Credit and
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any replacement therefor issued hereunder, to support the Borrower's obligations
under the Bond Documents. No portion of any Loan is to be used, and no portion
of any Letter of Credit is to be obtained, for the purpose of purchasing or
carrying any "margin security" or "margin stock" as such terms are used in
Regulations U and X of the Board of Governors of the Federal Reserve System, 12
C.F.R. Parts 221 and 224.
11.18. ENVIRONMENTAL COMPLIANCE. The Borrower has taken all appropriate
steps to investigate the past and present condition and usage of the Real Estate
and the operations conducted thereon and, based upon such diligent
investigation, has determined that, except as set forth on Schedule 11.18:
(a) none of the Borrower, its Subsidiaries or any operator of the
Real Estate or any operations thereon is in violation, nor have they
received from any governmental authority a written allegation of any
violation of any judgment, decree, order, law, license, rule or
regulation pertaining to environmental matters, including without
limitation, those arising under the Resource Conservation and Recovery
Act ("RCRA"), the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 as amended ("CERCLA"), the Superfund Amendments
and Reauthorization Act of 1986 ("XXXX"), the Federal Clean Water Act,
the Federal Clean Air Act, the Toxic Substances Control Act, or any
state or local statute, regulation, ordinance, order or decree relating
to health, safety or the environment (hereinafter "Environmental Laws"),
which violation would have a material adverse effect on the business,
assets or financial condition of the Borrower or any of its
Subsidiaries;
(b) none of the Borrower nor any of its Subsidiaries has
received notice from any third party including, without limitation, any
federal, state or local governmental authority, (i) that any of them has
been identified by the United States Environmental Protection Agency
("EPA") as a potentially responsible party under CERCLA with respect to
a site listed on the National Priorities List, 40 C.F.R. Part 000
Xxxxxxxx X; (ii) that any hazardous waste, as defined by 42 U.S.C.
Section 6903(5), any hazardous substances as defined by 42 U.S.C.
Section 9601(14), any pollutant or contaminant as defined by 42 U.S.C.
Section 9601(33) and any toxic substances, oil or hazardous materials or
other chemicals or substances regulated by any Environmental Laws
("Hazardous Substances") which any of them has generated, transported or
disposed of has been found at any site at which a federal, state or
local agency or other third party has conducted, or has ordered that any
of the Borrower or any of its Subsidiaries conduct, a remedial
investigation, removal
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or other response action pursuant to any Environmental Law; or (iii)
that it is or shall be a named party to any claim, action, cause of
action, complaint, or legal or administrative proceeding (in each case,
contingent or otherwise) arising out of any third party's incurrence of
costs, expenses, losses or damages of any kind whatsoever in connection
with the release of Hazardous Substances;
(c) (i) no portion of the Real Estate has been used for the
handling, processing, storage or disposal of Hazardous Substances except
in accordance with applicable Environmental Laws; and no underground
tank or other underground storage receptacle for Hazardous Substances is
located on any portion of the Real Estate; (ii) in the course of any
activities conducted by the Borrower or its Subsidiaries or operators of
its properties, no Hazardous Substances have been generated or are being
used on the Real Estate except in accordance with applicable
Environmental Laws; (iii) except in accordance with applicable
Environmental Laws, there have been no Releases or threatened Releases
of Hazardous Substances on, upon, into or from the properties of the
Borrower or its Subsidiaries, which releases would have a material
adverse effect on the value of any of the Real Estate or adjacent
properties or the environment; (iv) to the best of the Borrower's
knowledge, there have been no releases on, upon, from or into any real
property in the vicinity of any of the Real Estate which, through soil
or groundwater contamination, may have come to be located on, and which
would have a material adverse effect on the value of, the Real Estate;
and (v) in addition, any Hazardous Substances that have been generated
on any of the Real Estate have been transported offsite only by carriers
having an identification number issued by the EPA, treated or disposed
of only by treatment or disposal facilities maintaining valid permits as
required under applicable Environmental Laws, which transporters and
facilities have been and are, to the best of the Borrower's knowledge,
operating in compliance with such permits and applicable Environmental
Laws; and
(d) None of the Borrower or any of its Subsidiaries is obligated
under any applicable Environmental Law to (i) perform Hazardous
Substances site assessments, (ii) remove or remediate Hazardous
Substances, (iii) give notice to any governmental agency or (iv) record
or deliver to other Persons an environmental disclosure document or
statement by virtue of the transactions set forth herein and
contemplated hereby, or as a condition to the recording of any mortgage
or to the effectiveness of any other transactions contemplated hereby.
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11.19. SUBSIDIARIES, ETC. The only Subsidiaries of the Borrower are
listed on Schedule 11.19 hereto. Neither the Borrower nor any Subsidiary of the
Borrower is engaged in any joint venture or partnership with any other Person.
11.20. BANK ACCOUNTS. Schedule 11.20 (as such Schedule may be updated
from time to time in accordance with Section 13.9) sets forth the account
numbers and location of all bank accounts of the Borrower and each of its
Subsidiaries.
11.21. SUBORDINATED DEBT DOCUMENTS; BOND DOCUMENTS. The Borrower has
furnished to the Agent true, correct and complete copies of the Subordinated
Debt Documents and the Bond Documents. None of the Subordinated Debt Documents
or the Bond Documents has been amended, modified or supplemented, except as
permitted by Section 13.17. Each of the representations of the Borrower
contained in the Subordinated Debt Documents and the Bond Documents was true and
correct in all material respects when made and continues to be true and correct
in all material respects except to the extent of changes resulting from
transactions contemplated or permitted by the Subordinated Debt Documents or the
Bond Documents, as the case may be, and except for changes occurring in the
ordinary course of business that singly or in the aggregate are not materially
adverse.
11.22. DISCLOSURE. No representation or warranty made by the Borrower or
any of its Subsidiaries in this Credit Agreement, the other Loan Documents or
any agreement, instrument, document, certificate, or other written statement
furnished to the Agent or any Bank by or on behalf of the Borrower or any of its
Subsidiaries in connection with any of the transactions contemplated hereby
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements contained therein not misleading
in light of the circumstances in which they are made.
11.23. FISCAL YEAR. The Borrower has a fiscal year which ends on June 30
of each year and fiscal quarters which end on September 30, December 31, March
31 and June 30 of each year.
11.24. SOLVENCY. Each of the Borrower, individually, and the Borrower
and its Subsidiaries, taken as a whole (both before and after giving effect to
the transactions contemplated by this Credit Agreement and the other Loan
Documents) (i) is solvent, (ii) has assets having a fair value in excess of its
liabilities, (iii) has assets having a fair value in excess of the amount
required to pay its liabilities on its debts as they become due and matured, and
(iv) has, and expects to continue to have, access to adequate capital for the
conduct of its business and the ability
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to pay its debts as they mature. In computing the amount of contingent and
unliquidated liabilities at any time, such liabilities will be computed as the
amount which, in light of all the facts and circumstances existing at such time,
represents the amount that is probable to become an absolute and matured
liability.
11.25. CHIEF EXECUTIVE OFFICES. The Borrower's chief executive office is
located at 0000 XxXxxxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000, at which
location its books and records are kept. The chief executive office of each
subsidiary of the Borrower is located opposite such Person's name on Schedule
11.25, at which location each such Person's books and records are kept.
11.26. INSURANCE. Each of the Borrower and its Subsidiaries maintains
with financially sound and reputable insurers insurance with respect to its
properties and businesses against such casualties and contingencies as is in
accordance with businesses engaged in similar activities in similar geographic
areas, and in amounts, containing such terms, in such forms and for such
periods, as may be reasonable and prudent and in accordance with the terms of
the Security Agreements.
11.27. YEAR 2000 PROBLEM. The Borrower and its Subsidiaries have (i)
reviewed the areas within their businesses and operations which could be
adversely affected by failure to become "Year 2000 Compliant" (i.e. that
computer applications, imbedded microchips and other systems used by the
Borrower or any of its Subsidiaries, will be able properly to recognize and
perform properly date-sensitive functions involving certain dates prior to and
any date after December 31, 1999), (ii) developed a detailed plan and timetable
to become Year 2000 Compliant in a timely manner, and (iii) committed adequate
resources to support the Year 2000 plan of the Borrower and its Subsidiaries.
Based upon such review, the Borrower reasonably believes that the Borrower and
its Subsidiaries will become "Year 2000 Compliant" in a timely manner except to
the extent that failure to do so will not have any materially adverse effect on
the business or financial condition of the Borrower or any of its Subsidiaries.
11.28. GOVERNMENT CONTRACTS. Schedule 11.28 contains a true and correct
list, as of Closing Date, in reasonable detail, of all contracts to which the
Borrower or any of its Subsidiaries is a party under which accounts, chattel
paper or general intangibles included in the Collateral arise from account
debtors that are governmental entities subject to the Federal Assignment of
Claims Act.
12. AFFIRMATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is
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outstanding or any Bank has any obligation to make any Loans, the Swing Line
Bank has any obligation to make Swing Line Loans or the Agent has any obligation
to issue, extend or renew any Letters of Credit:
12.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or
cause to be paid the principal and interest on the Loans, all Reimbursement
Obligations, the Letter of Credit Fees, the Commitment Fees and all other
amounts provided for in this Credit Agreement and the other Loan Documents to
which the Borrower or any of its Subsidiaries is a party, all in accordance with
the terms of this Credit Agreement and such other Loan Documents.
12.2. MAINTENANCE OF OFFICE. The Borrower will, and will cause its
Domestic Subsidiaries to, maintain its chief executive office at the address set
forth or referred to in Section 11.25, or at such other place in the United
States of America as the Borrower shall designate upon ten (10) days written
notice to the Agent, where notices, presentations and demands to or upon the
Borrower and such Subsidiaries in respect of the Loan Documents to which the
Borrower and such Subsidiaries are a party may be given or made.
12.3. RECORDS AND ACCOUNTS. The Borrower will (i) keep, and cause each
of its Subsidiaries to keep, true and accurate records and books of account in
which full, true and correct entries will be made in accordance with generally
accepted accounting principles, (ii) maintain adequate accounts and reserves for
all taxes (including income taxes), depreciation, depletion, obsolescence and
amortization of its properties and the properties of its Subsidiaries,
contingencies, and other reserves and (iii) at all times, engage Deloitte &
Touche LLP, or such other firm of independent certified public accountants as
shall be satisfactory to the Agent, as their independent certified public
accountants and will not permit more than thirty (30) days to elapse between the
cessation of such firm's (or any successor firm's) engagement as the independent
certified public accountants of the Borrower and the appointment to such
capacity of a successor firm as shall be satisfactory to the Agent.
12.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrower
will deliver or cause to be delivered to each of the Banks:
(a) as soon as practicable, but in any event not later than
ninety (90) days after the end of each fiscal year of the Borrower, the
consolidated balance sheet of the Borrower and its Subsidiaries as at
the end of such year, and the related consolidated statement of income
and consolidated statement of cash flow for such year, each setting
forth in comparative form the figures for the previous fiscal year and
all such consolidated statements to be in
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reasonable detail, prepared in accordance with generally accepted
accounting principles, and certified without qualification by Deloitte &
Touche LLP or by other independent certified public accountants
satisfactory to the Agent;
(b) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of the fiscal quarters of the
Borrower, copies of the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such quarter, and the
related consolidated statement of income and consolidated statement of
cash flow for the portion of the Borrower's fiscal year then elapsed,
all in reasonable detail and prepared in accordance with generally
accepted accounting principles, together with a certification by the
principal financial or accounting officer of the Borrower that the
information contained in such financial statements fairly presents the
financial position of the Borrower and its Subsidiaries on the date
thereof (subject to year-end adjustments);
(c) as soon as practicable, but in any event within thirty (30)
days after the end of each month in each fiscal year of the Borrower,
unaudited monthly consolidated financial statements of the Borrower and
its Subsidiaries for such month prepared in accordance with generally
accepted accounting principles, together with a certification by the
principal financial or accounting officer of the Borrower that the
information contained in such financial statements fairly presents the
financial condition of the Borrower and its Subsidiaries on the date
thereof (subject to year-end adjustments);
(d) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by
the principal financial or accounting officer of the Borrower in
substantially the form of Exhibit C hereto and setting forth in
reasonable detail computations evidencing compliance with the covenants
contained in Section 14 and (if applicable) reconciliations to reflect
changes in generally accepted accounting principles since the Balance
Sheet Date;
(e) simultaneously with the delivery of the financial statements
referred to in subsection (c) above, a Compliance Certificate setting
forth the reasonable detail computations evidencing compliance with the
covenant set forth in Section 14.5 and (if applicable) reconciliations
to reflect changes in generally accepted accounting principles since the
Balance Sheet Date;
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(f) contemporaneously with the filing or mailing thereof, copies
of all material of a financial nature filed with the Securities and
Exchange Commission or sent to the stockholders of the Borrower;
(g) simultaneously with the delivery of the financial statements
referred to in subsection (a) above, projections of the Borrower and its
Subsidiaries updating those projections delivered to the Banks and
referred to in Section 11.4.2;
(h) as soon as practicable, but in any event not later than the
last day of each fiscal year of the Borrower, an annual budget on a
quarterly basis for the Borrower and its Subsidiaries for the proceeding
fiscal year prepared in reasonable detail using reasonable assumptions;
(i) as soon as practicable, but in any event not later than the
last day of each fiscal year of the Borrower (or more frequently if
requested by the Agent or the Majority Banks), a list of contracts with
governmental authorities subject to the Federal Assignment of Claims Act
updating the list referred to in Section 11.28; and
(j) from time to time such other financial data and information
(including accountants and management letters) as the Agent or any Bank
may reasonably request.
12.5. NOTICES.
12.5.1. DEFAULTS. The Borrower will promptly, and in any event
within two (2) Business Days of the Borrower becoming aware thereof,
notify the Agent and each of the Banks in writing of the occurrence of
any Default or Event of Default. If any Person shall give any notice or
take any other action in respect of a claimed default (whether or not
constituting an Event of Default) under this Credit Agreement, the
Subordinated Debt Documents, the Bond Documents or any other note,
evidence of indebtedness, indenture or other obligation to which or with
respect to which the Borrower or any of its Subsidiaries is a party or
obligor, whether as principal, surety or otherwise, the Borrower shall
forthwith give written notice thereof to the Agent and each of the
Banks, describing the notice or action and the nature of the claimed
default.
12.5.2. ENVIRONMENTAL EVENTS. The Borrower will promptly, and in
any event within ten (10) Business Days after becoming aware thereof,
give notice to the Agent (i) of any material violation of any
Environmental Law that the Borrower or any of its
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Subsidiaries reports in writing or is required to report in writing and
of which such Person has or should have knowledge (or for which any
written report supplemental to any oral report is made) to any federal,
state or local environmental agency, (ii) any Releases of Hazardous
Substances on, upon, into or from the properties of the Borrower or its
Subsidiaries if remediation of such condition would result in costs in
excess of $10,000, and (iii) upon becoming aware thereof, of any
inquiry, proceeding, investigation, or other action, including a notice
from any agency of potential environmental liability, of any federal,
state or local environmental agency or board, in each case that has the
likelihood to materially affect the assets, liabilities, financial
conditions or operations of the Borrower or any of its Subsidiaries, or
the Agent's security interests pursuant to the Security Documents.
12.5.3. NOTIFICATION OF CLAIMS AGAINST COLLATERAL. The Borrower
will, immediately upon becoming aware thereof, notify the Agent in
writing of any setoff, claims (including, with respect to the Real
Estate, environmental claims), withholdings or other defenses to which
any of the Collateral, or the Agent's rights with respect to the
Collateral, are subject.
12.5.4. NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will,
and will cause each of its Subsidiaries to, give notice to the Agent in
writing within fifteen (15) days of becoming aware of any litigation or
proceedings threatened in writing or any pending litigation and
proceedings affecting the Borrower or any of its Subsidiaries or to
which the Borrower or any of its Subsidiaries is or becomes a party
involving an uninsured claim against the Borrower or any of its
Subsidiaries that could reasonably be expected to have a materially
adverse effect on the Borrower or any of its Subsidiaries or which
question the validity of the transactions contemplated hereby or any of
the Loan Documents, and stating the nature and status of such litigation
or proceedings. The Borrower will, and will cause each of its
Subsidiaries to, give notice to the Agent in writing, in form and detail
satisfactory to the Agent, within ten (10) days of any judgment not
covered by insurance, final or otherwise, against the Borrower or any of
its Subsidiaries in an amount in excess of $250,000.
12.5.5. NOTICE OF MATERIAL ADVERSE CHANGE. The Borrower will
promptly, and in any event within two (2) Business Days of the Borrower
becoming aware thereof, notify the Agent and the Banks of any material
adverse change in the business, assets, condition (financial or
otherwise) or prospects of the Borrower and its Subsidiaries, taken as a
whole.
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12.6. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES. The Borrower will
do or cause to be done all things necessary to preserve and keep in full force
and effect its corporate existence, rights and franchises and those of its
Subsidiaries and will not, and will not cause or permit any of its Subsidiaries
to, convert to a limited liability company. The Borrower (i) will cause all of
its properties and those of its Subsidiaries used or useful in the conduct of
its business or the business of its Subsidiaries to be maintained and kept in
good condition, repair and working order (except for ordinary wear and tear) and
supplied with all necessary equipment, (ii) will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in
the judgment of the Borrower may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times,
and (iii) will, and will cause each of its Subsidiaries to, continue to engage
primarily in the businesses now conducted by them and in related businesses;
provided that nothing in this Section 12.6 shall prevent the Borrower from
discontinuing the operation and maintenance of any of its properties or any of
those of its Subsidiaries or from dissolving any Subsidiary of the Borrower if
such discontinuance or dissolution is, in the judgment of the Borrower,
desirable in the conduct of its or their business and does not materially
adversely affect the business of the Borrower and its Subsidiaries on a
consolidated basis.
12.7. INSURANCE. The Borrower will, and will cause each of its
Subsidiaries to, maintain with financially sound and reputable insurers
insurance with respect to its properties and business against such casualties
and contingencies as shall be in accordance with the general practices of
businesses engaged in similar activities in similar geographic areas and in
amounts, containing such terms, in such forms and for such periods as may be
reasonable and prudent and in accordance with the terms of the Security
Agreements.
12.8. TAXES. The Borrower will, and will cause each of its Subsidiaries
to, duly pay and discharge, or cause to be paid and discharged, before the same
shall become overdue, all taxes, assessments and other governmental charges
imposed upon it and its real properties, sales and activities, or any part
thereof, or upon the income or profits therefrom, as well as all claims for
labor, materials, or supplies that if unpaid might by law become a lien or
charge upon any of its property; provided that any such tax, assessment, charge,
levy or claim need not be paid if the validity or amount thereof shall currently
be contested in good faith by appropriate proceedings and if the Borrower or
such Subsidiary shall have set aside on its books adequate reserves with respect
thereto; and provided further that the Borrower and each of its Subsidiaries
will pay all such taxes, assessments, charges, levies or
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claims forthwith upon the commencement of proceedings to foreclose any lien that
may have attached as security therefor.
12.9. INSPECTION OF PROPERTIES AND BOOKS, ETC.
12.9.1. GENERAL. The Borrower shall permit the Banks, through the
Agent, to visit and inspect any of the properties of the Borrower or any
of its Subsidiaries, to examine the books of account of the Borrower and
its Subsidiaries (and to make copies thereof and extracts therefrom),
and to discuss the affairs, finances and accounts of the Borrower and
its Subsidiaries with, and to be advised as to the same by, its and
their officers, all at such reasonable times and intervals as the Agent
or any Bank may reasonably request.
12.9.2. APPRAISALS. Upon the request of the Agent or the Majority
Banks, the Borrower will from time to time obtain and deliver to the
Agent appraisal reports in form and substance and from appraisers
satisfactory to the Agent, stating (i) the then current fair market,
orderly liquidation and forced liquidation values of all or any portion
of the equipment or real estate owned by the Borrower or any of its
Subsidiaries and (ii) the then current business value of each of the
Borrower and its Subsidiaries. All such appraisals shall be conducted
and made at the expense of the Borrower if a Default or Event of Default
shall have occurred and be continuing and at the expense of the Banks
(ratably in accordance with their respective portions of the Total
Commitment) at all other times.
12.9.3. ENVIRONMENTAL ASSESSMENTS. The Agent may, at the
discretion of the Agent or at the request of the Majority Banks, for the
purpose of assessing and ensuring the value of any Mortgaged Property,
obtain from time to time one or more environmental assessments or audits
of such Mortgaged Property prepared by a hydrogeologist, an independent
engineer or other qualified consultant or expert approved by the Agent
to evaluate or confirm (i) whether any Hazardous Materials are present
in the soil or water at such Mortgaged Property and (ii) whether the use
and operation of such Mortgaged Property complies with all Environmental
Laws. Environmental assessments may include without limitation detailed
visual inspections of such Mortgaged Property including any and all
storage areas, storage tanks, drains, dry xxxxx and leaching areas, and
the taking of soil samples, surface water samples and ground water
samples, as well as such other investigations or analyses as the Agent
deems appropriate. All such environmental assessments shall be conducted
and made
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at the expense of the Borrower (x) if a Default or Event of Default
shall have occurred and be continuing, (y) in the event the Borrower or
a Subsidiary acquires additional Mortgaged Property pursuant to Section
12.13; provided that such environmental assessment shall be limited to
such additional Mortgaged Property, or (z) if the Agent or the Majority
Banks reasonably believe (pursuant to a notice delivered in accordance
with Section 12.5.2 or otherwise) that there could be Hazardous
Materials present in the soil or water at such Mortgaged Property or
that the use and operation of such Mortgaged Property may not comply
with all Environmental Laws. At all other times such environmental
assessments shall be at the expense of the Banks (ratably in accordance
with their respective portions of the Total Commitment).
12.9.4. COMMUNICATIONS WITH ACCOUNTANTS. The Borrower authorizes
the Agent and, if accompanied by the Agent, the Banks to communicate
directly with the Borrower's independent certified public accountants
and authorizes such accountants to disclose to the Agent and the Banks
any and all financial statements and other supporting financial
documents and schedules including copies of any management letter with
respect to the business, financial condition and other affairs of the
Borrower or any of its Subsidiaries; provided that such accountants
shall not be required to disclose to the Agent or the Banks any
information that is the subject of a legally privileged communication
with the Borrower. At the request of the Agent, the Borrower shall
deliver a letter addressed to such accountants instructing them to
comply with the provisions of this Section 12.9.4.
12.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The
Borrower will, and will cause each of its Subsidiaries to, comply with (i) the
applicable laws and regulations wherever its business is conducted, including
all Environmental Laws, (ii) the provisions of its charter documents and
by-laws, (iii) all agreements and instruments by which it or any of its
properties may be bound and (iv) all applicable decrees, orders, and judgments
except, in each case, where the failure to do so would not have a material
adverse effect on the business, assets or financial condition of the Borrower
and its Subsidiaries, taken as a whole. If any authorization, consent, approval,
permit or license from any officer, agency or instrumentality of any government
shall become necessary or required in order that the Borrower or any of its
Subsidiaries may fulfill any of its obligations hereunder or any of the other
Loan Documents to which the Borrower or such Subsidiary is a party, the Borrower
will, or (as the case may be) will cause such Subsidiary to, immediately take or
cause to be taken all reasonable steps within the power of the Borrower or such
Subsidiary to obtain such
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authorization, consent, approval, permit or license and furnish the Agent and
the Banks with evidence thereof.
12.11. EMPLOYEE BENEFIT PLANS. The Borrower will (i) promptly upon
filing the same with the Department of Labor or Internal Revenue Service,
furnish to the Agent upon request a copy of the most recent actuarial statement
required to be submitted under Section 103(d) of ERISA and Annual Report, Form
5500, with all required attachments, in respect of each Guaranteed Pension Plan
and (ii) promptly upon receipt or dispatch, furnish to the Agent any notice,
report or demand sent or received in respect of a Guaranteed Pension Plan under
Sections 302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or in
respect of a Multiemployer Plan, under Sections 4041A, 4202, 4219, 4242, or 4245
of ERISA.
12.12. USE OF PROCEEDS. The Borrower will use the proceeds of the Loans
and will obtain Letters of Credit solely for the purposes described in Section
11.17.
12.13. ADDITIONAL MORTGAGED PROPERTY. If, after the Closing Date, the
Borrower or any of its Subsidiaries acquires any real estate with a value in
excess of $1,000,000 (other than real estate subject to a purchase money
security interest permitted by Section 13.2(h)), the Borrower shall, or shall
cause such Subsidiary to, forthwith deliver to the Agent a fully executed
mortgage or deed of trust over such real estate, in form and substance
reasonably satisfactory to the Agent, together with title insurance policies,
surveys, evidences of insurance with the Agent named as loss payee and
additional insured, legal opinions and other documents and certificates with
respect to such real estate as the Agent may reasonably request. The Borrower
further agrees that, following the taking of such actions with respect to such
real estate, the Agent shall have for the benefit of the Banks and the Agent a
valid and enforceable first priority mortgage or deed of trust covering such
real estate, free and clear of all liens and encumbrances except for Permitted
Liens.
12.14. BANK ACCOUNTS. The Borrower will, and will cause each of its
Subsidiaries to, together with the employees, agents and other Persons acting on
behalf of the Borrower or such Subsidiary, cause all payments constituting
proceeds of Accounts Receivable or other Collateral to be paid, in the form
received, with any appropriate endorsements, in one of the accounts listed on
Schedule 11.20.
12.15. INTEREST RATE PROTECTION ARRANGEMENTS. Not later than ninety (90)
days after the Closing Date, the Borrower shall have entered into interest rate
protection arrangements with BKB or one of the other Banks for a notional amount
of not less than $7,500,000, for a term of
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not less than two (2) years, and on such other terms and conditions, including,
without limitation, with respect to the interest rate cap applicable to such
arrangements, as shall be reasonably satisfactory to the Agent.
12.16. ADDITIONAL LANDLORD CONSENTS. The Borrower will use reasonable
efforts to deliver to the Agent, no later than ninety (90) days after the
Closing Date, all consents required for the Agent to receive a security interest
under the Uniform Commercial Code (to the extent applicable thereto) in the
interest of the Borrower and its Subsidiaries in such material leaseholds of
real property as may be requested by the Agent, together in each case with such
landlord's lien waivers and estoppel certificates as the Agent may request.
12.17. FURTHER ASSURANCES. The Borrower will, and will cause each of its
Subsidiaries to, cooperate with the Banks and the Agent and execute such further
instruments and documents as the Banks or the Agent shall reasonably request to
carry out to their satisfaction the transactions contemplated by this Credit
Agreement and the other Loan Documents.
13. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Bank
has any obligation to make any Loans, the Swing Line Bank has any obligation to
make Swing Line Loans or the Agent has any obligations to issue, extend or renew
any Letters of Credit:
13.1. RESTRICTIONS ON INDEBTEDNESS. The Borrower will not, nor will it
permit any of its Subsidiaries to, create, incur, assume, guarantee or be or
remain liable, contingently or otherwise, with respect to any Indebtedness other
than:
(a) Indebtedness to the Banks and the Agent arising under any of
the Loan Documents;
(b) current liabilities and other obligations that are not
overdue of the Borrower or such Subsidiary incurred in the ordinary
course of business not incurred through (i) the borrowing of money or
(ii) the obtaining of credit, except for credit on an open account basis
customarily extended and in fact extended in connection with normal
purchases of goods and services;
(c) Indebtedness in respect of taxes, assessments, governmental
charges or levies and claims for labor, materials and supplies to the
extent that payment therefor shall not at the time be required to be
made in accordance with the provisions of Section 12.8;
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(d) Indebtedness in respect of judgments or awards (i) that have
been in force for less than the applicable period for taking an appeal
so long as execution is not levied thereunder or (ii) in respect of
which the Borrower or such Subsidiary shall at the time in good faith be
prosecuting an appeal or proceedings for review and in respect of which
a stay of execution shall have been obtained pending such appeal or
review;
(e) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the
ordinary course of business;
(f) obligations under Capitalized Leases and Indebtedness
incurred in connection with the acquisition after the date hereof of any
real or personal property by the Borrower or such Subsidiary, provided
that (i) the aggregate principal amount of all such Indebtedness of the
Borrower and its Subsidiaries outstanding at any time shall not exceed
the amount of $5,000,000 and (ii) in each such case the principal amount
of such Indebtedness so incurred shall not exceed the cost of the real
or personal property so acquired;
(g) Indebtedness existing on the date hereof and listed and
described on Schedule 13.1 hereto;
(h) Indebtedness owing by Subsidiaries of the Borrower to the
Borrower, so long such Indebtedness is subordinated to the prior payment
in full of the Obligations and is evidenced by a promissory note that
shall have been pledged and delivered to the Agent as security for the
Obligations;
(i) the Subordinated Debt;
(j) Indebtedness arising out of the Bond Documents;
(k) Indebtedness incurred for the purpose of refinancing
Indebtedness described in clause (g) above; provided that such
refinancing Indebtedness (i) has a weighted average life to maturity no
shorter than the Indebtedness being refinanced, (ii) is on terms and
conditions no more onerous to the Borrower or such Subsidiary than the
Indebtedness being refinanced and (iii) is in a principal amount no
greater than the Indebtedness being refinanced; and
(l) other unsecured Indebtedness in an aggregate amount for all
such Indebtedness not to exceed $1,000,000 at any time, so long as
immediately after, and after giving effect to the incurrence
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of such Indebtedness, no Default or Event of Default shall have occurred
and be continuing.
13.2. RESTRICTIONS ON LIENS. The Borrower will not, nor will it permit
any of its Subsidiaries to, (i) create or incur or suffer to be created or
incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (ii) transfer any of such property or assets or the
income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (iii) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; (iv) suffer to
exist for a period of more than thirty (30) days after the same shall have been
incurred any Indebtedness or claim or demand against it that if unpaid might by
law or upon bankruptcy or insolvency, or otherwise, be given any priority
whatsoever over its general creditors; or (v) sell, assign, pledge or otherwise
transfer any accounts, contract rights, general intangibles, chattel paper or
instruments, with or without recourse (other than the license by the Borrower of
software owned by it in the ordinary course of business, consistent with past
practices); provided that the Borrower and any of its Subsidiaries may create or
incur or suffer to be created or incurred or to exist:
(a) liens in favor of the Borrower on all or part of the assets
of Subsidiaries of the Borrower securing Indebtedness permitted pursuant
to Section 13.1(h);
(b) liens to secure taxes, assessments and other government
charges in respect of obligations not overdue or liens to secure claims
for labor, material or supplies in respect of obligations not overdue;
(c) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
(d) liens in respect of judgments or awards, the Indebtedness
with respect to which is permitted by Section 13.1(d);
(e) liens of carriers, warehousemen, mechanics and materialmen,
and other like liens in existence less than one hundred twenty (120)
days from the date of creation thereof in respect of obligations not
overdue;
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(f) encumbrances on Real Estate consisting of easements, rights
of way, zoning restrictions, restrictions on the use of real property
and defects and irregularities in the title thereto, landlord's or
lessor's liens under leases to which the Borrower or a Subsidiary of the
Borrower is a party, and other minor liens or encumbrances none of which
in the opinion of the Borrower interferes materially with the use of the
property affected in the ordinary conduct of the business of the
Borrower and its Subsidiaries, which defects do not individually or in
the aggregate have a materially adverse effect on the business of the
Borrower individually or of the Borrower and its Subsidiaries on a
consolidated basis;
(g) liens existing on the date hereof and listed on Schedule
13.2 hereto;
(h) purchase money security interests in or purchase money
mortgages on real or personal property acquired after the date hereof to
secure purchase money Indebtedness of the type and amount permitted by
Section 13.1(f), incurred in connection with the acquisition of such
property, which security interests or mortgages cover only the real or
personal property so acquired; and
(i) liens in favor of the Agent for the benefit of the Banks and
the Agent under the Loan Documents.
13.3. RESTRICTIONS ON INVESTMENTS. The Borrower will not, nor will it
permit any of its Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America that mature within one (1) year from the date of
purchase by the Borrower or such Subsidiary;
(b) demand deposits, certificates of deposit, bankers acceptances
and time deposits of United States of America banks having total assets
in excess of $1,000,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States
of America or any state thereof that at the time of purchase have been
rated and the ratings for which are not less than "Prime-1" if rated by
Xxxxx'x Investors Services, Inc., and not less than "A-1" if rated by
Standard and Poor's Ratings Group;
(d) mutual funds that invest solely in the Investments described
in clauses (a), (b) or (c) above;
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(e) Investments existing on the date hereof and listed on
Schedule 13.3 hereto;
(f) Investments consisting of the Guaranties;
(g) (i) Investments by the Borrower in its Subsidiaries existing
on the Closing Date, (ii) Investments by the Borrower or any of its
Subsidiaries in a Guarantor, or (iii) Investments by the Borrower or any
of its Subsidiaries in (A) a Subsidiary that is not a Guarantor and (B)
joint ventures and Persons which are not Subsidiaries; provided the
aggregate amount of such Investments outstanding pursuant to this
subclause (iii) shall not, at any time, exceed $1,000,000;
(h) Investments in Permitted Acquisitions;
(i) Investments consisting of promissory notes received as
proceeds of asset dispositions permitted by Section 13.5.2;
(j) Investments consisting of loans and advances to employees for
moving, entertainment, travel and other similar expenses in the ordinary
course of business not to exceed $500,000 in the aggregate at any time
outstanding; and
(k) Investments consisting of minority interests in the capital
stock or other equity interests of businesses in the aviation industry
not to exceed $1,000,000 in the aggregate at any time;
provided, however, that, with the exception of demand deposits referred to in
Section 13.3(b), the Guaranties referred to in Section 13.3(f), and loans and
advances referred to in Section 13.3(j), such Investments will be considered
Investments permitted by this Section 13.3 only if all actions have been taken
to the satisfaction of the Agent to provide to the Agent, for the benefit of the
Banks and the Agent, a first priority perfected security interest in all of such
Investments, free of all encumbrances other than Permitted Liens.
13.4. RESTRICTED PAYMENTS. The Borrower will not, nor will it permit any
of its Subsidiaries to make any Restricted Payments other than (i) so long as no
Default or Event of Default shall have occurred and be continuing or would
result therefrom, Restricted Payments constituting (A) payment of dividends in
respect of the common stock of the Borrower in an aggregate amount not to exceed
$400,000 in any fiscal year of the Borrower (or following the conversion of all
of the outstanding Subordinated Debt into common stock of the Borrower,
$600,000), and (B) the repurchase or redemption from employees of the Borrower
or its Subsidiaries of common stock of the Borrower or warrants to purchase such
common stock when such employees cease to
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be employed by the Borrower or such Subsidiaries in an aggregate amount not to
exceed $250,000 in any one fiscal year of the Borrower, (ii) the payment of
dividends by Subsidiaries of the Borrower to the Borrower and (iii) the
repayment or repurchase of Subordinated Debt in an aggregate principal amount
not to exceed $7,000,000 from the proceeds of Acquisition Loans.
13.5. MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS.
13.5.1. MERGERS AND ACQUISITIONS. The Borrower will not, nor
will it permit any of its Subsidiaries to, become a party to any merger
or consolidation, or agree to or effect any asset acquisition or stock
acquisition (other than the acquisition of assets in the ordinary course
of business consistent with past practices) except (a) the merger or
consolidation of one or more of the Subsidiaries of the Borrower with
and into the Borrower or a Guarantor, with the Borrower or such
Guarantor to be the survivor of such merger, (b) the merger or
consolidation of two or more Subsidiaries of the Borrower which are not
Guarantors, and (c) Permitted Acquisitions.
13.5.2. DISPOSITION OF ASSETS. The Borrower will not, nor will it
permit any of its Subsidiaries to, become a party to or agree to or
effect any disposition of assets, other than an Asset Disposition the
Net Cash Proceeds of which are used to prepay the Loans in accordance
with Section 8 which repayment is accompanied, if applicable, by an
equivalent and permanent reduction in the Total Revolving Credit
Commitment or the Total Acquisition Loan Commitment.
13.6. SALE AND LEASEBACK. The Borrower will not, nor will it permit any
of its Subsidiaries to, enter into any arrangement, directly or indirectly,
whereby the Borrower or any Subsidiary of the Borrower shall sell or transfer
any property owned by it in order then or thereafter to lease such property or
lease other property that the Borrower or any Subsidiary of the Borrower intends
to use for substantially the same purpose as the property being sold or
transferred.
13.7. COMPLIANCE WITH ENVIRONMENTAL LAWS. The Borrower will not, nor
will it permit any of its Subsidiaries to, (i) use any of the Real Estate or any
portion thereof for the handling, processing, storage or disposal of Hazardous
Substances in violation of any Environmental Law or in a manner which would
bring such Real Estate in violation of any Environmental Law, (ii) cause or
permit to be located on any of the Real Estate any underground tank or other
underground storage receptacle for Hazardous Substances in violation of any
Environmental Law or in a
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manner which would bring such Real Estate in violation of any Environmental Law,
(iii) generate any Hazardous Substances on any of the Real Estate in violation
of any Environmental Law or in a manner which would bring such Real Estate in
violation of any Environmental Law, (iv) conduct any activity at any Real Estate
or use any Real Estate in any manner so as to cause a Release or threatened
Release of Hazardous Substances on, upon or into the Real Estate in violation of
any Environmental Law or in a manner which would bring such Real Estate in
violation of any Environmental Law or (v) otherwise conduct any activity at any
Real Estate or use any Real Estate in any manner that would violate any
Environmental Law or bring such Real Estate in violation of any Environmental
Law, in each of the foregoing cases in a manner that has or is expected to have
a materially adverse effect on the business, assets or financial condition of
the Borrower or its Subsidiaries.
13.8. EMPLOYEE BENEFIT PLANS. Neither the Borrower nor any ERISA
Affiliate will:
(a) engage in any "prohibited transaction" within the meaning of
Section 406 of ERISA or Section 4975 of the Code which could result in a
material liability for the Borrower or any of its Subsidiaries;
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in Section 302 of ERISA,
whether or not such deficiency is or may be waived;
(c) fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner
which, could result in the imposition of a lien or encumbrance on the
assets of the Borrower or any of its Subsidiaries pursuant to Section
302(f) or Section 4068 of ERISA;
(d) amend any Guaranteed Pension Plan in circumstances requiring
the posting of security pursuant to Section 307 of ERISA or Section
401(a)(29) of the Code; or
(e) permit or take any action which would result in the aggregate
benefit liabilities (within the meaning of Section 4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of
such Plans, as of the latest valuation of each Guaranteed Pension Plan
required by ERISA and based on the actuarial methods and assumptions
employed in that valuation, and disregarding for this purpose the
benefit liabilities and assets of any such Plan with assets in excess of
benefit liabilities.
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13.9. BANK ACCOUNTS. The Borrower will not, and will not permit any of
its Subsidiaries to, establish or maintain any deposit account other than those
listed on Schedule 11.20 hereto. In the event that the Borrower or a Subsidiary
establishes or maintains any additional deposit accounts, it shall promptly give
the Agent notice of such new accounts, setting forth the account numbers and
locations thereof, which such notice shall be deemed to constitute an amendment
to Schedule 11.20.
13.10. TRANSACTIONS WITH AFFILIATES. The Borrower will not, and will not
permit any of its Subsidiaries to, engage in any transaction with any Affiliate
(other than for services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or from,
or otherwise requiring payments to or from any such Affiliate or, to the
knowledge of the Borrower, any corporation, partnership, trust or other entity
in which any such Affiliate has a substantial interest or is an officer,
director, trustee or partner, on terms more favorable to such Person than would
have been obtainable on an arm's-length basis in the ordinary course of
business.
13.11. FISCAL YEAR. The Borrower will not change the date of the end of
its fiscal year or of any fiscal quarter from that set forth in Section 11.23
hereof.
13.12. PROHIBITION ON NEGATIVE PLEDGES. The Borrower will not, nor will
it permit any of its Subsidiaries to, enter into, or be or become bound by or
subject to, any agreement prohibiting the creation or assumption of any lien or
security interest upon its properties, whether now owned or hereafter acquired.
13.13. RESTRICTION OF UPSTREAM LIMITATIONS. The Borrower will not, nor
will it permit any of its Subsidiaries to, be or become bound by any restriction
on the ability of such Subsidiary to make dividends or other Restricted Payments
to the Borrower.
13.14. CHARTER AMENDMENTS. The Borrower will not, nor will it permit any
of its Subsidiaries to, amend any of the rights, privileges, or preferences of
any class of its capital stock without the prior written consent of the Agent
and the Majority Banks.
13.15. CREATION OF SUBSIDIARIES. The Borrower shall not create any
Subsidiary (other than Subsidiaries existing on the Closing Date and disclosed
in Section 11.19 hereto) unless (a) one hundred percent (100%) of the capital
stock or other equity interests of such Subsidiary are owned by the Borrower,
(b) prior to the formation of such Subsidiary, the Borrower shall notify the
Agent and the Banks thereof, and (c) contemporaneously
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with the formation of such Subsidiary, the Borrower shall (i) take all steps as
may be necessary or advisable in the opinion of the Agent to grant to the Agent,
for the benefit of the Banks and the Agent, a perfected, first-priority pledge
of one hundred percent (100%) or (sixty-five percent (65%) in the case of a
Foreign Subsidiary) of the capital stock or other equity interest of such
Subsidiary pursuant to a pledge agreement in form and substance satisfactory to
the Agent, which such pledge agreement shall be a Security Document hereunder,
(ii) if such Subsidiary is a Domestic Subsidiary, cause such Subsidiary to
guaranty all of the Obligations hereunder pursuant to a guaranty in form and
substance satisfactory to the Agent, which such guaranty shall be a Security
Document hereunder, and (iii) if such Subsidiary is a Domestic Subsidiary, cause
such Subsidiary to take all steps as may be necessary or advisable in the
opinion of the Agent to grant to the Agent, for the benefit of the Banks and the
Agent, a first priority, perfected security interest in substantially all of its
assets as collateral security for such Guaranty, pursuant to security documents,
mortgages, pledges and other documents in form and substance satisfactory to the
Agent, each of which documents shall be Security Documents hereunder.
13.16. CONDUCT OF BUSINESS. None of the Borrower nor any of its
Subsidiaries will conduct any business or operations other than those
substantially similar to those conducted by each of them on the Closing Date.
13.17. MODIFICATION OF DOCUMENTS. The Borrower will not amend,
supplement or otherwise modify the Bond Documents or the Subordinated Debt
Documents without the prior written consent of the Agent and the Majority Banks.
13.18. PREPAYMENT OF OTHER INDEBTEDNESS. None of the Borrower, nor any
of its Subsidiaries will repay, prepay, redeem, repurchase, retire or acquire
any Indebtedness arising under the Bond Documents or any Subordinated Debt other
than (i) Reimbursement Obligations in respect of the IRB Letter of Credit or
(ii) Indebtedness consisting of Subordinated Debt to the extent permitted by
Section 13.4.
14. FINANCIAL COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Bank
has any obligation to make any Loans, the Swing Line Bank has any obligation to
make Swing Line Loans or the Agent has any obligation to issue, extend or renew
any Letters of Credit:
14.1. LEVERAGE RATIO. The Borrower will not, at any time during any
fiscal quarter ending on any date described in the table set forth
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below, permit the Leverage Ratio to exceed the ratio set forth opposite such
date in such table:
Fiscal Quarter Ending Ratio
--------------------- -----
Closing Date - 6/29/2000 4.00 to 1.00
6/30/2000 - 6/29/2001 3.75 to 1.00
6/30/2001 - 6/29/2002 3.50 to 1.00
6/30/2002 and for each fiscal 3.25 to 1.00
quarter ending thereafter
14.2. SENIOR DEBT RATIO. The Borrower will not, at any time during any
fiscal quarter ending on any date described in the table set forth below, permit
the Senior Debt Ratio to exceed the ratio set forth opposite such date in such
table:
Fiscal Quarter Ending Ratio
--------------------- -----
Closing Date - 6/29/2000 3.25 to 1.00
6/30/2000 - 6/29/2001 3.00 to 1.00
6/30/2001 - 6/29/2002 2.75 to 1.00
6/30/2002 - 6/29/2003 2.65 to 1.00
6/30/2003 and for each fiscal 2.50 to 1.00
quarter ending thereafter
14.3. DEBT SERVICE COVERAGE RATIO. The Borrower will not, at the end of
any fiscal quarter ending on any date described in the table set forth below,
permit the ratio of (a) Consolidated Operating Cash Flow, determined for the
period of the four (4) consecutive fiscal quarters of the Borrower then ending,
to (b) Consolidated Total Debt Service, determined for such period, to be less
than the ratio set forth opposite such date in such table:
Fiscal Quarter Ending Ratio
--------------------- -----
Closing Date - 6/29/2001 1.25 to 1.00
6/30/2001 and for each fiscal 1.30 to 1.00
quarter ending thereafter
14.4. CONSOLIDATED TANGIBLE NET WORTH. The Borrower will not permit
Consolidated Tangible Net Worth at any time to be less than the sum of (i)
$18,775,000, plus (ii) on a cumulative basis for each fiscal
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quarter beginning with the fiscal quarter ended March 31, 1999, (A) one hundred
percent (100%) of positive Consolidated Net Income of the Borrower and its
Subsidiaries minus (B) $150,000 (but solely to the extent that (A) minus (B) is
greater than $0).
14.5. QUICK RATIO. The Borrower will not at any time during any period
described in the table set forth below permit the ratio of (a) Consolidated
Quick Assets to (b) the sum of (i) Consolidated Current Liabilities and (ii) to
the extent not included within Consolidated Current Liabilities, the aggregate
outstanding amount of all Loans (other than the Term Loan, the Acquisition Loans
and obligations in respect of the Letters of Credit), to be less than the ratio
set forth oppose such period in such table:
Period Ratio
------ -----
Closing Date - 6/29/2001 1.25 to 1.00
6/30/2001 - 6/29/2002 1.30 to 1.00
6/30/2002 - 6/29/2003 1.35 to 1.00
6/30/2003 and thereafter 1.40 to 1.00
14.6. CAPITAL EXPENDITURES. The Borrower will not make, nor will it
permit its Subsidiaries to make, Restricted Capital Expenditures (a) during the
period from the Closing Date to June 30, 1999 that exceed, in the aggregate,
$1,500,000 for such period and (b) in any fiscal year of the Borrower thereafter
that exceed, in the aggregate, $4,000,000 for such fiscal year.
14.7. CONSOLIDATED NET INCOME. The Borrower will not permit Consolidated
Net Income of the Borrower and its Subsidiaries for any fiscal quarter ending
after the Closing Date to be less than $1.00.
15. CLOSING CONDITIONS.
The obligations of the Banks to make the initial Revolving Credit Loans,
the initial Swing Line Loans, the initial Acquisition Loans and the Term Loans
and of the Agent to issue any initial Letters of Credit shall be subject to the
satisfaction of the following conditions precedent on or prior to March 10,
1999:
15.1. LOAN DOCUMENTS. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full force
and effect and shall be in form and substance satisfactory to each of the Banks.
Each Bank shall have received a fully executed copy of each such document.
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15.2. CERTIFIED COPIES OF CHARTER DOCUMENTS. Each of the Banks shall
have received from the Borrower and each of its Subsidiaries, a copy, certified
by a duly authorized officer of each such Person to be true, correct and
complete on the Closing Date, of each of (i) its charter or other incorporation
documents as in effect on such date of certification, and (ii) its by-laws as in
effect on such date.
15.3. CORPORATE ACTION. All corporate action necessary for the valid
execution, delivery and performance by the Borrower and each of its
Subsidiaries, of this Credit Agreement and the other Loan Documents to which
they are or are to become a party shall have been duly and effectively taken,
and evidence thereof satisfactory to the Banks shall have been provided to each
of the Banks.
15.4. INCUMBENCY CERTIFICATE. Each of the Banks shall have received from
each of the Borrower and each of its Subsidiaries, an incumbency certificate,
dated as of the Closing Date, signed by a duly authorized officer of the
Borrower and each of its Subsidiaries, and giving the name and bearing a
specimen signature of each individual who shall be authorized: (i) to sign, in
the name and on behalf of each of the Borrower and each of its Subsidiaries,
each of the Loan Documents to which each of the Borrower and each of its
Subsidiaries, is or is to become a party; (ii) in the case of the Borrower, to
make Loan Requests and Conversion Requests and to apply for Letters of Credit;
and (iii) to give notices and to take other action on their behalf under the
Loan Documents.
15.5. VALIDITY OF LIENS. The Security Documents shall be effective to
create in favor of the Agent a legal, valid and enforceable first (except for
Permitted Liens entitled to priority under applicable law) security interest in
and lien upon the Collateral. All filings, recordings, deliveries of instruments
and other actions necessary or desirable in the opinion of the Agent to protect
and preserve such security interests shall have been duly effected. The Agent
shall have received evidence thereof in form and substance reasonably
satisfactory to the Agent.
15.6. PERFECTION CERTIFICATES AND UCC SEARCH RESULTS. The Agent shall
have received from each of the Borrower and each of its Domestic Subsidiaries a
completed and fully executed Perfection Certificate and the results of UCC
searches with respect to the Collateral, indicating no liens other than
Permitted Liens and otherwise in form and substance reasonably satisfactory to
the Agent.
15.7. MOTOR VEHICLE TITLES. The Agent shall have received all original
certificates of title with respect to all motor vehicles owned by the Borrower
or its Domestic Subsidiaries that are registered in accordance
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with applicable state or provincial registration statutes or regulations,
together with duly completed applications, signed by the registered owners of
such vehicles, to have the lien of the Agent, on behalf of itself and the Banks,
noted on such certificates of title.
15.8. LANDLORD CONSENTS. The Borrower and its Subsidiaries shall have
delivered to the Agent the consents required for the Agent to receive, as part
of the Security Documents, a security interest under the Uniform Commercial Code
(to the extent applicable thereto) in the interest of the Borrower and its
Subsidiaries in the leaseholds of real property described on Schedule 15.8,
together in each case with such landlord's lien waivers and estoppel
certificates as the Agent may request.
15.9. FINANCIAL STATEMENTS, PROJECTIONS. The Agent and the Banks shall
have received (a) copies of the financial statements, and projections referred
to in Section 11.4, together with any updates or revisions thereto, and (b) any
other information (financial and other information) reasonably requested by the
Agent. All such financial statements, projections and other information shall be
in form and substance reasonably satisfactory to the Agent.
15.10. NO MATERIAL ADVERSE CHANGE. The Banks shall be satisfied that
there shall have occurred no material adverse change in the business,
operations, assets, properties or condition (financial or otherwise) of the
Borrower or its Subsidiaries since the Balance Sheet Date.
15.11. NO LITIGATION. No litigation, inquiry, injunction or restraining
order shall be pending, entered or threatened that, in the reasonable opinion of
the Banks, could reasonably be expected to have a material adverse effect on (i)
the transactions contemplated hereby, (ii) the business, assets, liabilities
(actual or contingent) operations, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries, taken as a whole, (iii) the
ability of the Borrower to perform its obligations under the Loan Documents,
(iv) the rights and remedies of the Banks under the Loan Documents, or (v) the
perfection or priority of any security interests granted to the Agent under the
Loan Documents.
15.12. NO ADVERSE INFORMATION. There shall exist no information in
respect of the status of labor, union, collective bargaining, retirement,
pension, accounting, tax, employee benefit, health or safety matters, or
material contracts, leases or management services, involving the Borrower or any
of its Subsidiaries that the Agent or the Banks reasonably believe has, or could
reasonably be expected to have, a material adverse impact on the businesses,
assets, liabilities (actual or
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contingent), operations, condition (financial or otherwise) or prospects of the
Borrower or any of its Subsidiaries, or the financings contemplated hereby.
15.13. SUBORDINATED DEBT DOCUMENTS AND BOND DOCUMENTS. The Borrower
shall have provided the Banks and the Agent with copies, certified to be true,
correct and complete of each of the Subordinated Debt Documents and Bond
Documents.
15.14. CERTIFICATES OF INSURANCE. The Agent shall have received a
certificate of insurance from an independent insurance broker dated as of the
Closing Date, identifying insurers, types of insurance, insurance limits, and
policy terms, remaining the Agent as loss payee and additional insured, and
otherwise describing the insurance obtained in accordance with the provisions of
the Security Agreements.
15.15. OPINIONS OF COUNSEL. Each of the Banks and the Agent shall have
received a favorable legal opinion addressed to the Banks and the Agent, dated
as of the Closing Date, in form and substance reasonably satisfactory to the
Banks and the Agent, from XxXxxxx, XxXxxxx & Xxxxx New York and California
counsel to the Borrower and its Subsidiaries.
15.16. PAYOFF LETTERS. The Agent shall have received a payoff letter
from Sanwa Bank California, indicating the amount of the loan obligations of the
Borrower under the Prior Credit Agreement to be discharged on the Closing Date
and describing in reasonable detail the letters of credit issued and outstanding
under the Prior Credit Agreement, as to which the Agent will on the Closing Date
issue Letters of Credit as security for the reimbursement obligations of the
Borrower to Sanwa Bank California thereunder. The Agent shall have received
payoff letters from the lenders of any other Indebtedness to be repaid on the
Closing Date from the proceeds of the Loans and undertaking and agreeing, in the
case of any such Indebtedness which is secured by any properties and assets of
the Borrower or its Subsidiaries, to discharge and release such security of
record promptly following receipt of the payoff amounts referred to therein.
15.17. DISBURSEMENT INSTRUCTIONS. The Agent shall have received written
disbursement instructions prepared by the Borrower with respect to the proceeds
of the Term Loan, the initial Swing Line Loan (if any), the initial Revolving
Credit Loan (if any) and Acquisition Loan (if any) to be made on the Closing
Date.
15.18. PAYMENT OF FEES. The Borrower shall have paid to the Banks or the
Agent, as appropriate, the fees described in Sections 9.1 and 33
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and all other fees and expenses, including, without limitation, the fees and
expenses of the Agent's Special Counsel and expenses attributable to the Agent's
commercial finance examination, required to be paid prior to the Closing Date
hereunder.
16. CONDITIONS TO ALL BORROWINGS.
The obligations of the Banks to make any Loan, including the Revolving
Credit Loans, the Acquisition Loans and the Term Loan (whether made on the
Closing Date or the Second Term Loan Drawdown Date), of the Swing Line Bank to
make any Swing Line Loan, and of the Agent to issue, extend or renew any Letter
of Credit, in each case whether on or after the Closing Date, shall also be
subject to the satisfaction of the following conditions precedent:
16.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of each of the Borrower and its Subsidiaries
contained in this Credit Agreement, the other Loan Documents, in any Loan
Request or request for the issuance, extension or renewal of a Letter of Credit
or any other document or instrument delivered pursuant to or in connection with
this Credit Agreement shall be true as of the date as of which it was made and
shall also be true at and as of the time of the making of such Loan or the
issuance, extension or renewal of such Letter of Credit, with the same effect as
if made at and as of that time (except to the extent of changes resulting from
transactions contemplated or permitted by this Credit Agreement and the other
Loan Documents and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and to the extent that
such representations and warranties relate expressly to an earlier date). After
the making of such Loan or the issuance, extension or renewal of such Letter of
Credit and any Permitted Acquisition to be made in connection therewith, no
Default or Event of Default shall have occurred and be continuing. The Agent
shall have received a certificate of the Borrower signed by an authorized
officer of the Borrower to such effect.
16.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Bank would make it illegal for such Bank to make such Loan, to acquire a
participating interest in such Swing Line Loan or to participate in the
issuance, extension or renewal of such Letter of Credit or in the reasonable
opinion of the Swing Line Bank would make it illegal for the Swing Line Bank to
make such Swing Line Loan or in the reasonable opinion of the Agent would make
it illegal for the Agent to issue, extend or renew such Letter of Credit.
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16.3. GOVERNMENTAL REGULATION. Each Bank shall have received any
statements in substance and form reasonably satisfactory to such Bank as such
Bank shall require for the purpose of compliance with any applicable regulations
of the Comptroller of the Currency or the Board of Governors of the Federal
Reserve System.
16.4. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with the
transactions contemplated by this Credit Agreement, the other Loan Documents and
all other documents incident thereto shall be satisfactory in substance and in
form to the Banks and to the Agent and the Agent's Special Counsel, and the
Banks, the Agent and such counsel shall have received all information and such
counterpart originals or certified or other copies of such documents as the
Agent may reasonably request.
16.5. ADDITIONAL CONDITIONS TO ACQUISITION LOANS. The making of any
Acquisition Loan hereunder shall also be subject to the satisfaction of the
conditions precedent that the Agent shall have received evidence satisfactory to
it that:
(a) after giving effect to such Acquisition Loan and any proposed
Permitted Acquisition to be made in connection therewith, the Total
Revolving Credit Commitment minus (i) the outstanding amount of all
Revolving Credit Loans, (ii) the outstanding amount of all Swing Line
Loans, and (iii) the sum of the Maximum Drawing Amount and all Unpaid
Reimbursement Obligations, shall be not less than $15,000,000;
(b) the Borrower shall have delivered to the Agent a statement
certified by the principal financial or accounting officer of the
Borrower demonstrating with computations in reasonable detail that after
giving effect to such Loan and any proposed Permitted Acquisition to be
made in connection therewith the Borrower shall be in compliance, on a
Pro Forma Basis, with the covenants contained in Sections 14.1 and 14.2,
decreasing, for this purpose, the applicable ratio levels by 0.25 to
1.00 so that, by way of example, if the covenant set forth in Section
14.1 prohibits the Leverage Ratio from exceeding 4.00 to 1.00, the
Borrower shall demonstrate on a Pro Forma Basis that the Leverage Ratio
does not exceed 3.75 to 1.00; and
(c) the proposed acquisition, in the case of an Acquisition Loan
the proceeds of which are to be used for the purpose of making a
Permitted Acquisition, complies with each of the requirements set forth
in the definition of "Permitted Acquisition".
17. EVENTS OF DEFAULT; ACCELERATION; ETC.
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17.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the following events
("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of the Loans or
any Reimbursement Obligation when the same shall become due and payable,
whether at the stated date of maturity or any accelerated date of
maturity or at any other date fixed for payment;
(b) the Borrower or any of its Subsidiaries shall fail to pay any
interest on the Loans, the Commitment Fees, any Letter of Credit Fee, or
other sums due hereunder or under any of the other Loan Documents to
which it is a party, when the same shall become due and payable, whether
at the stated date of maturity or any accelerated date of maturity or at
any other date fixed for payment and such failure shall continue for
three (3) Business Days;
(c) the Borrower shall fail to comply with any of its covenants
contained in Sections 12.2, 12.4, 12.5, the first sentence of 12.6,
12.7, 12.10, 12.12, 12.14 through 12.16, 13.1 through 13.8, 13.10
through 13.14, 13.17, 13.18 or 14;
(d) the Borrower or any of its Subsidiaries shall fail to perform
any term, covenant or agreement contained herein or in any of the other
Loan Documents (other than those specified elsewhere in this Section
17.1) and such failure shall continue for fifteen (15) days after
written notice of such failure has been given to the Borrower by the
Agent;
(e) any representation or warranty of the Borrower or any of its
Subsidiaries in this Credit Agreement or any of the other Loan Documents
or in any other document or instrument delivered pursuant to or in
connection with this Credit Agreement or any of the other Loan Documents
shall prove to have been false in any material respect upon the date
when made or deemed to have been made or repeated;
(f) the Borrower or any of its Subsidiaries shall fail to pay at
maturity, or within any applicable period of grace, any obligation for
borrowed money or credit received or in respect of any Capitalized
Leases, in each case, where the aggregate principal amount thereof
is in excess of $1,000,000, or fail to observe or perform any material
term, covenant or agreement contained in any agreement by which it is
bound, evidencing or securing borrowed money or credit received or in
respect of any Capitalized Leases, in each case, where the aggregate
principal amount thereof
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is in excess of $1,000,000 for such period of time as would permit
(assuming the giving of appropriate notice if required) the holder or
holders thereof or of any obligations issued thereunder to accelerate
the maturity thereof;
(g) the Borrower or any of its Subsidiaries shall make an
assignment for the benefit of creditors, or admit in writing its
inability to pay or generally fail to pay its debts as they mature or
become due, or shall petition or apply for the appointment of a trustee
or other custodian, liquidator or receiver of any such Person or of any
substantial part of the assets of any such Person or shall commence any
case or other proceeding relating to any such Person under any
bankruptcy, reorganization, arrangement, insolvency, readjustment of
debt, dissolution or liquidation or similar law of any jurisdiction, now
or hereafter in effect, or shall take any action to authorize or in
furtherance of any of the foregoing, or if any such petition or
application shall be filed or any such case or other proceeding shall be
commenced against any such Person and any such Person shall indicate in
writing its approval thereof, consent thereto or acquiescence therein or
such petition or application shall not have been dismissed within
forty-five (45) days following the filing thereof;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or any of
its Subsidiaries bankrupt or insolvent, or approving a petition in any
such case or other proceeding, or a decree or order for relief is
entered in respect of any such Person in an involuntary case under
federal bankruptcy laws as now or hereafter constituted;
(i) there shall remain in force, undischarged, unsatisfied,
unstayed, and not bonded pending appeal, for more than thirty (30) days,
whether or not consecutive, any final judgment against the Borrower or
any of its Subsidiaries that, with other outstanding final judgments,
undischarged, against any such Person exceeds in the aggregate $250,000;
(j) if any of the Loan Documents shall be cancelled, terminated,
revoked or rescinded or the Agent's security interests, mortgages or
liens in a substantial portion of the Collateral shall cease to be
perfected, or shall cease to have the priority contemplated by the
Security Documents, in each case otherwise than in accordance with the
terms thereof, or any action at law, suit in equity or other legal
proceeding to cancel, revoke or rescind any of the Loan Documents shall
be commenced by or on behalf of
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the Borrower, or any of its Subsidiaries party thereto or any of their
respective stockholders, or any court or any other governmental or
regulatory authority or agency of competent jurisdiction shall make a
determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Loan Documents is illegal, invalid
or unenforceable in accordance with the terms thereof;
(k) the Borrower or any ERISA Affiliate incurs any liability to
the PBGC or a Guaranteed Pension Plan pursuant to Title IV of ERISA in
an aggregate amount exceeding $250,000, or the Borrower or any ERISA
Affiliate is assessed withdrawal liability pursuant to Title IV of ERISA
by a Multiemployer Plan requiring aggregate annual payments exceeding
$250,000, or any of the following occurs with respect to a Guaranteed
Pension Plan: (i) an ERISA Reportable Event, or a failure to make a
required installment or other payment (within the meaning of Section
302(f)(1) of ERISA), provided that the Agent determines in its
reasonable discretion that such event (A) could be expected to result in
liability of the Borrower or any of its Subsidiaries to the PBGC or such
Guaranteed Pension Plan in an aggregate amount exceeding $250,000 and
(B) could constitute grounds for the termination of such Guaranteed
Pension Plan by the PBGC, for the appointment by the appropriate United
States District Court of a trustee to administer such Guaranteed Pension
Plan or for the imposition of a lien in favor of such Guaranteed Pension
Plan; or (ii) the appointment by a United States District Court of a
trustee to administer such Guaranteed Pension Plan; or (iii) the
institution by the PBGC of proceedings to terminate such Guaranteed
Pension Plan;
(l) the Borrower or any of its Subsidiaries shall be enjoined,
restrained or in any way prevented by the order of any court or any
administrative or regulatory agency from conducting any material part of
its business and such order shall continue in effect for more than
thirty (30) days;
(m) there shall occur any material damage to, or loss, theft or
destruction of, any Collateral, whether or not insured, or any strike,
lockout, labor dispute, embargo, condemnation, act of God or public
enemy, or other casualty, which in any such case causes, for more than
fifteen (15) consecutive days, the cessation or substantial curtailment
of revenue producing activities at any facility of the Borrower or any
of its Subsidiaries;
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(n) there shall occur the loss, suspension or revocation of, or
failure to renew, any license or permit now held or hereafter acquired
by the Borrower or any of its Subsidiaries if such loss, suspension,
revocation or failure to renew would have a material adverse effect on
the business or financial condition of the Borrower or such Subsidiary;
(o) the Borrower or any of its Subsidiaries shall be indicted for
a state or any civil or criminal action shall otherwise have been
brought against the Borrower or any of its Subsidiaries, a punishment
for which in any such case could include the forfeiture of any assets of
the Borrower or such Subsidiary having a fair market value in excess of
$500,000;
(p) any default or event of default under the Subordinated Debt
Documents shall have occurred and be continuing, or the Subordinated
Debt shall be paid, prepaid, redeemed or repurchased in whole or in part
other than as expressly permitted by the terms of this Credit Agreement;
(q) a "Change in Control" under and as defined in the
Subordinated Debt Documents shall have occurred, or a "Repurchase Offer"
under and as defined in the Subordinated Debt Documents shall have been
made;
(r) any default or event of default under the Bond Documents
shall have occurred and be continuing;
(s) the Borrower shall at any time, directly or indirectly, own
beneficially and of record less than one hundred percent (100%) of the
Voting Stock or other capital stock of each of the Subsidiaries; or
(t) (i) any person or group of persons (within the meaning of
Section 13 or 14 of the Securities Exchange Act of 1934, as amended)
other than the Management Investors, shall have acquired beneficial
ownership (within the meaning of Rule 13d-3 promulgated by the
Securities and Exchange Commission under said Act) of (A) 20% or more of
the outstanding shares of common stock of the Borrower or (B) a greater
percentage of the outstanding shares of the Common Stock of the Borrower
than is then owned collectively by the Management Group; or (ii) during
any period of twelve (12) consecutive calendar months, individuals who
were directors of the Borrower on the first day of such period shall
cease to constitute a majority of the board of directors of the
Borrower;
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then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Majority Banks shall, by notice in writing to
the Borrower declare all amounts owing with respect to this Credit Agreement,
the Notes and the other Loan Documents and all Reimbursement Obligations to be,
and they shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrower; provided that in the event of any Event
of Default specified in Sections 17.1(g) or 17.1(h), all such amounts shall
become immediately due and payable automatically and without any requirement of
notice from the Agent or any Bank.
17.2. TERMINATION OF COMMITMENTS. If any one or more of the Events of
Default specified in Section 17.1(g) or Section 17.1(h) shall occur, any unused
portion of the credit hereunder shall forthwith terminate and each of the Banks
shall be relieved of all further obligations to make Loans to the Borrower, the
Swing Line Bank shall be relieved of all further obligations to make Swing Line
Loans to the Borrower and the Agent shall be relieved of all further obligations
to issue, extend or renew Letters of Credit. If any other Event of Default shall
have occurred and be continuing, the Agent may and, upon the request of the
Majority Banks, shall, by notice to the Borrower, terminate the unused portion
of the credit hereunder, and upon such notice being given such unused portion of
the credit hereunder shall terminate immediately and each of the Banks shall be
relieved of all further obligations to make Loans to the Borrower, the Swing
Line Bank shall be relieved of all further obligations to make Swing Line Loans
to the Borrower and the Agent shall be relieved of all further obligations to
issue, extend or renew Letters of Credit. No termination of the credit hereunder
shall relieve any of the Borrower or any of its Subsidiaries of any of the
Obligations.
17.3. REMEDIES. In case any one or more of the Events of Default shall
have occurred and be continuing, and whether or not the Banks shall have
accelerated the maturity of the Loans pursuant to Section 17.1, each Bank, if
owed any amount that has become due with respect to the Loans or the
Reimbursement Obligations, may, with the consent of the Majority Banks but not
otherwise, proceed to protect and enforce its rights by suit in equity, action
at law or other appropriate proceeding, whether for the specific performance of
any covenant or agreement contained in this Credit Agreement and the other Loan
Documents or any instrument pursuant to which the Obligations to such Bank are
evidenced, including as permitted by applicable law the obtaining of the ex
parte appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Bank. No remedy herein conferred upon any Bank
or the Agent or the holder of any Note or
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purchaser of any Letter of Credit Participation or participating interest in any
Swing Line Loan is intended to be exclusive of any other remedy and each and
every remedy shall be cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing at law or in equity or by statute
or any other provision of law.
17.4. DISTRIBUTION OF COLLATERAL PROCEEDS. In the event that, following
the occurrence or during the continuance of any Default or Event of Default, the
Agent or any Bank, as the case may be, receives any monies in connection with
the enforcement of any the Security Documents, or otherwise with respect to the
realization upon any of the Collateral, such monies shall be distributed for
application as follows:
(a) First, to the payment of, or (as the case may be) the
reimbursement of the Agent for or in respect of all reasonable costs,
expenses, disbursements and losses which shall have been incurred or
sustained by the Agent in connection with the collection of such monies
by the Agent, for the exercise, protection or enforcement by the Agent
of all or any of the rights, remedies, powers and privileges of the
Agent under this Credit Agreement or any of the other Loan Documents or
in respect of the Collateral or in support of any provision of adequate
indemnity to the Agent against any taxes or liens which by law shall
have, or may have, priority over the rights of the Agent to such monies;
(b) Second, to all other Obligations in such order or preference
as the Majority Banks may determine; provided, however, that (i)
distributions in respect of such Obligations shall be made pari passu
among Obligations with respect to any fees which may be payable to the
Agent and all other Obligations, (ii) Obligations owing to the Banks
with respect to each type of Obligation such as interest, principal,
fees and expenses, shall be made among the Banks pro rata; and (iii) the
Agent may in its discretion make proper allowance to take into account
any Obligations not then due and payable;
(c) Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Banks and the Agent
of all of the Obligations, to the payment of any obligations required to
be paid pursuant to Section 9-504(1)(c) of the Uniform Commercial Code
of the Commonwealth of Massachusetts; and
(d) Fourth, the excess, if any, shall be returned to the Borrower
or to such other Persons as are entitled thereto.
18. SETOFF.
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Regardless of the adequacy of any collateral, during the continuance of
any Event of Default, any deposits or other sums credited by or due from any of
the Banks to the Borrower and any securities or other property of the Borrower
in the possession of such Bank may be applied to or set off by such Bank against
the payment of Obligations and any and all other liabilities, direct, or
indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, of the Borrower to such Bank. Each of the Banks agrees with
each other Bank that (i) if an amount to be set off is to be applied to
Indebtedness of the Borrower to such Bank, other than Indebtedness evidenced by
the Notes held by such Bank or constituting Reimbursement Obligations owed to
such Bank or constituting such Bank's participating interest in any Swing Line
Loans, such amount shall be applied ratably to such other Indebtedness and to
the Indebtedness evidenced by all such Notes held by such Bank or constituting
Reimbursement Obligations owed to such Bank or constituting such Bank's
participating interest in any Swing Line Loans, and (ii) if such Bank shall
receive from the Borrower, whether by voluntary payment, exercise of the right
of setoff, counterclaim, cross action, enforcement of the claim evidenced by the
Notes held by, or constituting Reimbursement Obligations owed to, or the
participating interest in any Swing Line Loans of, such Bank by proceedings
against the Borrower at law or in equity or by proof thereof in bankruptcy,
reorganization, liquidation, receivership or similar proceedings, or otherwise,
and shall retain and apply to the payment of the Note or Notes held by, or
Reimbursement Obligations owed to, or the participating interest in any Swing
Line Loans of, such Bank any amount in excess of its ratable portion of the
payments received by all of the Banks with respect to the Notes held by, and
Reimbursement Obligations owed to, or the participating interest in any Swing
Line Loans of, all of the Banks, such Bank will make such disposition and
arrangements with the other Banks with respect to such excess, either by way of
distribution, pro tanto assignment of claims, subrogation or otherwise as shall
result in each Bank receiving in respect of the Notes held by it or
Reimbursement Obligations owed it or the participating interest in any Swing
Line Loans, its proportionate payment as contemplated by this Credit Agreement;
provided that if all or any part of such excess payment is thereafter recovered
from such Bank, such disposition and arrangements shall be rescinded and the
amount restored to the extent of such recovery, but without interest.
19. THE AGENT.
19.1. AUTHORIZATION.
(a) The Agent is authorized to take such action on behalf of each
of the Banks and to exercise all such powers as are hereunder and under
any of the other Loan Documents and any
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related documents delegated to the Agent, together with such powers as
are reasonably incident thereto, provided that no duties or
responsibilities not expressly assumed herein or therein shall be
implied to have been assumed by the Agent.
(b) The relationship between the Agent and each of the Banks is
that of an independent contractor. The use of the term "Agent" is for
convenience only and is used to describe, as a form of convention, the
independent contractual relationship between the Agent and each of the
Banks. Nothing contained in this Credit Agreement nor the other Loan
Documents shall be construed to create an agency, trust or other
fiduciary relationship between the Agent and any of the Banks.
(c) As an independent contractor empowered by the Banks to
exercise certain rights and perform certain duties and responsibilities
hereunder and under the other Loan Documents, the Agent is nevertheless
a "representative" of the Banks, as that term is defined in Article 1 of
the Uniform Commercial Code, for purposes of actions for the benefit of
the Banks and the Agent with respect to all collateral security and
guaranties contemplated by the Loan Documents. Such actions include the
designation of the Agent as "secured party", "mortgagee" or the like on
all financing statements and other documents and instruments, whether
recorded or otherwise, relating to the attachment, perfection, priority
or enforcement of any security interests, mortgages or deeds of trust in
collateral security intended to secure the payment or performance of any
of the Obligations, all for the benefit of the Banks and the Agent.
19.2. EMPLOYEES AND AGENTS. The Agent may exercise its powers and
execute its duties by or through employees or agents and shall be entitled to
take, and to rely on, advice of counsel concerning all matters pertaining to its
rights and duties under this Credit Agreement and the other Loan Documents. The
Agent may utilize the services of such Persons as the Agent in its sole
discretion may reasonably determine, and all reasonable fees and expenses of any
such Persons shall be paid by the Borrower.
19.3. NO LIABILITY. Neither the Agent nor any of its shareholders,
directors, officers or employees nor any other Person assisting them in their
duties nor any agent or employee thereof, shall be liable for any waiver,
consent or approval given or any action taken, or omitted to be taken, in good
faith by it or them hereunder or under any of the other Loan Documents, or in
connection herewith or therewith, or be responsible for the consequences of any
oversight or error of judgment
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whatsoever, except that the Agent or such other Person, as the case may be, may
be liable for losses due to its willful misconduct or gross negligence.
19.4. NO REPRESENTATIONS.
19.4.1. GENERAL. The Agent shall not be responsible for the
execution or validity or enforceability of this Credit Agreement, the
Notes, the Letters of Credit, any of the other Loan Documents or any
instrument at any time constituting, or intended to constitute,
collateral security for the Notes, or for the value of any such
collateral security or for the validity, enforceability or
collectability of any such amounts owing with respect to the Notes, or
for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate or
instrument hereafter furnished to it by or on behalf of the Borrower or
any of its Subsidiaries, or be bound to ascertain or inquire as to the
performance or observance of any of the terms, conditions, covenants or
agreements herein or in any instrument at any time constituting, or
intended to constitute, collateral security for the Notes or to inspect
any of the properties, books or records of the Borrower or any of its
Subsidiaries. The Agent shall not be bound to ascertain whether any
notice, consent, waiver or request delivered to it by the Borrower or
any holder of any of the Notes shall have been duly authorized or is
true, accurate and complete. The Agent has not made nor does it now make
any representations or warranties, express or implied, nor does it
assume any liability to the Banks, with respect to the creditworthiness
or financial conditions of the Borrower or any of its Subsidiaries. Each
Bank acknowledges that it has, independently and without reliance upon
the Agent or any other Bank, and based upon such information and
documents as it has deemed appropriate, made its own credit analysis and
decision to enter into this Credit Agreement.
19.4.2. CLOSING DOCUMENTATION, ETC. For purposes of determining
compliance with the conditions set forth in Section 15, each Bank that
has executed this Credit Agreement shall be deemed to have consented to,
approved or accepted, or to be satisfied with, each document and matter
either sent, or made available, by the Agent or the Arranger to such
bank for consent, approval, acceptance or satisfaction, or required
thereunder to be consented to, approved by, or satisfactory to, such
Bank, unless an officer of the Agent or the Arranger active on the
Borrower's account shall have received notice from such Bank prior to
the Closing Date specifying such Bank's objection thereto and such
objection shall
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not have been withdrawn by notice to the Agent or the Arranger to such
effect on or prior to the Closing Date.
19.5. PAYMENTS.
19.5.1. PAYMENTS TO AGENT. A payment by the Borrower to the Agent
hereunder or any of the other Loan Documents for the account of any Bank
or the Swing Line Bank shall constitute a payment to such Bank or the
Swing Lien Bank, as the case may be. The Agent agrees promptly to
distribute (a) to each Bank such Bank's pro rata share of payments
received by the Agent for the account of the Banks, and (b) to the Swing
Line Bank payments received by the Agent for the account to the Swing
Line Bank, in each case except as otherwise expressly provided herein or
in any of the other Loan Documents.
19.5.2. DISTRIBUTION BY AGENT. If in the opinion of the Agent the
distribution of any amount received by it in such capacity hereunder,
under the Notes or under any of the other Loan Documents might involve
it in liability, it may refrain from making distribution thereof until
its right to make such distribution shall have been adjudicated by a
court of competent jurisdiction. If a court of competent jurisdiction
shall adjudge that any amount received and distributed by the Agent is
to be repaid, each Person to whom any such distribution shall have been
made shall either repay to the Agent its proportionate share of the
amount so adjudged to be repaid or shall pay over the same in such
manner and to such Persons as shall be determined by such court.
19.5.3. DELINQUENT BANKS. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other Loan
Documents, any Bank that (i) fails to make available to the Agent its
pro rata share of any Revolving Credit Loan, Acquisition Loan or the
Term Loan, fails to make available to the Swing Line Bank its pro rata
share of any Swing Line Loan, or fails to purchase any Letter of Credit
Participation or (ii) fails to comply with the provisions of Section 18
with respect to making dispositions and arrangements with the other
Banks, where such Bank's share of any payment received, whether by
setoff or otherwise, is in excess of its pro rata share of such payments
due and payable to all of the Banks, in each case as, when and to the
full extent required by the provisions of this Credit Agreement, shall
be deemed delinquent (a "Delinquent Bank") and shall be deemed a
Delinquent Bank until such time as such delinquency is satisfied. A
Delinquent Bank shall be deemed to have assigned any and all payments
due to it
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from the Borrower, whether on account of outstanding Loans, Unpaid
Reimbursement Obligations, interest, fees or otherwise, to the remaining
nondelinquent Banks for application to, and reduction of, their
respective pro rata shares of all outstanding Loans and Unpaid
Reimbursement Obligations. The Delinquent Bank hereby authorizes the
Agent to distribute such payments to the nondelinquent Banks in
proportion to their respective pro rata shares of all outstanding Loans
and Unpaid Reimbursement Obligations. A Delinquent Bank shall be deemed
to have satisfied in full a delinquency when and if, as a result of
application of the assigned payments to all outstanding Loans and Unpaid
Reimbursement Obligations of the nondelinquent Banks, the Banks'
respective pro rata shares of all outstanding Loans and Unpaid
Reimbursement Obligations have returned to those in effect immediately
prior to such delinquency and without giving effect to the nonpayment
causing such delinquency.
19.6. HOLDERS OF NOTES. The Agent may deem and treat the payee of any
Note or the purchaser of any Letter of Credit Participation as the absolute
owner or purchaser thereof for all purposes hereof until it shall have been
furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.
19.7. INDEMNITY. The Banks ratably agree hereby to indemnify and hold
harmless the Agent and its affiliates from and against any and all claims,
actions and suits (whether groundless or otherwise), losses, damages, costs,
expenses (including any expenses for which the Agent and its affiliates have not
been reimbursed by the Borrower as required by Section 20), and liabilities of
every nature and character arising out of or related to this Credit Agreement,
the Notes, or any of the other Loan Documents or the transactions contemplated
or evidenced hereby or thereby, or the Agent's or such affiliate's actions taken
hereunder or thereunder, except to the extent that any of the same shall be
directly caused by the Agent's or such affiliate's willful misconduct or gross
negligence.
19.8. AGENT AS BANK. In its individual capacity, BKB shall have the same
obligations and the same rights, powers and privileges with respect to its
Commitments and the Loans made by it, and as the holder of any of the Notes and
as the purchaser of any Letter of Credit Participations, as it would have were
it not also the Agent and the Swing Line Bank.
19.9. RESIGNATION. The Agent may resign at any time by giving sixty (60)
days prior written notice thereof to the Banks and the Borrower. Upon any such
resignation, the Majority Banks shall have the
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right to appoint a successor Agent. Unless a Default or Event of Default shall
have occurred and be continuing, such successor Agent shall be reasonably
acceptable to the Borrower. If no successor Agent shall have been so appointed
by the Majority Banks and shall have accepted such appointment within thirty
(30) days after the retiring Agent's giving of notice of resignation, then the
retiring Agent may, on behalf of the Banks, appoint a successor Agent, which
shall be a financial institution having a rating of not less than A or its
equivalent by Standard & Poor's Ratings Group. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations hereunder. After any retiring Agent's
resignation, the provisions of this Credit Agreement and the other Loan
Documents shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Agent.
19.10. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT. Each Bank hereby
agrees that, upon learning of the existence of a Default or an Event of Default,
it shall promptly notify the Agent thereof. The Agent hereby agrees that upon
receipt of any notice under this Section 19.10 it shall promptly notify the
other Banks of the existence of such Default or Event of Default.
19.11. DUTIES IN THE CASE OF ENFORCEMENT. In case one or more Events of
Default have occurred and shall be continuing, and whether or not acceleration
of the Obligations shall have occurred, the Agent shall, if (i) so requested by
the Majority Banks and (ii) the Banks have provided to the Agent such additional
indemnities and assurances against expenses and liabilities as the Agent may
reasonably request, proceed to enforce the provisions of the Security Documents
authorizing the sale or other disposition of all or any part of the Collateral
and exercise all or any such other legal and equitable and other rights or
remedies as it may have in respect of such Collateral. The Majority Banks may
direct the Agent in writing as to the method and the extent of any such sale or
other disposition, the Banks hereby agreeing to indemnify and hold the Agent
harmless from all liabilities incurred in respect of all actions taken or
omitted in accordance with such directions, provided that the Agent need not
comply with any such direction to the extent that the Agent reasonably believes
the Agent's compliance with such direction to be unlawful or commercially
unreasonable in any applicable jurisdiction.
20. EXPENSES.
The Borrower agrees to pay (i) the reasonable costs of producing and
reproducing this Credit Agreement, the other Loan Documents and the other
agreements and instruments mentioned herein, (ii) any taxes
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(including any interest and penalties in respect thereto) payable by the Agent
or any of its Affiliates or any of the Banks (other than taxes based upon the
Agent's, such Affiliate's or any Bank's net income) on or with respect to the
transactions contemplated by this Credit Agreement and the other Loan Documents
(the Borrower hereby agreeing to indemnify the Agent and each Bank with respect
thereto), (iii) the reasonable fees, expenses and disbursements of the Agent's
Special Counsel or any local counsel to the Agent incurred in connection with
the preparation, negotiation, administration or interpretation of the Loan
Documents, the other Loan Documents and the other instruments mentioned herein,
each closing hereunder, syndications of the Loans, and amendments,
modifications, approvals, consents or waivers hereto or hereunder and
assignments hereunder, and/or the cancellation of any Loan Document upon payment
in full in cash of the Obligations, (iv) the fees, expenses and disbursements
(including, without limitation, fees, expenses and disbursements incurred in
connection with due diligence) of the Agent and its Affiliates incurred by the
Agent and its Affiliates in connection with the structuring, negotiation,
preparation, syndication, administration, delivery, waiver, modification or
interpretation of the Loan Documents, the other Loan Documents and the other
instruments mentioned herein, including all title insurance premiums and
surveyor, engineering and appraisal charges, (v) all reasonable out-of-pocket
expenses (including without limitation reasonable attorneys' fees and costs,
which attorneys may be employees of any Bank or the Agent, and reasonable
consulting, accounting, investment banking and similar professional fees and
charges) incurred by any Bank or the Agent in connection with (A) the
enforcement of or preservation of rights under any of the Loan Documents or the
administration thereof after the occurrence of a Default or Event of Default,
(B) any litigation, proceeding or dispute whether arising hereunder or
otherwise, in any way related to any Bank's or the Agent's relationship with,
the Borrower or any of its Subsidiaries and (C) the initial and on-going
collateral monitoring, commercial finance examinations, and field examination
expenses and appraisal and environmental survey expenses; and (vii) all
reasonable fees, expenses and disbursements of the Agent incurred in connection
with UCC searches, UCC filings or mortgage recordings. The covenants of this
Section 20 shall survive payment or satisfaction of all other Obligations.
21. INDEMNIFICATION.
The Borrower agrees to indemnify and hold harmless the Agent, the Banks
and their respective affiliates from and against any and all claims, actions and
suits whether groundless or otherwise, and from and against any and all
liabilities, losses (excluding loss of anticipated profits), damages and
expenses of every nature and character arising out of the transactions
contemplated hereby, this Credit Agreement or any of the other Loan Documents or
the transactions contemplated hereby
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including, without limitation, (i) any actual or proposed use by the Borrower or
any of its Subsidiaries of the proceeds of any of the Loans or Letters of
Credit, (ii) any actual or alleged infringement of any patent, copyright,
trademark, service xxxx or similar right of the Borrower or any of its
Subsidiaries, (iii) the Borrower or any of its Subsidiaries entering into or
performing this Credit Agreement or any of the other Loan Document, or (iv) with
respect to the Borrower and its Subsidiaries and their respective properties and
assets, the violation of any Environmental Law, the presence, disposal, escape,
seepage, leakage, spillage, discharge, emission, release or threatened release
of any Hazardous Substances or any action, suit, proceeding or investigation
brought or threatened with respect to any Hazardous Substances (including, but
not limited to, claims with respect to wrongful death, personal injury or damage
to property), in each case including, without limitation, the reasonable fees
and disbursements of counsel and allocated costs of internal counsel incurred in
connection with any such investigation, litigation or other proceeding. In
litigation, or the preparation therefor, the Banks and the Agent shall be
entitled to select their own counsel and, in addition to the foregoing
indemnity, the Borrower agrees to pay promptly the reasonable fees and expenses
of such counsel. If, and to the extent that the obligations of the Borrower
under this Section 21 are unenforceable for any reason, the Borrower hereby
agrees to make the maximum contribution to the payment in satisfaction of such
obligations which is permissible under applicable law. The covenants contained
in this Section 21 shall survive payment or satisfaction in full of all other
Obligations.
22. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made herein,
in the Notes, in any of the other Loan Documents, in any Loan Request or request
for the issuance, extension or renewal of a Letter of Credit, or in any
documents or other papers delivered by or on behalf of the Borrower or any of
its Subsidiaries in connection with the transactions contemplated hereby and the
Loan Documents shall be deemed to have been relied upon by the Banks and the
Agent, notwithstanding any investigation heretofore or hereafter made by any of
them, and shall survive the making by the Banks of any of the Loans and the
issuance, extension or renewal of any Letters of Credit, as herein contemplated,
and shall continue in full force and effect so long as any Letter of Credit or
any amount due under this Credit Agreement or the Notes or any of the other Loan
Documents remains outstanding or any Bank has any obligation to make any Loans,
the Swing Line Bank has any obligation to make any Swing Line Loans or the Agent
has any obligation to issue, extend or renew any Letter of Credit, and for such
further time as may be otherwise expressly specified in this Credit Agreement.
All statements contained in any certificate or other paper
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delivered to any Bank or the Agent at any time by or on behalf of the Borrower
or any of its Subsidiaries in connection with the transactions contemplated
hereby shall constitute representations and warranties by the Borrower or such
Subsidiary hereunder on and as of the date so delivered.
23. ASSIGNMENT AND PARTICIPATION.
23.1. CONDITIONS TO ASSIGNMENT BY BANKS. Except as provided herein, each
Bank may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Credit Agreement (including all or
a portion of its Revolving Credit Commitment Percentage and Revolving Credit
Commitment, its Acquisition Loan Commitment Percentage and Acquisition Loan
Commitment, its Term Percentage, and the same portion of the Loans at the time
owing to it, the Notes held by it and its participating interest in the Swing
Line Loans and the risk relating to any Letters of Credit); provided that (i)
each of the Agent and, unless a Default or Event of Default shall have occurred
and be continuing, the Borrower shall have given its prior written consent to
such assignment, which consent, in the case of the Borrower, will not be
unreasonably withheld, (ii) each such assignment shall be of a constant, and not
a varying, percentage of all the assigning Bank's rights and obligations under
this Credit Agreement, and shall be in the same proportion to the assigning
Bank's Revolving Credit Commitment, Acquisition Loan Commitment, the Loans owing
to it, the Notes held by it and its participating interest in the Swing Line
Loans and the risk relating to Letters of Credit, (iii) each assignment shall be
in an amount that is a whole multiple of $5,000,000 (or if less, such Bank's
entire Commitments hereunder) and (iv) the parties to such assignment shall
execute and deliver to the Agent, for recording in the Register (as hereinafter
defined), an Assignment and Acceptance, substantially in the form of Exhibit D
hereto (an "Assignment and Acceptance"), together with any Notes subject to such
assignment. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance, which
effective date shall be at least five (5) Business Days after the execution
thereof, (i) the assignee thereunder shall be a party hereto and, to the extent
provided in such Assignment and Acceptance, have the rights and obligations of a
Bank hereunder, and (ii) the assigning Bank shall, to the extent provided in
such assignment and upon payment to the Agent of the registration fee referred
to in Section 23.3, be released from its obligations under this Credit
Agreement.
23.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS; COVENANTS. By
executing and delivering an Assignment and Acceptance, the parties to the
assignment thereunder confirm to and agree with each other and the other parties
hereto as follows:
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(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Bank makes no
representation or warranty, express or implied, and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Credit Agreement, the other Loan Documents
or any other instrument or document furnished pursuant hereto or the
attachment, perfection or priority of any security interest or mortgage,
(b) the assigning Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower and its Subsidiaries or any other Person primarily or
secondarily liable in respect of any of the Obligations, or the
performance or observance by the Borrower and its Subsidiaries or any
other Person primarily or secondarily liable in respect of any of the
Obligations of any of their obligations under this Credit Agreement or
any of the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto;
(c) such assignee confirms that it has received a copy of this
Credit Agreement, together with copies of the most recent financial
statements referred to in Section 11.4 and Section 12.4 and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and
Acceptance;
(d) such assignee will, independently and without reliance upon
the assigning Bank, the Agent 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 Credit Agreement;
(e) such assignee represents and warrants that it is an Eligible
Assignee;
(f) such assignee appoints and authorizes the Agent to take such
action on its behalf and to exercise such powers under this Credit
Agreement and the other Loan Documents as are delegated to the Agent by
the terms hereof or thereof, together with such powers as are reasonably
incidental thereto;
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(g) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of this Credit
Agreement are required to be performed by it as a Bank;
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance; and
(i) such assignee acknowledges that it has made arrangements with
the assigning Bank satisfactory to such assignee with respect to its pro
rata share of Letter of Credit Fees in respect of outstanding Letters of
Credit.
23.3. REGISTER. The Agent shall maintain a copy of each Assignment and
Acceptance delivered to it and a register or similar list (the "Register") for
the recordation of the names and addresses of the Banks and the Commitments and
Commitment Percentages of, and principal amount of the Loans owing to and Letter
of Credit Participations purchased by, the Banks from time to time. The entries
in the Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Agent and the Banks may treat each Person whose name is recorded
in the Register as a Bank hereunder for all purposes of this Credit Agreement.
The Register shall be available for inspection by the Borrower and the Banks at
any reasonable time and from time to time upon reasonable prior notice. Upon
each such recordation, the assigning Bank agrees to pay to the Agent a
registration fee in the sum of $3,500.
23.4. NEW NOTES. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (i) record the information contained therein in
the Register, and (ii) give prompt notice thereof to the Borrower and the Banks
(other than the assigning Bank). Within five (5) Business Days after receipt of
such notice, the Borrower, at its own expense, shall execute and deliver to the
Agent, in exchange for each surrendered Note, a new Note to the order of such
Eligible Assignee in an amount equal to the amount assumed by such Eligible
Assignee pursuant to such Assignment and Acceptance and, if the assigning Bank
has retained some portion of its obligations hereunder, a new Note to the order
of the assigning Bank in an amount equal to the amount retained by it hereunder.
Such new Notes shall provide that they are replacements for the surrendered
Notes, shall be in an aggregate principal amount equal to the aggregate
principal amount of the surrendered Notes, shall be dated the effective date of
such Assignment and Acceptance and shall otherwise be substantially the form of
the assigned Notes. If requested by such Assignee, within five (5) Business Days
of issuance of any new Notes pursuant to this Section 23.4, the Borrower shall,
at its own expense, deliver an opinion of counsel, addressed to the
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Banks and the Agent, relating to the due authorization, execution and delivery
of such new Notes and the legality, validity and binding effect thereof, in form
and substance satisfactory to the Banks. The surrendered Notes shall be
cancelled and returned to the Borrower.
23.5. PARTICIPATIONS. Each Bank may sell participations to one or more
banks or other entities in all or a portion of such Bank's rights and
obligations under this Credit Agreement and the other Loan Documents; provided
that (i) any such sale or participation shall not affect the rights and duties
of the selling Bank hereunder to the Borrower and (ii) the only rights granted
to the participant pursuant to such participation arrangements with respect to
waivers, amendments or modifications of the Loan Documents shall be the rights
to approve waivers, amendments or modifications that would reduce the principal
of or the interest rate on any Loans, extend the term or increase the amount of
the Commitments of such Bank as it relates to such participant, reduce the
amount of any Commitment Fees or Letter of Credit Fees to which such participant
is entitled or extend any regularly scheduled payment date for principal or
interest.
23.6. DISCLOSURE. The Borrower agrees that in addition to disclosures
made in accordance with standard and customary banking practices any Bank may
disclose information obtained by such Bank pursuant to this Credit Agreement to
assignees or participants and potential assignees or participants hereunder;
provided that such assignees or participants or potential assignees or
participants shall agree (i) to treat in confidence such information unless such
information otherwise becomes public knowledge, (ii) not to disclose such
information to a third party, except as required by law or legal process and
(iii) not to make use of such information for purposes of transactions unrelated
to such contemplated assignment or participation. For purposes of this Section
23.6 an assignee or participant or potential assignee or participant may include
a counterparty with whom such Bank has entered into or potentially might enter
into a derivative contract referenced to credit or other risks or events arising
under this Credit Agreement or any other Loan Document.
23.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER. If any
assignee Bank is an Affiliate of the Borrower, then any such assignee Bank shall
have no right to vote as a Bank hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or other modifications to any of the Loan Documents or
for purposes of making requests to the Agent pursuant to Section 17.1 or Section
17.2, and the determination of the Majority Banks shall for all purposes of this
Agreement and the other Loan Documents be made without regard to such assignee
Bank's interest in any of the
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Loans or Reimbursement Obligations. If any Bank sells a participating interest
in any of the Loans or Reimbursement Obligations to a participant, and such
participant is the Borrower or an Affiliate of the Borrower, then such
transferor Bank shall promptly notify the Agent of the sale of such
participation. A transferor Bank shall have no right to vote as a Bank hereunder
or under any of the other Loan Documents for purposes of granting consents or
waivers or for purposes of agreeing to amendments or modifications to any of the
Loan Documents or for purposes of making requests to the Agent pursuant to
Section 17.1 or Section 17.2 to the extent that such participation is
beneficially owned by the Borrower or any Affiliate of the Borrower, and the
determination of the Majority Banks shall for all purposes of this Credit
Agreement and the other Loan Documents be made without regard to the interest of
such transferor Bank in the Loans or Reimbursement Obligations to the extent of
such participation.
23.8. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Bank shall
retain its rights to be indemnified pursuant to Section 21 with respect to any
claims or actions arising prior to the date of such assignment. If any assignee
Bank is not incorporated under the laws of the United States of America or any
state thereof, it shall, prior to the date on which any interest or fees are
payable hereunder or under any of the other Loan Documents for its account,
deliver to the Borrower and the Agent certification as to its exemption from
deduction or withholding of any United States federal income taxes. Anything
contained in this Section 23 to the contrary notwithstanding, any Bank may at
any time pledge all or any portion of its interest and rights under this Credit
Agreement (including all or any portion of its Notes) to (a) any of the twelve
Federal Reserve Banks organized under Section 4 of the Federal Reserve Act, 12
U.S.C. Section 341 or (b) to a lender to such Bank (or a trustee therefor) in
connection with a bona fide financing transaction. No such pledge or the
enforcement thereof shall release the pledgor Bank from its obligations
hereunder or under any of the other Loan Documents.
23.9. ASSIGNMENT THE BORROWER. Neither the Borrower nor any of its
Subsidiaries shall assign or transfer any of its rights or obligations under any
of the Loan Documents without the prior written consent of each of the Banks.
24. NOTICES, ETC.
Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to this
Credit Agreement or the Notes or any Letter of Credit Applications shall be in
writing and shall be delivered in hand, mailed by United States registered or
certified first class mail, postage prepaid, sent
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by overnight courier, or sent by facsimile and confirmed by delivery via courier
or postal service, addressed as follows:
(a) if to the Borrower, at 0000 XxXxxxxxx Xxxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx 00000, Attention: Xxxxx X. Xxxx, CFO, or at such other
address for notice as the Borrower shall last have furnished in writing
to the Person giving the notice;
(b) if to the Agent, at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000, Attention: Transportation Division, Mail Stop 01-08-01, or such
other address for notice as the Agent shall last have furnished in
writing to the Person giving the notice; and
(c) if to any Bank, at such Bank's address set forth on Schedule
1 hereto, or such other address for notice as such Bank shall have last
furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile
(which may be evidenced by the receipt of a transmission confirmation report
from the sending facsimile machine) or (ii) if sent by registered or certified
first-class mail, postage prepaid, on the third Business Day following the
mailing thereof.
25. GOVERNING LAW.
THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID COMMONWEALTH (EXCLUDING THE
LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE BORROWER AGREES THAT ANY
SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS OR
ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION
OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE
BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN SECTION 24. THE BORROWER HEREBY
WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
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26. HEADINGS.
The captions in this Credit Agreement are for convenience of reference
only and shall not define or limit the provisions hereof.
27. COUNTERPARTS.
This Credit Agreement and any amendment hereof may be executed in
several counterparts and by each party on a separate counterpart, each of which
when executed and delivered shall be an original, and all of which together
shall constitute one instrument. In proving this Credit Agreement it shall not
be necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought.
28. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Credit Agreement
nor any term hereof may be changed, waived, discharged or terminated, except as
provided in Section 30.
29. WAIVER OF JURY TRIAL.
THE BORROWER HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY
ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS CREDIT
AGREEMENT, THE NOTES OR ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR
OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF ANY SUCH RIGHTS AND
OBLIGATIONS. Except as prohibited by law, the Borrower hereby waives any right
it may have to claim or recover in any litigation referred to in the preceding
sentence any special, exemplary, punitive or consequential damages or any
damages other than, or in addition to, actual damages. The Borrower hereby (i)
certifies that no representative, agent or attorney of any Bank or the Agent has
represented, expressly or otherwise, that such Bank or the Agent would not, in
the event of litigation, seek to enforce the foregoing waivers and (ii)
acknowledges that the Agent and the Banks have been induced to enter into this
Credit Agreement and the other Loan Documents to which they are a party by,
among other things, the waivers and certifications contained herein.
30. CONSENTS, AMENDMENTS, WAIVERS, ETC.
Any consent or approval required or permitted by this Credit Agreement
to be given by all of the Banks may be given, and any term of this Credit
Agreement, the other Loan Documents or any other instrument related hereto or
mentioned herein may be amended, and the performance or observance by the
Borrower or any of its Subsidiaries of
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any terms of this Credit Agreement, the other Loan Documents or such other
instrument or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower and the
written consent of the Majority Banks. Notwithstanding the foregoing, (a) the
outstanding principal amount of the Notes may not be reduced, the amortization
of the Notes may not be lengthened, the maturity of the Notes may not be
extended, the amount of the Commitments of the Banks may not be increased, the
rate of interest on the Notes (other than interest accruing pursuant to Section
9.10.2 following the effective date of any waiver by the Majority Banks of the
Default or Event of Default relating thereto) and the amount of Commitment Fees
or Letter of Credit Fees hereunder may not be reduced, and no substantial
portion of the Collateral (other than in connection with dispositions of
Collateral permitted hereunder) or any guarantee of the Obligations may be
released, in each case without the written consent of each Bank affected
thereby; (b) this Section 30 and the definition of Majority Banks may not be
amended without the written consent of all of the Banks; (c) the amount of any
fees or Letter of Credit Fees payable for the Agent's account, Sections 5 and 19
may not be amended without the written consent of the Agent; and (d) no
amendment, waiver or consent shall affect the rights and obligations of the
Swing Line Bank without the written consent of the Swing Line Bank in addition
to the Banks required above to take such action. No waiver shall extend to or
affect any obligation not expressly waived or impair any right consequent
thereon. No course of dealing or delay or omission on the part of the Agent or
any Bank in exercising any right shall operate as a waiver thereof or otherwise
be prejudicial thereto. No notice to or demand upon the Borrower shall entitle
the Borrower to other or further notice or demand in similar or other
circumstances.
31. SEVERABILITY.
The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in whole or in
part in any jurisdiction, then such invalidity or unenforceability shall affect
only such clause or provision, or part thereof, in such jurisdiction, and shall
not in any manner affect such clause or provision in any other jurisdiction, or
any other clause or provision of this Credit Agreement in any jurisdiction.
32. CONFIDENTIALITY
Each of the Banks and the Agent agrees, on behalf of itself and each of
its affiliates, directors, officers, employees and representatives, to use
reasonable precautions to keep confidential, in accordance with their customary
procedures for handling confidential information of the same nature and in
accordance with safe and
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sound banking practices, any non-public information supplied to it by the
Borrower or any of its Subsidiaries pursuant to this Credit Agreement that is
identified by such Person as being confidential at the time the same is
delivered to the Banks or the Agent, provided that nothing herein shall limit
the disclosure of any such information (a) after such information shall have
become public other than through a violation of this Section 32, (b) to the
extent required by statute, rule, regulation or judicial process, (c) to counsel
for any of the Banks or the Agent, (d) to bank examiners or any other regulatory
authority having jurisdiction over any Bank or the Agent, or to auditors or
accountants, (e) to the Agent, any Bank or any of their Affiliates, (f) in
connection with any litigation to which any one or more of the Banks, the Agent
or any such Affiliate is a party, or in connection with the enforcement of
rights or remedies hereunder or under any other Loan Document, or (g) to any
assignee or participant (or prospective assignee or participant) so long as such
assignee or participant agrees to be bound by the provisions of Section 23.6.
The obligations of each Bank under this Section 32 shall supersede and replace
the obligations of such Bank under any confidentiality letter in respect of this
financing signed and delivered by such Bank to the Borrower prior to the date
hereof and shall be binding upon any assignee of, or purchaser of any
participation in, any interest in any of the Loans or Reimbursement Obligations
from any Bank.
33. PRIOR REIMBURSEMENT AGREEMENT SUPERSEDED.
The parties to the Prior Reimbursement Agreement hereby agree that,
except as provided below, on and as of the Closing Date this Credit Agreement
and the other Loan Documents shall supersede the Prior Reimbursement Agreement
and that from and after the Closing Date the rights and obligations of the
parties evidenced by the Prior Reimbursement Agreement shall be evidenced by
this Credit Agreement and the other Loan Documents; provided that the nothing in
this Section 33 shall limit the obligations of the Borrower or the other parties
to the Prior Reimbursement Agreement in respect of paragraphs 7(g), 10(g) or
11(l) thereof or any other provisions of the Prior Reimbursement Agreement that
by their terms survive termination of the Prior Reimbursement Agreement or
payment of the L/C Obligations (as defined in the Prior Reimbursement
Agreement). All letter of credit fees, other fees, interest and expenses, if
any, owing or accrued under or in respect of the Prior Reimbursement Agreement
through the Closing Date shall be calculated as of the Closing Date (pro-rated
in the case of any fractional periods), and shall be paid on the Closing Date.
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IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as an instrument under seal as of the date first set forth above.
MERCURY AIR GROUP, INC.
By: _____________________________________
Name:
Title:
BANKBOSTON, N.A., individually
and as Agent
By: _____________________________________
Name:
Title:
SANWA BANK CALIFORNIA
By: _____________________________________
Name:
Title:
MELLON BANK, N.A.
By: _____________________________________
Name:
Title:
UNION BANK OF
CALIFORNIA, N.A.
By: _____________________________________
Name:
Title:
122
SCHEDULE 1
Banks; Commitments; Commitment Percentages
Revolving Acquisition
Banks; Addresses; Credit Loan Acquisition
Domestic Lending Offices; Commitment Revolving Credit Commitment Loan Term Portion of
Eurodollar Lending Offices Percentage Commitment Percentage Commitment Percentage Term Loan
-------------------------- ---------- ---------------- ----------- ----------- ---------- ----------
BankBoston, N.A.
000 Xxxxxxx Xxxxxx, 01-08-01 37.5% $15,000,000 37.5% $ 5,625,000 37.5% $9,375,000
Xxxxxx, XX 00000
Attn: Transportation Division
Sanwa Bank California
Sanwa Bank Plaza 25% $10,000,000 25% $ 3,750,000 25% $6,250,000
000 X. Xxxxxxxx Xxxxxx, X0-00
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxx
Xxxxxx Bank, N.A.
000 X. Xxxx Xxxxxx, 0xx Xxxxx 18.75% $ 7,500,000 18.75% $ 2,812,500 18.75% $4,687,500
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx X. XxXxxxx
Union Bank of California, N.A. 18.75% $ 7,500,000 18.75% $ 2,812,500 18.75% $4,687,500
000 X. Xxxxxxxx Xx., 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxx Nations
TOTAL 100% $40,000,000 100% $15,000,000 100% $25,000,000
