EXHIBIT 10.37
SECOND AMENDED AND RESTATED LOAN AGREEMENT
AMONG
TALX CORPORATION, A MISSOURI CORPORATION
AS BORROWER
LASALLE BANK NATIONAL ASSOCIATION
AS ADMINISTRATIVE AGENT
AND
THE FROM TIME TO TIME LENDERS PARTY HERETO
DATED AS OF APRIL 14, 2005
TABLE OF CONTENTS
1. EFFECTIVE DATE................................................................. 1
2. DEFINITIONS AND RULES OF CONSTRUCTION.......................................... 1
2.1. LISTED DEFINITIONS........................................................ 1
2.2. OTHER DEFINITIONS......................................................... 2
2.3. REFERENCES TO COVERED PERSON.............................................. 2
2.4. REFERENCES TO REQUIRED LENDERS............................................ 2
2.5. ACCOUNTING TERMS.......................................................... 2
2.6. MEANING OF SATISFACTORY................................................... 2
2.7. COMPUTATION OF TIME PERIODS............................................... 2
2.8. GENERAL................................................................... 2
3. LENDERS' COMMITMENTS........................................................... 3
3.1. REVOLVING LOAN COMMITMENTS................................................ 3
3.1.1. AGGREGATE AMOUNT..................................................... 3
3.1.2. LIMITATION ON REVOLVING LOAN ADVANCES................................ 3
3.1.3. REVOLVING NOTES...................................................... 4
3.2. INTENTIONALLY DELETED..................................................... 4
3.3. LETTER OF CREDIT COMMITMENT............................................... 4
3.4. INCREASES IN AGGREGATE REVOLVING LOAN COMMITMENT.......................... 4
3.4.1. REQUEST FOR INCREASE................................................. 4
3.4.2. LENDERS' PARTICIPATION IN INCREASE................................... 5
3.4.3. PROPOSED NEW LENDER(S) PARTICIPATION IN INCREASE..................... 6
3.4.4. BUYING AND SELLING LENDERS........................................... 6
3.5. SWINGLINE FACILITY........................................................ 7
3.5.1. SWINGLINE LOANS...................................................... 7
3.5.2. PRINCIPAL AND INTEREST ON SWINGLINE LOANS............................ 8
3.5.3. REFUNDING SWINGLINE LOANS............................................ 8
3.6. REDUCTIONS OF AGGREGATE REVOLVING LOAN COMMITMENT......................... 9
4. INTEREST....................................................................... 9
4.1. INTEREST ON DRAWS ON LETTERS OF CREDIT.................................... 10
4.2. INTEREST ON AGGREGATE REVOLVING LOANS..................................... 10
4.3. ADJUSTED BASE RATE........................................................ 10
4.4. ADJUSTED EURODOLLAR RATE.................................................. 10
4.5. BASE RATE MARGINS AND EURODOLLAR MARGINS.................................. 10
4.6. CONVERSION OF LOANS....................................................... 11
4.7. INTEREST PERIODS FOR EURODOLLAR LOANS..................................... 11
4.8. TIME OF ACCRUAL........................................................... 12
4.9. COMPUTATION............................................................... 12
4.10. RATE AFTER MATURITY...................................................... 12
5. FEES........................................................................... 12
5.1. AMENDMENT FEE............................................................. 12
5.2. REVOLVING LOAN UNUSED FEE................................................. 12
5.3. LETTER OF CREDIT FEE...................................................... 12
5.4. LETTER OF CREDIT FRONTING FEE............................................. 13
5.5. OTHER LETTER OF CREDIT FEES............................................... 13
i
5.6. ADMINISTRATIVE AGENT'S FEES............................................... 13
5.7. CALCULATION OF FEES....................................................... 13
6. PAYMENTS....................................................................... 13
6.1. SCHEDULED PAYMENTS ON AGGREGATE REVOLVING LOAN............................ 13
6.1.1. INTEREST............................................................. 13
6.1.2. PRINCIPAL............................................................ 13
6.2. INTENTIONALLY DELETED..................................................... 14
6.3. PREPAYMENTS............................................................... 14
6.3.1. VOLUNTARY PREPAYMENTS................................................ 14
6.3.2. MANDATORY PREPAYMENTS WHEN OVER-ADVANCES EXIST....................... 14
6.4. REIMBURSEMENT OBLIGATIONS OF BORROWER..................................... 14
6.5. MANNER OF PAYMENTS AND TIMING OF APPLICATION OF PAYMENTS.................. 15
6.5.1. PAYMENT REQUIREMENT.................................................. 15
6.5.2. APPLICATION OF PAYMENTS AND PROCEEDS................................. 15
6.5.3. INTEREST CALCULATION................................................. 15
6.6. RETURNED INSTRUMENTS...................................................... 15
6.7. COMPELLED RETURN OF PAYMENTS OR PROCEEDS.................................. 15
6.8. DUE DATES NOT ON BUSINESS DAYS............................................ 16
7. PROCEDURE FOR OBTAINING ADVANCES AND LETTERS OF CREDIT......................... 16
7.1. INITIAL ADVANCE........................................................... 16
7.2. SUBSEQUENT LOAN ADVANCES.................................................. 16
7.2.1. BORROWER REQUESTS.................................................... 16
7.2.2. ADMINISTRATIVE AGENT'S RIGHT TO MAKE OTHER REVOLVING LOAN ADVANCES... 16
7.2.2.1. PAYMENT OF LOAN OBLIGATIONS.................................. 16
7.2.2.2. PAYMENTS TO OTHER CREDITORS.................................. 17
7.3. LETTERS OF CREDIT......................................................... 17
7.4. FUNDINGS.................................................................. 17
7.4.1. REVOLVING ADVANCES................................................... 17
7.4.2. DRAWS ON LETTERS OF CREDIT........................................... 17
7.4.3. ALL FUNDINGS RATABLE................................................. 18
7.5. ADMINISTRATIVE AGENT'S AVAILABILITY ASSUMPTION............................ 18
7.5.1. ASSUMPTION AS TO LENDERS............................................. 18
7.5.2. ASSUMPTION AS TO BORROWER............................................ 19
7.6. DISBURSEMENT.............................................................. 19
7.7. RESTRICTIONS ON ADVANCES.................................................. 19
7.8. RESTRICTION ON NUMBER OF EURODOLLAR LOANS................................. 20
7.9. EACH ADVANCE REQUEST AND LETTER OF CREDIT REQUEST A CERTIFICATION......... 20
7.10. REQUIREMENTS FOR EVERY ADVANCE REQUEST................................... 20
7.11. REQUIREMENTS FOR EVERY LETTER OF CREDIT REQUEST.......................... 20
7.12. EXONERATION OF ADMINISTRATIVE AGENT AND LENDERS.......................... 20
8. SECURITY AND GUARANTIES........................................................ 21
8.1. SECURITY AGREEMENTS....................................................... 21
8.2. PLEDGE AGREEMENTS......................................................... 21
8.3. COLLATERAL ASSIGNMENTS.................................................... 21
8.3.1. INTELLECTUAL PROPERTY ASSIGNMENTS.................................... 21
ii
8.3.2. ACQUISITION DOCUMENTS ASSIGNMENT..................................... 21
8.3.3. LEASE ASSIGNMENTS.................................................... 21
8.4. GUARANTIES................................................................ 21
8.5. ADDITIONAL SUBSIDIARIES................................................... 22
9. POWER OF ATTORNEY.............................................................. 22
10. CONDITIONS OF LENDING......................................................... 23
10.1. CONDITIONS TO INITIAL ADVANCE............................................ 23
10.1.1. LISTED DOCUMENTS AND OTHER ITEMS.................................... 23
10.1.2. FINANCIAL CONDITION................................................. 23
10.1.3. NO DEFAULT.......................................................... 24
10.1.4. PERFECTION OF SECURITY INTERESTS.................................... 24
10.1.5. REPRESENTATIONS AND WARRANTIES...................................... 24
10.1.6. NO MATERIAL ADVERSE CHANGE.......................................... 24
10.1.7. PENDING MATERIAL PROCEEDINGS........................................ 24
10.1.8. PAYMENT OF FEES AND EXPENSES........................................ 24
10.1.9. INTENTIONALLY DELETED............................................... 24
10.1.10. INTENTIONALLY DELETED.............................................. 24
10.1.11. INSURANCE.......................................................... 25
10.1.12. ENVIRONMENTAL...................................................... 25
10.1.13. OTHER ITEMS........................................................ 25
10.2. CONDITIONS TO SUBSEQUENT ADVANCES........................................ 25
10.2.1. GENERAL CONDITIONS.................................................. 25
10.2.2. REPRESENTATIONS AND WARRANTIES...................................... 25
10.2.3. NO DEFAULT.......................................................... 25
10.3. CONDITIONS TO ADVANCES FOR APPROVED ACQUISITIONS......................... 25
10.3.1. APPROVED ACQUISITION DELIVERABLES................................... 25
10.3.2. SATISFACTION OF CONDITIONS TO THE APPROVED ACQUISITION.............. 26
10.3.3. ADDITIONAL SUBSIDIARIES............................................. 26
10.3.4. INTENTIONALLY DELETED............................................... 26
10.3.5. AUTHORITY TO CONSUMMATE THE APPROVED ACQUISITIONS................... 26
10.3.6. REQUEST TO FUND..................................................... 27
11. CONDITIONS TO ISSUANCE OF LETTERS OF CREDIT................................... 27
11.1. NO PROHIBITIONS.......................................................... 27
11.2. REPRESENTATIONS AND WARRANTIES........................................... 27
11.3. NO DEFAULT............................................................... 27
11.4. OTHER CONDITIONS......................................................... 27
12. REPRESENTATIONS AND WARRANTIES................................................ 27
12.1. ORGANIZATION AND EXISTENCE............................................... 28
12.2. AUTHORIZATION............................................................ 28
12.3. DUE EXECUTION............................................................ 28
12.4. ENFORCEABILITY OF OBLIGATIONS............................................ 28
12.5. BURDENSOME OBLIGATIONS................................................... 28
12.6. LEGAL RESTRAINTS......................................................... 28
12.7. LABOR CONTRACTS AND DISPUTES............................................. 28
12.8. NO MATERIAL PROCEEDINGS.................................................. 29
12.9. MATERIAL LICENSES........................................................ 29
iii
12.10. COMPLIANCE WITH MATERIAL LAWS........................................... 29
12.10.1. GENERAL COMPLIANCE WITH ENVIRONMENTAL LAWS AND EMPLOYMENT LAWS..... 29
12.10.2. PROCEEDINGS........................................................ 29
12.10.3. INVESTIGATIONS REGARDING HAZARDOUS MATERIALS....................... 29
12.10.4. NOTICES AND REPORTS REGARDING HAZARDOUS MATERIALS.................. 29
12.10.5. ENVIRONMENTAL PROPERTY TRANSFER ACTS............................... 29
12.11. OTHER NAMES............................................................. 29
12.12. CONSUMMATION OF THE APPROVED ACQUISITIONS............................... 30
12.13. PRIOR TRANSACTIONS...................................................... 30
12.14. CAPITALIZATION.......................................................... 30
12.15. SOLVENCY................................................................ 30
12.16. PROJECTIONS; PRO FORMA BALANCE SHEET.................................... 30
12.17. FINANCIAL STATEMENTS.................................................... 31
12.18. NO CHANGE IN CONDITION.................................................. 31
12.19. INVESTMENTS............................................................. 31
12.20. INDEBTEDNESS............................................................ 31
12.21. INDIRECT OBLIGATIONS.................................................... 31
12.22. OPERATING LEASES........................................................ 31
12.23. CAPITAL LEASES.......................................................... 31
12.24. TAX LIABILITIES; GOVERNMENTAL CHARGES................................... 31
12.25. PENSION BENEFIT PLANS................................................... 32
12.25.1. PROHIBITED TRANSACTIONS............................................ 32
12.25.2. CLAIMS............................................................. 32
12.25.3. REPORTING AND DISCLOSURE REQUIREMENTS.............................. 32
12.25.4. ACCUMULATED FUNDING DEFICIENCY..................................... 32
12.25.5. MULTI-EMPLOYER PLAN................................................ 32
12.26. WELFARE BENEFIT PLANS................................................... 33
12.27. RETIREE BENEFITS........................................................ 33
12.28. DISTRIBUTIONS........................................................... 33
12.29. REAL PROPERTY........................................................... 33
12.30. STATE OF COLLATERAL AND OTHER PROPERTY.................................. 33
12.30.1. ACCOUNTS........................................................... 33
12.30.2. INVENTORY.......................................................... 34
12.30.3. EQUIPMENT.......................................................... 34
12.30.4. INTELLECTUAL PROPERTY.............................................. 34
12.30.5. DOCUMENTS, INSTRUMENTS AND CHATTEL PAPER........................... 35
12.31. CHIEF PLACE OF BUSINESS; LOCATIONS OF COLLATERAL........................ 35
12.32. NEGATIVE PLEDGES........................................................ 35
12.33. SECURITY DOCUMENTS...................................................... 35
12.33.1. SECURITY AGREEMENTS................................................ 36
12.33.2. COLLATERAL ASSIGNMENTS............................................. 36
12.33.2.1. INTELLECTUAL PROPERTY ASSIGNMENTS.......................... 36
12.33.2.2. PLEDGE AGREEMENT........................................... 36
12.33.2.3. ACQUISITION DOCUMENTS ASSIGNMENT........................... 36
12.34. S CORPORATION........................................................... 36
iv
12.35. SUBSIDIARIES AND AFFILIATES............................................. 36
12.36. BANK ACCOUNTS AND LOCKBOXES............................................. 37
12.37. MARGIN STOCK............................................................ 37
12.38. SECURITIES MATTERS...................................................... 37
12.39. INVESTMENT COMPANY ACT, ETC............................................. 37
12.40. NO MATERIAL MISSTATEMENTS OR OMISSIONS.................................. 37
12.41. FILINGS................................................................. 37
12.42. BROKER'S FEES........................................................... 38
12.43. NO XXXX-XXXXX XXXXXX FILING REQUIRED.................................... 38
13. MODIFICATION AND SURVIVAL OF REPRESENTATIONS.................................. 38
14. AFFIRMATIVE COVENANTS......................................................... 38
14.1. USE OF PROCEEDS.......................................................... 38
14.2. CORPORATE EXISTENCE...................................................... 39
14.3. MAINTENANCE OF PROPERTY AND LEASES....................................... 39
14.4. INVENTORY................................................................ 39
14.5. INSURANCE................................................................ 39
14.6. PAYMENT OF TAXES AND OTHER OBLIGATIONS................................... 40
14.7. COMPLIANCE WITH LAWS..................................................... 40
14.8. DISCOVERY AND CLEAN-UP OF HAZARDOUS MATERIAL............................. 40
14.8.1. IN GENERAL.......................................................... 41
14.8.2. ASBESTOS CLEAN-UP................................................... 41
14.9. TERMINATION OF PENSION BENEFIT PLAN...................................... 41
14.10. NOTICE TO ADMINISTRATIVE AGENT OF MATERIAL EVENTS....................... 42
14.11. BORROWING OFFICER....................................................... 43
14.12. MAINTENANCE OF SECURITY INTERESTS OF SECURITY DOCUMENTS................. 43
14.12.1. PRESERVATION AND PERFECTION OF SECURITY INTERESTS.................. 43
14.12.2. COLLATERAL HELD BY WAREHOUSEMAN, BAILEE, ETC....................... 44
14.12.3. COMPLIANCE WITH TERMS OF SECURITY DOCUMENTS........................ 44
14.13. ACCOUNTING SYSTEM....................................................... 44
14.13.1. ACCOUNT RECORDS.................................................... 44
14.13.2. TRACING OF PROCEEDS................................................ 45
14.14. FINANCIAL STATEMENTS.................................................... 45
14.14.1. ANNUAL FINANCIAL STATEMENTS........................................ 45
14.14.2. QUARTERLY FINANCIAL STATEMENTS..................................... 45
14.15. OTHER FINANCIAL INFORMATION............................................. 46
14.15.1. REPORTS OR INFORMATION CONCERNING ACCOUNTS OR INVENTORY............ 46
14.15.2. STOCKHOLDER REPORTS................................................ 46
14.15.3. PENSION BENEFIT PLAN REPORTS....................................... 46
14.15.4. TAX RETURNS........................................................ 46
14.16. REVIEW OF ACCOUNTS...................................................... 46
14.17. INTENTIONALLY DELETED................................................... 46
14.18. ANNUAL PROJECTIONS...................................................... 46
14.19. OTHER INFORMATION....................................................... 46
14.20. AUDITS BY ADMINISTRATIVE AGENT.......................................... 47
14.21. VERIFICATION OF ACCOUNTS AND NOTICES TO ACCOUNT DEBTORS................. 47
14.22. APPRAISALS OF COLLATERAL................................................ 47
v
14.23. ACCESS TO OFFICERS AND AUDITORS......................................... 47
14.24. PROFORMAS FOR PERMITTED ACQUISITIONS.................................... 48
14.25. INTENTIONALLY DELETED................................................... 48
14.26. ACQUISITION DOCUMENTS................................................... 48
14.27. FURTHER ASSURANCES...................................................... 49
15. NEGATIVE COVENANTS............................................................ 49
15.1. INVESTMENTS.............................................................. 49
15.2. INDEBTEDNESS............................................................. 50
15.3. PREPAYMENTS.............................................................. 51
15.4. INDIRECT OBLIGATIONS..................................................... 51
15.5. SECURITY INTERESTS....................................................... 51
15.6. NO AMENDMENTS TO ACQUISITION DOCUMENTS................................... 52
15.7. ACQUISITIONS............................................................. 52
15.8. BAILMENTS; CONSIGNMENTS; WAREHOUSING..................................... 53
15.9. DISPOSAL OF PROPERTY..................................................... 53
15.10. DISTRIBUTIONS........................................................... 53
15.11. CHANGE OF CONTROL....................................................... 53
15.12. AMENDMENT TO CHARTER DOCUMENTS.......................................... 54
15.13. CAPITAL STRUCTURE; EQUITY SECURITIES.................................... 54
15.14. CHANGE OF BUSINESS...................................................... 54
15.15. TRANSACTIONS WITH AFFILIATES............................................ 54
15.16. CONFLICTING AGREEMENTS.................................................. 54
15.17. SALE AND LEASEBACK TRANSACTIONS......................................... 54
15.18. NEW SUBSIDIARIES........................................................ 54
15.19. FISCAL YEAR............................................................. 55
15.20. LEASES.................................................................. 55
15.21. TRANSACTIONS HAVING A MATERIAL ADVERSE EFFECT ON COVERED PERSON......... 55
16. FINANCIAL COVENANTS........................................................... 55
16.1. SPECIAL DEFINITIONS...................................................... 55
16.2 INTENTIONALLY DELETED..................................................... 56
16.3. MINIMUM INTEREST COVERAGE................................................ 56
16.4. MAXIMUM RATIO OF TOTAL INDEBTEDNESS TO EBITDA............................ 56
16.5. INTENTIONALLY DELETED.................................................... 56
16.6. MINIMUM EBITDA........................................................... 56
17. DEFAULT....................................................................... 57
17.1. EVENTS OF DEFAULT........................................................ 57
17.1.1. FAILURE TO PAY PRINCIPAL OR INTEREST................................ 57
17.1.2. FAILURE TO PAY AMOUNTS OWED TO OTHER PERSONS........................ 57
17.1.3. REPRESENTATIONS OR WARRANTIES....................................... 57
17.1.4. CERTAIN COVENANTS................................................... 57
17.1.5. OTHER COVENANTS..................................................... 57
17.1.6. ACCELERATION OF OTHER INDEBTEDNESS.................................. 57
17.1.7. DEFAULT UNDER OTHER AGREEMENTS...................................... 57
17.1.8. BANKRUPTCY; INSOLVENCY; ETC......................................... 57
17.1.9. JUDGMENTS; ATTACHMENT; SETTLEMENT; ETC.............................. 58
17.1.10. PENSION BENEFIT PLAN TERMINATION, ETC.............................. 58
vi
17.1.11. LIQUIDATION OR DISSOLUTION......................................... 58
17.1.12. SEIZURE OF ASSETS.................................................. 59
17.1.13. RACKETEERING PROCEEDING............................................ 59
17.1.14. LOAN DOCUMENTS; SECURITY INTERESTS................................. 59
17.1.15. LOSS TO COLLATERAL................................................. 59
17.1.16. GUARANTY; GUARANTOR................................................ 59
17.2. CROSS DEFAULT............................................................ 59
17.3. RIGHTS AND REMEDIES...................................................... 60
17.3.1. TERMINATION OF COMMITMENTS.......................................... 60
17.3.2. ACCELERATION........................................................ 60
17.3.3. RIGHT OF SETOFF..................................................... 60
17.3.4. NOTICE TO ACCOUNT DEBTORS........................................... 60
17.3.5. ENTRY UPON PREMISES AND ACCESS TO INFORMATION....................... 60
17.3.6. COMPLETION OF UNCOMPLETED INVENTORY ITEMS........................... 61
17.3.7. BORROWER'S OBLIGATIONS.............................................. 61
17.3.8. SECURED PARTY RIGHTS................................................ 61
17.3.9. JOINT AND SEVERAL................................................... 62
17.3.10. MISCELLANEOUS...................................................... 62
17.4. APPLICATION OF FUNDS..................................................... 62
17.5. LIMITATION OF LIABILITY; WAIVER.......................................... 63
17.6. NOTICE................................................................... 63
18. ADMINISTRATIVE AGENT AND LENDERS.............................................. 63
18.1. APPOINTMENT, POWERS, AND IMMUNITIES...................................... 63
18.2. RELIANCE BY ADMINISTRATIVE AGENT......................................... 64
18.3. EMPLOYMENT OF AGENTS AND COUNSEL......................................... 64
18.4. DEFAULTS................................................................. 65
18.5. RIGHTS AS LENDER......................................................... 65
18.6. INDEMNIFICATION.......................................................... 65
18.7. NOTIFICATION OF LENDERS.................................................. 66
18.8. NON-RELIANCE ON AGENT AND OTHER LENDERS.................................. 66
18.9. RESIGNATION.............................................................. 66
18.10. COLLECTIONS AND DISTRIBUTIONS TO LENDERS BY ADMINISTRATIVE AGENT........ 67
18.11. LENDER AS NON-U.S. PARTICIPANT.......................................... 67
19. CHANGE IN CIRCUMSTANCES....................................................... 68
19.1. COMPENSATION FOR INCREASED COSTS AND REDUCED RETURNS..................... 68
19.1.1. LAW CHANGES OR TAX IMPOSITIONS...................................... 68
19.1.2. CAPITAL ADEQUACY.................................................... 69
19.1.3. NOTICE TO BORROWER.................................................. 69
19.2. MARKET FAILURE........................................................... 70
19.3. ILLEGALITY............................................................... 70
19.4. COMPENSATION............................................................. 70
19.5. TREATMENT OF AFFECTED LOANS.............................................. 71
19.6. TAXES.................................................................... 72
19.6.1. GROSS-UP............................................................ 72
19.6.2. LENDERS' UNDERTAKINGS............................................... 72
19.6.3. SURVIVAL OF BORROWER'S OBLIGATIONS.................................. 73
vii
19.7. USURY.................................................................... 73
20. GENERAL....................................................................... 74
20.1. LENDERS' RIGHT TO CURE................................................... 74
20.2. RIGHTS NOT EXCLUSIVE..................................................... 74
20.3. SURVIVAL OF AGREEMENTS................................................... 74
20.4. ASSIGNMENTS.............................................................. 74
20.4.1. PERMITTED ASSIGNMENTS............................................... 75
20.4.2. CONSEQUENCES AND EFFECT OF ASSIGNMENTS.............................. 75
20.4.3. AGREEMENTS UPON ASSIGNMENT.......................................... 76
20.4.4. REGISTER............................................................ 76
20.4.5. NOTICE TO BORROWER OF ASSIGNMENT.................................... 76
20.4.6. ASSIGNMENT TO FEDERAL RESERVE BANK.................................. 77
20.5. SALE OF PARTICIPATIONS................................................... 77
20.6. INTENTIONALLY DELETED.................................................... 77
20.7. INFORMATION.............................................................. 77
20.8. PAYMENT OF EXPENSES...................................................... 78
20.9. GENERAL INDEMNITY........................................................ 78
20.10. LETTERS OF CREDIT....................................................... 79
20.11. CHANGES IN ACCOUNTING PRINCIPLES........................................ 80
20.12. LOAN RECORDS............................................................ 80
20.13. OTHER SECURITY AND GUARANTIES........................................... 80
20.14. LOAN OBLIGATIONS PAYABLE IN DOLLARS..................................... 81
21. MISCELLANEOUS................................................................. 81
21.1. NOTICES.................................................................. 81
21.2. AMENDMENTS AND MODIFICATIONS; WAIVERS AND CONSENTS....................... 81
21.3. RIGHTS CUMULATIVE........................................................ 82
21.4. SUCCESSORS AND ASSIGNS................................................... 82
21.5. SEVERABILITY............................................................. 82
21.6. COUNTERPARTS............................................................. 82
21.7. GOVERNING LAW; NO THIRD PARTY RIGHTS..................................... 82
21.8. COUNTERPART FACSIMILE EXECUTION.......................................... 83
21.9. EFFECT OF MERGER OF BANK................................................. 83
21.10. NEGOTIATED TRANSACTION.................................................. 83
21.11. CHOICE OF FORUM......................................................... 83
21.12. SERVICE OF PROCESS...................................................... 84
21.13. WAIVER OF JURY TRIAL.................................................... 84
21.14. INCORPORATION BY REFERENCE.............................................. 85
21.15. PATRIOT ACT NOTIFICATION................................................ 85
21.16. STATUTORY NOTICE - INSURANCE............................................ 85
21.17. STATUTORY NOTICE - ORAL COMMITMENTS..................................... 85
viii
SECOND AMENDED AND RESTATED LOAN AGREEMENT
In consideration of the mutual agreements herein and other sufficient
consideration, the receipt of which is hereby acknowledged, TALX Corporation, a
Missouri corporation (Borrower), and LaSalle Bank National Association
(LaSalle), as Administrative Agent, and LaSalle and the other lenders listed on
Exhibit 3 to this Amended and Restated Loan Agreement (Agreement), as Lenders,
agree as follows:
The Borrower, LaSalle and Southwest Bank of St. Louis (Southwest) entered
into that certain Loan Agreement dated March 27, 2002 (Initial Loan Agreement),
as amended by that First Amendment to Loan Agreement dated July 29, 2002 among
Borrower, LaSalle and Southwest (First Amendment), as further amended by that
Second Amendment to Loan Agreement dated January 27, 2003 among Borrower,
LaSalle and Southwest (Second Amendment), as further amended by that Third
Amendment to Loan Agreement dated June 30, 2003 among Borrower, LaSalle and
Southwest (Third Amendment) (collectively, the Initial Loan Agreement, as so
amended by the First Amendment, Second Amendment and Third Amendment, is
referred to herein as the Original Loan Agreement), as amended and restated by
that certain Amended and Restated Loan Agreement dated March 31, 2004 (Initial
Amended and Restated Loan Agreement), as amended by that certain First Amendment
to Amended and Restated Loan Agreement dated September 9, 2004 (First Amendment
- Initial Amended and Restated Loan Agreement), as further amended by that
certain Second Amendment to Amended and Restated Loan Agreement dated September
30, 2004 (Second Amendment - Initial Amended and Restated Loan
Agreement)(collectively the Initial Amended and Restated Loan Agreement, as so
amended by the First Amendment - Initial Amended and Restated Loan Agreement,
and the Second Amendment - Initial Amended and Restated Loan Agreement is
referred to herein as the First Amended and Restated Loan Agreement).
The Borrower, in order to refinance the existing Indebtedness under the
First Amended and Restated Loan Agreement and to fund the acquisition of Target
One and Target Two, hereby requests that the Revolving Loan Commitment available
under the First Amended and Restated Loan Agreement be increased, and that
certain additional amendments be made to the First Amended and Restated Loan
Agreement for the sake of clarity and convenience, and that the First Amended
and Restated Loan Agreement be restated in its entirety as so amended. From the
Effective Date (defined below), all references made to the Original Loan
Agreement or the First Amended and Restated Loan Agreement in any Loan Document
or in any other instrument or document shall, without more, be deemed to refer
to this Agreement.
1. EFFECTIVE DATE. This Agreement is effective April 14, 2005.
2. DEFINITIONS AND RULES OF CONSTRUCTION.
2.1. LISTED DEFINITIONS. Capitalized words defined in the Glossary
attached hereto as Exhibit 2.1 shall have such defined meanings wherever
used in this Agreement and the other Loan Documents. The inclusion of a
defined term in the Glossary that is not used elsewhere in this Agreement
or in the other Loan Documents shall not affect the interpretation or
construction of this Agreement or the other Loan Documents.
1
2.2. OTHER DEFINITIONS. If a capitalized word in this Agreement is not
defined in the Glossary, it shall have such meaning as defined elsewhere
herein, or if not defined elsewhere herein, the meaning defined in the
UCC. Terms are italicized in this Agreement where they are defined.
2.3. REFERENCES TO COVERED PERSON. The words Covered Person, a Covered
Person, any Covered Person, each Covered Person and every Covered Person
refer to Borrower and each of its now existing or later acquired, created
or organized Subsidiaries separately. The words Covered Persons refers to
Borrower and its now existing or later acquired, created or organized
Subsidiaries collectively.
2.4. REFERENCES TO REQUIRED LENDERS. The words Required Lenders means any
one or more Lenders whose shares of Lenders' Exposure at the relevant time
aggregate at least sixty six and two-thirds percent (66 2/3%).
2.5. ACCOUNTING TERMS. Unless the context otherwise requires, accounting
terms herein that are not defined herein shall be determined under GAAP.
All financial measurements contemplated hereunder respecting Borrower
shall be made and calculated for Borrower and all of its now existing or
later acquired, created or organized Subsidiaries, if any, on a
consolidated and consolidating basis in accordance with GAAP unless
expressly provided otherwise herein.
2.6. MEANING OF SATISFACTORY. Whenever herein a document or matter is
required to be satisfactory to Administrative Agent or satisfactory to
Lenders or satisfactory to Required Lenders, unless expressly stated
otherwise such document must be satisfactory to Administrative Agent,
Lenders or Required Lenders (as applicable) in both form and substance,
and unless expressly stated otherwise Administrative Agent, Lenders or
Required Lenders (as applicable) shall have the commercially reasonable
discretion to determine whether the document or matter is satisfactory.
2.7. COMPUTATION OF TIME PERIODS. In computing or defining periods of time
from a specified date to a later specified date, and in computing the
accrual of interest or fees, the word from shall mean from and including
and the words to and until shall each mean to but excluding. Periods of
days referred to in this Agreement shall be counted in calendar days
unless Business Days are expressly prescribed, and references in this
Agreement to months and years are to calendar months and calendar years
unless otherwise specified.
2.8. GENERAL. Unless the context of this Agreement clearly requires
otherwise: (i) references to the plural include the singular and vice
versa; (ii) references to any Person include such Person's successors and
assigns, but, only if such successors and assigns are permitted by this
Agreement; (iii) references to one gender include all genders; (iv)
including is not limiting; (v) "or" has the inclusive meaning represented
by the phrase "and/or"; (vi) the words "hereof," "herein," "hereby,"
"hereunder" and similar terms in this Agreement refer to this Agreement as
a whole, including its Exhibits, and not to any particular provision of
this Agreement; (vii) the word "Section" or "section" and "Page" or "page"
refer to a section or page, respectively, of this Agreement, and the word
2
"Exhibit" refers to an Exhibit to this Agreement unless it expressly
refers to something else; (viii) reference to any agreement, document, or
instrument (including this Agreement and any other Loan Document or other
agreement, document or instrument defined herein), means such agreement,
document, or instrument as amended, modified, restated or replaced and in
effect from time to time in accordance with the terms thereof and, if
applicable, the terms hereof, and includes all attachments, exhibits and
schedules thereto and documents incorporated therein, if any; and (ix)
general and specific references to any Law means such Law as amended,
modified, codified or reenacted, in whole or in part, and in effect from
time to time. Section captions and the Table of Contents are for
convenience only and shall not affect the interpretation or construction
of this Agreement or the other Loan Documents.
3. LENDERS' COMMITMENTS. Subject to the terms and conditions hereof, and in
reliance upon the Representations and Warranties, Lenders make the following
commitments to Borrower:
3.1. REVOLVING LOAN COMMITMENTS.
3.1.1. AGGREGATE AMOUNT. Subject to the limitations in Section 3.1.2
and elsewhere herein, each Lender commits to make available to
Borrower, from the Effective Date to the Revolving Loan Maturity
Date, such Lender's Pro-Rata Share of an Aggregate Revolving Loan
Commitment of $100,000,000.00, by funding such Lender's Pro-Rata
Share of Revolving Loan Advances made from time to time by
Administrative Agent as provided herein. The Pro-Rata Share of each
Lender on the Effective Date is listed on Exhibit 3 hereto. The
Aggregate Revolving Loan Commitment may be increased or decreased as
provided in this Agreement. Subject to the limitations in Section
3.1.2 and elsewhere herein, payments and prepayments that are
applied to reduce the Aggregate Revolving Loan may be re-borrowed
through Revolving Loan Advances.
3.1.2. LIMITATION ON REVOLVING LOAN ADVANCES. No Revolving Loan
Advance will be made which would result in the sum of the Aggregate
Revolving Loan, Swingline Loan Exposure, and the Letter of Credit
Exposure on any Advance Date (except to the extent that a Revolving
Loan Advance will be used immediately to reimburse Letter of Credit
Issuer for unreimbursed draws on a Letter of Credit) exceeding the
Aggregate Revolving Loan Commitment, and no Revolving Loan Advance
will be made on or after the Revolving Loan Maturity Date. Lenders
may, however, in their absolute discretion make such Revolving Loan
Advances, but shall not be deemed by doing so to have increased the
Maximum Available Amount and shall not be obligated to make any such
Revolving Loan Advances thereafter. At any time that there is an
Existing Default, the Aggregate Revolving Loan Commitment may be
canceled as provided in Section 17.3. The Maximum Available Amount
on any date shall be a Dollar amount equal to the Aggregate
Revolving Loan Commitment, minus (a) the amount outstanding under
the Aggregate Revolving Loan on such date, (b) the Letter of Credit
Exposure on such date (except to the extent that a Revolving
3
Loan Advance will be used immediately to reimburse Letter of Credit
Issuer for unreimbursed draws on a Letter of Credit), and (c) the
Swingline Loan Exposure.
3.1.3. REVOLVING NOTES. The obligation of Borrower to repay each
Lender's Revolving Loan shall be evidenced by a promissory note
payable to the order of such Lender in a maximum principal amount
equal to the amount of its Revolving Loan Commitment and otherwise
in form and substance satisfactory to Lenders.
3.2. INTENTIONALLY DELETED.
3.3. LETTER OF CREDIT COMMITMENT. Letter of Credit Issuer commits to issue
standby letters of credit and commercial (documentary) letters of credit
for the account of Borrower from time to time from the Effective Date to
the Revolving Loan Maturity Date, but only in connection with transactions
satisfactory to Letter of Credit Issuer and only if the Letter of Credit
Exposure will not as a result of such issuance exceed the lesser of (i)
$1,000,000.00 and (ii) the Maximum Available Amount. The expiration date
of any Letter of Credit will be a Business Day that is not later than the
date which is twenty-five Business Days prior to the Revolving Loan
Maturity Date; provided, however, that the expiration date for a Letter of
Credit may be later than the Revolving Loan Maturity Date if Letter of
Credit Issuer consents to such issuance and Borrower provides to Letter of
Credit Issuer cash collateral satisfactory to Letter of Credit Issuer as
security for Borrower's obligation to reimburse Letter of Credit Issuer
for all draws thereunder. Immediately upon the issuance by Letter of
Credit Issuer of a Letter of Credit in accordance with the terms and
conditions of this Agreement, Letter of Credit Issuer shall be deemed to
have sold and transferred to each other Lender, and such other Lender
shall be deemed to have purchased and received from Letter of Credit
Issuer, a pro-rata undivided interest and participation in such Letter of
Credit, the reimbursement obligation of Borrower with respect thereto, and
any guaranty thereof or collateral therefor. Such other Lender's pro-rata
undivided interest shall be the same as its Pro-Rata Share of the
Aggregate Revolving Loan Commitment.
3.4. INCREASES IN AGGREGATE REVOLVING LOAN COMMITMENT.
3.4.1. REQUEST FOR INCREASE. At any time, the Borrower may request
that the Aggregate Revolving Loan Commitment be increased without
the prior written consent of all of the Lenders; provided that, (a)
the Aggregate Revolving Loan Commitment shall at no time exceed
$125,000,000; (b) the Borrower is not permitted to make any such
request during the six month period following any reduction in the
Aggregate Revolving Loan Commitment under this Agreement; (c) the
Borrower is not permitted to make any such request more frequently
than once in any 6-month period; and (d) each such request must be
in a minimum amount of $10,000,000 and increments of $5,000,000 in
excess thereof. Such request shall be made in a written notice given
to the Administrative Agent and the Lenders by the Borrower not less
than twenty (20) Business Days prior to the proposed effective date
of such increase, which notice (a "Commitment Increase Notice") must
specify the amount of the proposed increase in the Aggregate
Revolving Loan Commitment and the proposed effective date of such
increase.
4
Any increase in the Aggregate Revolving Loan Commitment under this
Agreement is subject to the following conditions precedent: (A)
Borrower must have executed promissory notes in favor of each Lender
and any Proposed New Lender in the amount of each Lender's Pro-Rata
Share of the Aggregate Revolving Loan Commitment, as increased under
this Section; (B) the Borrower must have obtained the consent
thereto of each Guarantor and its reaffirmation of the Loan
Document(s) executed by it, which consent and reaffirmation must be
in writing and in form and substance reasonably satisfactory to the
Administrative Agent, (C) as of the date of the Commitment Increase
Notice and as of the proposed effective date of the increase in the
Aggregate Revolving Loan Commitment under this Agreement, no event
shall have occurred and then be continuing which constitutes a
Default, Event of Default, or Existing Default under this Agreement,
(D) the Borrower, the Administrative Agent and each Proposed New
Lender or Lender that agreed to provide a "Commitment" in support of
such increase in the Aggregate Revolving Loan Commitment under this
Agreement must have executed and delivered a "Commitment and
Acceptance" substantially in the form of Exhibit 3.4.1 hereto, (E)
counsel for the Borrower and for the Guarantors must have provided
to the Administrative Agent supplemental opinions in form and
substance reasonably satisfactory to the Administrative Agent, and
(F) the Borrower and the Proposed New Lender must otherwise have
executed and delivered such other instruments and documents as may
be required under Section 10.1.1 or that the Administrative Agent
reasonably requests in connection with such increase. If any fee is
charged by the Lenders in connection with any such increase, such
fee shall be in accordance with then prevailing market conditions,
which market conditions shall have been reasonably documented by the
Administrative Agent to the Borrower. Upon satisfaction of the
conditions precedent to any increase in the Aggregate Revolving Loan
Commitment under this Agreement, the Administrative Agent will
promptly advise the Borrower and each Lender of the effective date
of such increase.
3.4.2. LENDERS' PARTICIPATION IN INCREASE. In the event of such a
Commitment Increase Notice, each of the Lenders will be given the
opportunity to participate in the requested increase. No Lender has
an obligation to increase its Commitment pursuant to a Commitment
Increase Notice. On or prior to the date that is fifteen (15)
Business Days after receipt of the Commitment Increase Notice, each
Lender must submit to the Administrative Agent a notice indicating
the maximum amount by which it is willing to increase its Commitment
in connection with such Commitment Increase Notice (any such notice
to the Administrative Agent being herein a "Lender Increase
Notice"). Any Lender which does not submit a Lender Increase Notice
to the Administrative Agent prior to the expiration of such fifteen
(15) Business Day period will be deemed to have denied any increase
in its Commitment. In the event that the increases of Commitments
set forth in the Lender Increase Notices exceed the amount requested
by the Borrower in the Commitment Increase Notice, the
Administrative Agent has the right, in consultation with the
Borrower, to allocate the amount of increases necessary to meet the
Borrower's Commitment Increase Notice.
5
3.4.3. PROPOSED NEW LENDER(S) PARTICIPATION IN INCREASE. In the
event that the Lender Increase Notices are less than the amount
requested by the Borrower, not later than three (3) Business Days
prior to the proposed effective date the Borrower may notify the
Administrative Agent of any financial institution that has agreed to
become a "Lender" party hereto (a "Proposed New Lender") in
connection with the Commitment Increase Notice. Any Proposed New
Lender must be consented to by the Administrative Agent (which
consent shall not be unreasonably withheld). If the Borrower does
not arrange for any Proposed New Lender(s) to commit to the
shortfall from the Lender Increase Notices, then the Borrower will
be deemed to have reduced the amount of its Commitment Increase
Notice to the aggregate amount set forth in the Lender Increase
Notices. Based upon (i) the Lender Increase Notices, (ii) any
allocations made in connection therewith and (iii) if applicable,
any notice regarding any Proposed New Lender, the Administrative
Agent will notify the Borrower and the Lenders on or before the
Business Day immediately prior to the proposed effective date of the
amount of each Lender's and Proposed New Lenders' Commitment (the
"Effective Commitment Amount") and the amount of the Aggregate
Revolving Loan Commitment under this Agreement which amounts are
effective on the following Business Day.
Upon the effective date of any increase in the Aggregate Revolving
Loan Commitment under this Agreement that is supported by a Proposed
New Lender, such Proposed New Lender will be a party to this
Agreement as a Lender, will have the rights and obligations of a
Lender hereunder, and execute any document evidencing joinder in
this Agreement as required by Administrative Agent. Nothing
contained herein constitutes, or otherwise is, a commitment on the
part of any Lender to increase its Commitment hereunder at any time.
3.4.4. BUYING AND SELLING LENDERS. For purposes of this Section
3.4.4, (A) the term "Buying Lender(s)" means (i) each Lender the
Effective Commitment Amount of which is greater than its Commitment
prior to the effective date of any increase in the Aggregate
Revolving Loan Commitment under this Agreement, and (ii) each
Proposed New Lender that is allocated an Effective Commitment Amount
in connection with any Commitment Increase Notice, and (B) the term
"Selling Lender(s)" shall mean each Lender whose Commitment under
this Agreement is not being increased from that in effect prior to
such increase in the Aggregate Revolving Loan Commitment under this
Agreement. Effective on the effective date of any increase in the
Aggregate Revolving Loan Commitment under this Agreement pursuant to
Sections 3.4.1, 3.4.2 and 3.4.3 above, each Selling Lender hereby
sells, grants, assigns and conveys to each Buying Lender, without
recourse, warranty, or representation of any kind, except as
specifically provided herein, an undivided percentage in such
Selling Lender's right, title and interest in and to its outstanding
Revolving Loans in the respective dollar amounts and percentages
necessary so that, from and after such sale, each such Selling
Lender's outstanding Revolving Loans shall equal such Selling
Lender's Pro-Rata Share (calculated based upon the Effective
Commitment Amounts) of the outstanding Revolving Loans under this
Agreement. Effective on the effective
6
date of the increase in the Aggregate Revolving Loan Commitment
under this Agreement pursuant to Sections 3.4.1, 3.4.2, and 3.4.3
above, each Buying Lender hereby purchases and accepts such grant,
assignment and conveyance from the Selling Lenders. Each Buying
Lender hereby agrees that its respective purchase price for the
portion of the outstanding Revolving Loans purchased hereby shall
equal the respective dollar amount necessary so that, from and after
such payments, each Buying Lender's outstanding Revolving Loans
shall equal such Buying Lender's Pro-Rata Share (calculated based
upon the Effective Commitment Amounts) of the outstanding Revolving
Loans under this Agreement. Such amount shall be payable on the
effective date of the increase in the Aggregate Revolving Loan
Commitment under this Agreement by wire transfer of immediately
available funds to the Administrative Agent. The Administrative
Agent, in turn, shall wire transfer any such funds received to the
Selling Lenders, in same day funds, for the sole account of the
Selling Lenders. Each Selling Lender hereby represents and warrants
to each Buying Lender that such Selling Lender owns the Revolving
Loans being sold and assigned hereby for its own account and has not
sold, transferred or encumbered any or all of its interest in such
Revolving Loans, except for participations which will be
extinguished upon payment to Selling Lender of an amount equal to
the portion of the outstanding Revolving Loans being sold by such
Selling Lender. Each Buying Lender hereby acknowledges and agrees
that, except for each Selling Lender's representations and
warranties contained in the foregoing sentence, each such Buying
Lender has entered into its Commitment and Acceptance with respect
to such increase on the basis of its own independent investigation
and has not relied upon, and will not rely upon, any explicit or
implicit written or oral representation, warranty or other statement
of the Lenders or the Administrative Agent concerning the
authorization, execution, legality, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or the
other Loan Documents. The Borrower hereby agrees to compensate each
Selling Lender for all losses, expenses and liabilities incurred by
each Lender in connection with the sale and assignment of any
Revolving Loan or Swingline Loan hereunder on the terms and in the
manner as set forth in Section 19.4.
3.5. SWINGLINE FACILITY.
3.5.1. SWINGLINE LOANS. Upon receipt of a Loan Request Certificate
as provided in Section 7.10, subject to the terms and conditions
hereof and in reliance on the obligations of the Lenders to the
Administrative Agent under this Agreement, Administrative Agent may,
in its sole discretion, advance a swingline (the "Swingline") in the
form of one or more swingline loans (each a "Swingline Loan") to the
Borrower from time to time before the Revolving Loan Maturity Date
on a revolving basis up to $5,000,000 in aggregate principal amount
from time to time (the "Swingline Facility") only if the Swingline
Loan Exposure will not as a result of such advance exceed the lesser
of (i) $5,000,000 or (ii) the Maximum Available Amount. The
Administrative Agent may make a Swingline Loan even if after making
a Swingline Loan, the Administrative Agent's Pro-Rata Share of the
sum of the Aggregate Revolving Loans, the Letter of Credit
7
Exposure, and all outstanding Swingline Loans will exceed the
Administrative Agent's Pro-Rata Share of the Aggregate Revolving
Loan Commitment. Swingline Loans may be repaid and their principal
amount reborrowed before the Revolving Loan Maturity Date, subject
to the terms and conditions hereof. No more than five (5) Swingline
Loans may be outstanding at any time.
All Swingline Loans made by Administrative Agent under the Swingline
Facility shall be evidenced by a Swingline Note of the Borrower (the
"Swingline Note") payable to the order of Administrative Agent in
the amount of its Swingline Facility. Without regard to the face
principal amount of the Swingline Note, the actual principal amount
at any time outstanding and owing by the Borrower on account thereof
during the period ending on the Revolving Loan Maturity Date shall
be the sum of all advances then or theretofore made thereon less all
principal payments actually received thereon during such period.
3.5.2. PRINCIPAL AND INTEREST ON SWINGLINE LOANS. Each Swingline
Loan shall bear interest on the unpaid principal amount thereof from
the date such Swingline Loan is made until paid in full at the
Adjusted Base Rate. Borrower shall pay interest on each Swingline
Loan monthly in arrears beginning on the first day of the first
calendar month ending after the date Administrative Agent advances
any Swingline Loan and continuing on the first day of each calendar
month thereafter and on the Revolving Loan Maturity Date. Borrower
shall repay the entire amount of any Swingline Loan as then
outstanding on the earlier of demand therefor or the Revolving Loan
Maturity Date. Upon the occurrence and during the continuance of an
Event of Default, Default, or Existing Default hereunder all
Swingline Loans shall bear interest at the rate specified in Section
4.10.
3.5.3. REFUNDING SWINGLINE LOANS. In its sole and absolute
discretion, Administrative Agent may at any time, but no less
frequently than once weekly, on behalf of the Borrower (which hereby
irrevocably authorizes Administrative Agent to act on its behalf for
such purpose), request each Lender by means of written or
telegraphic notices to make a Revolving Loan in an amount
proportionate to such Lender's Pro-Rata Share of the Aggregate
Revolving Loan Commitment as applied to the amount of the Swingline
Loans outstanding on the date such notice is given. Unless any of
the conditions of this Section 3.5.3 are not fulfilled on such date,
each Lender shall make the proceeds of its requested Loan available
to Administrative Agent, in immediately available funds, at the
principal office of Administrative Agent in Chicago, Illinois,
before 2:00 p.m. (Local Time) on the Business Day such notice is
given (provided that such notice is given by 12:00 p.m. Local Time).
In the event the Administrative Agent does not provide notice to the
Lenders by 12:00 p.m. Local Time, such notice from the
Administrative Agent shall be deemed to have been received on the
following Business Day. The proceeds of such Revolving Loans shall
be immediately paid to the Administrative Agent and applied to repay
the outstanding Swingline Loans.
8
3.5.3.1. If, prior to any Lender refunding a Swingline Loan
with a Revolving Loan pursuant to Section 3.5.3, one of the
events described in Section 17.1.8 has occurred, then, subject
to the provisions of Section 3.5.3.2 below, each Lender shall,
on the date such Revolving Loan was to have been made for the
benefit of the Borrower, purchase from the Administrative
Agent an undivided participation interest in the Swingline
Loan in an amount equal to its Pro-Rata Share of such
Swingline Loan. Upon request, each Lender shall promptly
transfer to the Administrative Agent, in immediately available
funds, the amount of its participation interest.
3.5.3.2. Each Lender's obligation to make Revolving Loans in
accordance with Section 3.5.3 and to purchase participation
interests in accordance with Section 3.5.3.1 shall be absolute
and unconditional and shall not be affected by any
circumstance, including (i) any setoff, counterclaim,
recoupment, defense or other right that such Lender may have
against the Administrative Agent, the Borrower or any other
Person for any reason whatsoever; (ii) the occurrence or
continuance of any Default or Event of Default; (iii) any
inability of the Borrower to satisfy the conditions precedent
to borrowing set forth in this Agreement at any time or (iv)
any other circumstance, happening or event whatsoever, whether
or not similar to any of the foregoing. If and to the extent
any Lender shall not have made the amount required pursuant to
Sections 3.5.3 or 3.5.3.1, as the case may be, available to
the Administrative Agent, as applicable, by 2:00 P.M., Local
Time on the Business Day on which such Lender receives notice
from the Administrative Agent of such payment or disbursement
(it being understood that any such notice received after 12:00
p.m. Local Time, on any Business Day shall be deemed to have
been received on the next following Business Day), such Lender
agrees to pay interest on such amount to the Administrative
Agent for the Administrative Agent's account forthwith on
demand, for each day from the date such amount was to have
been delivered to the Administrative Agent to the date such
amount is paid, at a rate per annum equal to (a) for the first
three days after demand, the Federal Funds Rate from time to
time in effect and (b) thereafter, the Base Rate from time to
time in effect.
3.6. REDUCTIONS OF AGGREGATE REVOLVING LOAN COMMITMENT. The Borrower shall
have the right at any time upon five (5) Business Days prior written
notice to the Administrative Agent and the Lenders to reduce the Aggregate
Revolving Loan Commitment in a minimum principal amount of $5,000,000.00
or such greater amount which is an integral multiple of $1,000,000.00;
provided, however, that the Borrower may not reduce the Aggregate
Revolving Loan Commitment below the aggregate sum of outstanding Loan
Obligations.
4. INTEREST.
9
4.1. INTEREST ON DRAWS ON LETTERS OF CREDIT. The unreimbursed amount of
each draw on a Letter of Credit shall bear interest at a rate per annum
equal to the Adjusted Base Rate applicable to Revolving Loans.
4.2. INTEREST ON AGGREGATE REVOLVING LOANS. Borrower may, as provided in
Section 7, designate the whole of an Advance or any part of an Advance to
be either a Base Rate Advance or a Eurodollar Advance; provided, however,
during the existence of an Existing Default, Borrower may not designate an
Advance or part of an Advance as a Eurodollar Advance. Each Base Rate
Advance when made will become a Base Rate Loan, which shall bear interest
at the Adjusted Base Rate. Each Eurodollar Advance when made will become a
Eurodollar Loan, which shall bear interest at the Adjusted Eurodollar
Rate. Borrower may also, as provided herein, convert some or all of a Base
Rate Loan into a Eurodollar Loan and some or all of a Eurodollar Loan into
a Base Rate Loan. For each Eurodollar Loan, Borrower shall select an
Interest Period as provided in Section 4. A Eurodollar Loan shall bear
interest at the Adjusted Eurodollar Rate throughout the applicable
Interest Period designated by Borrower.
4.3. ADJUSTED BASE RATE. The Adjusted Base Rate for any Base Rate Loan
which is a Revolving Loan shall be the Base Rate plus the applicable Base
Rate Margin determined from the table in Section 4.5.
4.4. ADJUSTED EURODOLLAR RATE. The Adjusted Eurodollar Rate for any
Eurodollar Loan which is a Revolving Loan shall be the Eurodollar Rate
plus the applicable Eurodollar Margin determined from the table in Section
4.5.
4.5. BASE RATE MARGINS AND EURODOLLAR MARGINS. Commencing on the Effective
Date, the Margins shall be determined as follows:
If the ratio of Borrower's Total
Indebtedness to EBITDA (for the four
fiscal quarter period of Borrower The Base Rate The Eurodollar
most recently ended) is: Margin is: Margin is:
Greater than or equal to 0.00% 2.00%
2.00 to 1
Less than 2.00 to 1 and greater than 0.00% 1.75%
or equal to
1.50 to 1
Less than 1.50 to 1 and greater than 0.00% 1.50%
or equal to
1.00 to 1
Less than 1.00 to 1 0.00% 1.25%
The ratio of Borrower's Total Indebtedness to EBITDA (for the four fiscal
quarter period of Borrower most recently ended) on a pro forma basis as of
the Effective Date (after consummation of the transactions contemplated
hereby, the initial Revolving Loan Advance, and the payment of all fees
and expenses hereunder) is 1.26 to 1. Thereafter,
10
the applicable Margins shall be re-determined by Administrative Agent
promptly after each delivery by Borrower to Administrative Agent of
Borrower's Financial Statements (and accompanying Compliance Certificate)
as required in Section 14.14.2, and will become applicable on the third
Business Day following the day when Borrower delivers such Financial
Statements (and accompanying Compliance Certificate) to Administrative
Agent.
4.6. CONVERSION OF LOANS. Borrower may (i) as of any Business Day convert
some or all of a Base Rate Loan to a Eurodollar Loan, or (ii) at the end
of any Interest Period of a Eurodollar Loan, continue the Loan as a
Eurodollar Loan for an additional Interest Period or convert some or all
of such Eurodollar Loan to a Base Rate Loan; provided however, that if
there is an Existing Default, Borrower may not convert a Base Rate Loan to
a Eurodollar Loan or continue a Eurodollar Loan for an additional Interest
Period. To cause any conversion or continuation, Borrower shall give
Administrative Agent, prior to 11:00 a.m. Local Time three Business Days
prior to the date the conversion or continuation is to be effective, a
written request (which may be mailed, personally delivered or telecopied
as provided in Section 21.1) (i) specifying whether a conversion or
continuation is requested, (ii) in the case of a conversion, specifying
the amount to be converted and whether it is to be a Eurodollar Loan or a
Base Rate Loan upon the conversion, and (iii) in the case of any
conversion to or continuation of a Eurodollar Loan, specifying the
Interest Period therefor. If such notice is not given prior to 11:00 a.m.
Local Time on the third Business Day preceding the last day of the
Interest Period of a Eurodollar Loan, then Borrower shall be deemed to
have timely given a notice to Administrative Agent requesting to convert
all of such Eurodollar Loan to a Base Rate Loan. In the case of a
Eurodollar Loan, any conversion or continuation shall become effective
only on the day following the last day of the current Interest Period.
4.7. INTEREST PERIODS FOR EURODOLLAR LOANS. For each Eurodollar Loan
Borrower shall select an Interest Period that is either one month, two
months, three months or six months; provided that:
4.7.1. every such Interest Period for a Eurodollar Advance shall
commence on the date of the Advance or on the date of the conversion
or continuation of any Loan as a Eurodollar Loan;
4.7.2. if any Interest Period would otherwise expire on a day of a
calendar month which is not a Business Day, then such Interest
Period shall expire on the next succeeding Business Day in that
calendar month; provided, however, that if the next succeeding
Business Day would be in the following calendar month, it shall
expire on the first preceding Business Day;
4.7.3. any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at
the end of such Interest Period; and
11
4.7.4. no Interest Period for a Eurodollar Loan that is part of the
Aggregate Revolving Loan shall extend beyond the Revolving Loan
Maturity Date.
4.8. TIME OF ACCRUAL. Interest shall accrue on all principal amounts
outstanding from the date when first outstanding to the date when no
longer outstanding. Amounts shall be deemed outstanding until payments are
applied thereto as provided herein.
4.9. COMPUTATION. Interest shall be computed for the actual days elapsed
over a year deemed to consist of 360 days. Interest rates that are based
on the Base Rate shall change simultaneously with any change in the Base
Rate and shall be effective for the entire day on which such change
becomes effective. The Base Rate will be determined by Administrative
Agent before the initial Advances on the Effective Date and on each
Business Day thereafter when the Base Rate changes.
4.10. RATE AFTER MATURITY. Borrower shall pay interest on the Aggregate
Revolving Loans and any Obligations with respect to Letters of Credit
after their Maturity, and, at the option of Administrative Agent, on the
Aggregate Revolving Loans and on the other Loan Obligations after the
occurrence of an Event of Default, at a rate per annum of two percent
(2.0%) plus the interest rate otherwise applicable thereto.
5. FEES.
5.1. AMENDMENT FEE. On the Effective Date, Borrower shall pay to
Administrative Agent, on behalf of each Lender, a fee equal to five (5)
basis points of each Lender's Pro-Rata Share of the Aggregate Revolving
Loan Commitment.
5.2. REVOLVING LOAN UNUSED FEE. Borrower shall pay to Administrative Agent
for the account of Lenders a non-refundable, recurring Revolving Loan
Unused Fee calculated by applying the daily equivalent of an annual Unused
Fee Rate (computed for the actual number of days over a year deemed to
consist of 360 days) to the Unused Revolving Loan Commitment on each day
during the period from the Effective Date to the Revolving Loan Maturity
Date. The Unused Revolving Loan Commitment on any day shall be the
difference between (i) the amount of the Aggregate Revolving Loan
Commitment and (ii) the sum of (a) the Aggregate Revolving Loan, (b) the
aggregate undrawn amount of outstanding Letters of Credit, and (c) the
total of all amounts drawn on outstanding Letters of Credit but not
reimbursed to Letter of Credit Issuer by Borrower as of the close of
business on such day. The Revolving Loan Unused Fee shall be payable
quarterly in arrears commencing on the last day of the first calendar
quarter ending after the Effective Date and continuing on the last day of
each calendar quarter thereafter and on the Revolving Loan Maturity Date.
The annual Unused Fee Rate shall be 0.250%.
5.3. LETTER OF CREDIT FEE. Borrower shall pay to Administrative Agent for
the account of Letter of Credit Issuer and each other Lender with a
Revolving Loan Commitment, a non-refundable recurring Letter of Credit Fee
for each Letter of Credit issued by Letter of Credit Issuer. The Letter of
Credit Fee for any Letter of Credit shall be an amount equal to the
aggregate undrawn amount of such Letter of Credit multiplied
12
by the Eurodollar Margin in effect on the date such Letter of Credit is
issued. The Letter of Credit Fee for each Letter of Credit shall be
payable in advance upon its issuance and quarterly thereafter on the last
Business Day of each calendar quarter thereafter while such Letter of
Credit is outstanding.
5.4. LETTER OF CREDIT FRONTING FEE. Borrower shall pay to Letter of Credit
Issuer a non-refundable, one-time Fronting Fee equal to 0.125% of the face
amount of each Letter of Credit issued by Letter of Credit Issuer. The
Fronting Fee due for any Letter of Credit shall be payable in advance on
the issuance date of such Letter of Credit.
5.5. OTHER LETTER OF CREDIT FEES. Borrower shall pay to Letter of Credit
Issuer such Letter of Credit Issuer's other customary fees for issuance,
amendment, or renewal of a Letter of Credit and, as Letter of Credit
Issuer and Borrower may agree with respect to each Letter of Credit, for
each negotiation of a draft drawn under such Letter of Credit.
5.6. ADMINISTRATIVE AGENT'S FEES. Borrower shall pay to Administrative
Agent, and solely for the account of Administrative Agent, an annual
non-refundable Agency Fee in the amount as set forth in the Agency Fee
Letter together with any other fee payable solely for the account of
Administrative Agent as set forth therein. The Agency Fee for the first
twelve (12) months shall be paid on or before the Effective Date, and an
annual Agency Fee payment shall thereafter be made to Administrative Agent
on each anniversary date of the Effective Date.
5.7. CALCULATION OF FEES. All of the foregoing fees and all other fees
payable to Administrative Agent or any Lender that are based on an annual
percentage shall be calculated on the basis of a year deemed to consist of
360 days and for the actual number of days elapsed.
6. PAYMENTS.
6.1. SCHEDULED PAYMENTS ON AGGREGATE REVOLVING LOAN.
6.1.1. INTEREST. Borrower shall pay interest accrued on each Base
Rate Loan included in the Aggregate Revolving Loan monthly in
arrears beginning on the first day of the first calendar month
ending after the Effective Date and continuing on the first day of
each calendar month thereafter, and on the Revolving Loan Maturity
Date. Borrower shall pay interest accrued on each Eurodollar Loan
included in the Aggregate Revolving Loan at the end of its Interest
Period, and in addition, for each such Eurodollar Loan with an
Interest Period longer than 90 days, Borrower shall pay interest
accrued thereon on each day that would have been the end of an
Interest Period with respect to such Eurodollar Loan had successive
Interest Periods of 90 days' duration been applicable to such
Eurodollar Loan. Borrower shall pay interest accrued on each
Revolving Loan after the Revolving Loan Maturity Date on demand.
6.1.2. PRINCIPAL. Borrower shall repay the entire amount of the
Aggregate Revolving Loan as then outstanding on the Revolving Loan
Maturity Date.
13
6.2. INTENTIONALLY DELETED.
6.3. PREPAYMENTS.
6.3.1. VOLUNTARY PREPAYMENTS. Subject to the limitations in the
following sentences, Borrower may wholly prepay any Base Rate Loan
or Eurodollar Loan that is included in the Aggregate Revolving Loan,
at any time and may make a partial prepayment thereon from time to
time, without payment of a premium. Notwithstanding the foregoing,
no partial or entire prepayment may be made hereunder unless (i)
Borrower gives Administrative Agent written notice (which may be
mailed, personally delivered or telecopied as provided in Section
21.1) or telephonic notice (promptly confirmed in writing in the
manner provided in Section 21.1) of Borrower's intention to make
such prepayment at least one Business Day prior to tendering such
prepayment, (ii) the total amount of such prepayment is a whole
multiple of $1,000.00 (iii) Borrower pays any accrued interest on
the amount prepaid at the time of such prepayment and (iv) Borrower
pays any amount that is due under Section 19.4 as a consequence of
the prepayment. Voluntary prepayments described in this Section
6.3.1, unless otherwise expressly stated in writing by Borrower to
Administrative Agent prior to the making of such prepayment, shall
be deemed made on the Base Rate Loans included in the Aggregate
Revolving Loan until they are reduced to zero, and then to the
Eurodollar Loans included in the Aggregate Revolving Loan (and all
compensation due pursuant to Section 19.4 in connection therewith)
until they are reduced to zero, and will be applied by Lenders to
reduce the Revolving Loans in accordance with their respective
Pro-Rata Shares of the Aggregate Revolving Loan Commitment.
6.3.2. MANDATORY PREPAYMENTS WHEN OVER-ADVANCES EXIST. If at any
time the sum of the Aggregate Revolving Loan, the Swingline Loan
Exposure and the Letter of Credit Exposure exceeds the Aggregate
Revolving Loan Commitment, whether as a result of optional Revolving
Loan Advances by Lenders as contemplated by Section 3.1.2 or
otherwise, Borrower shall on demand make a payment in the amount of
the excess to Administrative Agent for the account of Lenders on the
Aggregate Revolving Loan. Each such prepayment will be applied by
Administrative Agent and Lenders first to reduce the Base Rate Loans
that are included in the Aggregate Revolving Loan (and consequently
a ratable portion of each Lender's Revolving Loan) until they are
reduced to zero and then to reduce the Eurodollar Loans that are
included in the Aggregate Revolving Loan (and consequently a ratable
portion of each Lender's Revolving Loan). In the case of such a
prepayment, Borrower will pay any accrued interest on the amount
prepaid at the time of such prepayment, and Borrower will pay any
amount that is due under Section 19.4 as a consequence of the
prepayment.
6.4. REIMBURSEMENT OBLIGATIONS OF BORROWER. Borrower hereby
unconditionally agrees to immediately pay to Letter of Credit Issuer on
demand at the Letter of Credit Issuer's Applicable Lending Office all
amounts required to pay all drafts drawn under Letters of Credit issued
for the account of Borrower and all reasonable expenses incurred
14
by Letter of Credit Issuer in connection with such Letters of Credit and
in any event and without demand to remit to Letter of Credit Issuer (which
may be through obtaining Revolving Advances if permitted under Section
3.1.2) sufficient funds to pay all debts and liabilities arising under any
Letter of Credit issued for the account of Borrower.
6.5. MANNER OF PAYMENTS AND TIMING OF APPLICATION OF PAYMENTS.
6.5.1. PAYMENT REQUIREMENT. Unless expressly provided to the
contrary elsewhere herein, Borrower shall make each payment on the
Loan Obligations to Administrative Agent for the account of Lenders
as required under the Loan Documents at the Applicable Lending
Office of the Administrative Agent on the date when due, without
deduction, setoff or counterclaim. All such payments will be
distributed by Administrative Agent to Lenders as provided in
Section 18.10 for application to the Loan Obligations as provided
herein.
6.5.2. APPLICATION OF PAYMENTS AND PROCEEDS. All payments received
by Administrative Agent in immediately available funds at or before
3:00 p.m. (Local Time) on a Business Day will be distributed by
Administrative Agent to Lenders as provided in Section 18.10 on the
same Business Day. Such payments received on a day that is not a
Business Day or after 3:00 p.m. (Local Time) on a Business Day will
be distributed by Administrative Agent to Lenders as provided in
Section 18.10 on the next Business Day. The amount so distributed to
a Lender will be applied by such Lender to the relevant Loan
Obligation on the Business Day when received.
6.5.3. INTEREST CALCULATION. Section 6.5.2 notwithstanding, for
purposes of interest calculation only, (i) a payment by check,
draft, cash, by wire transfer, or other instrument received at or
before 3:00 p.m. (Local Time) on a Business Day shall be deemed to
have been applied to the relevant Loan Obligation on the Business
Day when it is received, (ii) a payment by check, draft, cash, by
wire transfer, or other instrument received on a day that is not a
Business Day or after 3:00 p.m. on a Business Day shall be deemed to
have been applied to the relevant Loan Obligation on the next
Business Day.
6.6. RETURNED INSTRUMENTS. If a payment is made by check, draft or other
instrument and the check, draft or other instrument is returned unpaid,
any application of the payment to the Loan Obligations will be reversed
and will be treated as never having been made.
6.7. COMPELLED RETURN OF PAYMENTS OR PROCEEDS. If Administrative Agent or
any Lender is for any reason compelled to surrender any payment or any
proceeds of the Collateral because such payment or the application of such
proceeds is for any reason invalidated, declared fraudulent, set aside, or
determined to be void or voidable as a preference, an impermissible
setoff, or a diversion of trust funds, then this Agreement and the Loan
Obligations to which such payment or proceeds was applied or intended to
be applied shall be revived as if such application was never made; and
Borrower shall be liable to pay to Administrative Agent or such Lender,
and shall indemnify Administrative
15
Agent or such Lender for and hold Administrative Agent or such Lender
harmless from any loss with respect to, the amount of such payment or
proceeds surrendered. This Section shall be effective notwithstanding any
contrary action that Administrative Agent or such Lender may take in
reliance upon its receipt of any such payment or proceeds. Any such
contrary action so taken by Administrative Agent or such Lender shall be
without prejudice to Administrative Agent's or such Lender's rights under
this Agreement and shall be deemed to have been conditioned upon the
application of such payment or proceeds having become final and
indefeasible. The provisions of this Section shall survive termination of
the Commitments, the expiration of the Letters of Credit and the
indefeasible full payment and satisfaction of all of the Loan Obligations.
6.8. DUE DATES NOT ON BUSINESS DAYS. If any payment required hereunder
becomes due on a date that is not a Business Day, then such due date shall
be deemed automatically extended to the next Business Day, and, in the
case of principal, additional interest shall accrue and be payable for the
period of any such extension.
7. PROCEDURE FOR OBTAINING ADVANCES AND LETTERS OF CREDIT.
7.1. INITIAL ADVANCE. Provided that all conditions thereto hereunder are
satisfied and subject to the limitations contained herein, Lenders will
fund and Administrative Agent will make the initial Revolving Loan Advance
on the Effective Date as directed by Borrower in a written direction
delivered to Administrative Agent. The manner of disbursement shall be
subject to Lenders' approval.
7.2. SUBSEQUENT LOAN ADVANCES.
7.2.1. BORROWER REQUESTS. From and after the Effective Date,
Borrower may request Revolving Loan Advances from time to time, but
not more often than once each Business Day, by submitting a request
therefor to Administrative Agent as provided in Section 7.10.
Administrative Agent may treat every request for an Advance as a
request for a Base Rate Advance if Borrower does not specify that
such Advance is to be a Eurodollar Advance in Borrower's request for
an Advance. Every request for an Advance shall be irrevocable. A
request for an Advance received by Administrative Agent on a day
that is not a Business Day or that is received by Administrative
Agent after 12:00 noon (Local Time) on a Business Day shall be
treated as having been received by Administrative Agent prior 12:00
noon (Local Time) on the next Business Day.
7.2.2. ADMINISTRATIVE AGENT'S RIGHT TO MAKE OTHER REVOLVING LOAN
ADVANCES.
7.2.2.1. PAYMENT OF LOAN OBLIGATIONS. If Borrower has failed
to timely pay any of the Loan Obligations, Administrative
Agent shall have the right to make Revolving Loan Advances at
any time and from time to time to cause timely payment of any
of the Loan Obligations. Administrative Agent may select the
Advance Date for any such Revolving Loan Advance, but such
Advance Date may only be a Business
16
Day. Administrative Agent will give notice to Borrower after
any such Revolving Loan Advance is made. Any such Revolving
Loan Advance will be a Base Rate Advance.
7.2.2.2. PAYMENTS TO OTHER CREDITORS. If Administrative Agent
becomes obligated to reimburse or pay to any creditor of
Borrower any amount in order to (i) obtain a release of such
creditor's Security Interest in any of the Collateral, or (ii)
otherwise satisfy an Obligation of Borrower to such creditor
to the extent not indefeasibly satisfied by the initial
Advance, and (a) an Event of Default has occurred and is
continuing and (b) there is not a good faith dispute as to the
obligation to such creditor, or there is a good faith dispute
and Borrower has failed to establish appropriate reserves
adequate to pay such items in accordance with GAAP, then
Administrative Agent shall have the right to make Revolving
Loan Advances for that purpose. Administrative Agent may
select the Advance Date for any such Advance, but such Advance
Date may only be a Business Day. Administrative Agent will
give notice to Borrower after any such Revolving Loan Advance
is made. Any such Revolving Loan Advance will be a Base Rate
Advance.
7.3. LETTERS OF CREDIT. Borrower may request the issuance of a Letter of
Credit by submitting an issuance request to Letter of Credit Issuer
pursuant to the Letter of Credit Agreement required under Section 11 no
less than five Business Days prior to the requested issue date for such
Letter of Credit.
7.4. FUNDINGS.
7.4.1. REVOLVING ADVANCES. Not later than 1:00 p.m. (Local Time) on
each Advance Date for an Advance, Administrative Agent shall
promptly notify each Lender of the amount of the Advance to be made
on that Advance Date. Each Lender shall make immediately available
to Administrative Agent by 3:00 p.m. (Local Time) on the Advance
Date funds consisting solely of Dollars in the amount of its
Pro-Rata Share of such Advance, in accordance with such remittance
instructions as may be given by Administrative Agent to Lenders from
time to time.
7.4.2. DRAWS ON LETTERS OF CREDIT. In the event that a draw is made
on a Letter of Credit and Borrower does not reimburse the amount of
such draw in full to Letter of Credit Issuer immediately on demand,
Letter of Credit Issuer shall promptly notify Administrative Agent
of such failure. Upon Administrative Agent's receipt of such notice
from Letter of Credit Issuer, Administrative Agent may notify each
Lender thereof and shall have the right to cause a Revolving Loan
Advance to be made, regardless whether such Revolving Loan Advance
would exceed the Maximum Available Amount, by notifying each Lender
of the draw, the amount of the Revolving Loan Advance required to
fund reimbursement of such draw, and the amount of such Lender's
ratable share of such Revolving Loan Advance. The Advance Date and
time for such Revolving Loan Advance
17
shall not be later than 1:00 p.m. (Local Time) on the first Business
Day following Administrative Agent's delivery of such notice to
Lenders. By no later than such Advance Date and time, each Lender
shall make immediately available to Administrative Agent funds
consisting solely of Dollars in the amount of its Pro-Rata Share of
such Revolving Loan Advance, rounded to the nearest xxxxx, in
accordance with such remittance instructions as may be given by
Administrative Agent to each Lender from time to time. Each
Revolving Loan Advance made by Administrative Agent pursuant to this
Section 7.4.2 shall be deemed to be a Base Rate Advance.
7.4.3. ALL FUNDINGS RATABLE. All fundings of Advances shall be made
by Lenders as provided herein in accordance with their Pro-Rata
Shares of the Aggregate Revolving Loan Commitment. Except as
otherwise expressly provided herein, a Lender shall not be obligated
to fund Revolving Loan Advances that would result in the sum of (a)
such Lender's Revolving Loan, plus (b) such Lender's Pro-Rata Share
of the Letter of Credit Exposure exceeding its Revolving Loan
Commitment, or make available any more than its Pro-Rata Share of
any Advance.
7.5. ADMINISTRATIVE AGENT'S AVAILABILITY ASSUMPTION.
7.5.1. ASSUMPTION AS TO LENDERS. Unless Administrative Agent has
been given written notice by a Lender prior to an Advance Date that
such Lender does not intend to make immediately available to
Administrative Agent such Lender's Pro-Rata Share of the Advance
which Administrative Agent will be obligated to make on the Advance
Date, Administrative Agent may assume that such Lender has made the
required amount available to Administrative Agent on the Advance
Date and Administrative Agent may, in reliance upon such assumption,
make available to Borrower a corresponding amount. If such
corresponding amount is not in fact made immediately available to
Administrative Agent by such Lender on the Advance Date,
Administrative Agent shall be entitled to recover such corresponding
amount on demand from such Lender. If such Lender does not pay such
corresponding amount immediately upon Administrative Agent's demand
therefor, then Administrative Agent shall promptly notify Borrower
and the other Lenders, and Borrower shall pay such corresponding
amount to Administrative Agent within two (2) Business Days of the
date of delivery of such notice by Administrative Agent.
Administrative Agent shall also be entitled to recover, either from
such defaulting Lender (a Defaulting Lender) or Borrower, interest
on such corresponding amount for each day from the date such
corresponding amount was made available by Administrative Agent to
Borrower to the date such corresponding amount is recovered by
Administrative Agent, at a rate per annum equal to (i) if paid by
such Lender, the cost to Administrative Agent of funding such amount
at the Federal Funds Rate, or (ii) if paid by Borrower, the
applicable rate for the Advance in question determined from the
request therefor. Each Lender shall be obligated only to fund its
Pro-Rata Share of an Advance subject to the terms and conditions
hereof, regardless of the failure of another Lender to fund its
Pro-Rata Share thereof. In addition, the failure of any Lender to
pay its
18
Pro-Rata Share of any such Advance shall cause such Lender to be a
Defaulting Lender and such Defaulting Lender shall, until such
amount is paid to Administrative Agent (with interest at the Federal
Funds Rate), (a) permit Administrative Agent the unconditional and
irrevocable right of setoff against any amounts (including, without
limitation, payments of principal, interest, and fees, as well as
indemnity payments) received by Administrative Agent hereunder for
the benefit of any such Defaulting Lender, and (b) if such failure
to pay shall continue for a period of two Business Days, result in
any such Defaulting Lender forfeiting any right to vote on any
matter that the Required Lenders or all Lenders are permitted to
vote for hereunder (and the calculation of Required Lenders shall
exclude such Defaulting Lender's interest in the Lenders' Exposure);
provided, however, once such a failure is cured, then such Lender
shall, subsequent thereto, have all rights hereunder; provided,
further, however, if any Lender shall fail to make such a payment
within the two Business Day period specified in clause (b) above
(other than by reason of events beyond the reasonable control of
such Lender) two or more times during the term hereof, such Lender
shall permanently forfeit its right to vote hereunder (and the
calculation of Required Lenders shall exclude such Defaulting
Lender's interest in the Lenders' Exposure).
7.5.2. ASSUMPTION AS TO BORROWER. Unless Administrative Agent has
been given written notice by Borrower prior to the date any payment
to be made by it is due, that it does not intend to remit such
payment, Administrative Agent may assume that the Borrower has
timely remitted such payment and Administrative Agent may, in
reliance upon such assumption, make available a corresponding amount
or pro-rata portion thereof to the Persons entitled thereto. If such
payment was not in fact remitted to the Administrative Agent in
immediately available funds, then, each Lender shall immediately on
demand repay to Administrative Agent the corresponding amount or
pro-rata portion thereof made available to such Lender, together
with interest thereon in respect of each day from the date such
amount was made available by Administrative Agent to such Lender to
the date such amount is repaid to Administrative Agent, at the
Federal Funds Rate.
7.6. DISBURSEMENT. Provided that all conditions precedent herein to a
requested Advance have been satisfied, Administrative Agent will make the
amount of such requested Advance available to Borrower on the applicable
Advance Date in immediately available funds in Dollars at Administrative
Agent's Applicable Lending Office.
7.7. RESTRICTIONS ON ADVANCES. No Advance will be made unless it is a
whole multiple of $1,000.00 and not less than $100,000.00 in the case of a
Eurodollar Advance, or a whole multiple of $1,000.00 and not less than
$50,000.00 in the case of a Base Rate Advance. No more than one Revolving
Loan Advance will be made on any one day pursuant to a request for a
Revolving Loan Advance. Advances will only be made for the purposes
permitted in Section 14.1. No Eurodollar Advance will be made so long as
there is any Existing Default.
19
7.8. RESTRICTION ON NUMBER OF EURODOLLAR LOANS. No more than five (5)
Eurodollar Loans with different Interest Periods may be outstanding at any
one time.
7.9. EACH ADVANCE REQUEST AND LETTER OF CREDIT REQUEST A CERTIFICATION.
Each submittal of a request for an Advance and each submittal of a request
for the issuance of a Letter of Credit by a Borrowing Officer shall
constitute a certification by Borrower that (i) there is no Existing
Default, (ii) all conditions precedent hereunder to the making of the
requested Advance or issuance of the requested Letter of Credit have been
satisfied, and (iii) the Representations and Warranties are then true in
all material respects, with such exceptions as have been disclosed to
Lenders in writing by Borrower or a Guarantor from time to time and are
satisfactory to Lenders, and will be true on the Advance Date or issuance
date, as applicable, as if then made with such exceptions.
7.10. REQUIREMENTS FOR EVERY ADVANCE REQUEST. Only a Loan Request
Certificate (which shall be in writing in the form attached hereto as
Exhibit 7.10 and mailed, personally delivered or telecopied as provided in
Section 21.1) from a Borrowing Officer to Administrative Agent that
specifies the amount of the Advance to be made, the Advance Date for the
requested Advance, the portion of the Advance which is requested to be a
Eurodollar Advance and the portion of the Advance which is requested to be
a Base Rate Advance, and the Interest Period to be applicable to the
Eurodollar Loan that will result from a requested Eurodollar Advance,
shall be treated as a request for an Advance. No Advance Date for any
requested Advance may be other than a Business Day. A request for a
Eurodollar Advance must be given prior to 11:00 a.m., Local Time, at least
three (3) Business Days prior to the Advance Date for such Eurodollar
Advance. A request for a Base Rate Advance must be given prior to 11:00
a.m., Local Time, on the Advance Date for such Base Rate Advance.
7.11. REQUIREMENTS FOR EVERY LETTER OF CREDIT REQUEST. Only a written
request (which may be mailed, personally delivered or telecopied as
provided in Section 21.1) from a Borrowing Officer to Administrative Agent
or an electronic initiation over an online service provided by Letter of
Credit Issuer that specifies the amount, requested issue date (which shall
be a Business Day and in no event later than twenty-five days before the
Revolving Loan Maturity Date) and beneficiary of the requested Letter of
Credit and other information necessary for its issuance shall be treated
as a request for issuance of a Letter of Credit. The form of Letter of
Credit application submitted by Borrower shall be in the form required by
the Letter of Credit Agreement.
7.12. EXONERATION OF ADMINISTRATIVE AGENT AND LENDERS. Neither
Administrative Agent nor any Lender shall incur any liability to Borrower
for treating a request that meets the express requirements of Section 7.10
or Section 7.11 as a request for an Advance or issuance of a Letter of
Credit, as applicable, if Administrative Agent believes in good faith that
the Person making the request is a Borrowing Officer or if, in the case of
a request for a Letter of Credit, it is electronically initiated. Neither
Administrative Agent nor any Lender shall incur any liability to Borrower
for failing to treat any such request as a request for an Advance or
issuance of a Letter of Credit, as applicable, if Administrative Agent
believes in good faith that the Person making the request is not a
Borrowing Officer.
20
8. SECURITY AND GUARANTIES. As security for the payment and performance of the
Loan Obligations, and also as security for the payment and performance of all
Obligations to Administrative Agent, Borrower has executed and delivered, or has
caused to be executed and delivered, the Existing Loan Documents, which continue
in existence in full force and effect and which are enforceable in accordance
with their terms and Borrower shall on the Execution Date execute and deliver,
or cause to be executed and delivered, to Administrative Agent the following
documents as may be required by Administrative Agent in its sole discretion and
each satisfactory to Administrative Agent:
8.1. SECURITY AGREEMENTS. Security agreements granting to Administrative
Agent for the benefit of Lenders a first priority Security Interest under
the UCC in all of the Goods, Equipment, Accounts, Inventory, Instruments,
Documents, Chattel Paper, General Intangibles and other personal property
of each Covered Person and every Subsidiary of each Covered Person,
whether now owned or hereafter acquired, and all proceeds thereof, subject
only to Permitted Security Interests affecting such property.
8.2. PLEDGE AGREEMENTS. Stock pledge agreements and membership pledge
agreements granting to Administrative Agent for the benefit of Lenders a
first priority Security Interest in all of each Covered Person's interest
in the capital stock, membership interests, and other securities (and all
options and warrants therefor) of every Subsidiary of every Covered
Person, now or hereafter issued and outstanding, and all proceeds thereof.
8.3. COLLATERAL ASSIGNMENTS. The following collateral assignments from
each Covered Person, each subject to no other Security Interests except
existing Permitted Security Interests affecting the item assigned.
8.3.1. INTELLECTUAL PROPERTY ASSIGNMENTS. One or more assignments
assigning to Administrative Agent for the benefit of Lenders a
Security Interest in all the Intellectual Property of such Covered
Person described in Section 12.30.4 to the Disclosure Schedule.
8.3.2. ACQUISITION DOCUMENTS ASSIGNMENT. An assignment assigning to
Administrative Agent for the benefit of Lenders all of Borrower's
rights and interest under the Acquisition Documents for any Approved
Acquisition.
8.3.3. LEASE ASSIGNMENTS. One or more assignments assigning to
Administrative Agent for the benefit of Lenders a Security Interest
in the leasehold estate(s) of such Covered Persons described in
Section 12.29 to the Disclosure Schedule as may be requested by
Administrative Agent in its sole discretion, including
acknowledgement of such collateral assignment by the applicable
landlord.
8.4. GUARANTIES. Unconditional guaranties of the Loan Obligations to
Administrative Agent for the benefit of Lenders of each Covered Person and
every Subsidiary of each Covered Person.
21
8.5. ADDITIONAL SUBSIDIARIES. As further security for the payment and
performance of the Loan Obligations, if any Subsidiary of any Covered
Person is acquired or organized after the Execution Date, Borrower shall
(i) execute and deliver or cause to be executed and delivered by the
applicable Covered Person, a pledge agreement granting to Administrative
Agent for the benefit of Lenders a first priority Security Interest in all
of such Covered Person's interest in the voting capital stock, securities,
membership interests or other equity interests, as applicable (and all
options and warrants therefor), of any such later acquired or organized
Subsidiary, now or hereafter issued and outstanding, and all proceeds
thereof and a security agreement granting to Administrative Agent for the
benefit of Lenders a first priority Security Interest under the UCC in all
of the Goods, Equipment, Accounts, Inventory, Instruments, Documents,
Chattel Paper, General Intangibles and other personal property of such
Covered Person, and (ii) cause to be executed and delivered to
Administrative Agent by every such later acquired or organized Subsidiary
of any Covered Person (which may only be acquired or organized if
permitted elsewhere in this Agreement) an unconditional guaranty of the
Loan Obligations or, at the option of Administrative Agent in
Administrative Agent's absolute discretion, a joinder agreement in which
such Subsidiary becomes a Borrower under this Agreement and assumes
primary, joint and several liability for the Loan Obligations, and a
security agreement (as described in Section 8.1) and other appropriate
security documents, each in form satisfactory to Lenders.
Administrative Agent may, either before or after an Event of Default, but
only with the consent or at the direction of Required Lenders, granted or
withheld in their absolute discretion, exchange, waive or release the
Security Interests in any of the Collateral or permit Borrower to
substitute any real or personal property for any of the Collateral without
affecting the Loan Obligations or Administrative Agent's right to take any
other action with respect to any other Collateral, provided, however, that
Administrative Agent may, in its absolute discretion and without the
consent of any Lender, do or permit Borrower to do any of the foregoing
with respect to Collateral or other property that has an aggregate fair
market value that does not exceed $100,000.00, or in the event that the
disposal of such Collateral is permitted under Section 15.9 or upon the
indefeasible payment in full of all of the Loan Obligations, the
expiration or termination of all Letters of Credit and reduction of the
Letter of Credit Exposure to zero, and the termination of the Commitments.
9. POWER OF ATTORNEY. Borrower hereby authorizes Administrative Agent and
irrevocably appoints Administrative Agent (acting by any of its officers) as
Borrower's agent and attorney-in-fact (which appointment is coupled with an
interest and is therefore irrevocable) to do any of the following until all of
the Loan Obligations are fully and indefeasibly paid and satisfied, there are no
Letters of Credit outstanding and the Letter of Credit Exposure is irreversibly
zero, and the Commitments are terminated:
9.1. At any time while there exists an Event of Default that has not been
cured or waived in writing by Lenders, (i) demand payment of any Account;
(ii) enforce payment of any Account by legal proceedings or otherwise;
(iii) exercise all of Borrower's rights and remedies in proceedings
brought to collect any Account; (iv) sell or assign any Account upon such
terms, for such amount and at such time or times as Administrative
22
Agent deems advisable; (v) settle, adjust, compromise, extend or renew any
Account; (vi) discharge and release any Account; (vii) prepare, file and
sign Borrower's name on any proof of claim in bankruptcy or other similar
documents against an Account Debtor; (viii) notify the postal authorities
of any change of the address for delivery of Borrower's mail to any
address designated by Administrative Agent, and open and process all mail
addressed to Borrower; (ix) endorse Borrower's name on any verification of
Accounts and notices thereof to Account Debtors; (x) make one or more
Revolving Loan Advances to pay the costs and expenses of any of the
foregoing; (xi) take control in any manner of any item of payment or
proceeds of any Account; (xii) have access to any lockbox or postal box
into which Borrower's mail is deposited; (xiii) endorse Borrower's name
upon any items of payment and cash or deposit same and apply the proceeds
thereof to the Loan Obligations as provided herein; (xiv) endorse
Borrower's name upon any chattel paper, document, instrument, invoice, or
similar document or agreement relating to any Account or other item of the
Collateral; and (xv) do anything that Administrative Agent deems necessary
in its reasonable discretion to assure that the Loan Obligations are fully
and indefeasibly paid and satisfied.
9.2. At any time, file and/or execute in Borrower's name and on Borrower's
behalf any financing statement or amendments thereto deemed necessary or
appropriate by Administrative Agent to assure the perfection or continued
perfection of Administrative Agent's Security Interests in the Collateral
for the benefit of Lenders and the filing or execution of any such
financing statement or amendments is hereby ratified and confirmed.
The foregoing power of attorney and authorization shall be deemed
automatically revoked upon the indefeasible payment in full of all of the
Loan Obligations, the expiration or termination of all Letters of Credit
and reduction of the Letter of Credit Exposure to zero, and the
termination of the Commitments.
10. CONDITIONS OF LENDING.
10.1. CONDITIONS TO INITIAL ADVANCE. Lenders will have no obligation to
fund the initial Revolving Loan Advance or any subsequent Advance unless:
10.1.1. LISTED DOCUMENTS AND OTHER ITEMS. Administrative Agent shall
have received on or before the Effective Date all of the documents
and other items listed or described in Exhibit 10.1.1 hereto as
being conditions to the initial Advances, with each being
satisfactory to Lenders and (as applicable) duly executed and (also
as applicable) sealed, attested, acknowledged, certified, or
authenticated, or Administrative Agent shall have received an
agreement from Borrower to deliver any such documents and items
within a certain number of days post-closing satisfactory to
Administrative Agent in its sole discretion.
10.1.2. FINANCIAL CONDITION. Lenders shall have determined to their
satisfaction that the financial statements of Borrower for the
fiscal year ended 3/31/04 and the fiscal quarter ended 12/31/04 and
the proforma financial statements of Borrower for the period ending
as of the Effective Date (after giving effect to the
23
consummation of the transactions contemplated hereby, the funding of
the initial Revolving Loan Advance, and the payment of all fees and
expenses hereunder), and for the periods ending 3/31/05, 3/31/06,
3/31/07, 3/31/08, 3/31/09, and 3/31/10 as furnished to
Administrative Agent, and other information furnished to
Administrative Agent by Borrower (i) for the periods ended on or
before the Effective Date, fairly and accurately reflect the
business and financial condition of Borrower, its cash flows and the
results of its operations for such periods, (ii) for the periods
that will end after the Effective Date, fairly and accurately
forecast the business and financial condition of Borrower, its cash
flows, and the results of its operations for such periods, (iii) are
consistent in all material respects with the sources and uses of
cash for the Approved Acquisitions previously provided to
Administrative Agent and with the forecasts previously delivered to
Administrative Agent, and (iv) with respect to Borrower's proforma
financial statements, the ratio of Total Indebtedness to EBITDA as
set forth therein does not exceed 2.5 to 1 on a proforma basis as of
the Effective Date and minimum trailing twelve month consolidated
EBITDA shall not be less than $37,000,000.00.
10.1.3. NO DEFAULT. There shall be no Existing Default and no
Default or Event of Default will occur as a result of such Advance
being requested or made or the application of the proceeds thereof.
10.1.4. PERFECTION OF SECURITY INTERESTS. Every Security Interest
required to be granted by Borrower to Administrative Agent under
Section 8 shall have been perfected and shall be, except as
otherwise satisfactory to Lenders, a first priority Security
Interest.
10.1.5. REPRESENTATIONS AND WARRANTIES. The Representations and
Warranties shall be true and correct.
10.1.6. NO MATERIAL ADVERSE CHANGE. Since the date of the Initial
Financial Statements delivered to Administrative Agent, there shall
not have been any change which has or is reasonably likely to have a
Material Adverse Effect on any Covered Person.
10.1.7. PENDING MATERIAL PROCEEDINGS. There shall be no pending
Material Proceedings other than as disclosed in Section 12.8 of the
Disclosure Schedule.
10.1.8. PAYMENT OF FEES AND EXPENSES. Borrower shall have paid and
reimbursed to Lenders all fees, costs and expenses and the
attorneys' fees of the Administrative Agent.
10.1.9. INTENTIONALLY DELETED. .
10.1.10. INTENTIONALLY DELETED.
24
10.1.11. INSURANCE. Administrative Agent shall be satisfied with the
insurance maintained by Borrower (including the insurance carrier,
the types of insurance maintained, and the levels of insurance
maintained).
10.1.12. ENVIRONMENTAL. Administrative Agent shall be satisfied with
the results of the environmental due diligence it has conducted, if
any, with respect to any real property owned and/or leased by
Borrower, including without limitation the Phase I Environmental
Reports, if any, ordered by or on behalf of Administrative Agent.
10.1.13. OTHER ITEMS. Administrative Agent shall have received such
other consents, approvals, opinions, certificates, documents or
information as it reasonably deems necessary.
10.2. CONDITIONS TO SUBSEQUENT ADVANCES. Lenders will have no obligation
to fund any Advance after the initial Advance unless:
10.2.1. GENERAL CONDITIONS. All of the conditions to the initial
Advances in Section 10.1 (except the condition in Section 10.1.5)
shall have been and shall remain satisfied.
10.2.2. REPRESENTATIONS AND WARRANTIES. The Representations and
Warranties are then true, with such exceptions as have been
disclosed to Lenders in writing by Borrower or any Guarantor from
time to time and are satisfactory to Lenders, and will be true as of
the time of such Advance, as if then made with such exceptions.
10.2.3. NO DEFAULT. There shall be no Existing Default and no
Default or Event of Default will occur as a result of such Advance
being requested or made or the application of the proceeds thereof.
10.3. CONDITIONS TO ADVANCES FOR APPROVED ACQUISITIONS. Further, prior to
Lenders funding any Advance relating to an Approved Acquisition:
10.3.1. APPROVED ACQUISITION DELIVERABLES. The Administrative Agent
shall have received:
10.3.1.1. copies, certified as true, complete and correct by
the Responsible Officer of the Borrower, of the applicable
Acquisition Documents;
10.3.1.2. all pro forma financial statements as described in
Section 14.24; and
10.3.1.3. certified copies of the resolutions, in form and
substance satisfactory to Lenders, duly adopted by the board
of directors/members of the Borrower or the Subsidiary of
Borrower, as applicable, authorizing the
25
execution, delivery, and performance of the applicable
Acquisition Documents.
10.3.2. SATISFACTION OF CONDITIONS TO THE APPROVED ACQUISITION.
Administrative Agent shall have received the applicable Approved
Acquisition Documents, which shall be in form and substance
satisfactory to Administrative Agent. Administrative Agent shall be
satisfied that all requirements to close the Approved Acquisitions,
respectively, have been completed or waived by the parties to the
Approved Acquisition Documents, respectively, except for the
delivery of the purchase price with respect to the applicable
Approved Acquisition; and every other condition, if any, to the
applicable Approved Acquisition as described herein shall be
satisfied, or waived by the Administrative Agent; and (i) with
respect to the acquisition of Target One, the Administrative Agent
shall have completed its due diligence with respect to the Target
One Acquisition and shall have received evidence satisfactory to the
Administrative Agent that the total amount of Loan proceeds used as
consideration at the time of closing of the Target One Acquisition
shall not exceed $5,000,000, unless otherwise prior approved by
Administrative Agent; and (ii) with respect to the acquisition of
Target Two, the Administrative Agent shall have completed its due
diligence with respect to the Target Two Acquisition and shall have
received evidence satisfactory to the Administrative Agent that the
total amount of Loan proceeds used as consideration at the time of
closing of the Target Two Acquisition shall not exceed $24,000,000,
unless otherwise prior approved by Administrative Agent.
10.3.3. ADDITIONAL SUBSIDIARIES. In the case an Approved Acquisition
is in the form of a purchase of stock or of membership interests of
any limited liability company or in the case where a Covered Person
creates a new Subsidiary to effect the purchase of assets, Borrower
shall have complied with the requirements of Section 8.5 and
delivered to the Administrative Agent certified resolutions, good
standing certificates and other customary documents (including
attorney opinion letters) as are reasonably requested by
Administrative Agent.
10.3.4. INTENTIONALLY DELETED.
10.3.5. AUTHORITY TO CONSUMMATE THE APPROVED ACQUISITIONS. The
Borrower (and any relevant Subsidiary) shall have the full right,
power and authority to make the Approved Acquisition and to enter
into the Approved Acquisition Documents; and the performance or
observance by the Borrower (or any relevant Subsidiary) of the
Approved Acquisition Documents shall neither (a) contravene any
provision of law or any charter or by-law provision or judgment,
order or decree applicable to or affecting the Borrower or any
Subsidiary nor (b) contravene any covenant, indenture or agreement
of Borrower or any Subsidiary which results, or is reasonably likely
to result, in a Material Adverse Effect on Borrower or any
Subsidiary; the Approved Acquisition Documents when executed and
delivered by the Borrower (and any relevant Subsidiary), shall be
valid, binding and enforceable, except as may be limited by (i)
bankruptcy,
26
insolvency, reorganization, fraudulent transfer, moratorium or other
similar laws or judicial decisions for the relief of debtors or the
limitation of creditors' rights generally; and (ii) any equitable
principles relating to or limiting the rights of creditors generally
or any equitable remedy which may be granted to cure any defaults.
10.3.6. REQUEST TO FUND. Borrower shall have executed and delivered
to the Administrative Agent a Loan Request Certificate in the
form(s) set forth in Section 7.10 from a Responsible Officer.
11. CONDITIONS TO ISSUANCE OF LETTERS OF CREDIT. Borrower must have executed and
delivered to Letter of Credit Issuer the Letter of Credit Issuer's Master Letter
of Credit Agreement in form satisfactory to Letter of Credit Issuer under which
Borrower evidences its obligation to reimburse to Letter of Credit Issuer on
demand the amount of each draw on such Letter of Credit as provided in Section
6.4, together with interest from the date of the draw at the rate provided in
Section 4.1 and (without duplication) all reasonable expenses incurred by Letter
of Credit Issuer in connection with such Letter of Credit. As conditions
precedent to the issuance of any Letter of Credit:
11.1. NO PROHIBITIONS. No order, judgment or decree of any Governmental
Authority shall exist which purports by its terms to enjoin or restrain
Letter of Credit Issuer or any other Lender from issuing such Letter of
Credit, and no Law or request or directive (whether or not having the
force of law) from any Governmental Authority with jurisdiction over
Letter of Credit Issuer or any other Lender shall exist which prohibits,
or requests that Letter of Credit Issuer or any other Lender refrain from,
the issuance of letters of credit generally or such Letter of Credit in
particular, or imposes upon Letter of Credit Issuer or any other Lender
with respect to such Letter of Credit any restriction or reserve or
capital requirement (for which Letter of Credit Issuer or any other Lender
is not otherwise compensable by Borrower hereunder).
11.2. REPRESENTATIONS AND WARRANTIES. The Representations and Warranties
are then true, with such exceptions as have been disclosed to Lenders in
writing by Borrower or such Guarantor from time to time and are
satisfactory to Lenders, and will be true as of the time of the issuance
of such Letter of Credit, as if then made with such exceptions.
11.3. NO DEFAULT. There shall be no Existing Default and no Default or
Event of Default is reasonably likely to occur as a result of such Letter
of Credit being issued or a draw thereon being made or paid.
11.4. OTHER CONDITIONS. All of the conditions to the initial Advances in
Section 10.1 (except the condition in Section 10.1.5) shall have been and
shall remain satisfied.
12. REPRESENTATIONS AND WARRANTIES. Except as otherwise described in the
Disclosure Schedule attached hereto as Exhibit 12, Borrower represents and
warrants to Administrative Agent, Lenders, and Letter of Credit Issuer, on its
behalf and on behalf of each Covered Person, as follows (provided, however, that
to the extent such representations and warranties apply to the entity and assets
acquired pursuant to the Approved Acquisitions, such representations and
27
warranties shall be to the best of Borrower's knowledge) and Borrower covenants
that Borrower shall undertake its best efforts to obtain the consents of all
third parties to all material contracts and leases set forth in the Disclosure
Schedule as soon as reasonably practicable.
12.1. ORGANIZATION AND EXISTENCE. Each Covered Person is duly organized
and existing in good standing under the Laws of the state of its
organization, is duly qualified to do business and is in good standing in
every state where the nature or extent of its business or properties
require it to be qualified to do business, except where the failure to so
qualify is not reasonably likely to have a Material Adverse Effect on any
Covered Person. Each Covered Person has the power and authority to own its
properties and carry on its business as now being conducted.
12.2. AUTHORIZATION. Each Covered Person is duly authorized to execute and
perform every Loan Document to which such Covered Person is a party, and
Borrower is duly authorized to borrow hereunder, and this Agreement and
the other Loan Documents have been duly authorized by all requisite
corporate, partnership or membership action (in the case of limited
liability companies) of each Covered Person. No consent, approval or
authorization of, or declaration or filing with, any Governmental
Authority, and no consent of any other Person, is required in connection
with Borrower's execution, delivery or performance of this Agreement and
the other Loan Documents, except for those already duly obtained.
12.3. DUE EXECUTION. Every Loan Document to which a Covered Person is a
party has been executed on behalf of such Covered Person by a Person duly
authorized to do so.
12.4. ENFORCEABILITY OF OBLIGATIONS. Each of the Loan Documents to which a
Covered Person is a party constitutes the legal, valid and binding
obligation of such Covered Person, enforceable against such Covered Person
in accordance with its terms, except to the extent that the enforceability
thereof against such Covered Person may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar Laws affecting
creditors' rights generally or by equitable principles of general
application.
12.5. BURDENSOME OBLIGATIONS. No Covered Person is a party to or bound by
any Contract or is subject to any provision in the Charter Documents of
such Covered Person which would, if performed by such Covered Person,
result in a Default or Event of Default either immediately or upon the
elapsing of time.
12.6. LEGAL RESTRAINTS. The execution and performance of any Loan Document
by a Covered Person will not violate or constitute a default under the
Charter Documents of such Covered Person, any Material Agreement of such
Covered Person, or any Material Law, and will not, except as expressly
contemplated or permitted in this Agreement, result in any Security
Interest being imposed on any of such Covered Person's property.
12.7. LABOR CONTRACTS AND DISPUTES. There is no collective bargaining
agreement or other labor contract covering employees of a Covered Person.
No union or other labor organization is seeking to organize, or to be
recognized as, a collective bargaining unit of employees of a Covered
Person. There is no pending or, to Borrower's knowledge,
28
threatened, strike, work stoppage, material unfair labor practice claim or
other material labor dispute against or affecting any Covered Person or
its employees.
12.8. NO MATERIAL PROCEEDINGS. There are no Material Proceedings pending
or, to the best knowledge of Borrower, threatened, against any Covered
Person, except as set forth in Section 12.8 of the Disclosure Schedule.
12.9. MATERIAL LICENSES. All Material Licenses have been obtained or exist
for each Covered Person.
12.10. COMPLIANCE WITH MATERIAL LAWS. Each Covered Person is in compliance
in all material respects with all Material Laws. Without limiting the
generality of the foregoing:
12.10.1. GENERAL COMPLIANCE WITH ENVIRONMENTAL LAWS AND EMPLOYMENT
LAWS. The operations and employee compensation practices of every
Covered Person comply in all material respects with all applicable
Environmental Laws and Employment Laws which are Material Laws.
12.10.2. PROCEEDINGS. None of the operations of any Covered Person
are the subject of any judicial or administrative complaint, order
or proceeding alleging the violation of any applicable Environmental
Laws or Employment Laws which are Material Laws.
12.10.3. INVESTIGATIONS REGARDING HAZARDOUS MATERIALS. None of the
operations of any Covered Person are, or in the past six years have
been, the subject of investigation by any Governmental Authority
regarding the improper transportation, storage, disposal, generation
or release into the environment of any Hazardous Material, the
results of which have or are reasonably likely to have a Material
Adverse Effect on such Covered Person, or reduce materially the
value of the Collateral.
12.10.4. NOTICES AND REPORTS REGARDING HAZARDOUS MATERIALS. No
notice or report under any Environmental Law indicating a past or
present spill or release into the environment of any Hazardous
Material has been filed within the six years ending on the Execution
Date, or is required to be filed, by any Covered Person.
12.10.5. ENVIRONMENTAL PROPERTY TRANSFER ACTS. No Environmental
Property Transfer Acts are applicable to the transactions
contemplated by this Agreement or the Acquisition Documents and each
Covered Person has provided all notices and obtained all necessary
environmental permit transfers and consents, if any, required in
order to consummate the transactions contemplated by this Agreement
or the Acquisition Documents, to perfect Administrative Agent's
Security Interests for the benefit of Lenders and to operate such
Covered Person's business as presently or proposed to be operated.
12.11. OTHER NAMES. No Covered Person has used any name other than the
full name which identifies such Covered Person in this Agreement. The only
trade name or style
29
under which a Covered Person sells Inventory or creates Accounts, or to
which instruments in payment of Accounts are made payable, is the name
which identifies such Covered Person in this Agreement.
12.12. CONSUMMATION OF THE APPROVED ACQUISITIONS. When applicable,
Borrower will have delivered to Administrative Agent complete and correct
executed copies of the Acquisition Documents for the Approved
Acquisitions. Such Acquisition Documents have been duly authorized and
executed and are the valid and binding obligation of Borrower and, to
Borrower's knowledge, the other parties thereto and are enforceable in
accordance with their terms except to the extent that the enforceability
thereof against such Covered Person may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally or by equitable principles of general
application. All Covered Persons, and to the best of Borrower's knowledge,
all other parties to such Acquisition Documents, have to date performed
all obligations, covenants, and conditions required of it prior to or as a
condition to the consummation of the transactions contemplated by such
Acquisition Documents to which it is a party other than any such
obligation, covenant, or condition that has been waived. Further, with
respect to any Approved Acquisition, Borrower is not in default of any of
its obligations under the applicable Acquisition Documents for such
Approved Acquisition, and all representations and warranties of Borrower
in such Acquisition Documents are complete and correct in all material
respects as of the date the Administrative Agent makes any Advance to
Borrower for its use in funding the purchase price of such Approved
Acquisition as if made on and as of such date. Further, to the knowledge
of Borrower after due inquiry, all of the representations and warranties
of the Sellers contained in any Acquisition Documents for any Approved
Acquisition or any instrument furnished in connection therewith or in
reference thereto are true and correct in all material respects as of the
date the Administrative Agent makes any Advance to Borrower for its use in
funding the purchase price of such Approved Acquisition as if made on and
as of such date.
12.13. PRIOR TRANSACTIONS. Except as set forth in Section 12.13 of the
Disclosure Schedule, within the past five (5) years, no Covered Person has
been a party to any merger or consolidation, or acquired all or
substantially all of the assets of any Person.
12.14. CAPITALIZATION. As of the Effective Date, Borrower's authorized
capital stock, and issued and outstanding capital stock, are as described
in Section 12.14 of the Disclosure Schedule, and all issued and
outstanding shares of Borrower are validly issued and outstanding, fully
paid and non-assessable.
12.15. SOLVENCY. Borrower is Solvent prior to and after giving effect to
the making of the initial Revolving Loan Advance on the Effective Date.
12.16. PROJECTIONS; PRO FORMA BALANCE SHEET. The projections of Borrower's
annual financial condition, results of operations, and cash flow for the
period ending as of the Effective Date and for the periods ending 3/31/05,
3/31/06, 3/31/07, 3/31/08, 3/31/09 and 3/31/10, a copy of which have been
delivered to Administrative Agent, represent Borrower's good faith best
estimate of Borrower's future financial performance for the
30
periods set forth therein. Such projections have been prepared on the
basis of the assumptions set forth therein, which Borrower believes are
fair and reasonable in light of current and reasonably foreseeable
business conditions. The pro forma balance sheet of Borrower as of the
Effective Date, a copy of which has been provided by Borrower to
Administrative Agent, presents fairly and accurately Borrower's financial
condition as of the Effective Date as if the transactions contemplated by
the Acquisition Documents for the Approved Acquisitions had occurred on
the Effective Date.
12.17. FINANCIAL STATEMENTS. The Financial Statements are complete and
correct in all material respects, have been prepared in accordance with
GAAP, and reflect in all material respects the financial condition,
results of operations and cash flows of the Persons covered thereby as of
the dates and for the periods stated therein, subject in the case of
interim Financial Statements to the absence of footnotes and normal
year-end adjustments made in accordance with GAAP.
12.18. NO CHANGE IN CONDITION. Since the date of the Financial Statements
delivered to Administrative Agent as required herein, there has been no
change which has or is reasonably likely to have a Material Adverse Effect
on any Covered Person.
12.19. INVESTMENTS. No Covered Person has any Investments in other Persons
except existing Permitted Investments.
12.20. INDEBTEDNESS. No Covered Person has any Indebtedness except
existing Permitted Indebtedness.
12.21. INDIRECT OBLIGATIONS. No Covered Person has any Indirect
Obligations except existing Permitted Indirect Obligations.
12.22. OPERATING LEASES. As of the Effective Date, no Covered Person has
an interest as lessee under any Operating Leases other than (a) leases of
non-material items of office equipment; and (b) short-term leases for
office space, none of which is material to the business of any Covered
Person except as set forth in Section 12.22 of this Disclosure Schedule.
12.23. CAPITAL LEASES. No Covered Person has an interest as a lessee under
any Capital Leases other than Capital Leases that are Permitted
Indebtedness.
12.24. TAX LIABILITIES; GOVERNMENTAL CHARGES. Each Covered Person has
filed or caused to be filed all tax reports and returns required to be
filed by it with any Governmental Authority, except where extensions have
been properly obtained. Each Covered Person has paid or made adequate
provision for payment of all Taxes of such Covered Person, except Taxes
which are being diligently contested in good faith by appropriate
proceedings and as to which such Covered Person has established adequate
reserves in conformity with GAAP. No Security Interest for any such Taxes
has been filed and no claims are being asserted with respect to any such
Taxes which, if adversely determined, has or is reasonably likely to have
a Material Adverse Effect on such Covered Person. There are no material
unresolved issues concerning any liability of a
31
Covered Person for any Taxes which will have or is reasonably likely to
have a Material Adverse Effect on such Covered Person.
12.25. PENSION BENEFIT PLANS. All Pension Benefit Plans maintained by each
Covered Person or an ERISA Affiliate of such Covered Person that are
intended to qualify under Section 401 of the Code are duly qualified under
Section 401 of the Code. All Pension Benefit Plans maintained by each
Covered Person on an ERISA Affiliate of such Covered Person are in
compliance with the provisions of ERISA and all other Material Laws.
Except with respect to events or occurrences which do not have and are not
reasonably likely to have a Material Adverse Effect on any Covered Person:
12.25.1. PROHIBITED TRANSACTIONS. None of such Pension Benefit Plans
has participated in, engaged in or been a party to any non-exempt
PROHIBITED TRANSACTION as defined in ERISA or the Code, and no
officer, director or employee of such Covered Person or of an ERISA
Affiliate of such Covered Person has committed a breach of any of
the responsibilities or obligations imposed upon fiduciaries by
Title I of ERISA.
12.25.2. CLAIMS. There are no claims, pending or threatened,
involving any such Pension Benefit Plan by a current or former
employee (or beneficiary thereof) of such Covered Person or ERISA
Affiliate of such Covered Person, nor is there any reasonable basis
to anticipate any claims involving any such Pension Benefit Plan
which would likely be successfully maintained against such Covered
Person or such ERISA Affiliate.
12.25.3. REPORTING AND DISCLOSURE REQUIREMENTS. There are no
violations of any reporting or disclosure requirements with respect
to any such Pension Benefit Plan and none of such Pension Benefit
Plans has violated any applicable Law, including ERISA and the Code.
12.25.4. ACCUMULATED FUNDING DEFICIENCY. No such Pension Benefit
Plan has (i) incurred an accumulated funding deficiency (within the
meaning of Section 412(a) of the Code), whether or not waived; (ii)
been a Pension Benefit Plan with respect to which a Reportable Event
(to the extent that the reporting of such events to the PBGC within
thirty days of the occurrence has not been waived) has occurred and
is continuing; or (iii) been a Pension Benefit Plan with respect to
which there exist conditions or events which have occurred that
present a significant risk of termination of such Pension Benefit
Plan by the PBGC.
12.25.5. MULTI-EMPLOYER PLAN. All Multi-employer Plans to which any
Covered Person contributes or is obligated to contribute are listed
in Section 12.26.5 of the Disclosure Schedule. No Covered Person or
ERISA Affiliate of such Covered Person has received notice that any
such Multi-employer Plan is in reorganization or has been terminated
within the meaning of Title IV of ERISA, and no such Multi-employer
Plan is reasonably expected to be in reorganization or to be
terminated within the meaning of Title IV of ERISA.
32
12.26. WELFARE BENEFIT PLANS. No Covered Person or ERISA Affiliate
of any Covered Person maintains a Welfare Benefit Plan that has a
liability which, if enforced or collected, has or is reasonably
likely to have a Material Adverse Effect on any Covered Person. Each
Covered Person and each ERISA Affiliate of any Covered Person has
complied in all material respects with the applicable requirements
of Section 4980B of the Code pertaining to continuation coverage as
mandated by COBRA.
12.27. RETIREE BENEFITS. No Covered Person or ERISA Affiliate of
such Covered Person has an obligation to provide any Person with any
medical, life insurance, or similar benefit following such Person's
retirement or termination of employment (or to such Person's
beneficiary subsequent to such Person's death) other than (i) such
benefits provided to Persons at such Person's sole expense and (ii)
obligations under COBRA.
12.28. DISTRIBUTIONS. No Distribution other than as allowed in
Section 15.10 has been or shall be declared, paid or made upon or in
respect of any capital stock of Borrower on and after the Execution
Date, except as expressly permitted hereby.
12.29. REAL PROPERTY. No Covered Person owns any real property.
12.30. STATE OF COLLATERAL AND OTHER PROPERTY. Each Covered Person
has good and marketable or merchantable title to all real and
personal property purported to be owned by it or reflected in the
Initial Financial Statements, except for personal property sold in
the ordinary course of business or otherwise in accordance with the
terms of Section 15.9 of this Agreement after the date of the
Initial Financial Statements. There are no Security Interests on any
of the property purported to be owned by any Covered Person,
including the Collateral, except Permitted Security Interests. Each
material tangible item of Personal Property Collateral purported to
be owned by a Covered Person is in generally good operating
condition and repair and is suitable for the use to which it is
customarily put by its owner. Without limiting the generality of the
foregoing:
12.30.1. ACCOUNTS. With respect to each Account scheduled,
listed or referred to in reports submitted by any Covered
Person to Administrative Agent pursuant to the Loan Documents,
except as disclosed therein: (i) the Account arose from a bona
fide transaction completed in all material respects in
accordance with the terms of any documents pertaining to such
transaction; (ii) the Account is not evidenced by a judgment
and there is no material dispute respecting it; (iii) the
amount of the Account as shown on the applicable Covered
Person's books and records and all invoices and statements
which may be delivered to Administrative Agent with respect
thereto are actually and absolutely owing to the applicable
Covered Person and are not in any way contingent; (iv) there
are no material setoffs, counterclaims or disputes existing or
asserted with respect to the Account and the applicable
Covered Person has not made any agreement with any Account
Debtor for any deduction therefrom except a discount or
allowance allowed by the applicable Covered Person in the
ordinary course of its business for prompt payment; (v)
Borrower has no knowledge of any material facts, events or
occurrences which in any way impair the validity or
enforcement of the Account or tend to reduce the amount
payable thereunder as
33
shown on the applicable Covered Person's books and records and
all invoices and statements delivered to Administrative Agent
with respect thereto; (vi) the Account is assignable; (vii)
the Account arose in the ordinary course of the applicable
Covered Person's business; (viii) to such Covered Person's
best knowledge, the Account Debtor with respect to the Account
has the capacity to contract; (ix) the services furnished
and/or goods sold giving rise to the Account were not, at the
time furnished or sold, subject to any Security Interest
except the first priority, perfected Security Interest granted
to Administrative Agent for the benefit of Lenders and subject
to the Permitted Security Interests; and (x) to such Covered
Person's best knowledge, there are no material proceedings or
actions which are threatened or pending against the Account
Debtor with respect to the Account.
12.30.2. INVENTORY. With respect to Inventory scheduled,
listed or referred to in any certificate, schedule, list or
report given by any Covered Person, except as disclosed
therein: (i) such Inventory (except for Inventory in transit)
is located at one or another of the premises listed in Section
12.30.2 of the Disclosure Schedule; (ii) the applicable
Covered Person has good and merchantable title to such
Inventory subject to no Security Interest whatsoever except
for the first priority, perfected Security Interest granted to
Administrative Agent for the benefit of Lenders and subject to
Permitted Security Interests; (iii) such Inventory is of
generally good and merchantable quality, free from any
material defects; (iv) such Inventory is not subject to any
licensing, patent, royalty, trademark, trade name or copyright
agreements with any third parties; and (v) the completion of
manufacture and sale or other disposition of such Inventory by
Administrative Agent or Lenders following an Event of Default
shall not require the consent of any Person and shall not
constitute a breach or default under any contract or agreement
to which any Covered Person is a party or to which the
Inventory is subject.
12.30.3. EQUIPMENT. With respect to each Covered Person's
owned equipment: (i) such Covered Person has good and
marketable title thereto; (ii) none of such equipment is
subject to any Security Interests except for the first
priority, perfected Security Interest granted to
Administrative Agent for the benefit of Lenders pursuant
hereto and subject to Permitted Security Interests; and (iii)
all such equipment is generally in good operating condition
and repair, ordinary wear and tear alone excepted, and is
suitable for the uses to which customarily put in the conduct
of such Covered Person's business.
12.30.4. INTELLECTUAL PROPERTY. With respect to the
Intellectual Property of the Covered Persons: (i) Section
12.30.4 of the Disclosure Schedule contains a complete and
correct list of all of each Covered Person's registered
Intellectual Property, (ii) the Covered Person listed on the
Disclosure Schedule as the owner thereof owns all right, title
and interest in, under and to such Intellectual Property,
subject to no licenses or any interest therein or other
agreements relating thereto, except for the Intellectual
Property Assignments; (iii) none of such Intellectual Property
is subject to any pending or, to such Covered Person's
knowledge,
34
threatened challenge; (iv) to the knowledge of such Covered
Person, such Covered Person has not committed any patent,
trademark, trade name, service xxxx or copyright infringement,
and the present conduct of such Covered Person's business does
not infringe any patents, trademarks, trade name rights,
service marks, copyrights, publication rights, trade secrets
or other proprietary rights of any Person; and (v) there are
no claims or demands of any Person pertaining to, or any
proceedings which are pending or, to the knowledge of such
Covered Person, threatened, which challenge such Covered
Person's rights in respect of any proprietary or confidential
information or trade secrets used in the conduct of such
Covered Person's business.
12.30.5. DOCUMENTS, INSTRUMENTS AND CHATTEL PAPER. All
documents, instruments and chattel paper describing,
evidencing or constituting Collateral, and all signatures and
endorsements of all Covered Persons thereon, are complete,
valid, and genuine, and to the best of Borrower's knowledge,
all signatures and endorsements of all parties other than
Covered Persons are complete, valid and genuine. All goods
evidenced by such documents, instruments and chattel paper are
owned by a Covered Person free and clear of all Security
Interests other than Permitted Security Interests.
12.31. CHIEF PLACE OF BUSINESS; LOCATIONS OF COLLATERAL. As of the
Execution Date,
12.31.1. The only chief executive office and the principal
places of business of each Covered Person are located at the
places listed and so identified in Section 12.31.1 of the
Disclosure Schedule and the state of incorporation or
organization for each Covered Person is as identified in
Section 12.31.1 of the Disclosure Schedule;
12.31.2. The books and records of each Covered Person, and all
of such Covered Person's chattel paper and all records of
Accounts, are located only at the places listed and so
identified in Section 12.31.2 of the Disclosure Schedule; and
12.31.3. All of the tangible Collateral (except for Inventory
which is in transit) is located only at the places listed and
so identified in Section 12.31.3 of the Disclosure Schedule;
no Covered Person has an office or place of business other
than as identified in Section 12.31.3 of the Disclosure
Schedule.
12.32. NEGATIVE PLEDGES. No Covered Person is a party to or bound by
any material Contract which prohibits the creation or existence of
any Security Interest upon or assignment or conveyance of any of the
Collateral. In addition to the foregoing and not in limitation
thereof, no Covered Person is party to or bound by any Contract with
the United States or any other department, agency, public
corporation, or other instrumentality thereof which prohibits the
creation or existence of any Security Interest upon or assignment or
conveyance of any of the Collateral.
12.33. SECURITY DOCUMENTS.
35
12.33.1. SECURITY AGREEMENTS. Each Security Agreement is effective
to grant to Administrative Agent for the benefit of Lenders an
enforceable Security Interest in the Personal Property Collateral
described therein. Upon appropriate filing (as to all Personal
Property Collateral in which a Security Interest may be perfected
under the applicable state's UCC by filing a financing statement) or
Administrative Agent's taking possession (as to items of the
Personal Property Collateral of which a secured party must take
possession in order to perfect a Security Interest under the
applicable state's UCC) or Administrative Agent's taking control (as
to items of the Personal Property Collateral of which a secured
party must take control in order to perfect a security interest
under the applicable state's UCC), Administrative Agent will have a
fully perfected first priority Security Interest in the Personal
Property Collateral described in each Security Agreement, subject
only to Permitted Security Interests affecting such Personal
Property Collateral.
12.33.2. COLLATERAL ASSIGNMENTS.
12.33.2.1. INTELLECTUAL PROPERTY ASSIGNMENTS. Each
Intellectual Property Assignment is effective to grant to
Administrative Agent for the benefit of Lenders an enforceable
first priority security interest in all the Intellectual
Property described therein, subject only to Permitted Security
Interests affecting such Intellectual Property. Upon
appropriate filing in the United States Patent and Trademark
Offices and the United States Copyright Office, as well as the
appropriate filing of a financing statement, Administrative
Agent's Security Interest in the Intellectual Property will be
fully perfected.
12.33.2.2. PLEDGE AGREEMENT. Each Pledge Agreement is
effective to grant to Administrative Agent for the benefit of
Lenders an enforceable first priority Security Interest in all
the stock, membership interests, and other securities
described therein.
12.33.2.3. ACQUISITION DOCUMENTS ASSIGNMENT. The Acquisition
Documents Assignment is effective to grant to Administrative
Agent for the benefit of Lenders an enforceable first priority
Security Interest in and lien on all of Borrower's rights,
remedies, claims and interests under the Acquisition Documents
covered thereby.
12.34. S CORPORATION. As of the Effective Date and thereafter, there is no
election in effect under Section 1362(a) of the Code for any Covered
Person to be treated as an S Corporation as defined in Section 1361 (a) of
the Code.
12.35. SUBSIDIARIES AND AFFILIATES. Borrower has no Subsidiaries, except
for those Subsidiaries listed in Section 12.35 of the Disclosure Schedule.
36
12.36. BANK ACCOUNTS AND LOCKBOXES. All bank accounts maintained by any
Covered Person with any bank or other financial institution are described
in Section 12.36 of the Disclosure Schedule.
12.37. MARGIN STOCK. No Covered Person is engaged or will engage,
principally or as one of its important activities, in the business of
extending credit for the purpose of PURCHASING or CARRYING MARGIN STOCK
(within the meaning of Regulation U). Except for the Repurchases, no part
of the proceeds of any Advance will be used to purchase or carry any such
margin stock, or to extend credit to others for the purpose of purchasing
or carrying any such margin stock. No part of the proceeds of any Advance
will be used for any purpose which violates, or which would be
inconsistent with, the provisions of Regulation U. None of the
transactions contemplated by any of the Acquisition Documents will violate
Regulations T, U or X of the FRB.
12.38. SECURITIES MATTERS. No proceeds of any Advance will be used to
acquire any security in any transaction which is subject to Sections 13
and 14 of the Securities Exchange Act of 1934.
12.39. INVESTMENT COMPANY ACT, ETC. No Covered Person is an investment
company registered or required to be registered under the Investment
Company Act of 1940, or a company CONTROLLED (within the meaning of such
Investment Company Act) by such an INVESTMENT COMPANY or an AFFILIATED
PERSON of, or PROMOTER or PRINCIPAL UNDERWRITER for, an INVESTMENT
company, as such terms are defined in the Investment Company Act of 1940.
No Covered Person is subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate
Commerce Act or any other Law limiting or regulating its ability to incur
Indebtedness for money borrowed.
12.40. NO MATERIAL MISSTATEMENTS OR OMISSIONS. Neither the Loan Documents,
any of the Financial Statements nor any statement, list, certificate or
other information furnished or to be furnished by Borrower or any other
Covered Person to Administrative Agent or Lenders in connection with the
Loan Documents or any of the transactions contemplated thereby contains
any untrue statement of a material fact, or omits to state a material fact
necessary to make the statements therein not materially misleading.
Borrower has disclosed to Administrative Agent and Lenders everything of
which Borrower has knowledge regarding the business, operations, property,
financial condition, or business prospects or itself and every Covered
Person that has or is reasonably likely to have a Material Adverse Effect
on any Covered Person.
12.41. FILINGS. All registration statements, reports, proxy statements and
other documents, if any, required to be filed by any Covered Person with
the Securities and Exchange Commission pursuant to the Securities Act of
1933, and the Securities Exchange Act of 1934, have been filed, and such
filings are complete and accurate in all material respects and contain no
untrue statements of material fact or omit to state any material facts
required to be stated therein or necessary in order to make the statements
therein not misleading, and all capital stock of any covered Person that
is issued and
37
outstanding has been sold pursuant to transactions that are registered
under the Securities Act of 1933 or that are exempt thereunder.
12.42. BROKER'S FEES. No broker or finder is entitled to compensation for
services rendered with respect to the transactions contemplated by this
Agreement or the Acquisition Documents.
12.43. NO XXXX-XXXXX XXXXXX FILING REQUIRED. None of the Covered Persons,
any Guarantor, or Seller was required to file notification under the
Xxxx-Xxxxx Xxxxxx Antitrust Improvement Act of 1976, or to notify or
obtain the approval of any Governmental Authority in connection with any
Approved or Permitted Acquisition, unless such notification was filed or
such approval was obtained, as the case may be.
13. MODIFICATION AND SURVIVAL OF REPRESENTATIONS. Borrower may at any time after
the initial Advances are made propose to Lenders in writing to modify the
representations and warranties in Section 12, the representations and warranties
in any other Loan Document and any other representation or warranty made in any
certificate, report, opinion or other document delivered by Borrower pursuant to
the Loan Documents. If the proposed modifications are satisfactory to Required
Lenders as evidenced by their written assent thereto, then such representations
and warranties shall be deemed and treated as so modified, but only as of the
date of Borrower's written modification proposal. If such proposed modifications
are not satisfactory to Required Lenders, then such proposed modifications shall
not be deemed or treated as modifying such representations and warranties. All
such representations and warranties, as made or deemed made as of a particular
time, shall survive execution of each of the Loan Documents and the making of
every Advance, and may be relied upon by Administrative Agent and Lenders as
being true and correct in all material respects as of the date when made or
deemed made until all of the Loan Obligations are fully and indefeasibly paid,
no Letters of Credit are outstanding and the Letter of Credit Exposure is
irreversibly zero.
14. AFFIRMATIVE COVENANTS. Borrower covenants and agrees that, while any of the
Commitments remains in effect and until all of the Loan Obligations are fully
and indefeasibly paid, no Letters of Credit are outstanding and the Letter of
Credit Exposure is irreversibly zero, Borrower shall do, or cause to be done,
the following:
14.1. USE OF PROCEEDS. Subject to the terms and conditions hereof, (i) the
proceeds of the Revolving Loan Advances disbursed on the Effective Date
shall be used solely to refinance the existing Indebtedness of Borrower
under the First Amended and Restated Loan Agreement and to pay the
transaction costs of this Agreement, (ii) the proceeds of any subsequent
Revolving Loan Advance shall be used solely to pay the purchase price of
any Approved Acquisition, for working capital, capital expenditures
permitted hereunder, as the source for payment of Borrower's reimbursement
obligations with respect to Letters of Credit, to pay the transaction
costs for this Loan Agreement, to finance Approved Acquisitions and
Permitted Acquisitions, and to finance Repurchases but only so long as (a)
the cumulative aggregate amount of all Revolving Loan Advances utilized to
effect the Repurchases are not greater than Five Million and No/100
Dollars ($5,000,000.00) in the aggregate; (b) there is no Default
hereunder at the time of any such Repurchase; and (c) the Maximum
Available Amount that is available to Borrower under
38
the Aggregate Revolving Loan Commitment immediately following any
Revolving Loan Advance made to finance Repurchases is not less than Five
Million and No/100 Dollars ($5,000,000.00).
14.2. CORPORATE EXISTENCE. Each Covered Person shall maintain its
existence in good standing and shall maintain in good standing its right
to transact business in those states in which it is now or hereafter doing
business, except where the failure to so qualify will not have and will
not be reasonably likely to have a Material Adverse Effect on any Covered
Person. Each Covered Person shall obtain and maintain all Material
Licenses for such Covered Person.
14.3. MAINTENANCE OF PROPERTY AND LEASES. Each Covered Person shall
maintain in good condition and working order, and repair and replace as
required, all buildings, equipment, machinery, fixtures and other real and
personal property whose useful economic life has not elapsed and which is
necessary for the ordinary conduct of the business of such Covered Person.
Each Covered Person shall maintain in good standing and free of defaults
all of its leases of buildings, equipment, machinery, fixtures and other
real and personal property whose useful economic life has not elapsed and
which is necessary for the ordinary conduct of the business of such
Covered Person. No Covered Person shall permit any of its owned equipment
or other owned property to become a fixture to real property or an
accession to other personal property unless Administrative Agent has a
valid, perfected and first priority Security Interest for the benefit of
Lenders in such real or personal property.
14.4. INVENTORY. Each Covered Person shall keep its Inventory in good and
merchantable condition at its own expense and shall hold such Inventory
for sale or lease, or to be furnished in connection with the rendition of
services, in the ordinary course of such Covered Person's business, on
terms which do not include xxxx-and-hold, guarantied sale, sale and
return, sale on approval, consignment or similar repurchase or return
terms. All such Inventory shall be produced in accordance with the Federal
Fair Labor Standards Act of 1938 and all rules, regulations, and orders
thereunder.
14.5. INSURANCE. Each Covered Person shall at all times keep insured or
cause to be kept insured, in insurance companies having a rating of at
least "A" by Best's Rating Service, all property owned by it of a
character usually insured by others carrying on businesses similar to that
of such Covered Person in such manner and to such extent and covering such
risks as such properties are usually insured. Each Covered Person shall
carry business interruption insurance in such amounts, in such manner and
to such extent and covering such risks as businesses similar to that of
such Covered Persons are usually insured. Each Covered Person shall at all
times carry insurance, in insurance companies having a rating of at least
"A" by Best's Rating Service, against liability on account of damage to
persons or property (including product liability insurance and insurance
required under all Laws pertaining to workers' compensation) and covering
all other liabilities common to such Covered Person's business, in such
manner and to such extent as such coverage is usually carried by others
conducting businesses similar to that of such Covered Person (and each
Covered Person shall maintain liability coverage, including tail coverage,
in the amounts in effect for such Covered Person on the Effective Date).
All
39
policies of liability insurance maintained hereunder shall name
Administrative Agent as an additional insured for the benefit of Lenders;
all policies of property insurance maintained hereunder shall reflect
Administrative Agent's interest therein as mortgagee for the benefit of
Lenders under a standard New York or Union mortgagee clause.
Administrative Agent is authorized, but not obligated, as the
attorney-in-fact for Borrower and for the benefit of Lenders, at any time
when there does not then exist an Event of Default, with Borrower's
consent (which consent shall not be unreasonably withheld), and when an
Event of Default is in existence, without Borrower's consent, to (i)
adjust and compromise proceeds payable under such policies of insurance,
(ii) collect, receive and give receipts for such proceeds in the name of
Borrower, Administrative Agent and Lenders, and (iii) to endorse
Borrower's name upon any instrument in payment thereof. Such power granted
to Administrative Agent shall be deemed coupled with an interest and shall
be irrevocable. All policies of insurance maintained hereunder shall
contain a clause providing that such policies may not be canceled, reduced
in coverage or otherwise modified without 30 days prior written notice to
Administrative Agent. Borrower shall upon request of Administrative Agent
at any time furnish to Administrative Agent updated evidence of insurance
(in the form required as a condition to Administrative Agent's lending
hereunder) for such insurance.
14.6. PAYMENT OF TAXES AND OTHER OBLIGATIONS. Each Covered Person shall
promptly pay and discharge or cause to be paid and discharged, as and when
due, any and all income taxes, federal or otherwise, lawfully assessed and
imposed upon it, and any and all lawful taxes, rates, levies, and
assessments whatsoever upon its properties and every part thereof, or upon
the income or profits therefrom and all claims of materialmen, mechanics,
carriers, warehousemen, landlords and other like Persons for labor,
materials, supplies, storage or other items or services which if unpaid
might be or become a Security Interest or charge upon any of its property;
provided, however, that a Covered Person may diligently contest in good
faith by appropriate proceedings the validity of any such taxes, rates,
levies, or assessments, provided such Covered Person has established
adequate reserves therefor in conformity with GAAP on the books of such
Covered Person, and no Security Interest, other than a Permitted Security
Interest, results from such non-payment.
14.7. COMPLIANCE WITH LAWS. Each Covered Person shall comply in all
material respects with all Material Laws and each Covered Person shall
ensure, and cause each other Covered Person to ensure, that no Person who
owns a controlling interest in or otherwise controls a Covered Person is
or shall be (i) listed on the Specially Designated Nationals and Blocked
Person List maintained by the Office of Foreign Assets Control (OFAC),
Department of the Treasury, and/or any other similar lists maintained by
OFAC pursuant to any authorizing statute, Executive Order or regulation or
(ii) a person designated under Section 1(b), (c) or (d) of Executive Order
No. 13224 (September 23, 2001), any related enabling legislation or any
other similar Executive Orders, and each Covered Person shall comply, and
cause each other Covered Person to comply, with all applicable Bank
Secrecy Act ("BSA") and anti-money laundering laws and --- regulations.
14.8. DISCOVERY AND CLEAN-UP OF HAZARDOUS MATERIAL.
40
14.8.1. IN GENERAL. Upon any Covered Person receiving notice of any
violation of Environmental Laws or any similar notice described in
Section 12.10.3, or upon any Covered Person otherwise discovering
Hazardous Material on any property owned or leased by such Covered
Person which is in violation of, or which would result in liability
under, any Environmental Law, Borrower shall: (i) promptly take such
reasonable acts as may be necessary to prevent danger or harm to the
property or any person therein as a result of such Hazardous
Material; (ii) at the request of Administrative Agent, and at
Borrower's sole cost and expense, obtain and deliver to
Administrative Agent promptly, but in no event later than 90 days
after such request, a then currently dated environmental assessment
of the property certified to Administrative Agent and any future
holder of the Loan Obligations, a proposed plan for responding to
any environmental problems described in such assessment, and an
estimate of the costs thereof; and (iii) take all necessary steps to
initiate and expeditiously complete all removal, remedial, response,
corrective and other action to eliminate any such environmental
problems, and keep Administrative Agent informed of such actions and
the results thereof.
14.8.2. ASBESTOS CLEAN-UP. In the event that any property owned by
any Covered Person contains Asbestos Material, Borrower shall
develop and implement, as soon as reasonably possible, an Operations
and Maintenance Program (as contemplated by EPA guidance document
entitled Managing Asbestos in Place; A Building Owner's Guide to
Operations and Maintenance Programs for Asbestos-Containing
Materials) for managing in place the Asbestos Material, and deliver
a true, correct and complete copy of such Operations and Maintenance
Program to Administrative Agent. In the event that the asbestos
survey done in connection with developing the Operations and
Maintenance Program reveals Asbestos Material which, due to its
condition, location or planned building renovation, is recommended
to be encapsulated or removed, Borrower shall promptly cause the
same to be encapsulated or removed and disposed of offsite, in
either case by a licensed and experienced asbestos contractor, all
in accordance with applicable state, federal and local Laws. Upon
completion of any such encapsulation or removal, Borrower shall
deliver to Administrative Agent a certificate in such form as is
then customarily available signed by the consultant overseeing the
activity certifying to Administrative Agent that the work has been
completed in compliance with all applicable Laws regarding
notification, encapsulation, removal and disposal and that no
airborne fibers beyond permissible exposure limits remain on site.
All costs of such inspection, testing and remedial actions shall be
paid by Borrower.
14.9. TERMINATION OF PENSION BENEFIT PLAN. No Covered Person or ERISA
Affiliate of such Covered Person shall terminate or amend any Pension
Benefit Plan maintained by such Covered Person or such ERISA Affiliate if
such termination or amendment would result in any liability to such
Covered Person or such ERISA Affiliate under ERISA or any increase in
current liability for the plan year for which such Covered Person or such
ERISA Affiliate is required to provide security to such Pension Benefit
Plan under the
41
Code, which such liability could reasonably be expected to have a Material
Adverse Effect on such Covered Person.
14.10. NOTICE TO ADMINISTRATIVE AGENT OF MATERIAL EVENTS. Borrower shall,
promptly upon any Responsible Officer of Borrower obtaining knowledge or
notice thereof, give notice to Administrative Agent of (i) any breach of
any of the covenants in Section 14, 15, or 16; (ii) any Default or Event
of Default; (iii) the commencement of any Material Proceeding; and (iv)
any loss of or damage to any assets of a Covered Person or the
commencement of any proceeding for the condemnation or other taking of any
of the assets of a Covered Person, if Insurance/Condemnation Proceeds in
excess of $100,000.00 are likely to be payable as a consequence of such
loss, damage or proceeding, or if such loss, damage or proceeding has or
is reasonably likely to have a Material Adverse Effect on such Covered
Person. In addition,
14.10.1. Borrower shall furnish to Administrative Agent from time to
time all information which Administrative Agent reasonably requests
with respect to the status of any Material Proceeding.
14.10.2. Borrower shall furnish to Administrative Agent from time to
time all information which Administrative Agent reasonably requests
with respect to any Pension Benefit Plan established by a Covered
Person or an ERISA Affiliate of any Covered Person.
14.10.3. Borrower shall deliver notice to Administrative Agent of
the establishment of any Pension Benefit Plan by a Covered Person or
an ERISA Affiliate of such Covered Person.
14.10.4. Borrower shall promptly deliver to Administrative Agent
notice of any event of default with respect to any of the Permitted
Indebtedness, the occurrence of which would be reasonably likely to
have a Material Adverse Effect.
14.10.5. Borrower shall promptly deliver notice to Administrative
Agent of the assertion by the holder of any capital stock,
membership interest, or any other equity interest in a Covered
Person or any Indebtedness of a Covered Person in the outstanding
principal amount in excess of $100,000.00 that a default exists with
respect thereto or that such Covered Person is not in compliance
with the terms thereof, or of the threat or commencement by such
holder of any enforcement action because of such asserted default or
noncompliance and such assertion, threat or commencement would be
reasonably likely to have a Material Adverse Effect.
14.10.6. Borrower shall, promptly after becoming aware thereof,
deliver notice to Administrative Agent of any pending or threatened
strike, work stoppage, material unfair labor practice claim or other
material labor dispute affecting a Covered Person.
42
14.10.7. Borrower shall deliver notice to Administrative Agent of
any change in the name, state of organization, or form of
organization of any Covered Person, at least 30 days prior to such
change.
14.10.8. Borrower shall, promptly after becoming aware thereof,
deliver notice to Administrative Agent of any event that has or is
reasonably likely to have a Material Adverse Effect.
14.10.9. Borrower shall, promptly after becoming aware thereof,
deliver notice to Administrative Agent of an actual, alleged, or
potential violation of any Material Law applicable to a Covered
Person or the property of a Covered Person if such violation would
reasonably be likely to have a Material Adverse Effect.
14.10.10. Borrower shall notify Administrative Agent promptly in
writing of any fact or condition of which Borrower is aware which
materially and adversely affects the value of the Collateral,
including any adverse fact or condition or the occurrence of any
event which causes loss or depreciation in the value of any material
item of the Collateral, and the amount of such loss or depreciation.
Borrower shall provide such additional information to Administrative
Agent regarding the amount of any loss or depreciation in value of
the Collateral as Administrative Agent may request from time to
time.
14.11. BORROWING OFFICER. Borrower shall keep on file with Administrative
Agent at all times an appropriate instrument naming each Borrowing
Officer.
14.12. MAINTENANCE OF SECURITY INTERESTS OF SECURITY DOCUMENTS.
14.12.1. PRESERVATION AND PERFECTION OF SECURITY INTERESTS. Borrower
shall promptly, upon the reasonable request of Administrative Agent
and at Borrower's expense, execute, acknowledge and deliver, or
cause the execution, acknowledgment and delivery of, and thereafter
file or record in the appropriate governmental office, any document
or instrument supplementing or confirming the Security Documents or
otherwise deemed necessary by Administrative Agent to create,
preserve or perfect any Security Interest purported to be created by
the Security Documents or to fully consummate the transactions
contemplated by the Loan Documents. The foregoing actions by
Borrower shall include, upon the reasonable request of
Administrative Agent, (i) filing financing or continuation
statements, and amendments thereof, in form and substance
satisfactory to Administrative Agent; (ii) delivering to
Administrative Agent the originals of each instrument, document and
chattel paper in the principal amount of $100,000 or more, and all
other Collateral of which Administrative Agent should have physical
possession in accordance with applicable law in order to perfect
Administrative Agent's Security Interest for the benefit of Lenders
therein, duly endorsed or assigned to Administrative Agent without
restriction; (iii) delivering to Administrative Agent all letters of
credit on which Borrower is named beneficiary; (iv) placing a notice
of the existence of Administrative Agent's Security Interest for the
benefit of Lenders, acceptable to Administrative Agent,
43
upon the books and records of Borrower pertaining to the Collateral,
as designated by Administrative Agent; (v) delivering to
Administrative Agent or if directed by Administrative Agent, to the
applicable government agency, such notices, filings, statements,
continuations, or amendments as Administrative Agent shall deem
necessary as desirable to perfect its interest in that portion of
the Collateral that consists of Intellectual Property; and (vi)
delivering to Administrative Agent or if directed by Administrative
Agent, to the applicable government agency, such notices, filings,
statements, continuations or amendments as Administrative Agent
shall deem necessary or desirable to perfect its interest in that
portion of the Collateral that consists of Accounts of a value in
excess of $450,000.00 with respect to which the Account Debtor is
the United States of America or any department agency, public
corporation or other instrumentality thereof. Borrower hereby
authorizes Administrative Agent to file any financing or
continuation statements and amendments thereof covering the
Collateral of all Covered Persons in form and substance satisfactory
to Administrative Agent and ratifies Administrative Agent's
authority to file any such statements or amendments already filed.
14.12.2. COLLATERAL HELD BY WAREHOUSEMAN, BAILEE, ETC. If any
Collateral of a value in excess of $250,000.00 in the aggregate is
at any time in the possession or control of a warehouseman, bailee
or any of Borrower's agents or processors, then Borrower shall
notify Administrative Agent thereof and shall notify such Person of
Administrative Agent's Security Interest for the benefit of Lenders
in such Collateral and, upon Administrative Agent's request,
instruct such Person to hold all such Collateral for Administrative
Agent's account subject to Administrative Agent's instructions. If
at any time any material portion of the Collateral as determined by
Administrative Agent in its reasonable discretion is located on any
premises that are not owned by a Covered Person, then Borrower, if
requested by Administrative Agent, shall obtain or cause to be
obtained written waivers, in form and substance satisfactory to
Administrative Agent, of all present and future Security Interests
to which the owner or lessor or any mortgagee of such premises may
be entitled to assert against the Collateral.
14.12.3. COMPLIANCE WITH TERMS OF SECURITY DOCUMENTS. Each Covered
Person shall comply with all of the terms, conditions and covenants
in the Security Documents to which such Covered Person is a party.
14.13. ACCOUNTING SYSTEM. Each Covered Person shall maintain a system of
accounting established and administered in accordance with GAAP. Without
limiting the generality of the foregoing:
14.13.1. ACCOUNT RECORDS. Each Covered Person shall maintain a
record of Accounts at its principal place of business that itemize
each Account of such Covered Person and describe the names and
addresses of the Account Debtors on such Accounts, all relevant
invoice numbers, invoice dates, and shipping dates, and the due
dates, collection histories, and aging of such Accounts.
44
14.13.2. TRACING OF PROCEEDS. Each Covered Person shall maintain
detailed and accurate records of all transfers of any proceeds of
the Loans from Borrower to such Covered Person. Borrower shall
maintain reasonably detailed and accurate records of proceeds of the
Loans and transfers of the proceeds of the Loans (i) received by it
from the Lenders, (ii) transferred from it to any other Covered
Person, (iii) received by it from another Covered Person, and (iv)
transferred by it to Persons to effect the Repurchases which such
record shall include a schedule detailing the sale price paid per
share to effect such Repurchases.
14.14. FINANCIAL STATEMENTS. Borrower shall deliver to Administrative
Agent:
14.14.1. ANNUAL FINANCIAL STATEMENTS. Within 120 days after the
close of each fiscal year of Borrower, year-end consolidated and
consolidating financial statements of Borrower and its Subsidiaries,
containing a balance sheet, income statement, statement of cash
flows and an audit report without qualification by an independent
certified public accounting firm selected by Borrower and
satisfactory to Administrative Agent, and accompanied by (i) a
Compliance Certificate of the Chief Financial Officer of Borrower,
(ii) a certificate of the independent certified public accounting
firm that examined such financial statements to the effect that they
have reviewed and are familiar with the financial covenants set
forth in this Agreement and that, in examining such financial
statements, they did not become aware of any fact or condition which
then constituted a Default or Event of Default, except for those, if
any, described in reasonable detail in such certificate, (iii) the
management letter and report on internal controls delivered by such
independent certified public accounting firm in connection with its
audit, and (iv) if requested by Administrative Agent, any summary
prepared by such independent certified public accounting firm of the
adjustments proposed by the members of its audit team.
14.14.2. QUARTERLY FINANCIAL STATEMENTS. Within 30 days after the
end of each fiscal quarter of Borrower, unaudited consolidated and
consolidating internally prepared financial statements of Borrower
and its Subsidiaries for the quarters not covered by the latest
year-end financial statements, in each case containing a balance
sheet, income statement, and statement of cash flows and accompanied
by a Compliance Certificate of the Chief Financial Officer of
Borrower.
Each Compliance Certificate shall be in the form of Exhibit 14.14,
shall contain detailed calculations of the financial measurements
referred to in Section 16 for the relevant periods, and shall
contain statements by the signing officer to the effect that, except
as explained in reasonable detail in such Compliance Certificate,
(i) the attached Financial Statements are complete and correct in
all material respects (subject, in the case of Financial Statements
other than annual, to normal year-end audit adjustments) and have
been prepared in accordance with GAAP applied consistently
throughout the periods covered thereby and with prior periods
(except as disclosed therein) (ii) all of the Representations and
Warranties
45
are true and correct in all material respects as of the date such
certification is given as if made on such date, and (iii) there is
no Existing Default. If any Compliance Certificate delivered to
Administrative Agent discloses that a representation or warranty is
not true and correct in all material respects, or that there is an
Existing Default that has not been cured or waived in writing by
Required Lenders, such Compliance Certificate shall state what
action Borrower has taken or proposes to take with respect thereto.
14.15. OTHER FINANCIAL INFORMATION. Borrower shall also deliver the
following to Administrative Agent:
14.15.1. REPORTS OR INFORMATION CONCERNING ACCOUNTS OR INVENTORY.
Such reports and information, in form and detail satisfactory to
Administrative Agent, and documents as Administrative Agent may
reasonably request from time to time concerning Accounts including,
to the extent requested by Administrative Agent, copies of any
related invoices.
14.15.2. STOCKHOLDER REPORTS. Contemporaneously with their filing by
or on behalf of Borrower or any other Covered Person, copies of any
proxy statements, financial statements and reports which Borrower
makes available to its stockholders, members or partners.
14.15.3. PENSION BENEFIT PLAN REPORTS. Promptly upon the reasonable
request of Administrative Agent at any time or from time to time, a
copy of each annual report or other filing or notice filed with
respect to each Pension Benefit Plan of a Covered Person or an ERISA
Affiliate of a Covered Person.
14.15.4. TAX RETURNS. Promptly upon the reasonable request of
Administrative Agent at any time or from time to time, a copy of
each federal, state, or local tax return or report filed by
Borrower.
14.16. REVIEW OF ACCOUNTS. Not less often than annually, and promptly at
Administrative Agent's request if there is an Event of Default in
existence, Borrower shall conduct (and shall cause each other Covered
Person to conduct) a review of its Accounts, bad debt reserves, and
collection histories of Account Debtors and promptly following such review
provide Administrative Agent with a report of such review in form and
detail satisfactory to Administrative Agent.
14.17. INTENTIONALLY DELETED.
14.18. ANNUAL PROJECTIONS. Within the 30 days after the first day of each
fiscal year of Borrower, projected balance sheets, statements of income
and expense for Borrower and every other Covered Person as of the end of
and for each quarter of such fiscal year and each quarter through the
Revolving Loan Maturity Date, in such detail as Administrative Agent may
reasonably require, shall be delivered to Administrative Agent.
14.19. OTHER INFORMATION. Upon the request of Administrative Agent,
Borrower shall promptly deliver to Administrative Agent such other
information about the business,
46
operations, revenues, financial condition, property, or business prospects
of Borrower and every other Covered Person as Administrative Agent may,
from time to time, reasonably request.
14.20. AUDITS BY ADMINISTRATIVE AGENT. Administrative Agent or Persons
authorized by and acting on behalf of Administrative Agent or any Lender
may at any time during normal business hours audit the books and records
and inspect any of the property of each Covered Person from time to time
upon reasonable notice to such Covered Person, and in the course thereof
may make copies or abstracts of such books and records and discuss the
affairs, finances and books and records of such Covered Person with its
accountants and officers. Each Covered Person shall cooperate with
Administrative Agent and such Persons in the conduct of such audits and
shall deliver to Administrative Agent any instrument necessary for
Administrative Agent to obtain records from any service bureau maintaining
records for such Covered Person. Borrower shall reimburse Administrative
Agent for all reasonable costs and expenses incurred by it in conducting
each audit. Provided there is no Event of Default that has occurred and is
continuing, Administrative Agent shall not conduct an audit more than one
(1) time per calendar year, and Borrower's obligation to reimburse
Administrative Agent shall be capped at $5,000.00 per audit. However,
neither limitation shall apply to audits at any time an Event of Default
is in existence.
14.21. VERIFICATION OF ACCOUNTS AND NOTICES TO ACCOUNT DEBTORS. Upon the
occurrence and during the continuation of an Event of Default,
Administrative Agent shall have the right, in its commercially reasonable
judgment, to verify the validity and amount of any Account and any other
maker relating to an Account, by communicating in writing or orally
directly with the Account Debtor or any Person who represents or
Administrative Agent believes represents the Account Debtor.
14.22. APPRAISALS OF COLLATERAL. Upon Administrative Agent's request at
any time if there is an Event of Default in existence, Borrower shall at
its expense provide Administrative Agent with appraisals, prepared on a
basis satisfactory to Administrative Agent and from appraisers acceptable
to Administrative Agent, of any or all of the Collateral as Administrative
Agent may reasonably specify.
14.23. ACCESS TO OFFICERS AND AUDITORS. Each Covered Person shall permit
any Lender and Administrative Agent and each of their representatives and
agents to discuss the business, operations, revenues, financial condition,
property, or business prospects of such Covered Person with its officers,
accountants and independent auditors as often as Administrative Agent may
request in its discretion, and such Covered Person shall direct such
officers, accountants and independent auditors to cooperate with
Administrative Agent, Lenders, and their representatives and agents, and
make full disclosure to Administrative Agent, Lenders, and their
representatives and agents, of those matters that they may deem relevant
to the continuing ability of Borrower timely to pay and perform the Loan
Obligations. Administrative Agent and each Lender agrees that it will not
disclose to third Persons any information that it obtains about any
Covered Person or its operations or finances that is reasonably considered
non-public information. Administrative Agent and Lenders may, however,
disclose such information to each other
47
and all of their respective officers, attorneys, auditors, accountants,
bank examiners, agents and representatives who have a need to know such
information in connection with the administration, interpretation or
enforcement of the Loan Documents or the lending and collection activity
contemplated therein or to the extent required by Law or a Governmental
Authority. Administrative Agent and Lenders shall advise such Persons that
such information is to be treated as confidential. Administrative Agent
and any Lender may also disclose such information in any documents that it
files in any legal proceeding to pursue, enforce or preserve its rights
under the Loan Documents to the extent that its counsel advises in writing
that such disclosure is reasonably necessary. Administrative Agent's and
Lenders' non-disclosure obligation shall not apply to any information that
(i) is disclosed to Administrative Agent or any Lender by a third Person
not affiliated with or employed by Borrower who does not have a
commensurate duty of non-disclosure, or (ii) becomes publicly known other
than as a result of disclosure by Administrative Agent or a Lender.
14.24. PROFORMAS FOR PERMITTED ACQUISITIONS. Borrower shall, no less than
20 days prior to making any Permitted Acquisition, prepare and furnish to
Administrative Agent proforma financial statements described below for the
Target Company (if such Permitted Acquisition is structured as a purchase
of equity) or the Surviving Company (if such Permitted Acquisition is
structured as a purchase of assets or a merger), demonstrating to the
satisfaction of Administrative Agent that the Target Company, all
Surviving Companies, and Borrower, as the case may be, will be Solvent
upon consummation of such acquisition and upon the passage of time
thereafter, and that none of the covenants in Section 16 will be violated
as a consequence of such acquisition or with the passage of time
thereafter and, if applicable, demonstrating that the Maximum Available
Amount will be great enough to allow a Revolving Loan Advance to be made
in the amount Borrower will request in connection with the closing of such
Permitted Acquisition. Such proforma financial statements shall contain
consolidated and consolidating balance sheets, income statements,
statements of cash flows and such other reports and disclosures of
Borrower as well as the Target Company (if such Permitted Acquisition is
structured as a purchase of equity) or the Surviving Company (if such
Permitted Acquisition is structured as a purchase of assets or a merger)
and shall cover such forecast periods, as Administrative Agent may in its
discretion require. Borrower shall also provide to Administrative Agent
copies of the audited financial statements (if available, or unaudited
financial statements if no audited financial statements exist) for the
Target Company for the three fiscal years most recently ended and for each
of the completed fiscal quarters in the then current fiscal year.
14.25. INTENTIONALLY DELETED.
14.26. ACQUISITION DOCUMENTS. Borrower shall fully perform in all material
respects all of its obligations under all Acquisition Documents, and shall
enforce all of its rights and remedies thereunder as it deems appropriate
in its reasonable business judgment; provided, however, that Borrower
shall not take any action or fail to take any action which would result in
a waiver or other loss of any material right or remedy of Borrower
thereunder. Without limiting the generality of the foregoing, Borrower
shall take all action necessary or appropriate to permit, and shall not
take any action which would have
48
a Material Adverse Effect upon, the full enforcement of all indemnification
rights under all the Acquisition Documents. Borrower shall not, without
Administrative Agent's prior written consent, modify, amend, supplement,
compromise, satisfy, release or discharge any material provision of the
Acquisition Documents, any material collateral securing the same, any
Person liable directly or indirectly with respect thereto, or any material
agreement relating to the Acquisition Documents or the collateral therefor.
Borrower shall notify Administrative Agent in writing promptly after
Borrower becomes aware thereof, of any event or fact which could give rise
to a claim by it for indemnification under any of the Acquisition Documents
to the extent such claims in the aggregate exceed $100,000.00, and shall
diligently pursue such right and report to Administrative Agent on all
further developments with respect thereto. If an Event of Default then
exists, Borrower shall remit directly to Administrative Agent, for
application to the Loan Obligations in such order as Administrative Agent
determines, all amounts received by Borrower as indemnification or
otherwise pursuant to the Acquisition Documents. If Borrower fails after
Administrative Agent's demand to pursue diligently any right under any of
the Acquisition Documents, or if an Event of Default then exists, then
Administrative Agent may directly enforce such right in its own or
Borrower's name and may enter into such settlements or other agreements
with respect thereto as Administrative Agent determines. Notwithstanding
the foregoing, Borrower shall at all times remain liable to observe and
perform all of its duties and obligations under all the Acquisition
Documents, and Administrative Agent's exercise of any of its rights with
respect to the Collateral shall not release Borrower from any of such
duties or obligations. Administrative Agent shall not be obligated to
perform or fulfill any of Borrower's duties or obligations under any of the
Acquisition Documents or to make any payment thereunder, or to make any
inquiry as to the sufficiency of any payment or property received by it
thereunder or the sufficiency of performance by any party thereunder, or to
present or file any claim, or to take any action to collect or enforce any
performance or payment of any amounts, or any delivery of any property.
14.27. FURTHER ASSURANCES. Borrower shall execute and deliver, or cause to
be executed and delivered, to Administrative Agent such documents and
agreements, and shall take or cause to be taken such actions, as
Administrative Agent may from time to time reasonably request to carry out
the terms and conditions of this Agreement and the other Loan Documents.
15. NEGATIVE COVENANTS. Borrower covenants and agrees that, while any of the
Commitments remains in effect and until all of the Loan Obligations are fully
and indefeasibly paid, no Letters of Credit are outstanding and the Letter of
Credit Exposure is zero, Borrower shall not, directly or indirectly, do any of
the following, or permit any Covered Person to do any of the following, without
the prior written consent of Required Lenders:
15.1. INVESTMENTS. Make any Investments in any other Person except the
following:
15.1.1. Investments in (i) interest-bearing obligations of the United
States government or any department, agency or instrumentality
thereof; (ii) certificates of deposit issued by any Lender; (iii)
prime commercial paper rated A1 or better by Standard and Poor's
Corporation or Prime P1 or better by Xxxxx'x Investor
49
Service, Inc.; (iv) agreements involving the sale to a Covered Person
of United States government securities and their guarantied repurchase
the next Business Day by a commercial bank chartered under the Laws of
the United States or any state thereof which has capital and surplus
of not less than $500,000,000.00 (v) certificates of deposit issued by
and time deposits with any commercial bank chartered under the Laws of
the United States or any state thereof which has capital and surplus
of not less than $500,000,000.00; or (vi) municipal bonds that are
rated in either of the two highest rating categories by a nationally
recognized rating service.
15.1.2. Accounts arising in the ordinary course of business and
payable in accordance with Borrower's or such Covered Person's
customary trade terms.
15.1.3. Any Investments that are the Approved Acquisitions or
Permitted Acquisitions.
15.1.4. Investments existing on the Effective Date and disclosed in
Section 12.19 of the Disclosure Schedule.
15.1.5. Notes received by a Covered Person in settlement of
Indebtedness of other Persons to such Covered Person that was incurred
in the ordinary course of such Covered Person's business.
15.1.6. Investments by any Covered Person in any other Covered Person.
15.1.7. Loans to employees of any Covered Person, provided that in no
event shall all such loans exceed $500,000 in the aggregate.
15.1.8. Investments by any Covered Person in Xxxxxxx.
15.2. INDEBTEDNESS. Create, incur, assume, or allow to exist any
Indebtedness of any kind or description, except the following:
15.2.1. Indebtedness to trade creditors incurred in the ordinary
course of business, to the extent that it is not overdue past the
original due date by more than 90 days, provided that Indebtedness
that is overdue past its original due date by more than ninety (90)
days will be considered Permitted Indebtedness if it is the subject of
a good faith dispute and Borrower or such Covered Person has
established appropriate reserves adequate to pay such items in
accordance with GAAP.
15.2.2. The Loan Obligations.
15.2.3. Indebtedness secured by Permitted Security Interests.
15.2.4. Indebtedness under Capital Leases to the extent it does not
exceed $3,500,000.00 in the aggregate at any time and is on terms
approved in advance in writing by Administrative Agent.
50
15.2.5. Indebtedness owed by one Covered Person to another Covered
Person.
15.2.6. Any Interest Hedge Obligation.
15.2.7. The Indebtedness set forth on Section 15.2.7 of the Disclosure
Schedule.
15.2.8. Indebtedness incurred in connection with Permitted
Acquisitions that does not exceed $2,500,000.00.
15.3. PREPAYMENTS. Voluntarily prepay any Indebtedness other than (a) the
Loan Obligations in accordance with the terms of the Loan Documents, (b)
trade payables in the ordinary course of business, and (c) Operating and
Capital Lease obligations.
15.4. INDIRECT OBLIGATIONS. Create, incur, assume or allow to exist any
Indirect Obligations except the Permitted Indebtedness and except Indirect
Obligations existing on the Execution Date and disclosed on Section 12.21
of the Disclosure Schedule.
15.5. SECURITY INTERESTS. Create, incur, assume or allow to exist any
Security Interest upon all or any part of its property, real or personal,
now owned or hereafter acquired (including, without limitation, any Account
with respect to which the Account Debtor is the United States or any
department, agency, public corporation or other instrumentality thereof),
except the following:
15.5.1. Security Interests for taxes, assessments or governmental
charges not delinquent or being diligently contested in good faith and
by appropriate proceedings and for which adequate book reserves in
accordance with GAAP are maintained.
15.5.2. Security Interests arising out of deposits in connection with
workers' compensation insurance, unemployment insurance, old age
pensions, or other social security or retirement benefits legislation.
15.5.3. Deposits or pledges to secure bids, tenders, contracts (other
than contracts for the payment of money), leases, statutory
obligations, surety and appeal bonds, and other obligations of like
nature arising in the ordinary course of business.
15.5.4. Security Interests imposed by any Law, such as mechanics',
workmen's, materialmen's, landlords', carriers', or other like
Security Interests arising in the ordinary course of business which
secure payment of obligations which are not past due or which are
being diligently contested in good faith by appropriate proceedings
and for which adequate reserves in accordance with GAAP are maintained
on Borrower's books.
15.5.5. Purchase money Security Interests securing payment of the
purchase price of capital assets acquired by a Covered Person after
the Execution Date in an aggregate principal amount outstanding at any
one time that does not exceed $1,000,000.00.
51
15.5.6. Security Interests securing the Loan Obligations in favor of
Administrative Agent for the benefit of Lenders.
15.5.7. Security Interests existing on the Execution Date that are
disclosed in Section 12.30 of the Disclosure Schedule and are
satisfactory to Lenders.
15.5.8. Security Interests arising in connection with Permitted
Acquisitions to the extent of the limitations set forth in Section
15.2.8.
15.5.9. Security Interests granted under Capital Leases to the extent
of the limitations set forth in Section 15.2.4 and security interests
granted under Operating Leases.
15.6. NO AMENDMENTS TO ACQUISITION DOCUMENTS. Agree to, acquiesce to, or
consent to any amendment, modification, supplement, restatement,
replacement or change to any of the documents executed in connection with
any of the Acquisition Documents if such change would be reasonably likely
to have a Material Adverse Effect.
15.7. ACQUISITIONS. Acquire a controlling interest in the stock, membership
interests, or any other equity interest in a Person, or acquire all or
substantially all of the assets of a Person (including without limitation
assets comprising all or substantially all of an unincorporated business
unit or division of any Person), except for the Approved Acquisitions and
Permitted Acquisitions. Permitted Acquisition means an acquisition (other
than the Approved Acquisitions) of a controlling interest in the stock,
membership interests, or any other equity interest in a Person, or the
acquisition of all or substantially all of the assets of a Person
(including without limitation assets comprising all or substantially all of
an unincorporated business unit or division of any Person), which satisfies
each of the following conditions: (i) Borrower or any Subsidiary of
Borrower is the Acquiring Company, (ii) if the acquisition is structured as
a merger, Borrower or any Subsidiary of Borrower is the Surviving Company,
(iii) Target Company is in a substantially similar line of business as
Borrower or another Covered Person, (iv) Target Company has an EBITDA in
excess of zero for the twelve month period ended on the date such
acquisition is consummated, (v) there is no Existing Default, and no
Default or Event of Default will occur or is reasonably likely to occur as
a result of or due to such acquisition, (vi) Borrower has fully complied
with Section 14.24 of this Agreement with respect to such acquisition,
(vii) the Maximum Available Amount is at least $3,000,000.00 after giving
effect to such acquisition, (viii) the purchase price (including without
limitation any deferred purchase price, seller notes, assumed Indebtedness,
or similar items) together with all expenses incurred in connection with
such acquisition does not exceed $15,000,000.00 for any single acquisition
or $30,000,000.00 in the aggregate during any fiscal year of Borrower, (ix)
simultaneously with the closing of such acquisition, the Target Company (if
such Permitted Acquisition is structured as a purchase of equity) or the
Surviving Company (if such Permitted Acquisition is structured as a
purchase of assets or a merger) executes and delivers to Administrative
Agent (a) such documents necessary to grant to Administrative Agent for the
benefit of the Lenders a first priority Security Interest in all of the
assets of such Target Company or Surviving Company (subject to Permitted
Security Interests), each in form and substance
52
satisfactory to Administrative Agent (and if the Target Company becomes a
Subsidiary of any Covered Person, such Covered Person executes and delivers
to Administrative Agent a Pledge Agreement granting to Administrative Agent
for the benefit of the Lenders a first priority security interest in 100%
of the capital stock or other equity interests of such Target Company,
along with the original stock certificates, if any, and stock powers
executed in blank, each in form and substance satisfactory to
Administrative Agent), and (b) an unlimited Guaranty of the Loan
Obligations, or at the option of Administrative Agent in Administrative
Agent's absolute discretion, a joinder agreement satisfactory to
Administrative Agent in which such Target Company or Surviving Company
becomes a Borrower under this Agreement and assumes primary, joint and
several liability for the Loan Obligations, (x) prior to the closing of
such acquisition, a Responsible Officer of Borrower delivers to
Administrative Agent a certificate on behalf of Borrower certifying that
such acquisition is a Permitted Acquisition, and (xi) such acquisition is
friendly, rather than hostile, in nature.
15.8. BAILMENTS; CONSIGNMENTS; WAREHOUSING. Store any Inventory or other
assets in excess of $250,000.00 in the aggregate with a bailee,
warehouseman, consignee or pursuant to an express or implied agreement
establishing a bailment or consignment of Inventory or similar arrangement,
unless Administrative Agent has received a written acknowledgment
satisfactory to Administrative Agent from the third party involved which
acknowledges the prior perfected Security Interest of Administrative Agent
for the benefit of Lenders in such Inventory.
15.9. DISPOSAL OF PROPERTY. Sell, transfer, exchange, lease, or otherwise
dispose of any of its assets except (i) sales of Inventory in the ordinary
course of business, (ii) the sales of obsolete or unused assets, (iii)
sales of assets that are replaced by comparable assets of comparable or
better quality; and (iv) sales of other assets that do not exceed
$500,000.00 per year in the aggregate.
15.10. DISTRIBUTIONS. Directly or indirectly declare or make, or incur any
liability to make, any Distribution to any Person other than Distributions
from one Covered Person to another; provided that: (1) the payment of cash
dividends in an amount not to exceed six cents per share per calendar
quarter, up to a maximum of $7,500,000.00 per fiscal year and (2) the
Repurchases shall be permitted so long as there is no Default hereunder at
the time of declaration of such Distribution or Repurchases. For purposes
of this Section, a Distribution means and includes (i) any cash dividend or
payment, (ii) any retirement or prepayment of debt securities (other than
the Loan Obligation or as otherwise permitted hereunder) before their
regularly scheduled maturity dates, (iii) any loan or advance to a
shareholder or partner (other than Permitted Investments), (iv) any direct
or indirect purchase, redemption or other acquisition or retirement of any
class of its capital stock other than repurchases of Borrower's capital
stock made in connection with the exercise by employees of stock options
either by (x) the acquisition of shares from an employee in payment of the
exercise price for options, or (y) the withholding of shares in payment of
an employee's tax obligations in connection with such exercise.
15.11. CHANGE OF CONTROL. Merge or consolidate with or into another Person
provided that a Covered Person shall be permitted to merge or consolidate
with or into another
53
Covered Person upon advance written notice to Administrative Agent, or
permit any Person or Group (i) to become the record or beneficial owner,
directly or indirectly, on a fully diluted basis, of securities
representing 49% or more of the voting power of Borrower's then outstanding
securities having the power to vote or 49% or more of Borrower's then
outstanding capital stock, or (ii) to acquire the power to elect a majority
of the Board of Directors of Borrower.
15.12. AMENDMENT TO CHARTER DOCUMENTS. Amend, modify, supplement, restate,
replace, or change any of its Charter Documents, except to the extent such
change could not reasonably be expected to adversely affect Administrative
Agent or any Lender.
15.13. CAPITAL STRUCTURE; EQUITY SECURITIES. Make any change in capital
structure which has or is reasonably likely to have a Material Adverse
Effect; or issue or create any stock, membership interest, or other equity
interest (or class or series thereof, or non-equity interest that is
convertible into stock, membership interests or other equity interest (or
class or series thereof), in any Covered Person, except stock, membership
interests, or other equity interests (or class or series thereof) that are
subordinated in right of payment to all the Loan Obligations.
15.14. CHANGE OF BUSINESS. Engage in any business other than substantially
as conducted on the Effective Date.
15.15. TRANSACTIONS WITH AFFILIATES. Enter into or be a party to any
transaction or arrangement, including the purchase, sale or exchange of
property of any kind or the rendering of any service, with any Affiliate
other than a Covered Person, or make any loans or advances to any Affiliate
other than a Covered Person, except that each Covered Person may engage in
such transactions in the ordinary course of business and pursuant to the
reasonable requirements of its business and on fair and reasonable terms
substantially as favorable to it as those which it could obtain in a
comparable arm's-length transaction with a non-Affiliate. No Covered Person
may pay any management or other fees to any Affiliate that is not a Covered
Person; provided, however, that no such management fees may be paid while
there is an Existing Default, and any such management fees which are not
paid when due as a result of this sentence may be subsequently paid only at
such time as (i) there is no Existing Default, and (ii) the payment of such
management fee would not cause a Default to occur or result in a Default.
15.16. CONFLICTING AGREEMENTS. Enter into any agreement, that would, if
fully complied with by it, result in a Default or Event of Default either
immediately or upon the elapsing of time.
15.17. SALE AND LEASEBACK TRANSACTIONS. Enter into any agreement or
arrangement with any Person providing for any Covered Person to lease or
rent property that Borrower has sold or will sell or otherwise transfer to
such Person.
15.18. NEW SUBSIDIARIES. Organize, create or acquire any Subsidiary unless
it is part of the Approved Acquisitions or a Permitted Acquisition or
Borrower has obtained the prior
54
written consent of Administrative Agent thereto (which consent shall not be
unreasonably withheld) and contemporaneously with the organization,
creation or acquisition of such Subsidiary, the applicable Covered Person
and such Subsidiary executes and delivers to Administrative Agent for the
benefit of Lenders the following additional documents: an unlimited
guaranty of the Loan Obligations by such Subsidiary, a pledge of the
capital stock or membership interests of such Covered Person in such
Subsidiary, and other Security Documents requested by Administrative Agent
so as to grant Administrative Agent, for the benefit of the Lenders, a
perfected, first priority security interest in all real and personal
property of such Subsidiary subject to Permitted Security Interests,
together with an opinion letter from counsel for such Subsidiary. Such
counsel shall be acceptable to Administrative Agent and such opinion letter
shall be substantially similar to the opinion letter(s) received on the
Effective Date.
15.19. FISCAL YEAR. Change its fiscal year (currently April 1 - March 31),
without the prior written consent of Administrative Agent, which consent
shall not be unreasonably withheld.
15.20. LEASES. Enter into any Capital Leases except as permitted by Section
15.2.
15.21. TRANSACTIONS HAVING A MATERIAL ADVERSE EFFECT ON COVERED PERSON.
Enter into any transaction which has or is reasonably likely to have a
Material Adverse Effect on any Covered Person; or enter into any
transaction, or take or contemplate taking any other action, or omit or
contemplate omitting to take any action, which any Responsible Officer
knows, or reasonably should know is likely to cause a Default or Event of
Default hereunder.
16. FINANCIAL COVENANTS.
16.1. SPECIAL DEFINITIONS. As used in this Section 16 and elsewhere herein,
the following capitalized terms have the following meanings:
EBIT means, with respect to any fiscal period of Borrower, the consolidated
net income of Borrower and each Covered Person for such fiscal period, as
determined in accordance with GAAP and reported on the Financial Statements
for such period, plus (i) Interest Expense in such period, (ii) income tax
expense in such period, and (iii) the non-cash charges of any share-based
compensation awards, to the extent such non-cash charges were expensed
during such period in accordance with SFAS 123 or are required to be shown
as an expense in any comparative financial statements for periods prior to
the effective date of SFAS 123. For any period during which a Target
Company is acquired, EBIT shall be calculated on a proforma basis as if
such Target Company had been acquired on the first day of such period.
EBITDA means, with respect to any fiscal period of Borrower, the
consolidated net income of Borrower and each Covered Person for such fiscal
period, as determined in accordance with GAAP and reported on the Financial
Statements for such period, plus (i) (A) Interest Expense in such period,
(B) income tax expense in such period, (C) amortization of good will and
depreciation expense taken in such period, (D) any
55
extraordinary loss in such period, (E) payments or noncash charges in such
period in connection with the SEC Settlement of up to Three Million and
00/100 Dollars ($3,000,000.00), and (F) the non-cash charges of any
share-based compensation awards, to the extent such non-cash charges were
expensed during such period in accordance with SFAS 123 or are required to
be shown as an expense in any comparative financial statements for periods
prior to the effective date of SFAS 123, minus (ii) (A) any extraordinary
gain in such period and (B) any noncash gains in such period in connection
with the SEC Settlement. For any period during which a Target Company is
acquired, EBITDA shall be calculated on a proforma basis as if such Target
Company had been acquired on the first day of such period.
Interest Expense means for any period of calculation, all interest, whether
paid in cash or accrued as a liability, but without duplication, on
Indebtedness of Borrower and each Covered Person during such period.
Senior Indebtedness means the outstanding balance of the Loan Obligations
at the time of calculation.
SFAS 123 means Financial Accounting Standards Board Statement of Financial
Accounting Standards No. 123 (revised 2004).
Total Indebtedness means the sum of Senior Indebtedness and the unamortized
capitalized amount of all Capital Leases.
All other capitalized terms used in this Section 16 shall have their
meanings and shall be determined under GAAP.
16.2. INTENTIONALLY DELETED.
16.3. MINIMUM INTEREST COVERAGE. The ratio of Borrower's: (i) EBIT minus
dividends and income tax expense to (ii) Interest Expense for the
four-quarter period then ended, calculated the last day of each fiscal
quarter ending March 31, June 30, September 30, and December 31 through the
Revolving Loan Maturity Date shall not be less than 2.0 to 1.
16.4. MAXIMUM RATIO OF TOTAL INDEBTEDNESS TO EBITDA. The ratio of
Borrower's Total Indebtedness to EBITDA for the four-quarter period then
ended, calculated the last day of each fiscal quarter ending March 31, June
30, September 30, and December 31 through the Revolving Loan Maturity Date
shall not be greater than 2.50 to 1.
16.5. INTENTIONALLY DELETED.
16.6. MINIMUM EBITDA. Borrower's EBITDA for the four-quarter period then
ended, calculated as of the last day of each fiscal quarter ending March
31, June 30, September 30, and December 31 through the Revolving Loan
Maturity Date shall be no less than (A) $37,000,000, plus (B) 75% of EBITDA
of Target One and Target Two for the most recently-ended four fiscal
quarters prior to the closing of each Approved
56
Acquisition, respectively, as such amount is mutually agreed by the
Administrative Agent and the Borrower.
17. DEFAULT.
17.1. EVENTS OF DEFAULT. Any one or more of the following shall constitute
an event of default (an Event of Default) under this Agreement:
17.1.1. FAILURE TO PAY PRINCIPAL OR INTEREST. Failure of Borrower to
pay any principal of the Loans or interest accrued thereon when due or
within two (2) days thereafter, or failure of Borrower to pay any of
the other Loan Obligations when due, or within two (2) days
thereafter.
17.1.2. FAILURE TO PAY AMOUNTS OWED TO OTHER PERSONS. Failure of any
Covered Person to make any payment due on Indebtedness of such Covered
Person over $200,000.00 to Persons (other than Lenders under the Loan
Documents) which continues uncured or unwaived beyond any applicable
grace period specified in the documents evidencing such Indebtedness.
17.1.3. REPRESENTATIONS OR WARRANTIES. Any of the Representations and
Warranties is discovered to have been false in any material respect
when made.
17.1.4. CERTAIN COVENANTS. Failure of any Covered Person to comply
with the covenants in Sections 14.1, 14.5, 14.9, 14.10, 14.14, 14.20,
14.23, 14.24, 14.25, 14.26, 15, or 16.
17.1.5. OTHER COVENANTS. Failure of any Covered Person to comply with
any of the terms or provisions of any of the Loan Documents applicable
to it (other than a failure which constitutes an immediate Event of
Default under, or for which some other grace period is specified in
any other Section of this 17.1) which is not remedied or waived in
writing by Administrative Agent within 30 days after a Responsible
Officer becoming aware of such failure.
17.1.6. ACCELERATION OF OTHER INDEBTEDNESS. Any Obligation (other than
a Loan Obligation) of a Covered Person for the repayment of
$200,000.00 or more of borrowed money becomes or is declared to be due
and payable or required to be prepaid (other than by an originally
scheduled prepayment) prior to the original maturity thereof.
17.1.7. DEFAULT UNDER OTHER AGREEMENTS. The occurrence of any default
or event of default under any agreement to which a Covered Person is a
party (other than the Loan Documents), which default or event of
default continues uncured or unwaived beyond any applicable grace
period provided therein and has or is reasonably likely to have a
Material Adverse Effect.
17.1.8. BANKRUPTCY; INSOLVENCY; ETC. A Covered Person (i) fails to
pay, or admits in writing its inability to pay, its debts generally as
they become due, or otherwise becomes insolvent (however evidenced);
(ii) makes an assignment for
57
the benefit of creditors; (iii) files a petition in bankruptcy, is
adjudicated insolvent or bankrupt, petitions or applies to any
tribunal for any receiver or any trustee of such Covered Person or any
substantial part of its property; (iv) commences any proceeding
relating to such Covered Person under any reorganization, arrangement,
readjustment of debt, dissolution or liquidation Law of any
jurisdiction, whether now or hereafter in effect; (v) has commenced
against it any such proceeding which remains undismissed for a period
of 60 days, or by any act indicates its consent to, approval of, or
acquiescence in any such proceeding or the appointment of any receiver
of or any trustee for it or of any substantial part of its property,
or allows any such receivership or trusteeship to continue
undischarged for a period of 60 days; or (vi) takes any action to
authorize any of the foregoing.
17.1.9. JUDGMENTS; ATTACHMENT; SETTLEMENT; ETC. Any one or more
judgments or orders is entered against a Covered Person or any
attachment or other levy is made against the property of a Covered
Person with respect to a claim or claims involving in the aggregate
liabilities (not paid or fully covered by insurance, less the amount
of reasonable deductibles in effect on the Execution Date) in excess
of $200,000.00 and such judgment or order becomes final and
non-appealable or if timely appealed is not fully bonded and
collection thereof stayed pending the appeal. Notwithstanding the
foregoing, any order, judgment, or settlement entered into by Borrower
to effectuate the SEC Settlement shall not constitute an Event of
Default.
17.1.10. PENSION BENEFIT PLAN TERMINATION, ETC. Any Pension Benefit
Plan termination by the PBGC or the appointment by the appropriate
United States District Court of a trustee to administer any Pension
Benefit Plan or to liquidate any Pension Benefit Plan; or any event
which constitutes grounds either for the termination of any Pension
Benefit Plan by PBGC or for the appointment by the appropriate United
States District Court of a trustee to administer or liquidate any
Pension Benefit Plan shall have occurred and be continuing for thirty
(30) days after Borrower has notice of any such event; or any
voluntary termination of any Pension Benefit Plan which is a DEFINED
BENEFIT PENSION PLAN as defined in Section 3(35) of ERISA while such
defined benefit pension plan has an ACCUMULATED FUNDING DEFICIENCY,
unless Administrative Agent has been notified of such intent to
voluntarily terminate such plan and Required Lenders have given their
consent and agreed that such event shall not constitute a Default; or
the plan administrator of any Pension Benefit Plan applies under
Section 412(d) of the Code for a waiver of the minimum funding
standards of Section 412(1) of the Code and Required Lenders determine
that the substantial business hardship upon which the application for
such waiver is based could subject any Covered Person or ERISA
Affiliate of any Covered Person to a liability in excess of
$200,000.00.
17.1.11. LIQUIDATION OR DISSOLUTION. A Covered Person files a
certificate of dissolution under applicable state Law or is liquidated
or dissolved or suspends or terminates the operation of its business,
or has commenced against it any action
58
or proceeding for its liquidation or dissolution or the winding up of
its business, or takes any corporate action in furtherance thereof,
except in connection with the consolidation of such a Covered Person
and its assets with another Covered Person and its assets.
17.1.12. SEIZURE OF ASSETS. All or any material part of the property
of any Covered Person is nationalized, expropriated, seized or
otherwise appropriated, or custody or control of such property or of
any Covered Person shall be assumed by any Governmental Authority or
any court of competent jurisdiction at the instance of any
Governmental Authority, unless the same is being contested in good
faith by proper proceedings diligently pursued and a stay of
enforcement is in effect.
17.1.13. RACKETEERING PROCEEDING. There is filed against any Covered
Person any civil or criminal action, suit or proceeding under any
federal or state racketeering statute (including, without limitation,
the Racketeer Influenced and Corrupt Organization Act of 1970), which
action, suit or proceeding is not dismissed within 120 days and could
result in the confiscation or forfeiture of any material portion of
the Collateral.
17.1.14. LOAN DOCUMENTS; SECURITY INTERESTS. For any reason other than
the failure of Administrative Agent to take any action available to it
to maintain perfection of the Security Interests created in favor of
Administrative Agent for the benefit of Lenders pursuant to the Loan
Documents, any Loan Document ceases to be in full force and effect or
any Security Interest with respect to any portion of the Collateral
intended to be secured thereby ceases to be, or is not, valid,
perfected and prior to all other Security Interests (other than the
Permitted Security Interests) or is terminated, revoked or declared
void or invalid.
17.1.15. LOSS TO COLLATERAL. Any loss, theft, damage or destruction of
any item or items of Collateral occurs which either (i) has or is
reasonably likely to have a Material Adverse Effect on any other
Covered Person or (ii) materially and adversely affects the operation
of Borrower's business and is not covered by insurance as required
herein.
17.1.16. GUARANTY; GUARANTOR. Any Guaranty ceases to be in full force
and effect or any action is taken to discontinue or assert the
invalidity or unenforceability of any Guaranty or any Guarantor fails
to comply with any of the terms or provisions of any Guaranty, or any
representation or warranty of any Guarantor therein is false in any
material respects, or any Guarantor denies that it has any further
liability under any Guaranty or gives notice to Administrative Agent
to such effect, or any Guarantor fails to furnish the financial
statements required under any Guaranty.
17.2. CROSS DEFAULT. An Event of Default under this Agreement will
automatically and immediately constitute a default under all other Loan
Documents without regard to any requirement therein for the giving of
notice or the passing of time.
59
17.3. RIGHTS AND REMEDIES.
17.3.1. TERMINATION OF COMMITMENTS. Upon an Event of Default described
in Section 17.1.8, the Commitments shall be deemed canceled. Upon any
other Event of Default, and at any time thereafter, Required Lenders
may cancel the Commitments. Such cancellation may be, in either case,
without presentment, demand or notice of any kind, which Borrower
expressly waives.
17.3.2. ACCELERATION. Upon an Event of Default described in Section
17.1.8, all of the outstanding Loan Obligations shall automatically
become immediately due and payable. Upon any other Event of Default,
and at any time thereafter, Required Lenders may declare all of the
outstanding Loan Obligations immediately due and payable. Such
acceleration may be, in either case, without presentment, demand or
notice of any kind, which Borrower expressly waives.
17.3.3. RIGHT OF SETOFF. So long as there is any Event of Default in
existence, each Lender is hereby authorized, without notice to
Borrower (any such notice being expressly waived by Borrower), to the
fullest extent permitted by law, to set off and apply against the Loan
Obligations any and all deposits (general or special, time or demand,
provisional or final) at any time held, or any other Indebtedness at
any time owing by such Lender (or its Affiliate) to or for the credit
or the account of Borrower, irrespective of whether or not such Lender
shall have made any demand under this Agreement or the Notes or any
Guaranty and although such Loan Obligations may be unmatured. The
rights of each Lender under this Section are in addition to other
rights and remedies (including, without limitation, other rights of
setoff) which such Lender may otherwise have. All amounts received by
each Lender on account of the Loan Obligations pursuant to this
Section shall be paid over promptly to Administrative Agent for
distribution to Lenders as provided in this Agreement and shall be
applied as provided in this Agreement.
17.3.4. NOTICE TO ACCOUNT DEBTORS. Upon the occurrence of any Event of
Default and at any time and from time to time thereafter so long as
such Event of Default is continuing, Administrative Agent may (if
Required Lenders concur), without prior notice to Borrower, notify any
or all Account Debtors that the Accounts have been assigned to
Administrative Agent for the benefit of Lenders and that
Administrative Agent has a Security Interest therein for the benefit
of Lenders, and Administrative Agent may direct, or Borrower, at
Administrative Agent's request, shall direct, any or all Account
Debtors to make all payments upon the Accounts directly to
Administrative Agent for the benefit of Lenders.
17.3.5. ENTRY UPON PREMISES AND ACCESS TO INFORMATION. Upon the
occurrence of an Event of Default and acceleration of the Loan
Obligations as provided herein, and at any time thereafter:
Administrative Agent may (i) enter upon the premises leased or owned
by Borrower where Collateral is located (or is believed to be located)
without any obligation to pay rent to Borrower, or any other place or
places where Collateral is believed to be located, (ii) render
Collateral usable or
60
saleable, (iii) remove Collateral therefrom to the premises of
Administrative Agent or any agent of Administrative Agent for such
time as Administrative Agent may desire in order effectively to
collect or liquidate Collateral, (iv) take possession of, and make
copies and abstracts of, Borrower's original books and records, obtain
access to Borrower's data processing equipment, computer hardware and
software relating to any of the Collateral and use all of the
foregoing and the information contained therein in any manner
Administrative Agent deems appropriate in connection with the exercise
of Administrative Agent's rights, and (v) notify postal authorities to
change the address for delivery of Borrower's mail to an address
designated by Administrative Agent and to receive, open and process
all mail addressed to Borrower.
17.3.6. COMPLETION OF UNCOMPLETED INVENTORY ITEMS. Upon the occurrence
of an Event of Default and at any time and from time to time
thereafter so long as an Event of Default is continuing,
Administrative Agent may request that Borrower, and Borrower shall
upon such request, use Borrower's best efforts to obtain the consent
of its and any other Covered Person's customers to the completion
(before or after foreclosure by Administrative Agent of its security
interest therein) of the manufacture of all uncompleted Inventory
items that Borrower or any other Covered Person was manufacturing for
such customers pursuant to contracts or accepted purchase orders, and
the commitment by such customers to purchase such items upon their
completion as provided in the relevant contracts or accepted purchase
orders. Borrower shall, as an uncompensated agent for Lenders,
complete or cause to be completed the manufacture and shipment of all
such items as provided in the relevant contracts or accepted purchase
orders if Administrative Agent so directs.
17.3.7. BORROWER'S OBLIGATIONS. Upon the occurrence of an Event of
Default and during its continuance, Borrower shall, if Administrative
Agent so requests, assemble all the movable tangible Collateral and
make it available to Administrative Agent at a place or places to be
designated by Administrative Agent in its discretion.
17.3.8. SECURED PARTY RIGHTS. Upon an Event of Default and
acceleration of the Loan Obligations as provided herein, and at any
time and from time to time thereafter:
17.3.8.1. Administrative Agent may exercise any or all of its
rights under the Security Documents as a secured party under the
UCC and any other applicable Law; and
17.3.8.2. Administrative Agent may sell or otherwise dispose of
any or all of the Collateral at public or private sale in a
commercially reasonable manner, which sale Administrative Agent
may postpone from time to time by announcement at the time and
place of sale stated in the notice of sale or by announcement at
any adjourned sale without being required to give a new notice of
sale, all as Administrative Agent deems
61
advisable, for cash or credit. Administrative Agent or any Lender
may become the purchaser at any such sale if permissible under
applicable Law, and such Lender may, in lieu of actual payment of
the purchase price, setoff the amount thereof against Borrower's
obligations owing to Lender, and Borrower agrees that such Lender
has no obligation to preserve rights to Collateral against prior
parties or to marshal any Collateral for the benefit of any
Person.
In connection with and for the sole purpose of the advertising for
sale, further manufacture, selling, or otherwise realizing upon any of
the Collateral securing the obligations of Borrower to Lender, to the
extent Administrative Agent has not foreclosed upon its Security
Interest in the following, Administrative Agent may use and is hereby
granted a license to use, without charge or liability to
Administrative Agent or Lenders therefor, any of Borrower's or any
other Covered Person's labels, trade names, trademarks, trade secrets,
service marks, patents, patent applications, licenses, certificates of
authority, advertising materials, or any of Borrower's or any other
Covered Person's other properties or interests in properties of
similar nature, to the extent that such use thereof is not prohibited
by agreements under which Borrower or such other Covered Person has
rights therein, and all of Borrower's rights under license, franchise
and similar agreements shall inure to Lenders' benefit.
17.3.9. JOINT AND SEVERAL. Each Obligation and liability to the Letter
of Credit Issuer, Administrative Agent and each Lender of Borrower,
including, without limitation, the Loan Obligations, are the joint and
several obligations of Borrower, and each Guarantor and Administrative
Agent may proceed directly against Borrower, any Guarantor, all of the
foregoing, or any one of the foregoing or any combination of the
foregoing, without first proceeding against Borrower, or without
joining all Persons liable or potentially liable for any portion of
the Loan Obligations in one action.
17.3.10. MISCELLANEOUS. Upon the occurrence of an Event of Default and
at any time thereafter so long as such Event of Default is continuing,
Lenders may exercise any other rights and remedies available to
Lenders under the Loan Documents or otherwise available to Lenders at
law or in equity.
17.4. APPLICATION OF FUNDS. Any funds received by Lenders or Administrative
Agent for the benefit of Lenders with respect to any Loan Obligation after
its Maturity, including proceeds of Collateral, shall be applied as
follows: (i) first, to reimburse Lenders pro-rata for any amounts due to
Lenders under Section 20.9; (ii) second, to reimburse to Administrative
Agent all unreimbursed costs and expenses paid or incurred by
Administrative Agent that are payable or reimbursable by Borrower
hereunder; (iii) third, to reimburse to Lenders pro-rata all unreimbursed
costs and expenses paid or incurred by Lenders (including costs and
expenses incurred by Administrative Agent as a Lender that are not
reimbursable as provided in the preceding clause) that are payable or
reimbursable by Borrower hereunder; (iv) fourth, to the payment of accrued
and unpaid fees due hereunder and all other amounts due hereunder (other
than the Loans and
62
interest accrued thereon); (v) fifth, to the payment of the Loans of each
of the Lenders and interest accrued thereon (which payments shall be pro
rata to each of the Lenders in accordance with the amount of the Loans
outstanding) and to the payment (pari passu with the foregoing) of any
Interest Hedge Obligations (vi) sixth, to Letter of Credit Issuer as cash
collateral for the Letter of Credit Exposure; and (vii) seventh, to the
payment of the other Loan Obligations. Any remaining amounts shall be
applied to payment of all the Obligations to Administrative Agent. Any
further remaining amounts shall be paid to Borrower or such other Persons
as shall be legally entitled thereto. Except as expressly provided
otherwise herein, Lenders may apply and reverse and reapply, payments and
proceeds of the Collateral to the Loan Obligations in such order and manner
as Lenders determine in their absolute discretion. Borrower hereby
irrevocably waives the right to direct the application of payments and
proceeds of the Collateral.
17.5. LIMITATION OF LIABILITY; WAIVER. Administrative Agent and Lenders
shall not be liable to Borrower as a result of any commercially reasonable
possession, repossession, collection or sale by Administrative Agent of
Collateral; and Borrower hereby waives all rights of redemption from any
such sale and the benefit of all valuation, appraisal and exemption Laws.
If Administrative Agent seeks to take possession of any of the Collateral
by replevin or other court process, Borrower hereby irrevocably waives (i)
the posting of any bonds, surety and security relating thereto required by
any statute, court rule or otherwise as an incident to such possession,
(ii) any demand for possession of the Collateral prior to the commencement
of any suit or action to recover possession thereof, (iii) any requirement
that Administrative Agent retain possession and not dispose of any
Collateral until after trial or final judgment, and (iv) to the extent
permitted by applicable Law, all rights to notice and hearing prior to the
exercise by Administrative Agent of Administrative Agent's right to
repossess the Collateral without judicial process or to replevy, attach or
levy upon the Collateral without notice or hearing. Administrative Agent
shall have no obligation to preserve rights to the Collateral or to
xxxxxxxx any Collateral for the benefit of any Person.
17.6. NOTICE. Any notice of intended action required to be given by
Administrative Agent (including notice of a public or private sale of
Collateral), if given as provided in Section 21.1 at least 10 days prior to
such proposed action, shall be effective and constitute reasonable and fair
notice to Borrower.
18. ADMINISTRATIVE AGENT AND LENDERS.
18.1. APPOINTMENT, POWERS, AND IMMUNITIES. LaSalle is hereby appointed
Administrative Agent hereunder and under each of the other Loan Documents.
Each Lender hereby irrevocably appoints and authorizes Administrative Agent
to act as its agent under this Agreement and the other Loan Documents with
such powers and discretion as are specifically delegated to Administrative
Agent by the terms of this Agreement and the other Loan Documents, together
with such other powers as are reasonably incidental thereto. Administrative
Agent (which term as used in this sentence and in Section 18.5 and the
first sentence of Section 18.6 hereof shall include its affiliates and its
own and its affiliates' officers, directors, employees, and agents): (a)
shall not have any duties or responsibilities except those expressly set
forth in this Agreement and
63
shall not be a trustee or fiduciary for any Lender; (b) shall not be
responsible to the Lenders for any recital, statement, representation, or
warranty (whether written or oral) made in or in connection with any Loan
Document or any certificate or other document referred to or provided for
in, or received by any of them under, any Loan Document, or for the value,
validity, effectiveness, genuineness, enforceability, or sufficiency of any
Loan Document, or any other document referred to or provided for therein or
for any failure by any Covered Person or any other Person to perform any of
its obligations thereunder or the validity or priority of any Security
Interest in any Collateral; (c) shall not be responsible for or have any
duty to ascertain, inquire into, or verify the performance or observance of
any covenants or agreements by any Covered Person or the satisfaction of
any condition or to inspect the property (including the books and records)
of any Covered Person or any of its Subsidiaries or affiliates; (d) shall
not be required to initiate or conduct any litigation or collection
proceedings under any Loan Document; and (e) shall not be responsible for
any action taken or omitted to be taken by it under or in connection with
any Loan Document, except for its own gross negligence or willful
misconduct. Administrative Agent may employ agents and attorneys-in-fact
and shall not be responsible for the negligence or misconduct of any such
agents or attorneys-in-fact selected by it with reasonable care.
18.2. RELIANCE BY ADMINISTRATIVE AGENT. Administrative Agent shall be
entitled to rely upon any certification, notice, instrument, writing, or
other communication (including, without limitation, any thereof by
telephone or telecopy) believed by it to be genuine and correct and to have
been signed, sent or made by or on behalf of the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel for any
Covered Person), independent accountants, and other experts selected by
Administrative Agent. Administrative Agent may deem and treat the payee of
any Note as the holder thereof for all purposes hereof unless and until
Administrative Agent receives and accepts an Assignment and Acceptance
executed in accordance with Section 20.4 hereof. As to any matters not
expressly provided for by this Agreement, Administrative Agent shall not be
required to exercise any discretion or take any action, but shall be
required to act or to refrain from acting (and shall be fully protected in
so acting or refraining from acting) upon the instructions of the Required
Lenders, and such instructions shall be binding on all of the Lenders;
provided, however, that Administrative Agent shall not be required to take
any action that exposes Administrative Agent to personal liability or that
is contrary to any Loan Document or applicable law or unless it shall first
be indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of taking any
such action.
18.3. EMPLOYMENT OF AGENTS AND COUNSEL. Administrative Agent may execute
any of its duties hereunder by or through employees, agents, and
attorneys-in-fact and shall not be liable to any Lender, except with
respect to money or securities received by it or such agents or
attorneys-in-fact, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. Administrative Agent
shall be entitled to advice of counsel concerning all matters pertaining to
the agency hereby created and its duties hereunder and shall not be liable
to any Lender for acting or failing to act as advised by such counsel,
except where doing so violates an express obligation of Administrative
Agent under the Loan Documents.
64
18.4. DEFAULTS. Administrative Agent shall not be deemed to have knowledge
or notice of the occurrence of a Default or Event of Default unless
Administrative Agent has received written notice from a Lender or the
Borrower specifying such Default or Event of Default and stating that such
notice is a Notice of Default. In the event that Administrative Agent
receives such a notice of the occurrence of a Default or Event of Default,
Administrative Agent shall give notice thereof to the Lenders.
Administrative Agent shall (subject to Section 18.2 hereof) take such
action with respect to such Default or Event of Default as shall reasonably
be directed by the Required Lenders, provided that, unless and until
Administrative Agent shall have received such directions, Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interest of the Lenders.
18.5. RIGHTS AS LENDER. With respect to its Commitment and the Loans made
by it, LaSalle (and any successor acting as Administrative Agent) in its
capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were
not acting as Administrative Agent, and the term Lender or Lenders shall,
unless the context otherwise indicates, include Administrative Agent in its
individual capacity. LaSalle (and any successor acting as Administrative
Agent) and its affiliates may (without having to account therefor to any
Lender) accept deposits from, lend money to, make investments in, provide
services to, and generally engage in any kind of lending, trust, or other
business with any Covered Person or any of its Subsidiaries or Affiliates
as if it were not acting as Administrative Agent, and LaSalle (and any
successor acting as Administrative Agent) and its Affiliates may accept
fees and other consideration from any Covered Person or any of its
Subsidiaries or Affiliates for services in connection with this Agreement
or otherwise without having to account for the same to Lenders. The Lenders
acknowledge that, pursuant to such activities, Administrative Agent or its
Affiliates may receive information regarding Borrower or its Affiliates
(including information that may be subject to confidentiality obligations
in favor of Borrower or such Affiliates) and acknowledge that
Administrative Agent shall be under no obligation to provide such
information to the Lenders.
18.6. INDEMNIFICATION. Whether or not the transactions contemplated hereby
are consummated, Lenders agree to reimburse and indemnify Administrative
Agent upon demand (to the extent not reimbursed under Section 20.8, but
without limiting the obligations of Borrower under Section 20.8) ratably in
accordance with their respective Commitments, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including attorneys' fees), or disbursements of any kind and
nature whatsoever that may be imposed on, incurred by or asserted against
Administrative Agent (including by any Lender) in any way relating to or
arising out of any Loan Document or the transactions contemplated thereby
or any action taken or omitted by Administrative Agent under any Loan
Document; provided that no Lender shall be liable for any of the foregoing
to the extent they arise from the gross negligence or willful misconduct of
the Person to be indemnified. Without limitation of the foregoing, each
Lender agrees to reimburse Administrative Agent promptly upon demand for
its ratable share of any costs or expenses payable by Borrower under
Section 20.8, to the extent that Administrative Agent is not promptly
reimbursed for such costs and
65
expenses by Borrower. The agreements contained in this Section shall
survive payment in full of the Loans and all other amounts payable under
this Agreement.
18.7. NOTIFICATION OF LENDERS. Each Lender agrees to use its good faith
efforts, upon becoming aware of anything which has or is reasonably likely
to have a Material Adverse Effect on any Covered Person, to promptly notify
Administrative Agent thereof. Administrative Agent shall promptly deliver
to each Lender copies of every written notice, demand, report (including
any financial report), or other writing which Administrative Agent gives to
or receives from Borrower and which itself (a) constitutes, or which
contains information about, something that has or is reasonably likely to
have a Material Adverse Effect on any Covered Person, or (b) is otherwise
delivered to Administrative Agent by Borrower pursuant to the Loan
Documents and is deemed material information by Administrative Agent in its
sole discretion. Administrative Agent and its directors, officers, agents,
and employees shall have no liability to any Lender for failure to deliver
any such item to such Lender unless the failure constitutes gross
negligence or willful misconduct.
18.8. NON-RELIANCE ON AGENT AND OTHER LENDERS. Each Lender acknowledges
that Administrative Agent has not made any representation or warranty to
it, and that no act by the Administrative Agent hereafter taken, including
any review of the affairs of Borrower and its Affiliates, shall be deemed
to constitute any representation or warranty by Administrative Agent to any
Lender. Each Lender agrees that it has, independently and without reliance
on Administrative Agent or any other Lender, and based on such documents
and information as it has deemed appropriate, made its own credit analysis
of the Covered Persons and their Subsidiaries and decision to enter into
this Agreement and that it will, independently and without reliance upon
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own analysis and decisions in taking or not taking action under the Loan
Documents. Except for notices, reports, and other documents and information
expressly required to be furnished to Lenders by Administrative Agent
hereunder, Administrative Agent shall not have any duty or responsibility
to provide any Lender with any credit or other information concerning the
affairs, financial condition, or business of any Covered Person or any of
its Subsidiaries or Affiliates that may come into the possession of
Administrative Agent or any of its Affiliates.
18.9. RESIGNATION. Administrative Agent may resign at any time by giving
notice thereof to the Lenders and Borrower. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Administrative
Agent, which shall be a commercial bank organized under the laws of the
United States of America having a combined capital and surplus of at least
$1,000,000,000.00. If no successor Administrative Agent shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within thirty (30) days after the retiring Administrative Agent's giving of
notice of resignation, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent which shall
be a commercial bank organized under the laws of the United States of
America having combined capital and surplus of at least $1,000,000,000.00.
Upon the acceptance of any appointment as Administrative Agent hereunder by
a successor, such successor shall
66
thereupon succeed to and become vested with all the rights, powers,
discretion, privileges, and duties of the retiring Administrative Agent,
and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder. If no successor has accepted appointment as
Administrative Agent within thirty (30) days after the date on which
Administrative Agent first attempts to appoint a successor Administrative
Agent, the resigning Administrative Agent's resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties
of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor which accepts such appointment. After
any retiring Administrative Agent's resignation hereunder as Administrative
Agent, the provisions of this Section 18.9 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 Administrative Agent.
18.10. COLLECTIONS AND DISTRIBUTIONS TO LENDERS BY ADMINISTRATIVE AGENT.
Except as otherwise provided in this Agreement, all payments of interest,
fees, principal and other amounts received by Administrative Agent for the
account of Lenders shall be distributed by Administrative Agent to Lenders
in accordance with their Pro-Rata Shares of the outstanding Loan
Obligations at the time of such distribution on the same Business Day when
received, unless received after 1:00 p.m. (Local Time) in which case they
shall be so distributed by 1:00 p.m. (Local Time) on the next Business Day.
All amounts received by any Lender on account of the Loan Obligations,
including amounts received by way of setoff, shall be paid over promptly to
Administrative Agent for distribution to Lenders as provided above in this
Section. Such distributions shall be made according to instructions that
each Lender may give to Administrative Agent from time to time.
18.11. LENDER AS NON-U.S. PARTICIPANT. To the extent permitted by
applicable law, each lender that is not a United States person within the
meaning of Code Section 7701(a)(30) (a "Non-U.S. Participant") shall
deliver to the Borrower and the Administrative Agent on or prior to the
initial Advance (or in the case of a Lender that is an Assignee, on the
date of such assignment to such Lender) two accurate and complete original
signed copies of IRS Form W-8BEN, W-8ECI, or W-8IMY (or any successor or
other applicable form prescribed by the IRS) certifying to such Lender's
entitlement to a complete exemption from, or a reduced rate in, United
States withholding tax on interest payments to be made hereunder or any
Loan. If a Lender that is a Non-U.S. Participant is claiming a complete
exemption from withholding on interest pursuant to Code Sections 871(h) or
881(c), the Lender shall deliver (along with two accurate and complete
original signed copies of IRS Form W-8BEN) a certificate in form and
substance reasonably acceptable to Administrative Agent (any such
certificate, a "Withholding Certificate"). In addition, each Lender that is
a Non-U.S. Participant agrees that from time to time after the date hereof
(or in the case of a Lender that is an Assignee, after the date of the
assignment to such Lender), when a lapse in time (or change in
circumstances occurs) renders the prior certificates hereunder obsolete or
inaccurate in any material respect, such Lender shall, to the extent
permitted under applicable law, deliver to the Company and the
Administrative Agent two new and accurate and complete original signed
copies of an IRS Form W-8BEN, W-8ECI, or W-8IMY (or any successor or other
applicable forms prescribed by the IRS), and if applicable, a new
Withholding Certificate, to confirm or establish the entitlement of such
Lender or the Administrative Agent to an
67
exemption form, or reduction in, United States withholding tax on interest
payments to be made hereunder or any Loan.
Each Lender that is not a Non-U.S. Participant (other than any such
Lender which is taxed as a corporation for U.S. federal income tax
purposes) shall provide two properly completed and duly executed copies of
IRS Form W-9 (or any successor or other applicable form) to the Borrower
and the Administrative Agent certifying that such Lender is exempt from
United States backup withholding tax. To the extent that a form provided
pursuant to this Section is rendered obsolete or inaccurate in any material
respects as result of change in circumstances with respect to the status of
a Lender, such Lender shall, to the extent permitted by applicable law,
deliver to the Borrower and the Administrative Agent revised forms
necessary to confirm or establish the entitlement to such Lender's or
Agent's exemption from United States backup withholding tax. The Borrower
shall not be required to pay additional amounts to a Lender, or indemnify
any lender, under this Section, to the extent that such obligations would
not have arisen but for the failure of such Lender to comply with this
Section.
Each Lender agrees to indemnify the Administrative Agent and hold the
Administrative Agent harmless for the full amount of any and all present or
future Taxes and related liabilities (including penalties, interest,
additions to tax and expenses, and any Taxes imposed by any jurisdiction on
amounts payable to the Administrative Agent under this Section) which are
imposed on or with respect to principal, interest or fees payable to such
Lender hereunder and which are not paid by the Borrower pursuant to this
Section, whether or not such Taxes or related liabilities were correctly or
legally asserted. This indemnification shall be made within 30 days from
the date the Administrative Agent makes written demand therefor.
19. CHANGE IN CIRCUMSTANCES.
19.1. COMPENSATION FOR INCREASED COSTS AND REDUCED RETURNS.
19.1.1. LAW CHANGES OR TAX IMPOSITIONS. If, after the Effective Date,
the adoption of any applicable Law or any change in any applicable Law
or any change in the interpretation or administration thereof by any
Governmental Authority charged with the interpretation or
administration thereof, or compliance by any Lender (or its Applicable
Lending Office) with any request or directive (whether or not having
the force of law) of any such Governmental Authority, central bank, or
comparable agency:
19.1.1.1. Subjects such Lender (or its Applicable Lending Office)
to any Tax with respect to any Eurodollar Loans or its obligation
to make Eurodollar Loans, or change the basis of taxation of any
amounts payable to such Lender (or its Applicable Lending Office)
under this Agreement in respect of any Eurodollar Loans (other
than Taxes imposed on the overall net income of such Lender by
the jurisdiction in which such Lender has its principal office or
such Applicable Lending Office);
68
19.1.1.2. Imposes, modifies, or deems applicable any reserve,
special deposit, assessment or similar requirement (other than
the reserve requirement utilized in the determination of the
Eurodollar Rate) relating to any extensions of credit or other
assets of, or any deposits with or other liabilities or
commitments of, such Lender (or its Applicable Lending Office),
including the Commitment of such Lender hereunder; or
19.1.1.3. Imposes on such Lender (or its Applicable Lending
Office) or on the United States market for certificates of
deposit or the London Interbank market any other condition
affecting this Agreement, its Commitments or its Note or any of
such extensions of credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such
Lender (or its Applicable Lending Office) of making, converting into,
continuing, or maintaining any Loans or to reduce any sum received or
receivable by such Lender (or its Applicable Lending Office) under
this Agreement or any of its Notes with respect to any Loans, then
Borrower shall pay to such Lender on demand such amount or amounts as
will compensate such Lender for such increased cost or reduction. If
any Lender requests compensation by Borrower under this Section
19.1.1, Borrower may, by notice to such Lender (with a copy to
Administrative Agent), suspend the obligation of such Lender to make
or continue Loans of the type with respect to which such compensation
is requested, or to convert Loans of any other type into Loans of such
type, until the event or condition giving rise to such request ceases
to be in effect (in which case the provisions of Section 19.5 shall be
applicable); provided, however, that such suspension shall not affect
the right of such Lender to receive the compensation so requested.
19.1.2. CAPITAL ADEQUACY. If, after the Effective Date, any Lender
shall have determined that the adoption of any applicable Law
regarding capital adequacy or any change therein or in the
interpretation or administration thereof by any governmental
authority, central bank, or comparable agency charged with the
interpretation or administration thereof, or any request or directive
regarding capital adequacy (whether or not having the force of law) of
any such governmental authority, central bank, or comparable agency,
has or would have the effect of reducing the rate of return on the
capital of such Lender or any corporation controlling such Lender as a
consequence of such Lender's obligations hereunder to a level below
that which such Lender or such corporation could have achieved but for
such adoption, change, request, or directive (taking into
consideration its policies with respect to capital adequacy), then
from time to time upon demand Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender for such
reduction.
19.1.3. NOTICE TO BORROWER. Each Lender shall promptly notify Borrower
and Administrative Agent of any event of which it has knowledge,
occurring after the date hereof, which will entitle such Lender to
compensation pursuant to this
69
Section 19.1 and will designate a different Applicable Lending Office
if such designation will avoid the need for, or reduce the amount of,
such compensation and will not, in the judgment of such Lender, be
otherwise disadvantageous to it. Any Lender claiming compensation
under this Section 19.1 shall furnish to Borrower and Administrative
Agent a statement setting forth the additional amount or amounts to be
paid to it hereunder which shall be conclusive in the absence of
manifest error. In determining such amount, such Lender may use any
reasonable averaging and attribution methods.
19.2. MARKET FAILURE. If on or prior to the first day of any Interest
Period for any Eurodollar Loan:
19.2.1. Administrative Agent determines (which determination shall be
conclusive) that by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining
the Eurodollar Rate for such Interest Period; or
19.2.2. the Required Lenders determine (which determination shall be
conclusive) and notify Administrative Agent that the Eurodollar Rate
will not adequately and fairly reflect the cost to the Lenders of
funding Eurodollar Loans for such Interest Period;
then Administrative Agent shall give Borrower prompt notice thereof, and so
long as such condition remains in effect, the Lenders shall be under no
obligation to make additional Eurodollar Loans, continue Eurodollar Loans,
or to convert Eurodollar Loans and Borrower shall, on the last day(s) of
the then current Interest Period(s) for the outstanding Eurodollar Loans
either prepay such Loans or convert such Loans into Base Rate Loans in
accordance with the terms of this Agreement.
19.3. ILLEGALITY. Notwithstanding any other provision of this Agreement, in
the event that it becomes unlawful for any Lender or its Applicable Lending
Office to make, maintain, or fund Eurodollar Loans hereunder, then such
Lender shall promptly notify Borrower thereof and such Lender's obligation
to make, continue Eurodollar Loans or convert Base Rate Loans into
Eurodollar Loans shall be suspended until such time as such Lender may
again make, maintain, and fund Eurodollar Loans (in which case the
provisions of Section 19.5 shall be applicable).
19.4. COMPENSATION. Upon the request of any Lender, Borrower shall pay to
such Lender such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss, cost, or
expense (including loss of anticipated profits) incurred by it as a result
of:
19.4.1. any payment, prepayment, or conversion of a Eurodollar Loan
for any reason (including, without limitation, the acceleration of the
Loans pursuant to the terms hereof) on a date other than the last day
of the Interest Period for such Eurodollar Loan; or
70
19.4.2. any failure by Borrower for any reason to borrow, convert,
continue, or prepay a Eurodollar Loan on the date for such borrowing,
conversion, continuation, or prepayment specified in the relevant
notice of borrowing, prepayment, continuation, or conversion under
this Agreement.
If a Lender claims compensation under this Section 19.4, such Lender shall
furnish a certificate to Borrower that states the amount to be paid to it
hereunder and includes a description of the method used by such Lender in
calculating such amount. Borrower shall have the burden of proving that the
amount of any such compensation calculated by a Lender is not correct. Any
compensation payable by Borrower to a Lender under this Section 19.4 shall
be payable without regard to whether such Lender has funded its Pro-Rata
Share of any Eurodollar Advance or Eurodollar Loan through the purchase of
deposits in an amount or of a maturity corresponding to the deposits used
as a reference in determining the Eurodollar Rate.
19.5. TREATMENT OF AFFECTED LOANS. If the obligation of any Lender to make
Eurodollar Loans or to continue any Eurodollar Loans, or to convert any
Base Rate Loan into a Eurodollar Loan shall be suspended pursuant to
Section 19.1, 19.2, or 19.3 (such Loans being herein called Affected
Loans), such Lender's Affected Loans shall be automatically and immediately
converted into Base Rate Loans on the last day(s) of the then current
Interest Period(s) for Affected Loans (or, in the case of a conversion
required by Section 19.3, on such earlier date as such Lender may specify
to Borrower with a copy to Administrative Agent) and, unless and until such
Lender gives notice as provided below that the circumstances specified in
Section 19.1, 19.2, or 19.3 that gave rise to such conversion no longer
exist:
19.5.1. to the extent that such Lender's Affected Loans have been so
converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Affected Loans shall continue to
be made and applied as provided for herein; and
19.5.2. all Loans that would otherwise be made or continued by such
Lender as Eurodollar Loans shall be made or continued instead as Base
Rate Loans, and all Loans of such Lender that would otherwise be
converted into Eurodollar Loans shall be converted instead into (or
shall remain as) Base Rate Loans.
If such Lender gives notice to Borrower (with a copy to Administrative
Agent) that the circumstances specified in Section 19.1, 19.2, or 19.3
hereof that gave rise to the conversion of such Lender's Affected Loans
pursuant to this Section 19.5 no longer exist (which such Lender agrees to
do promptly upon such circumstances ceasing to exist) at a time when Loans
of the type of the Affected Loans made by other Lenders are outstanding,
such Lender's Base Rate Loans shall be automatically converted, on the
first day(s) of the next succeeding Interest Period(s) for such outstanding
Loans of the type of the Affected Loans, to the extent necessary so that,
after giving effect thereto, all Loans held by the Lenders holding Loans of
the type of the Affected Loans and by such Lender are held pro rata (as to
principal amounts, type of interest, and Interest Periods) in accordance
with their respective Commitments.
71
19.6. TAXES.
19.6.1. GROSS-UP. Any and all payments by Borrower to or for the
account of any Lender or the Administrative Agent hereunder or under
any other Loan Document shall be made free and clear of and without
deduction for any and all Taxes, whether imposed now or in the future,
excluding, in the case of each Lender and the Administrative Agent,
Taxes imposed on its income, and franchise Taxes imposed on it, by the
jurisdiction under the Laws of which such Lender (or its Applicable
Lending Office) or the Administrative Agent (as the case may be) is
organized or any political subdivision thereof. If Borrower is
required by Law to deduct any Taxes from or in respect of any sum
payable under this Agreement or any other Loan Document to any Lender
or the Administrative Agent, (i) the sum payable will be increased as
necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section
19.6) such Lender or the Administrative Agent receives an amount equal
to the sum it would have received had no such deductions been made,
(ii) Borrower shall make such deductions, (iii) Borrower shall pay the
full amount deducted to the relevant taxation authority or other
authority in accordance with applicable Law, and (iv) Borrower shall
furnish to Administrative Agent, at its address referred to herein,
the original or a certified copy of a receipt evidencing payment
thereof. In addition, Borrower agrees to pay any and all present or
future stamp or documentary taxes and any other excise or property
taxes or charges or similar levies which arise from any payment made
under this Agreement or any other Loan Document or from the execution
or delivery of, or otherwise with respect to, this Agreement or any
other Loan Document (hereinafter referred to as Impositions). Borrower
agrees to indemnify each Lender and the Administrative Agent for the
full amount of Taxes and Impositions (including, without limitation,
any Taxes or Impositions imposed or asserted by any jurisdiction on
amounts payable under this Section 19.6) paid by such Lender or the
Administrative Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect
thereto. Within 30 days after the date of any payment of Taxes,
Borrower shall furnish to Administrative Agent the original or a
certified copy of the receipt evidencing such payment.
19.6.2. LENDERS' UNDERTAKINGS.
19.6.2.1. Each Lender organized under the Laws of a jurisdiction
outside the United States, on or prior to the date of its
execution and delivery of this Agreement in the case of each
Lender listed on the signature pages hereof and on or prior to
the date on which it becomes a Lender in the case of each other
Lender, and from time to time thereafter if requested in writing
by Borrower or Administrative Agent (but only so long as such
Lender remains lawfully able to do so), shall provide Borrower
and Administrative Agent with (i) Internal Revenue Service Form
1001 or 4224, as appropriate, or any successor form prescribed by
the Internal Revenue Service, certifying that such Lender is
entitled to benefits under an income tax treaty to which the
United States is a party
72
which reduces the rate of withholding Tax on payments of interest
or certifying that the income receivable pursuant to this
Agreement is effectively connected with the conduct of a trade or
business in the United States, (ii) Internal Revenue Service Form
W-8 or W-9, as appropriate, or any successor form prescribed by
the Internal Revenue Service, and (iii) any other form or
certificate required by any Governmental Authority (including any
certificate required by Sections 871(h) and 881(c) of the
Internal Revenue Code), certifying that such Lender is entitled
to an exemption from or a reduced rate of Tax on payments
pursuant to this Agreement or any of the other Loan Documents.
For any period with respect to which a Lender has failed to
provide Borrower and Administrative Agent with the appropriate
form pursuant to this Section 19.6.2 (unless such failure is due
to a change in treaty or Law occurring subsequent to the date on
which a form originally was required to be provided), such Lender
shall not be entitled to indemnification under Section 19.6.1
with respect to Taxes imposed by the United States; provided,
however, that should a Lender, which is otherwise exempt from or
subject to a reduced rate of withholding tax, become subject to
Taxes because of its failure to deliver a form required
hereunder, Borrower shall take such steps as such Lender shall
reasonably request to assist such Lender to recover such Taxes.
19.6.2.2. If Borrower is required to pay additional amounts to or
for the account of any Lender or Administrative Agent pursuant to
this Section 19.6.2, then such Lender or the Administrative Agent
will agree to use reasonable efforts to change the jurisdiction
of its Applicable Lending Office so as to eliminate or reduce any
such additional payment which may thereafter accrue if such
change, in the judgment of such Lender or the Administrative
Agent, as the case may be, is not otherwise disadvantageous to
such Lender or the Administrative Agent, as the case may be.
19.6.3. SURVIVAL OF BORROWER'S OBLIGATIONS. Without prejudice to the
survival of any other agreement of Borrower hereunder, the agreements
and obligations of Borrower contained in this Section 19.6 shall
survive the termination of the Commitments, the expiration of the
Letters of Credit, the indefeasible full payment and satisfaction of
all of the Loan Obligations, and the release of the Collateral.
19.7. USURY. Notwithstanding any provisions to the contrary in Section 4 or
elsewhere in any of the Loan Documents, Borrower shall not be obligated to
pay interest at a rate which exceeds the maximum rate permitted by Law. If,
but for this Section 19.7, Borrower would be deemed obligated to pay
interest at a rate which exceeds the maximum rate permitted by Law, or if
any of the Loan Obligations is paid or becomes payable before its
originally scheduled Maturity and as a result Borrower has paid or would be
obligated to pay interest at such an excessive rate, then (i) Borrower
shall not be obligated to pay interest to the extent it exceeds the
interest that would be payable at
73
the maximum rate permitted by Law; (ii) if the outstanding Loan Obligations
have not been accelerated as provided in Section 17.3.2, any such excess
interest that has been paid by Borrower shall be refunded; (iii) if the
outstanding Loan Obligations have been accelerated as provided in Section
17.3.2, any such excess that has been paid by Borrower shall be applied to
the Loan Obligations as provided in Section 17.4; and (iv) the effective
rate of interest shall be deemed automatically reduced to the maximum rate
permitted by Law.
20. GENERAL.
20.1. LENDERS' RIGHT TO CURE. Required Lenders may from time to time, in
their absolute discretion, for Borrower's account and at Borrower's
expense, pay (or, with the consent of Required Lenders, make a Revolving
Loan Advance to pay) any amount or do any act required of Borrower
hereunder or requested by Administrative Agent or Required Lenders to
preserve, protect, maintain or enforce the Loan Obligations, the Collateral
or Administrative Agent's Security Interests therein for the benefit of
Lenders, and which Borrower fails to pay or do, including payment of any
judgment against Borrower, insurance premium, taxes or assessments,
warehouse charge, finishing or processing charge, landlord's claim, and any
other Security Interest upon or with respect to the Collateral provided
that neither Administrative Agent nor any Lender shall take any such
actions if there is no Event of Default, Borrower is disputing such item(s)
in good faith and Borrower establishes appropriate reserves adequate to pay
any such item(s) in accordance with GAAP in the event that Borrower does
not prevail in such a dispute. All payments that Lenders make pursuant to
this Section and all out-of-pocket costs and expenses that Lenders pay or
incur in connection with any action taken by them hereunder shall be a part
of the Loan Obligations, the repayment of which shall be secured by the
Collateral. Any payment made or other action taken by Lenders pursuant to
this Section shall be without prejudice to any right to assert an Event of
Default hereunder and to pursue Lender's other rights and remedies with
respect thereto. 20.2. RIGHTS NOT EXCLUSIVE. Every right granted to
Administrative Agent and Lenders hereunder or under any other Loan Document
or allowed to it at law or in equity shall be deemed cumulative and may be
exercised from time to time.
20.3. SURVIVAL OF AGREEMENTS. All covenants and agreements made herein and
in the other Loan Documents shall survive the execution and delivery of
this Agreement, the Notes and other Loan Documents and the making of every
Advance. All agreements, obligations and liabilities of Borrower under this
Agreement concerning the payment of money to Administrative Agent and
Lenders, including Borrower's obligations under Sections 20.8 and 20.9, but
excluding the obligation to repay the Loans and interest accrued thereon,
shall survive the repayment in full of the Loans and interest accrued
thereon, whether or not indefeasible, the return of the Notes to Borrower,
the termination of the Commitments and the expiration of all Letters of
Credit.
20.4. ASSIGNMENTS.
74
20.4.1. PERMITTED ASSIGNMENTS. At any time after the Execution Date,
any Lender may assign to one or more Eligible Assignees all or a
portion of its rights and obligations under this Agreement (including
all or a portion of the Notes payable to it, its Commitments and its
Loans), provided that the terms of assignment satisfy the following
requirements:
20.4.1.1. Administrative Agent shall have accepted the
assignment, which acceptance shall not be unreasonably withheld.
20.4.1.2. Each such assignment shall be of a constant, and not a
varying, percentage of all of the assigning Lender's rights and
obligations under this Agreement.
20.4.1.3. For each assignment involving the issuance and transfer
of Notes, the assigning Lender shall execute an Assignment and
Acceptance in the form attached hereto as Exhibit 20.4.1 together
with any Note subject to such assignment and a processing fee of
$3,500.00.
20.4.1.4. The minimum Commitment which may be assigned (which
must include the applicable portion of the assigning Lender's
Revolving Loan Commitment and Letter of Credit Commitment) is
$5,000,000.00, or such lesser amount which constitutes such
Lender's entire Commitment; provided, however, that no such
minimum shall apply between a Lender and its Affiliates, or
between one Lender and another Lender or an assignment of all of
a Lender's rights and obligations under this Agreement.
20.4.1.5. The assignee shall have an office located in the United
States and is otherwise an Eligible Assignee.
20.4.1.6. If there is no Event of Default in existence as of the
date of such assignment, Borrower shall have consented to the
assignment, which consent shall not be unreasonably withheld.
20.4.2. CONSEQUENCES AND EFFECT OF ASSIGNMENTS. From and after the
effective date specified in any Assignment and Acceptance, the
assignee shall be deemed and treated as a party to this Agreement and,
to the extent that rights and obligations hereunder and under the
Notes held by the assignor have been assigned or negotiated to the
assignee pursuant to such Assignment and Acceptance, to have the
rights and obligations of a Lender hereunder as fully as if such
assignee had been named as a Lender in this Agreement and of a holder
of such Notes, and the assignor shall, to the extent that rights and
obligations hereunder or under such Notes have been assigned or
negotiated by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its future obligations
under this Agreement. If the assignee is not incorporated under the
laws of the United States of America or a state thereof, it shall
deliver to
75
Borrower and Administrative Agent certification as to the exemption
from deduction or withholding of Taxes in accordance with Section
19.6.
20.4.3. AGREEMENTS UPON ASSIGNMENT. By executing and delivering an
Assignment and Acceptance, the assignor thereunder and the assignee
confirm to and agree with each other and the other parties hereto
substantially as follows: (i) the assignment made under such
Assignment and Acceptance is made under such Assignment and Acceptance
without recourse; (ii) such assignor makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of any Covered Person or the performance or observance by
any Covered Person of any of its Loan Obligations; (iii) such assignee
confirms that it has received a copy of this Agreement, together with
copies of the Financial Statements and such other Loan Documents and
other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into such Assignment and
Acceptance; (iv) such assignee will, independently and without
reliance upon Administrative Agent, such assignor, or any other
Lender, and based on such documents and information as it deems
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee
appoints and authorizes Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement
and the other Loan Documents as are delegated to Administrative Agent
by the terms hereof and thereof, together with such powers as are
reasonably incidental thereto; and (vi) such assignee agrees that it
will perform in accordance with their terms all of the obligations
which by the terms of this Agreement are required to be performed by
it as a Lender and a holder of a Note.
20.4.4. REGISTER. Administrative Agent shall maintain at its address
referred to herein a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names
and addresses of the Lenders and the Commitment of and principal
amount of Loans owing to, each Lender from time to time (the
Register). The entries in the Register shall be conclusive and binding
for all purposes, absent manifest error, and Borrower, Administrative
Agent and Lenders may treat each Person whose name is recorded in the
Register as a Lender hereunder for all purposes of this Agreement. The
Register shall be available for inspection by Borrower or any Lender
at any reasonable time and from time to time upon reasonable prior
notice. Upon its receipt of an Assignment and Acceptance executed by
the parties thereto, together with any Note subject to such assignment
and payment of the processing fee, Administrative Agent shall, if such
Assignment and Acceptance has been completed and is in substantially
the form of Exhibit 20.4.1 hereto, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the parties thereto.
20.4.5. NOTICE TO BORROWER OF ASSIGNMENT. Upon its receipt of an
Assignment and Acceptance executed by an assigning Lender, if
Administrative Agent accepts the assignment contemplated thereby,
Administrative Agent shall give prompt
76
notice thereof to Borrower. Borrower shall execute and deliver
replacement Notes to the assignor and assignee as requested by
Administrative Agent and necessary to give effect to the assignment.
If Borrower fails or refuses to execute and deliver such replacement
Notes, Administrative Agent may, as agent and attorney-in-fact for
Borrower, execute and deliver such replacement Notes on behalf of
Borrower. Borrower hereby appoints Administrative Agent as its agent
and attorney-in-fact for such purpose and acknowledges that such power
is coupled with an interest and therefore irrevocable. Administrative
Agent shall not have any liability to Borrower or anyone else,
including any Lender, as a consequence of exercising such power in any
instance.
20.4.6. ASSIGNMENT TO FEDERAL RESERVE BANK. Notwithstanding any other
provision set forth in this Agreement, any Lender may at any time
assign and pledge all or any portion of its Loans and its Note to any
Federal Reserve Bank as collateral security pursuant to Regulation A
and any Operating Circular issued by such Federal Reserve Bank. No
such assignment shall release the assigning Lender from its
obligations hereunder.
20.5. SALE OF PARTICIPATIONS. Each Lender may sell participations to one or
more Persons (other than Borrower or an Affiliate of Borrower) in all or a
portion of its rights and obligations under this Agreement (including all
or a portion of its Commitment and its Loans); provided, however, that (i)
such Lender's obligations under this Agreement shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) the participant shall be
entitled to the benefit of the yield protection provisions contained in
Section 19 and the right of setoff contained in Section 17.3.3, (iv) the
amount of the participation shall be in a minimum amount of $1,000,000.00
or such lesser amount which constitutes such Lender's entire Commitment,
provided, however, that no such minimum amount shall apply to
participations between any of Lenders or between any Lender and any of its
Affiliates; and (v) Borrower, the other Lenders and Administrative Agent
shall continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations under this Agreement, and such
Lender shall retain the sole right to enforce the obligations of Borrower
relating to its Loans, its Notes and its funding of Advances and to approve
any amendment, modification, or waiver of any provision of this Agreement
(other than amendments, modifications, or waivers that (a) decrease the
amount of principal of the Loans, (b) reduce the rate at which interest is
payable on the Loans, (c) extend the final maturity of the Notes, (d)
increase its Commitment (if such increase is to be shared by any such
Participant), or (e) release any Guarantor. Notwithstanding the foregoing,
the sale of any such participations which require Borrower to file a
registration statement with the SEC or under the securities Laws of any
state shall not be permitted.
20.6. INTENTIONALLY DELETED.
20.7. INFORMATION. Any Lender or Administrative Agent may furnish any
information concerning Borrower or any of its Subsidiaries in the
possession of such Lender or Administrative Agent, as the case may be, from
time to time to assignees and participants
77
(including prospective assignees and participants), provided such assignees
and participants shall agree to keep such information confidential.
20.8. PAYMENT OF EXPENSES. Borrower agrees to pay or reimburse to
Administrative Agent all of Administrative Agent's out-of-pocket costs
incurred in connection with Administrative Agent's due diligence review
before execution of the Loan Documents; the negotiation and preparation of
proposals, a commitment letter and the Loan Documents; the syndication of
the Loans; the administration of this Agreement, the Loan Documents and the
Loans; the perfection of Administrative Agent's Security Interests in the
Collateral; the interpretation of any of the Loan Documents; any amendment
of or supplementation to any of the Loan Documents; and any waiver, consent
or forbearance with respect to any Default or Event of Default. Borrower
agrees to pay or reimburse to each Lender all of such Lender's
out-of-pocket costs incurred in connection with the enforcement of such
Lender's rights and remedies under the Loan Documents after a Default or
Event of Default. Administrative Agent's out-of-pocket costs may include
but are not limited to the following, to the extent they are actually paid
or incurred by Administrative Agent: title insurance fees and premiums; the
cost of searches for Security Interests existing against Covered Persons;
recording and filing fees; appraisal fees; environmental consultant fees;
litigation costs; and all attorneys' and paralegals' expenses and
reasonable fees. Each Lender's out-of-pocket costs may include but are not
limited to the following, to the extent they are actually paid or incurred
by a Lender: litigation costs and all attorneys' and paralegals' expenses
and reasonable fees. Attorneys' and paralegals' expenses may include but
are not limited to filing charges; telephone, data transmission, facsimile
and other communication costs; courier and other delivery charges; and
photocopying charges. Litigation costs may include but are not limited to
filing fees, deposition costs, expert witness fees, expenses of service of
process, and other such costs paid or incurred in any administrative,
arbitration, or court proceedings involving a Lender and any Covered
Person, including proceedings under the Federal Bankruptcy Code. All costs
which Borrower is obligated to pay or reimburse Administrative Agent or the
Lenders are Loan Obligations payable to Administrative Agent or Lender, as
applicable, and are payable on demand by Administrative Agent or such
Lender.
20.9. GENERAL INDEMNITY.
20.9.1. Borrower agrees to indemnify and hold harmless Administrative
Agent and each Lender and each of their Affiliates and their
respective officers, directors, employees, agents, and advisors (each,
an Indemnified Party) from and against any and all claims, damages,
losses, liabilities, costs, and expenses (including, without
limitation, reasonable attorneys' fees) that may be incurred by or
asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of (including,
without limitation, in connection with any investigation, litigation,
or proceeding or preparation of defense in connection therewith) the
Loan Documents, the Acquisition Documents, any of the transactions
contemplated herein or therein or the actual or proposed use of the
proceeds of the Loans, or the manufacture, storage, transportation,
release or disposal of any Hazardous Material on, from, over or
affecting any of the
78
Collateral or any of the assets, properties, or operations of any
Covered Person or any predecessor in interest, directly or indirectly,
except to the extent such claim, damage, loss, liability, cost, or
expense is found in a final, non-appealable judgment by a court of
competent jurisdiction to have resulted from such Indemnified Party's
gross negligence or willful misconduct. In the case of an
investigation, litigation or other proceeding to which the indemnity
in this Section 20.9 applies, such indemnity shall be effective
whether or not such investigation, litigation or proceeding is brought
by Borrower, its directors, shareholders or creditors or an
Indemnified Party or any other Person or any Indemnified Party is
otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. Borrower agrees not to assert any
claim against Administrative Agent, any Lender, any of their
Affiliates, or any of their respective directors, officers, employees,
attorneys, agents, and advisers, on any theory of liability, for
special, indirect, consequential, or punitive damages arising out of
or otherwise relating to the Loan Documents, the Acquisition
Documents, any of the transactions contemplated herein or therein or
the actual or proposed use of the proceeds of the Loans. Borrower
shall pay, indemnify and hold harmless the Indemnified Parties for,
from and against, and shall promptly reimburse the Indemnified Parties
for, any and all claims, damages, liabilities, losses, costs and
expenses (including reasonable attorneys' fees and expenses and
amounts paid in settlement) incurred, paid or sustained by the
Indemnified Parties, arising out of or relating to the Acquisition
Documents or enforcement by Administrative Agent of any of its rights
with respect thereto.
20.9.2. The obligations of Borrower under this Section 20.9 shall
survive the termination of the Commitments, the expiration of the
Letters of Credit, the indefeasible full payment and satisfaction of
all of the Loan Obligations, and the release of the Collateral.
20.9.3. To the extent that any of the indemnities required from
Borrower under this Section are unenforceable because they violate any
Law or public policy, Borrower shall pay the maximum amount which it
is permitted to pay under applicable Law.
20.10. LETTERS OF CREDIT. Borrower assumes all risks of the acts or
omissions of any beneficiary of any of the Letters of Credit. Neither
Administrative Agent nor any of its directors, officers, employees, agents,
or representatives shall be liable or responsible for: (a) the use which
may be made of any of the Letters of Credit or for any acts or omissions of
beneficiary in connection therewith; (b) the validity, sufficiency or
genuineness of documents, or of any endorsement(s) thereon, even if such
documents should in fact prove to be in any or all respects invalid,
insufficient, fraudulent or forged; (c) payment by Administrative Agent
against presentation of documents which, on their face, appear to comply
with the terms of any Letter of Credit, even though such documents may fail
to bear any reference or adequate reference to any such Letter of Credit;
or (d) any other circumstances whatsoever in making or failing to make
payment under any Letter of Credit in connection with which Administrative
Agent would, pursuant to the Uniform Customs and Practices for Documentary
Credits (1993 Revision), International Chamber
79
of Commerce Publication No. 500 (as amended from time to time), be absolved
from liability. In furtherance and not in limitation of the foregoing,
Letter of Credit Issuer may accept documents that appear on their face to
be in order, without responsibility for further investigation, regardless
of any notice or information to the contrary.
20.11. CHANGES IN ACCOUNTING PRINCIPLES. If any Covered Person, at the end
of its fiscal year and with the concurrence of its independent certified
public accountants, changes the method of valuing the Inventory of such
Covered Person, or if any other changes in accounting principles from those
used in the preparation of any of the Financial Statements are required by
or result from the promulgation of principles, rules, regulations,
guidelines, pronouncements or opinions by the Financial Accounting
Standards Board or the American Institute of Certified Public Accountants
(or successors thereto or bodies with similar functions), and any of such
changes result in a change in the method of calculation of, or affect the
results of such calculation of, any of the financial covenants, standards
or terms found herein, then the parties hereto agree to enter into and
diligently pursue negotiations in order to amend such financial covenants,
standards or terms so as to equitably reflect such changes, with the
desired result that the criteria for evaluating the financial condition and
results of operations of such Covered Person shall be the same after such
changes as if such changes had not been made; provided, however, that until
such changes are made, all financial covenants herein and all the
provisions hereof which contemplate financial calculation hereunder shall
remain in full force and effect.
20.12. LOAN RECORDS. The date and amount of all Advances to Borrower and
payments of amounts due from Borrower under the Loan Documents will be
recorded in the records that Administrative Agent normally maintains for
such types of transactions. The failure to record, or any error in
recording, any of the foregoing shall not, however, affect the obligation
of Borrower to repay the Loans and other amounts payable under the Loan
Documents. Borrower shall have the burden of proving that such records are
not correct. Borrower agrees that Administrative Agent's and any Lender's
books and records showing the Loan Obligations and the transactions
pursuant to this Agreement shall be admissible in any action or proceeding
arising therefrom, and shall constitute prima facie proof thereof,
irrespective of whether any Loan Obligation is also evidenced by a
promissory note or other instrument. Administrative Agent will provide to
Borrower a monthly statement of Advances, payments, and other transactions
pursuant to this Agreement. Such statement shall be deemed correct,
accurate and binding on Borrower and an account stated (except for
reversals and reapplications of payments as provided in Section 6.7 and
corrections of errors discovered by Administrative Agent or a Lender),
unless Borrower notifies Administrative Agent in writing to the contrary
within 60 days after such statement is rendered. In the event a timely
written notice of objections is given by Borrower, only the items to which
exception is expressly made will be considered to be disputed by Borrower.
20.13. OTHER SECURITY AND GUARANTIES. Administrative Agent or any Lender
may, without notice or demand and without affecting Borrower's obligations
hereunder, from time to time: (a) take from any Person and hold collateral
(other than the Collateral) for the payment of all or any part of the Loan
Obligations and exchange, enforce and release
80
such collateral or any part thereof; and (b) accept and hold any
endorsement or guaranty of payment of all or any part of the Loan
Obligations and release or substitute any such endorser or guarantor, or
any Person who has given any Security Interest in any other collateral as
security for the payment of all or any part of the Loan Obligations, or any
other Person in any way obligated to pay all or any part of the Loan
Obligations.
20.14. LOAN OBLIGATIONS PAYABLE IN DOLLARS. All Loan Obligations that are
payable in Dollars under the terms of the Loan Documents shall be payable
only in Dollars. If, however, to obtain a judgment in any court it is
necessary to convert a Loan Obligation payable in Dollars into another
currency, the rate of exchange used shall be that at which Administrative
Agent, using its customary procedures, could purchase Dollars with such
other currency in New York, New York on the Business Day immediately
preceding the day on which such judgment is rendered. If any sum in another
currency is paid to a Lender or received by a Lender and applied to a Loan
Obligation payable in Dollars, such Loan Obligation shall be deemed paid
and discharged only to the extent of the amount of Dollars that
Administrative Agent, using its customary procedures, is able to purchase
in New York, New York with such sum on the Business Day immediately
following receipt thereof. Borrower agrees to indemnify each Lender against
any loss in Dollars that it may incur on such Loan Obligation as a result
of such payment or receipt and application to such Loan Obligation.
21. MISCELLANEOUS.
21.1. NOTICES. All notices, consents, requests and demands to or upon the
respective parties hereto shall be in writing, and shall be deemed to have
been given or made when delivered in person to those Persons listed on the
signature pages hereof or three (3) days after deposit in the United States
mail, postage prepaid, or, in the case of overnight courier services, one
(1) day after delivery to the overnight courier service, or in the case of
telecopy notice, when sent, verification received, in each case addressed
as set forth on the signature pages hereof, or such other address as either
party may designate by notice to the other in accordance with the terms of
this Section. No notice given to or demand made on Borrower by
Administrative Agent or any Lender in any instance shall entitle Borrower
to notice or demand in any other instance.
21.2. AMENDMENTS AND MODIFICATIONS; WAIVERS AND CONSENTS. Unless otherwise
provided herein, no amendment to or modification of any provision of this
Agreement, or of any of the other Loan Documents shall be effective unless
it is in writing and signed by authorized officers of Borrower and Required
Lenders. Unless otherwise provided herein, no waiver of, or consent to any
departure by Borrower from, the requirements of any provision of this
Agreement or any of the other Loan Documents shall be effective unless it
is in writing and signed by authorized officers of Required Lenders. Any
such amendment, modification, waiver or consent shall be effective only in
the specific instance and for the purpose for which given. The foregoing
notwithstanding, no such amendment, modification or consent shall, unless
signed by authorized officers of Borrower and of all Lenders: (i) extend or
increase any Commitment or subject any Lender or the Letter of Credit
Issuer to a greater obligation than expressly provided for in this
Agreement, (ii) reduce or forgive the repayment of principal of any Advance
or the
81
reimbursement of any draw on a Letter of Credit or change the rate, or
mechanism for determining the rate, of interest on any Advance or any fees
or other amounts payable by Borrower hereunder, (iii) change the regularly
scheduled dates for payments of principal or interest of any Advance or
other fees or amounts payable to any Lender under the Loan Documents
(including, without limitation, the Revolving Loan Maturity Date), (iv)
change the provisions of Section 18 to the detriment of any Lender, (v)
change the definition of Required Lenders herein, (vi) change any
requirement herein that any particular action be taken by all Lenders or by
Required Lenders, (vii) change the provisions of this Section, (viii)
release any of the Collateral (except in the ordinary course of business or
as otherwise expressly permitted by the terms of this Agreement) or any
Covered Person or any Guarantor from its obligations under the Loan
Documents, or (ix) change any provisions of this Agreement requiring
ratable distributions to Lenders. No failure by Administrative Agent or any
Lender to exercise, and no delay by Administrative Agent or any Lender in
exercising, any right, remedy, power or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise by
Administrative Agent or any Lender of any right, remedy, power or privilege
hereunder preclude any other exercise thereof, or the exercise of any other
right, remedy, power or privilege existing under any Law or otherwise.
21.3. RIGHTS CUMULATIVE. Each of the rights and remedies of Administrative
Agent and Lenders under this Agreement shall be in addition to all of its
other rights and remedies under applicable Law, and nothing in this
Agreement shall be construed as limiting any such rights or remedies.
21.4. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and all future holders of the
Notes and their respective successors and assigns, except that Borrower may
not assign, delegate or transfer any of its rights or obligations under
this Agreement without the prior written consent of Administrative Agent
and Required Lenders. With respect to Borrower's successors and assigns,
such successors and assigns shall include any receiver, trustee or
debtor-in-possession of or for Borrower.
21.5. SEVERABILITY. Any provision of this Agreement which is prohibited,
unenforceable or not authorized in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or lack of authorization without invalidating the
remaining provisions hereof or affecting the validity, enforceability or
legality of such provision in any other jurisdiction unless the
ineffectiveness of such provision would result in such a material change as
to cause completion of the transactions contemplated hereby to be
unreasonable.
21.6. COUNTERPARTS. This Agreement may be executed by the parties hereto on
any number of separate counterparts, and all such counterparts taken
together shall constitute one and the same instrument. It shall not be
necessary in making proof of this Agreement to produce or account for more
than one counterpart signed by the party to be charged.
21.7. GOVERNING LAW; NO THIRD PARTY RIGHTS. This Agreement, the Notes and
the other Loan Documents and the rights and obligations of the parties
hereunder and
82
thereunder shall be governed by and construed and interpreted in accordance
with the internal Laws of the State of Illinois applicable to contracts
made and to be performed wholly within such state, without regard to choice
or conflicts of law principles; except that the provisions of the Loan
Documents pertaining to the creation or perfection of Security Interests or
the enforcement of rights of Administrative Agent and Lenders in Collateral
located in a State other that the State of Illinois shall be governed by
the Laws of such State. This Agreement is solely for the benefit of the
parties hereto and their respective successors and assigns, and no other
Person shall have any right, benefit, priority or interest under, or
because of the existence of, this Agreement.
21.8. COUNTERPART FACSIMILE EXECUTION. For purposes of this Agreement, a
document (or signature page thereto) signed and transmitted by facsimile
machine or telecopier is to be treated as an original document. The
signature of any Person thereon, for purposes hereof, is to be considered
as an original signature, and the document transmitted is to be considered
to have the same binding effect as an original signature on an original
document. At the request of any party hereto, any facsimile or telecopy
document is to be re-executed in original form by the Persons who executed
the facsimile or telecopy document. No party hereto may raise the use of a
facsimile machine or telecopier or the fact that any signature was
transmitted through the use of a facsimile or telecopier machine as a
defense to the enforcement of this Agreement or any amendment or other
document executed in compliance with this Section.
21.9. EFFECT OF MERGER OF BANK. Effective immediately upon the merger of
Administrative Agent or a Lender with or into another financial
institution, all references to Administrative Agent or such Lender under
every Loan Document shall be deemed to be references to the surviving
institution. If the surviving institution does not have a "Prime Rate,"
references in the Loan Documents to Prime Rate shall be deemed to be
references to the reference rate (however it is designated) established
from time to time by the surviving institution that is most similar to the
Prime Rate.
21.10. NEGOTIATED TRANSACTION. Borrower, Administrative Agent and each
Lender represent each to the others that in the negotiation and drafting of
this Agreement and the other Loan Documents they have been represented by
and have relied upon the advice of counsel of their choice. Borrower and
Administrative Agent affirm that their counsel have both had substantial
roles in the drafting and negotiation of this Agreement and each Lender
affirms that its counsel has participated in the drafting and negotiation
of this Agreement; therefore, this Agreement will be deemed drafted by all
of Borrower, Administrative Agent and Lenders, and the rule of construction
to the effect that any ambiguities are to be resolved against the drafter
will not be employed in the interpretation of this Agreement.
21.11. CHOICE OF FORUM. SUBJECT ONLY TO THE EXCEPTION IN THE NEXT SENTENCE,
BORROWER, ADMINISTRATIVE AGENT, AND EACH LENDER HEREBY AGREES TO THE
EXCLUSIVE JURISDICTION OF THE FEDERAL COURT OF THE NORTHERN DISTRICT OF
ILLINOIS AND THE STATE COURTS OF ILLINOIS LOCATED IN XXXX COUNTY AND WAIVES
ANY OBJECTION BASED ON VENUE OR FORUM NON CONVENIENS WITH
83
RESPECT TO ANY ACTION INSTITUTED THEREIN, AND AGREES THAT ANY DISPUTE
CONCERNING THE RELATIONSHIP BETWEEN ADMINISTRATIVE AGENT, LENDERS, AND
BORROWER OR THE CONDUCT OF ANY OF THEM IN CONNECTION WITH THIS AGREEMENT OR
OTHERWISE SHALL BE HEARD ONLY IN THE COURTS DESCRIBED ABOVE.
NOTWITHSTANDING THE FOREGOING: (1) ADMINISTRATIVE AGENT OR ANY LENDER SHALL
HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST BORROWER OR ITS
PROPERTY IN ANY COURTS OF ANY OTHER JURISDICTION ADMINISTRATIVE AGENT OR
ANY LENDER DEEM NECESSARY OR APPROPRIATE IN ORDER TO REALIZE ON THE
COLLATERAL, OR OTHER SECURITY FOR THE LOAN OBLIGATIONS, AND (2) EACH OF THE
PARTIES HERETO ACKNOWLEDGES THAT ANY APPEALS FROM THE COURTS DESCRIBED IN
THE IMMEDIATELY PRECEDING SENTENCE MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE THOSE JURISDICTIONS.
21.12. SERVICE OF PROCESS. BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY
AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY
BE MADE BY REGISTERED MAIL (RETURN RECEIPT REQUESTED) DIRECTED TO BORROWER
AT ITS ADDRESS SET FORTH ON THE SIGNATURE PAGES HEREOF, AND SERVICE SO MADE
SHALL BE DEEMED TO BE COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE
BEEN SO DEPOSITED IN THE U.S. MAILS; OR AT ADMINISTRATIVE AGENT'S OR ANY
LENDER'S OPTION, BY SERVICE UPON CT CORPORATION, WHICH BORROWER IRREVOCABLY
APPOINTS AS BORROWER'S AGENT FOR THE PURPOSE OF ACCEPTING SERVICE OF
PROCESS WITHIN THE STATE OF ILLINOIS. ADMINISTRATIVE AGENT OR SUCH LENDER
SHALL PROMPTLY FORWARD BY REGISTERED MAIL ANY PROCESS SO SERVED UPON SAID
AGENT TO BORROWER AT ITS ADDRESS ON THE SIGNATURE PAGES HEREOF. NOTHING IN
THIS SECTION SHALL AFFECT THE RIGHT OF ADMINISTRATIVE AGENT OR ANY LENDER
TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
21.13. WAIVER OF JURY TRIAL. BORROWER, ADMINISTRATIVE AGENT, AND EACH
LENDER HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND,
ACTION OR CAUSE OF ACTION (1) ARISING UNDER THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT, OR (2) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO
THE DEALINGS OF THE PARTIES HERETO OR EITHER OF THEM IN RESPECT OF THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR THE TRANSACTIONS RELATED HERETO OR
THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE. BORROWER, ADMINISTRATIVE
AGENT, AND EACH LENDER AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND,
ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY
AND THAT
84
EITHER MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE
WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
21.14. INCORPORATION BY REFERENCE. Each attachment, exhibit and schedule
hereto and all of the terms of the other Loan Documents are incorporated in
and made a part of this Agreement by this reference.
21.15. PATRIOT ACT NOTIFICATION. As required by federal law and LaSalle's
policies and practices, LaSalle may need to collect certain customer
identification information and documentation in connection with opening or
maintaining accounts, or establishing or continuing to provide services.
21.16. STATUTORY NOTICE - INSURANCE. The following notice is given pursuant
to Section 10 of the Collateral Protection Act set forth in Chapter 815
Section 180/1 of the Illinois Compiled Statutes (1996); nothing contained
in such notice shall be deemed to limit or modify the terms of the Loan
Documents:
UNLESS YOU PROVIDE EVIDENCE OF THE INSURANCE COVERAGE REQUIRED BY YOUR
AGREEMENT WITH US, WE MAY PURCHASE INSURANCE AT YOUR EXPENSE TO PROTECT OUR
INTERESTS IN YOUR COLLATERAL. THIS INSURANCE MAY, BUT NEED NOT, PROTECT
YOUR INTERESTS. THE COVERAGE THAT WE PURCHASE MAY NOT PAY ANY CLAIM THAT
YOU MAKE OR ANY CLAIM THAT IS MADE AGAINST YOU IN CONNECTION WITH THE
COLLATERAL. YOU MAY LATER CANCEL ANY INSURANCE PURCHASED BY US, BUT ONLY
AFTER PROVIDING EVIDENCE THAT YOU HAVE OBTAINED INSURANCE AS REQUIRED BY
OUR AGREEMENT. IF WE PURCHASE INSURANCE FOR THE COLLATERAL, YOU WILL BE
RESPONSIBLE FOR THE COSTS OF THAT INSURANCE, INCLUDING THE INSURANCE
PREMIUM, INTEREST AND ANY OTHER CHARGES WE MAY IMPOSE IN CONNECTION WITH
THE PLACEMENT OF THE INSURANCE, UNTIL THE EFFECTIVE DATE OF THE
CANCELLATION OR EXPIRATION OF THE INSURANCE. THE COSTS OF THE INSURANCE MAY
BE ADDED TO YOUR TOTAL OUTSTANDING BALANCE OR OBLIGATION. THE COSTS OF THE
INSURANCE MAY BE MORE THAN THE COST OF INSURANCE YOU MAY BE ABLE TO OBTAIN
ON YOUR OWN.
21.17. STATUTORY NOTICE - ORAL COMMITMENTS. Nothing contained in the
following notice shall be deemed to limit or modify the terms of the Loan
Documents:
ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR
FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW
SUCH DEBT ARE NOT ENFORCEABLE REGARDLESS OF THE LEGAL THEORY UPON WHICH IT
IS BASED THAT IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT.
85
TO PROTECT YOU (BORROWER) AND US (CREDITOR) FROM MISUNDERSTANDING OR
DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED
IN THIS WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE
AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.
Borrower acknowledges that there are no other agreements between
Administrative Agent, Lenders, and Borrower, oral or written, concerning
the subject matter of the Loan Documents, and, except as expressly
described herein, that all prior agreements concerning the same subject
matter, including any proposal or commitment letter, are merged into the
Loan Documents and thereby extinguished.
[SIGNATURE PAGES FOLLOW]
86
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by appropriate duly authorized officers as of the Execution Date.
TALX CORPORATION, A MISSOURI CORPORATION
AS BORROWER
By: ___________________________________________
Name: _________________________________________
Title: ________________________________________
NOTICE ADDRESS FOR BORROWER:
0000 Xxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
WITH A COPY TO:
Xxxxx Xxxx LLP
Xxx Xxxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attention: R. Xxxxxxx Xxxx and Xxxxx X. Xxxxx
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
appropriate duly authorized officers as of the Execution Date.
LASALLE BANK NATIONAL ASSOCIATION
AS ADMINISTRATIVE AGENT AND A LENDER
By: __________________________________________
Name: ________________________________________
Title: _______________________________________
NOTICE ADDRESS:
LaSalle Bank National Association
000 X. XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
With copies to:
One Metropolitan Square
Xxx Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxx Xxxxxx
And
Xxxxxxxxx Xxxxxxx Xxxxx Xxxxxx
000 Xxxxx Xxxxxx, Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxx X. XxXxxxxxx
APPLICABLE LENDING OFFICE:
LaSalle Bank National Association
000 X. XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
appropriate duly authorized officers as of the Execution Date.
SOUTHWEST BANK OF ST. LOUIS, AS A LENDER
By: _________________________________
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice-President
By: _________________________________
Name: Xxxx X. Xxxxxxxxxxxx
Title: Executive Vice President
NOTICE ADDRESS AND APPLICABLE LENDING OFFICE:
Southwest Bank of St. Louis
00000 Xxxxxxxxxx Xxxx
Xx. Xxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx
With a copy to:
Xxxxxxxxx Xxxxxxxx LLP
One Metropolitan Square
000 X. Xxxxxxxx, Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
appropriate duly authorized officers as of the Execution Date.
NATIONAL CITY BANK OF THE MIDWEST, AS A LENDER
By:_______________________________
Name:_____________________________
Title:____________________________
NOTICE ADDRESS AND APPLICABLE LENDING OFFICE:
National City Bank
00000 Xxxxxxx Xxxx
Xx. Xxxxx, XX 00000
Attention: Xxxx Xxxxxxx
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
appropriate duly authorized officers as of the Execution Date.
FIFTH THIRD BANK (SOUTHERN INDIANA), AS A LENDER
By:_________________________________
Name:______________________________
Title:_______________________________
NOTICE ADDRESS AND APPLICABLE LENDING OFFICE:
___________________________________________
___________________________________________
___________________________________________
Attention: ________________________________
With a copy to:
___________________________________________
___________________________________________
___________________________________________
Attention: ________________________________
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
appropriate duly authorized officers as of the Execution Date.
XXXXXXX XXXXX BUSINESS FINANCIAL SERVICES INC., AS A LENDER
By:_________________________________
Name:______________________________
Title:_______________________________
NOTICE ADDRESS AND APPLICABLE LENDING OFFICE:
___________________________________________
___________________________________________
___________________________________________
Attention: ________________________________
With a copy to:
___________________________________________
___________________________________________
___________________________________________
Attention: ________________________________
[SIGNATURE PAGE FOLLOWS]
ACKNOWLEDGEMENT AND CONSENT OF GUARANTORS
Each Guarantor (i) acknowledges the amendments to and restatement of the First
Amended and Restated Loan Agreement as set forth in this Agreement; (ii)
consents to the execution of this Agreement by the Borrower and (iii)
acknowledges that this consent is not required under the terms of its Guaranty
and that the execution hereof by the Guarantor shall not be construed to require
the Lenders to obtain its acknowledgment to any future amendment, modification
or waiver of any term of the Agreement except as otherwise provided in said
Guaranty. Each Guarantor hereby agrees that the Guaranty shall apply, without
limitation, to all indebtedness, obligations and liabilities of the Borrower
under this Agreement and that the Guaranty shall be and remain in full force and
effect.
TALX UCM SERVICES, INC., A MISSOURI CORPORATION, AS A GUARANTOR
By:________________________________
Name:______________________________
Title:_____________________________
TALX FASTIME SERVICES, INC., A TEXAS CORPORATION, AS A GUARANTOR
By:________________________________
Name:______________________________
Title:_____________________________
TALX EMPLOYER SERVICES, LLC, A MISSOURI LIMITED LIABILITY COMPANY, AS A
GUARANTOR
By:________________________________
Name:______________________________
Title:_____________________________
UI ADVANTAGE, INC., A MARYLAND CORPORATION, AS A GUARANTOR
By:________________________________
Name:______________________________
Title:_____________________________
TBT ENTERPRISES, INCORPORATED, A MARYLAND CORPORATION, AS A GUARANTOR
By:________________________________
Name:______________________________
Title:_____________________________
NET PROFIT, INC., A SOUTH CAROLINA CORPORATION, AS A GUARANTOR
By:________________________________
Name:______________________________
Title:_____________________________
EXHIBIT 2.1
GLOSSARY
ACCOUNT -- as to any Person, the right of such Person to payment for goods sold
or leased or for services rendered by such Person.
ACCOUNT DEBTOR -- the obligor on any Account.
ACQUIRING COMPANY -- the Person obligated to pay or provide the consideration
payable in connection with a Permitted Acquisition upon the consummation
thereof.
ACQUISITION DOCUMENTS -- means the documents to which Borrower or any other
Covered Person is a party and under which the Approved Acquisitions or any
Permitted Acquisition is contemplated.
ACQUISITION DOCUMENTS ASSIGNMENT -- the assignment of the Acquisition Documents
that is executed and delivered to Administrative Agent for the benefit of
Lenders as provided herein.
ADJUSTED BASE RATE -- is defined in Section 4.3.
ADJUSTED EURODOLLAR RATE -- is defined in Section 4.4.
ADMINISTRATIVE AGENT -- LaSalle in its capacity as Administrative Agent under
this Agreement, and its successors and assigns in such capacity.
ADVANCE -- a Revolving Loan Advance or Swingline Loan.
ADVANCE DATE -- the date on which an Advance is requested by Borrower to be
made, or is otherwise contemplated or intended to be made, as provided herein.
AFFECTED LOAN -- is defined in Section 19.5.
AFFILIATE -- with respect to any Person, (a) any other Person who is a partner,
director, officer, stockholder, member, partner or other equity holder of such
Person; and (b) any other Person which, directly or indirectly, through one or
more intermediaries, is in control of, is controlled by or is under common
control with such Person, and any partner, director, officer or stockholder,
member, partner or other equity holder of such other Person described. For
purposes of this Agreement, control of a Person by another Person shall be
deemed to exist if such other Person has the power, directly or indirectly,
either to (i) vote twenty percent (20%) or more of the securities, membership
interests or other equity interest having the power to vote in an election of
directors or managers of such Person, or (ii) direct the management of such
Person, whether by contract or otherwise and whether alone or in combination
with others.
AGENCY FEE -- is specified in Section 5.6.
94
AGENCY FEE LETTER -- means that certain fee letter dated March 4, 2004 between
the Borrower and the Agent, which is incorporated herein by reference.
AGGREGATE REVOLVING LOAN -- the from time to time outstanding principal balance
of all Revolving Loan Advances.
AGGREGATE REVOLVING LOAN COMMITMENT -- the aggregate commitments of Lenders as
stated in Section 3.1.1 to fund Revolving Loan Advances, as it may be changed as
provided herein.
AGREEMENT -- this document (including every document that is stated herein to be
an appendix, exhibit or schedule hereto, whether or not physically attached to
this document).
AMENDMENT FEE - the fee payable to Administrative Agent, on behalf of each
Lender, as required in Section 5.1
APPLICABLE LENDING OFFICE -- means, for Administrative Agent and each Lender and
for each Loan, the Applicable Lending Office of Administrative Agent or such
Lender (or of an Affiliate of such Lender) designated for such Loan on the
signature pages hereof or such other office of such Lender (or an Affiliate of
Administrative Agent or such Lender) as Administrative Agent or such Lender may
from time to time specify to Administrative Agent (in the case of another
Lender) and Borrower by written notice in accordance with the terms hereof as
the office by which its Loans are to be made and maintained.
APPROVED ACQUISITIONS -- means the Target One Acquisition and the Target Two
Acquisition.
ASBESTOS MATERIAL -- either asbestos or asbestos-containing materials.
ASSIGNED COLLATERAL -- any tangible or intangible property of Borrower, now
owned or hereafter acquired, other than the Personal Property Collateral in
which Lender holds or will hold a Security Interest under a Collateral
Assignment to secure payment or performance of any of the Loan Obligations as
required or contemplated under Section 8.3, and all proceeds thereof.
BASE RATE -- for any day, the rate per annum equal to the higher of: (i) the
Prime Rate (as such rate may fluctuate from time to time as provided for herein)
for such day; or (ii) the Federal Funds Rates plus 0.5%. Any change in the Base
Rate due to a change in either the Prime Rate or the Federal Funds Rate shall be
effective on the effective date of such change in the Prime Rate or Federal
Funds Rate. The interest rate so designated from time to time as the Base Rate
by Administrative Agent is a reference rate and does not necessarily represent
the lowest or best rate charged to any customer of Administrative Agent or any
other Lender.
BASE RATE ADVANCE -- an Advance that will become a Base Rate Loan.
BASE RATE MARGIN -- is specified in Section 4.5.
BASE RATE LOAN -- any portion of a Loan on which interest accrues at the Base
Rate.
BENEFICIAL OWNER -- as defined in Rule 13-D-3 of the Securities and Exchange
Commission.
95
BORROWER -- TALX Corporation, a Missouri corporation.
BORROWING OFFICER -- each officer of Borrower who is authorized to submit a
request for an Advance or the issuance of a Letter of Credit on behalf of
Borrower.
BUSINESS DAY -- a day other than a Saturday, Sunday or other day on which
commercial banks are authorized or required to close under the Laws of either
the United States or the State of Illinois and when used in connection with
Eurodollar Loans, also a day other than any day on which dealings in U.S. Dollar
deposits are not carried on in the London interbank market.
BUYING LENDER(S) -- is defined in Section 3.4.4.
CAPITAL LEASE -- any lease that has been or should be capitalized under GAAP.
CHARTER DOCUMENTS -- the articles or certificate of incorporation and bylaws of
a corporation; the certificate of limited partnership and partnership agreement
of a limited partnership; the partnership agreement of a general partnership;
the articles of organization and operating agreement of a limited liability
company; or the indenture of a trust.
CLAIMS ACT -- the Assignment of Claims Act of 1940.
COBRA -- the Consolidated Omnibus Budget Reconciliation Act.
CODE -- the Internal Revenue Code of 1986 and all regulations thereunder of the
IRS.
COLLATERAL -- all of the Personal Property Collateral, the Assigned Collateral,
any other property in which Administrative Agent or a Lender has a Security
Interest to secure payment or performance of all or any of the Loan Obligations
and all proceeds and products thereof.
COLLATERAL ASSIGNMENT -- any of the collateral assignments required or
contemplated under Section 8.3 to be executed and delivered to Lender.
COMMITMENT - means, as to any Lender, such Lender's commitment to make Loans and
to issue or participate in Letters of Credit under this Agreement.
COMMITMENT AND ACCEPTANCE -- is defined in Section 3.4.1.
COMMITMENT INCREASE NOTICE --is defined in Section 3.4.2.
COMMONLY CONTROLLED ENTITY -- a Person which is under common control with
another Person within the meaning of Section 414(b) or (c) of the Code.
COMPLIANCE CERTIFICATE -- defined in Section 14.14
CONTRACT -- any contract, note, bond, indenture, lease, deed, mortgage, deed of
trust, security agreement, pledge, hypothecation agreement, assignment, or other
agreement or undertaking, or any security.
COVERED PERSON -- defined in Section 2.3.
96
DEFAULT -- any of the events listed in Section 17.1 of this Agreement, without
giving effect to any requirement for the giving of notice, for the lapse of
time, or both, or for the happening of any other condition, event or act.
DEFAULT RATE -- the rate of interest payable on each Loan after its Maturity and
in certain other circumstances as provided in Section 4.10.
DISCLOSURE SCHEDULE -- the disclosure schedule of Borrower attached hereto as
Exhibit 12.
DOL -- the United States Department of Labor.
DOLLARS and the sign $ -- lawful money of the United States.
DEFAULTING LENDER -- is defined in Section 7.5.
EBIT -- is defined in Section 16.1.
EBITDA -- is defined in Section 16.1.
EFFECTIVE COMMITMENT AMOUNT -- is defined in Section 3.4.3.
EFFECTIVE DATE -- the date when this Agreement is effective as provided in
Section 1.
ELIGIBLE ASSIGNEE -- means (i) a Lender; (ii) an Affiliate of a Lender; and
(iii) any other Person approved by Administrative Agent; provided, however, that
neither Borrower, any Covered Person, any Guarantor nor an Affiliate of Borrower
or Guarantor shall qualify as an Eligible Assignee.
EMPLOYMENT LAW -- ERISA, the Occupational Safety and Health Act, the Fair Labor
Standards Act, or any other Law pertaining to the terms or conditions of labor
or safety in the workplace or discrimination or sexual harassment in the
workplace.
ENVIRONMENTAL LAW -- the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response, Compensation and Liability Act, the Clean
Water Act, the Clean Air Act, or any other Law pertaining to environmental
quality or remediation of Hazardous Material.
ENVIRONMENTAL PROPERTY TRANSFER ACTS -- any law pertaining to the provision of
notices or obtaining of environmental permit transfers or consents, required in
order to consummate the transfer of real or personal property or the perfection
of Security Interests.
EPA -- the United States Environmental Protection Agency.
ERISA -- the Employee Retirement Income Security Act of 1974.
ERISA AFFILIATE -- as to any Person, any trade or business (irrespective of
whether incorporated) which is a member of a group of which such Person is a
member and thereafter treated as a single employer under 414(b), (c), (m) or (o)
of the Code or applicable Treasury Regulations.
97
EURODOLLAR ADVANCE -- an Advance that will become a Eurodollar Loan.
EURODOLLAR MARGIN-- is defined in Section 4.5.
EURODOLLAR LOAN -- any portion of an Aggregate Loan on which interest accrues at
the Adjusted Eurodollar Rate.
EURODOLLAR RATE -- for the applicable Interest Period therefor, means a rate of
interest equal to (a) the per annum rate of interest at which United States
dollar deposits in an amount comparable to the amount of the relevant Eurodollar
Loan and for a period equal to the relevant Interest Period are offered in the
London Interbank Eurodollar market at 11:00 A.M. (London time) two (2) Business
Days prior to the commencement of such Interest Period (or three (3) Business
Days prior to the commencement of such Interest Period if banks in London,
England were not open and dealing in offshore United States dollars on such
second preceding Business Day), as displayed in the Bloomberg Financial Markets
system (or other authoritative source selected by the Administrative Agent in
its sole discretion) or, if the Bloomberg Financial Markets system or another
authoritative source is not available, as the Eurodollar Rate is otherwise
determined by the Administrative Agent in its sole and absolute discretion,
divided by (b) a number determined by subtracting from 1.00 the then stated
maximum reserve percentage for determining reserves to be maintained by member
banks of the Federal Reserve System for Eurocurrency funding or liabilities as
defined in Regulation D (or any successor category of liabilities under
Regulation D), such rate to remain fixed for such Interest Period. Without
limiting the effect of the foregoing, the reserve requirement shall reflect any
other reserves required to be maintained by any Lender with respect to any
category of liabilities which includes deposits by reference to which the
Eurodollar Rate is to be determined, or any category of extensions of credit or
other assets which include Eurodollar Loans. (The entire amount of a Eurodollar
Loan shall be deemed to constitute a Eurocurrency liability and as such shall be
deemed to be subject to such reserve requirements without benefit of credits for
proration, exceptions or setoffs which may be available from time to time to any
Lender under Regulation D.) The Eurodollar Rate shall be adjusted automatically
on and as of the effective date of any change in any such reserve requirements.
The Administrative Agent's determination of the Eurodollar Rate shall be
conclusive, absent manifest error.
EVENT OF DEFAULT -- any of the events listed in Section 17.1 of this Agreement
as to which any requirement for the giving of notice, for the lapse of time, or
both, or for the happening of any further condition, event or act has been
satisfied.
EXECUTION DATE -- the date when this Agreement has been executed.
EXISTING DEFAULT -- a Default which has occurred and is continuing, or an Event
of Default which has occurred, and which has not been waived in writing by the
Required Lenders, or all of the Lenders if required by Section 21.2.
EXISTING LOAN DOCUMENTS -- means, collectively, the Guaranty dated March 27,
2002 executed by TALX UCM Services, Inc. (f/k/a Xxxxx X. Xxxxx, Inc.), a
Missouri corporation; the Guaranty dated March 27, 2002 executed by TALX FasTime
Services, Inc. (f/k/a Ti3, Inc.) a Texas corporation; the Guaranty dated March
31, 2004, executed by TALX Employer Services, LLC, a
98
Missouri limited liability company; the Guaranty dated October 15, 2004,
executed by UI Advantage, Inc., a Maryland corporation; the Guaranty dated
October 15, 2004, executed by TBT Enterprises, Incorporated, a Maryland
corporation; the Guaranty dated October 25, 2004, executed by Net Profit, Inc.,
a South Carolina corporation; the Security Agreement dated March 27, 2002
executed by Borrower; the Security Agreement dated March 27, 2002 executed by
TALX UCM Services, Inc. (f/k/a Xxxxx X. Xxxxx, Inc.), a Missouri corporation;
the Security Agreement dated March 27, 2002 executed by TALX FasTime Services,
Inc. (f/k/a Ti3, Inc.) a Texas corporation; the Security Agreement dated March
31, 2004, executed by TALX Employer Services, LLC, a Missouri limited liability
company; the Security Agreement dated October 15, 2004, executed by UI
Advantage, Inc., a Maryland corporation; the Security Agreement dated October
15, 2004, executed by TBT Enterprises, Incorporated, a Maryland corporation; the
Security Agreement dated October 25, 2004, by Net Profit, Inc., a South Carolina
Corporation; the Collateral Assignment of Membership Interest dated March 31,
2004, executed by Borrower; the Collateral Assignment of, and Security Interest
in, Lessee's Interest in Lease, dated May 28, 2004, executed by TALX UCM
Services, Inc., a Missouri corporation; the Collateral Assignment of, and
Security Interest in, Lessee's Interest in Lease dated May 28, 2004, executed by
Borrower; the Stock Pledge of Ti3 stock dated March 27, 2002 executed by
Borrower; the Stock Pledge of TALX UCM Services, Inc. stock dated March 26, 2003
executed by Borrower; the Stock Pledge of UI Advantage, Inc., a Maryland
corporation dated October 15, 2004, executed by Borrower; the Stock Pledge of
TBT Enterprises, Incorporated dated October 15, 2004, executed by Borrower, the
Stock Pledge of Net Profit, Inc., a South Carolina corporation, dated October
25, 2004, by Borrower; the Grant of Security Interest in Intellectual Property
dated March 27, 2002 by Borrower; the Grant of Security Interest in Intellectual
Property dated March 27, 2002 by TALX UCM Services, Inc. (f/k/a Xxxxx X. Xxxxx,
Inc.), a Missouri corporation; the Grant of Security Interest in Intellectual
Property dated March 31, 2004 executed by Borrower; the Grant of Security
Interest in Intellectual Property dated March 31, 2004, by TALX FasTime
Services, Inc., a Texas corporation; the Grant of Security Interest dated March
31, 2004, by TALX UCM Services, Inc. (f/k/a Xxxxx X. Xxxxx, Inc.), a Missouri
corporation; the Grant of Security Interest in Intellectual Property dated
October 25, 2004, by Net Profit, Inc., a South Carolina corporation; and the
Trademark Assignment by Net Profit Inc., a South Carolina corporation, dated
October 25, 2004.
FEDERAL FUNDS RATE -- for any day, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to Administrative
Agent (in its individual capacity) on such day on such transactions as
determined by Administrative Agent.
FIRST AMENDED AND RESTATED LOAN AGREEMENT -- is defined in the preamble to this
Agreement.
99
FINANCIAL STATEMENTS -- the most recent of the Initial Financial Statements and
the financial statements of Borrower required to be furnished to Administrative
Agent under Section 14.14 of this Agreement.
FRB -- the Board of Governors of the Federal Reserve System and any successor
thereto or to the functions thereof.
FRONTING FEE -- the fee payable to Letter of Credit Issuer as required in
Section 5.4.
GAAP -- those generally accepted accounting principles set forth in Statements
of the Financial Accounting Standards Board and in Opinions of the Accounting
Principles Board of the American Institute of Certified Public Accountants or
which have other substantial authoritative support in the United States and are
applicable in the circumstances, as applied on a consistent basis.
GOVERNMENTAL AUTHORITY -- the federal government of the United States; the
government of any foreign country that is recognized by the United States or is
a member of the United Nations; any state of the United States; any local
Government or municipality within the territory or under the jurisdiction of any
of the foregoing; any department, agency, division, or instrumentality of any of
the foregoing; and any court, arbitrator, or board of arbitrators whose orders
or judgements are enforceable by or within the territory of any of the
foregoing.
GROUP -- as used in Regulation 13-D issued by the Securities and Exchange
Commission.
GUARANTOR -- each of the Persons required under this Agreement to execute and
deliver to Administrative Agent for the benefit of Lenders a guaranty of part or
all of the Loan Obligations and each other Persons who previously delivered a
guaranty as noted under the definition "Existing Loan Documents".
GUARANTY -- each guaranty of part or all of the Loan Obligations executed and
delivered to Administrative Agent for the benefit of Lenders by any Guarantor.
HAZARDOUS MATERIAL -- any hazardous, radioactive, toxic, solid or special waste,
material, substance or constituent thereof, or any other such substance (as
defined under any applicable Law or regulation), including Asbestos Material.
HAZARDOUS MATERIAL does not include materials or products containing hazardous
constituents which are not considered to be waste under the applicable
Environmental Law or which are considered to be waste but are transported,
handled or disposed of in accordance with the applicable Environmental Law, or
Asbestos Material which is not friable.
IMPOSITIONS -- is defined in Section 19.6.1.
INDEBTEDNESS -- as to any Person at any particular date, any contractual
obligation enforceable against such Person (i) to repay borrowed money; (ii) to
pay the deferred purchase price of property or services; (iii) to make payments
or reimbursements with respect to bank acceptances or to a factor; (iv) to make
payments or reimbursements with respect to letters of credit whether or not
there have been drawings thereunder; (v) with respect to which there is any
Security Interest in any property of such Person; (vi) to make any payment or
contribution to a Multi-
100
Employer Plan; (vii) that is evidenced by a note, bond, debenture or similar
instrument; (viii) under any conditional sale agreement or title retention
agreement; or (ix) to pay interest or fees with respect to any of the foregoing.
INDEBTEDNESS also includes any other Obligation that either (i) is
non-contingent and liquidated in amount or (ii) should under GAAP be included in
liabilities and not just as a footnote on a balance sheet.
INDIRECT OBLIGATION -- as to any Person, (a) any guaranty by such Person of any
Obligation of another Person; (b) any Security Interest in any property of such
Person that secures any Obligation of another Person; (c) any enforceable
contractual requirement that such Person (i) purchase an Obligation of another
Person or any property that is security for such Obligation, (ii) advance or
contribute funds to another Person for the payment of an Obligation of such
other Person or to maintain the working capital, net worth or solvency of such
other Person as required in any documents evidencing an Obligation of such other
Person, (iii) purchase property, securities or services from another Person for
the purpose of assuring the beneficiary of any Obligation of such other Person
that such other Person has the ability to timely pay or discharge such
Obligation, (iv) grant a Security Interest in any property of such Person to
secure any Obligation of another Person, (v) otherwise assure or hold harmless
the beneficiary of any Obligation of another Person against loss in respect
thereof; (d) any Obligation arising from the endorsement by such Person of an
instrument; (e) any Obligation of such Person as a surety; and (f) any other
contractual requirement enforceable against such Person that has the same
substantive effect as any of the foregoing. The term INDIRECT OBLIGATION does
not, however, include the endorsement by a Person of instruments for deposit or
collection in the ordinary course of business or the liability of a general
partner of a partnership for Obligations of such partnership. The amount of any
Indirect Obligation of a Person shall be deemed to be the stated or determinable
amount of the Obligation in respect of which such Indirect Obligation is made
or, if not stated or determinable, the maximum reasonably anticipated liability
in respect thereof as determined by such Person in good faith.
INITIAL FINANCIAL STATEMENTS -- the financial statements (not including the
proforma financial statements) of Borrower referred to in Section 10.1.2.
INSURANCE/CONDEMNATION PROCEEDS -- insurance proceeds payable as a consequence
of damage to or destruction of any of the Collateral and proceeds payable as a
consequence of condemnation or sale in lieu of condemnation of any of the
Collateral.
INTELLECTUAL PROPERTY -- as to any Person, any domestic or foreign patents or
patent applications of such Person, any inventions made or owned by such Person
upon which either domestic or foreign patent applications have not yet been
filed, any domestic or foreign trade names or trademarks of such Person, any
domestic or foreign trademark registrations or applications filed by such
Person, any domestic or foreign service marks of such Person, any domestic or
foreign service xxxx registrations and applications by such Person, any domestic
or foreign copyrights of such Person, and any domestic or foreign copyright
registrations or applications by such Person.
INTELLECTUAL PROPERTY ASSIGNMENT -- each assignment of Intellectual Property
that Borrower executes and delivers to Administrative Agent for the benefit of
Lenders.
101
INTEREST EXPENSE -- is defined in Section 16.1.
INTEREST HEDGE OBLIGATION -- any obligations of Borrower to Administrative Agent
or any Affiliate of Administrative Agent under an agreement or agreements
between Borrower and Administrative Agent or any Affiliate of Administrative
Agent under which the exposure of Borrower to fluctuations in interest rates is
effectively limited, whether in the form of one or more interest rate cap,
collar, or corridor agreements, interest rate swaps, or the like, or options
therefor.
INTEREST PERIOD -- the period during which a particular Adjusted Eurodollar Rate
applies to a Eurodollar Loan, as selected by Borrower as provided in Section
4.7.
INVENTORY -- goods owned and held by a Person for sale, lease or resale or
furnished or to be furnished under contracts for services, and raw materials,
goods in process, materials, component parts and supplies used or consumed, or
held for use or consumption in such Person's business.
INVESTMENT -- (a) a loan or advance of money or property to a Person, (b) stock,
membership interest, or other equity interest in a Person, (c) a debt instrument
issued by a Person, whether or not convertible to stock, membership interest, or
other equity interest in such Person, or (d) any other interest in or rights
with respect to a Person which include, in whole or in part, a right to share,
with or without conditions or restrictions, some or all of the revenues or net
income of such Person.
IRS -- the Internal Revenue Service.
XXXXXXX - means Xxxxxxx & Associates, LLC, a Nebraska limited liability company,
which is a wholly-owned subsidiary of Talx UCM Services, Inc., a Missouri
corporation.
LASALLE -- LaSalle Bank National Association.
LAW -- any statute, rule, regulation, order, judgment, award or decree of any
Governmental Authority.
LENDER -- any one of the lenders listed on Exhibit 3 to this Agreement,
including Administrative Agent in its capacity as a lender, or any Person who
takes an assignment from any of such lenders of all or a portion of its rights
and obligations as a lender under this Agreement pursuant to Section 20.4.1 and
an Assignment and Acceptance as provided therein.
LENDER INCREASE NOTICE -- is defined in Section 3.4.2.
LENDERS' EXPOSURE -- the sum of the Aggregate Revolving Loan Commitment and the
Letter of Credit Exposure.
LETTER OF CREDIT -- any standby or commercial (documentary) letter of credit
issued by Letter of Credit Issuer pursuant to the Letter of Credit Commitment.
LETTER OF CREDIT AGREEMENT -- defined in Section 11
102
LETTER OF CREDIT COMMITMENT -- the commitment of the Letter of Credit Issuer to
issue Letters of Credit as provided in Section 3.3.
LETTER OF CREDIT EXPOSURE -- the undrawn amount of all outstanding letters of
credit issued under the Letter of Credit Commitment plus all amounts drawn on
such letters of credit and not yet reimbursed by Borrower.
LETTER OF CREDIT FEE -- the fee payable to Administrative Agent and Lenders as
required in Section 5.3.
LETTER OF CREDIT ISSUER -- LaSalle, or any other Lender succeeding to LaSalle's
commitment to issue Letters of Credit pursuant to Section 3.3.
LOAN -- a Revolving Loan or a Swingline Loan.
LOAN AGREEMENT -- this Agreement.
LOAN DOCUMENTS -- this Agreement, the Notes, the Guaranties, the Security
Documents, any Rate Agreement, any reimbursement agreement between Borrower and
the Letter of Credit Issuer and all other agreements, certificates, documents,
instruments and other writings executed from time to time in connection herewith
or related hereto, and including, without limitation, the Existing Loan
Documents.
LOAN OBLIGATIONS -- all of Borrower's Indebtedness owing to Letter of Credit
Issuer, Administrative Agent or Lenders under the Loan Documents, whether as
principal, interest, fees or otherwise, including, without limitation, the
Borrower's Indebtedness under this Agreement, all reimbursement obligations of
Borrower to Letter of Credit Issuer or Lenders with respect to the Letter of
Credit Exposure, all Obligations to Administrative Agent, and all other
obligations and liabilities of Borrower to Administrative Agent or Lenders under
the Loan Documents and all Interest Hedge Obligations (in each case including
all extensions, renewals, modifications, rearrangements, restructures,
replacements and refinancings of the foregoing, whether or not the same involve
modifications to interest rates or other payment terms), whether now existing or
hereafter created, absolute or contingent, direct or indirect, joint or several,
secured or unsecured, due or not due, contractual or tortious, liquidated or
unliquidated, arising by operation of law or otherwise, including but not
limited to the obligation of Borrower to repay future advances by Administrative
Agent or Lenders hereunder, whether or not made pursuant to commitment and
whether or not presently contemplated by Borrower, Administrative Agent or
Lenders in the Loan Documents.
LOCAL TIME -- the local time in the city in which Administrative Agent's address
is located, as set forth on the signature page hereto (as changed from time to
time in accordance with the terms hereof).
MARGIN -- the Base Rate Margin or Eurodollar Margin.
MATERIAL ADVERSE EFFECT -- as to any Covered Person and with respect to any
event or occurrence of whatever nature (including any adverse determination in
any litigation, arbitration, investigation or proceeding), a material adverse
effect on (i) the business, operations, revenues,
103
financial condition, property, or business prospects of the Borrower
specifically or of the Subsidiaries taken as a whole, (ii) the value of the
Collateral, (iii) the validity or enforceability of the Loan Documents, (iv) the
ability of such Person to timely pay or perform such Covered Person's
Obligations generally, (v) in the case of Borrower specifically, the ability of
Borrower to pay or perform any of Borrower's Obligations to Lender, or (vi) in
the case of a Guarantor specifically, the ability of such Guarantor to pay or
perform any of its Obligations under the terms of its Guaranty.
MATERIAL AGREEMENT -- as to any Person, any Contract to which such Person is a
party or by which such Person is bound which, if violated or breached, has or is
reasonably likely to have a Material Adverse Effect on the Borrower specifically
or the Subsidiaries taken as a whole including without limitation all
Acquisition Documents.
MATERIAL LAW -- any separately enforceable provision of a Law whose violation by
a Person has or is reasonably likely to have a Material Adverse Effect on the
Borrower specifically or the Subsidiaries taken as a whole.
MATERIAL LICENSE -- (i) as to any Covered Person, any license, permit or consent
from a Governmental Authority or other Person and any registration and filing
with a Governmental Authority or other Person which if not obtained, held or
made by such Covered Person has or is reasonably likely to have a Material
Adverse Effect on the Borrower specifically or the Subsidiaries taken as a
whole, and (ii) as to any Person who is a party to this Agreement or any of the
other Loan Documents, any license, permit or consent from a Governmental
Authority or other Person and any registration or filing with a Governmental
Authority or other Person that is necessary for the execution or performance by
such party, or the validity or enforceability against such party, of this
Agreement or such other Loan Document.
MATERIAL OBLIGATION -- as to any Person, an Obligation of such Person which if
not fully and timely paid or performed has or is reasonably likely to have a
Material Adverse Effect on the Borrower specifically or the Subsidiaries taken
as a whole.
MATERIAL PROCEEDING -- any litigation, investigation or other proceeding by or
before any Governmental Authority (i) which involves any of the Loan Documents
or any of the transactions contemplated thereby, or involves a Covered Person or
a Guarantor as a party or any property of Covered Person or a Guarantor, and has
or is reasonably likely to have a Material Adverse Effect on the Borrower
specifically or the Subsidiaries taken as a whole if adversely determined, (ii)
in which there has been issued an injunction, writ, temporary restraining order
or any other order of any nature which purports to restrain or enjoin the making
of any Advance, the consummation of any other transaction contemplated by the
Loan Documents, or the enforceability of any provision of any of the Loan
Documents, (iii) which involves the actual or alleged breach or violation by a
Covered Person of, or default by a Covered Person under, any Material Agreement,
or (iv) which involves the actual or alleged violation by a Covered Person or
any Guarantor of any Material Law.
MATURITY -- as to any Indebtedness, the time when it becomes payable in full,
whether at a regularly scheduled time, because of acceleration or otherwise.
104
MAXIMUM AVAILABLE AMOUNT -- the maximum Dollar amount available for Revolving
Loan Advances on any date as limited in Section 3.1.2, as it may be changed as
provided herein.
MULTI-EMPLOYER PLAN -- a Pension Benefit Plan which is a multi-employer plan as
defined in Section 4001(a)(3) of ERISA.
NOTE -- any Revolving Note or Swingline Note.
NOTICE OF DEFAULT -- is specified in Section 18.4.
OBLIGATION -- as to any Person, any Indebtedness of such Person, any guaranty by
such Person of any Indebtedness of another Person, and any contractual
requirement enforceable against such Person that does not constitute
Indebtedness of such Person or a guaranty by such Person but which would involve
the expenditure of money by such Person if complied with or enforced.
OBLIGATIONS TO ADMINISTRATIVE AGENT -- exclusive of all the Loan Obligations,
all of Borrower's Indebtedness owing to Administrative Agent (whether as
principal, interest, fees or otherwise), all obligations of Borrower under
agreements between Borrower and Administrative Agent under which the exposure of
Borrower to fluctuations in interest rates is effectively limited, whether in
the form of interest rate cap, collar or corridor agreements, interest rate
swaps, or the like, or options therefor, all Indirect Obligations of Borrower
owing to Administrative Agent, all reimbursement obligations of Borrower to
Administrative Agent with respect to letters of credit, and all other
obligations and liabilities of Borrower to Administrative Agent including all
extensions, renewals, modifications, rearrangements, restructures, replacements
and refinancings of the foregoing, whether or not the same involve modifications
to interest rates or other payment terms), whether now existing or hereafter
created, absolute or contingent, direct or indirect, joint or several, secured
or unsecured, due or not due, contractual or tortious, liquidated or
unliquidated, arising by operation of law or otherwise, or acquired by
Administrative Agent outright, conditionally or as collateral security from
another, including the obligation of Borrower to repay future advances by
Administrative Agent, whether or not made pursuant to commitment and whether or
not presently contemplated by Borrower and Administrative Agent.
OPERATING LEASE -- any lease that is not a Capital Lease.
ORIGINAL LOAN AGREEMENT -- is defined in the preamble to this Agreement.
PBGC -- the Pension Benefit Guaranty Corporation.
PENSION BENEFIT PLAN -- any pension or profit-sharing plan which is covered by
Title I of ERISA and all other benefit plans, in each case in respect of which a
Covered Person or a Commonly Controlled Entity of such Covered Person is an
employer as defined in Section 3(5) of ERISA.
PERMITTED ACQUISITIONS -- any acquisition by Borrower or a Covered Person of
stock, membership interests, or other equity interests of another Person or the
assets of another Person permitted under Section 15.7.
105
PERMITTED DISTRIBUTIONS -- any Distributions permitted under Section 15.10.
PERMITTED INDEBTEDNESS -- Indebtedness that Borrower is permitted under Section
15.2 to incur, assume, or allow to exist.
PERMITTED INDIRECT OBLIGATIONS -- Indirect Obligations that Borrower is
permitted under Section 15.4 to create, incur, assume, or allow to exist.
PERMITTED INVESTMENTS -- Investments that Borrower is permitted under Section
15.1 to make in other Persons.
PERMITTED SECURITY INTERESTS -- Security Interests that Borrower is permitted
under Section 15.5 to create, incur, assume, or allow to exist.
PERSON -- any individual, partnership, corporation, trust, unincorporated
association, joint venture, limited liability company, Governmental Authority,
or other organization in any form that has the legal capacity to xxx or be sued.
If the context so implies or requires, the term Person includes Borrower.
PERSONAL PROPERTY COLLATERAL -- all of the Goods, Equipment, Accounts,
Inventory, Instruments, Documents, Chattel Paper, General Intangibles and other
personal property of Borrower, whether now owned or hereafter acquired, and all
proceeds thereof, in which Administrative Agent at any time holds a Security
Interest for the benefit of Lenders.
PLEDGE AGREEMENT -- any pledge agreement required or contemplated under Section
8.3 to be executed and delivered to Administrative Agent for the benefit of
Lenders.
PRIME RATE --on any day, the rate of interest per annum then most recently
established by Administrative Agent as its Prime Rate. Such rate is a general
reference rate of interest, may not be related to any other rate, and may not be
the lowest or best rate actually charged by Administrative Agent to any customer
or a favored rate and may not correspond with future increases or decreases in
interest rates charged by other lenders or market interest rates in general.
PROFORMA FINANCIAL STATEMENTS -- the proforma financial statements referred to
in Section 10.1.2.
PROPOSED NEW LENDER -- is defined in Section 3.4.3.
PRO-RATA SHARE -- with respect to a Lender's obligation to make Revolving Loans,
participate in Letters of Credit, reimburse the Letter of Credit Issuer, and
receive payments of principal, interest, fees, costs, and expenses with respect
thereto, (x) prior to the Aggregate Revolving Loan Commitment being terminated
or reduced to zero, the percentage obtained by dividing (i) such Lender's
Revolving Loan Commitment, by (ii) the Aggregate Revolving Loan Commitment of
all Lenders; and (y) from and after the time the Aggregate Revolving Loan
Commitment has been terminated or reduced to zero, the percentage obtained by
dividing (i) the sum of the aggregate unpaid principal amount of such Lender's
Revolving Loans (after settlement and repayment of all Swingline Loans by the
Lenders) and such Lender's Letter of Credit Exposure,
106
by (ii) the sum of the aggregate unpaid principal amounts of all Revolving Loans
(after settlement and repayment of all Swingline Loans by the Lenders) and the
aggregate Letter of Credit Exposure.
RATE AGREEMENT -- (a) any and all agreements, devices or arrangements (including
all schedules, amendments and supplements thereto and all documents and
confirming evidence now or hereafter exchanged between the counterparties
confirming the transactions governed by such agreements devices or arrangements)
designed to protect at least one of the parties thereto from the fluctuations of
interest rates, exchange rates or forward rates applicable to such party's
assets, liabilities or exchange transactions, including, but not limited to,
Dollar-denominated or cross-currency interest rate exchange agreements, forward
currency exchange agreements, interest rate cap or collar protection agreements,
forward rate currency or interest rate options, puts, warrants and those
commonly known as interest rate "swap" agreements; and (b) any and all
cancellations, buybacks, reversals, terminations or assignments of any of the
foregoing.
REGULATION D, REGULATION T, REGULATION U and REGULATION X -- respectively,
Regulation D issued by the FRB, Regulation T issued by the FRB, Regulation U
issued by the FRB and Regulation X issued by the FRB.
REPORTABLE EVENT -- a reportable event as defined in Title IV of ERISA or the
regulations thereunder.
REPRESENTATIONS AND WARRANTIES -- The representations and warranties made by any
Covered Person with respect to itself and any other Covered Persons in Section
12, and the representations and warranties made in any other Loan Document or
certificate, report or opinion delivered by Borrower, any Guarantor, or any
other Covered Person pursuant to the Loan Documents, as such representations and
warranties are modified from time to time as provided in Section 13.
REPURCHASES -- Borrower's repurchase, from time to time, of its issued and
outstanding capital stock which was sold pursuant to transactions that are
registered under the Securities Act of 1933 or that are exempt therefrom.
REQUIRED LENDERS -- defined in Section 2.4.
RESPONSIBLE OFFICER -- as to any Person that is not an individual, partnership,
limited liability company or trust, the Chairman of the Board of Directors, the
President, the chief executive officer, the chief operating officer, the chief
financial officer, the Treasurer, any Assistant to the Treasurer, or any Vice
President in charge of a principal business unit; as to any partnership, any
individual who is a general partner thereof or any individual who has general
management or administrative authority over all or any principal unit of the
partnership's business; as to any limited liability company, any managing
member, or manager, any individual who has general management or administrative
authority over all or any principal unit of the limited liability company's
business; and as to any trust, any individual who is a trustee.
REVOLVING LOAN -- any Lender's Pro-Rata Share of the Aggregate Revolving Loan.
107
REVOLVING LOAN ADVANCE -- an Advance by Administrative Agent that is to be
funded by Lenders under the Aggregate Revolving Loan Commitment.
REVOLVING LOAN COMMITMENT -- the commitment of each Lender as stated in Section
3.1.1. to fund Revolving Loan Advances.
REVOLVING LOAN MATURITY DATE - April 14, 2010, unless sooner accelerated in
accordance with the terms of this Agreement.
REVOLVING LOAN UNUSED FEE -- the fee described in Section 5.2.
REVOLVING NOTE -- any note delivered to a Lender as required by Section 3.1.3 to
evidence Borrower's obligation to repay such Lender's Revolving Loan.
SEC SETTLEMENT -- means the settlement agreement between the Securities Exchange
Commission ("SEC") and Borrower resulting from the investigation known as In the
Matter of TALX Corporation (D-02448-A), including a payment by Borrower of up to
Three Million and 00/100 Dollars ($3,000,000.00) pursuant to such settlement.
SECURITY AGREEMENT -- any security agreement required or contemplated under
Section 8 to be executed and delivered to Administrative Agent for the benefit
of Lenders, as well as the following documents: the Security Agreement dated
March 27, 2002 executed by Borrower; the Security Agreement dated March 27, 2002
executed by TALX UCM Services, Inc. (f/k/a Xxxxx X. Xxxxx, Inc.), a Missouri
corporation; the Security Agreement dated March 27, 2002 executed by TALX
FasTime Services, Inc (f/k/a Ti3,Inc.) a Texas Corporation; the Security
Agreement dated March 31, 2004, executed by TALX Employer Services, LLC, a
Missouri limited liability company; the Security Agreement dated October 15,
2004, executed by UI Advantage, Inc., a Maryland corporation; the Security
Agreement dated October 15, 2004, executed by TBT Enterprises, Incorporated, a
Maryland corporation; the Security Agreement dated October 25, 2004, by Net
Profit, Inc., a South Carolina Corporation; the Collateral Assignment of, and
Security Interest in, Lessee's Interest in Lease, dated May 28, 2004, executed
by TALX UCM Services, Inc., a Missouri corporation; the Collateral Assignment
of, and Security Interest in, Lessee's Interest in Lease dated May 28, 2004,
executed by Borrower, the Stock Pledge of Ti3 stock dated March 27, 2002
executed by Borrower; the Stock Pledge of TALX UCM Services, Inc. stock dated
March 26, 2003 executed by Borrower; the Stock Pledge of UI Advantage, Inc., a
Maryland corporation dated October 15, 2004, executed by Borrower; the Stock
Pledge of TBT Enterprises, Incorporated dated October 15, 2004, executed by
Borrower; the Stock Pledge of Net Profit, Inc., a South Carolina corporation,
dated October 25, 2004, by Borrower; the Grant of Security Interest in
Intellectual Property dated March 27, 2002 by Borrower; the Grant of Security
Interest in Intellectual Property dated March 27, 2002 by TALX UCM Services,
Inc. (f/k/a Xxxxx X. Xxxxx, Inc.), a Missouri corporation; the Grant of Security
Interest in Intellectual Property dated March 31, 2004 executed by Borrower; the
Grant of Security Interest in Intellectual Property dated March 31, 2004, by
TALX FasTime Services, Inc., a Texas corporation; the Grant of Security Interest
dated March 31, 2004, by TALX UCM Services, Inc. (f/k/a Xxxxx X. Xxxxx, Inc.), a
Missouri corporation; the Grant of Security Interest in Intellectual Property
dated October 25, 2004, by Net Profit, Inc., a South Carolina corporation; and
the Trademark Assignment by Net Profit Inc., a South Carolina corporation, dated
October 25, 2004.
108
SECURITY DOCUMENTS -- all of the documents required or contemplated to be
executed and delivered to Administrative Agent for the benefit of Lenders under
Section 8, all other documents granting a Security Interest in any asset of
Borrower or any other Person to secure the payment or performance of any of the
Loan Obligations from time to time, including any such documents listed on
Exhibit 10.1.1 and any similar documents at any time executed and delivered to
Administrative Agent for the benefit of Lenders from time to time, by Borrower,
any Covered Person, or any other Person to secure payment or performance of any
of the Loan Obligations.
SECURITY INTEREST -- as to any item of tangible or intangible property, any
interest therein or right with respect thereto that secures an Obligation or
Indirect Obligation, whether such interest or right is created under a Contract,
or by operation of law or statute (such as but not limited to a statutory lien
for work or materials), or as a result of a judgment, or which arises under any
form of preferential or title retention agreement or arrangement (including a
conditional sale agreement or a lease) that has substantially the same economic
effect as any of the foregoing.
SELLER -- any Person who is a party to any Approved Acquisition or any Permitted
Acquisition other than Borrower or a Covered Person.
SELLING LENDER(S) -- is defined in Section 3.4.4.
SENIOR INDEBTEDNESS -- is defined in Section 16.1.
SOLVENT -- as to any Person, such Person not being "insolvent" within the
meaning of Section 101(32) of the Bankruptcy Code, Section 2 of the Uniform
Fraudulent Transfer Act (the "UFTA") or Section 3 of the Illinois Uniform
Fraudulent Transfer Act set forth in Section 160/3 of the Illinois Compiled
Statutes (1996) (the "Illinois UFTA"), (ii) such Person not having unreasonably
small capital, within the meaning of Section 548 of the Bankruptcy Code, Section
4 of the UFTA, or Section 5 of the Illinois UFTA, and (iii) such Person not
being unable to pay such Person's debts as they become due within the meaning of
Section 548 of the Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the
Illinois UFTA.
SOUTHWEST -- Southwest Bank of St. Louis.
SUBSIDIARY -- as to any Person, another Person with respect to which more than
50% of the outstanding shares of stock or other equity interests of each class
having ordinary voting power (other than stock having such power only by reason
of the happening of a contingency) is at the time owned by such Person or by one
or more Subsidiaries of such Person; provided, that Xxxxxxx shall not be
considered a Subsidiary of any Person for purposes of this Agreement so long as
the book value of Xxxxxxx'x total assets reflected on a balance sheet prepared
in accordance with GAAP (other than goodwill and related intangible assets
recorded in connection with the acquisition of Xxxxxxx) does not exceed two
million five hundred thousand and 00/100 ($2,500,000.00).
SURVIVING COMPANY -- as applicable, either (i) the Person that will own the
assets to be acquired from a Target Company in an Approved Acquisition or a
Permitted Acquisition upon the consummation thereof, or (ii) the survivor of the
merger of an Acquiring Company with the
109
Target Company in an Approved Acquisition or a Permitted Acquisition upon the
consummation thereof.
SWINGLINE -- is defined in Section 3.5.
SWINGLINE FACILITY -- is defined in Section 3.5.
SWINGLINE LOAN -- is defined in Section 3.5.
SWINGLINE LOAN EXPOSURE -- the aggregate principal amount of all outstanding
Swingline Loans issued under the Swingline Facility.
SWINGLINE NOTE -- is defined in Section 3.5.
TARGET COMPANY -- the Person whose assets or stock, membership interests, or
other equity interests will be acquired in an Approved Acquisition or a
Permitted Acquisition upon the consummation thereof, or if applicable, with
which an Acquiring Company will merge in an Approved Acquisition or a Permitted
Acquisition upon the consummation thereof.
TARGET ONE -- means Xxxxx & Xxxxx Consultants, LLC, a Texas limited liability
company.
TARGET ONE ACQUISITION -- means the acquisition of the assets of Target One by
TALX Tax Incentive Services, LLC pursuant to the Target One Acquisition
Documents.
TARGET ONE ACQUISITION DOCUMENTS -- means the acquisition agreement entered into
by Borrower and/or TALX Tax Incentive Services, LLC in the form as furnished and
approved by the Administrative Agent in writing prior to the consummation of the
Target One Acquisition, with only such amendments, modifications or supplements
thereto, or waivers of the terms thereof, as shall be prior approved in writing
by the Administrative Agent.
TARGET TWO -- means Xxx-Xxx Associates, Inc., a Massachusetts corporation.
TARGET TWO ACQUISITION -- means the acquisition of the capital stock of Target
Two by TALX UCM Services, Inc. pursuant to the Target Two Acquisition Documents.
TARGET TWO ACQUISITION DOCUMENTS -- means the acquisition agreement entered into
by Borrower and/or TALX UCM Services, Inc. in the form as furnished and approved
by the Administrative Agent in writing prior to the consummation of the Target
Two Acquisition, with only such amendments, modifications or supplements
thereto, or waivers of the terms thereof, as shall be prior approved in writing
by the Administrative Agent.
TAX -- as to any Person, any tax, duty, impost, deduction, charges,
withholdings, assessment, fee, or other charge 1evied by a Governmental
Authority (and all liabilities associated therewith) on the income or property
of such Person, including any interest or penalties thereon, and which is
payable by such Person.
TOTAL INDEBTEDNESS -- is defined in Section 16.1.
110
UCC -- the Uniform Commercial Code as in effect from time to time in the State
of Illinois or such other similar statute as in effect from time to time in
Illinois or any other appropriate jurisdiction.
UNITED STATES -- when used in a geographical sense, all the states of the United
States of America and the District of Columbia; and when used in a legal
jurisdictional sense, the government of the country that is the United States of
America.
WAGE AND HOUR LAWS -- the Xxxxx-Xxxxx Act, the Service Contract Act, the
Contract Work Hours & Safety Standards Act and any other federal Law governing
wage compensation or hours of work.
WELFARE BENEFIT PLAN -- any plan described by Section 3(1) of ERISA.
111
]
EXHIBIT 3
LENDERS, LENDERS' COMMITMENTS AND PRO-RATA SHARES
LENDER REVOLVING LOAN COMMITMENT
------ -------------------------
LaSalle Bank National Association $ 35,000,000.00
Southwest Bank of St. Louis $ 25,000,000.00
National City Bank of Michigan/Illinois $ 17,500,000.00
Fifth Third Bank (Southern Indiana) $ 10,000,000.00
Xxxxxxx Xxxxx Business Financial Services Inc. $ 12,500,000.00
----------------
AGGREGATES $ 100,000,000.00
----------------
EXHIBIT 3.4.1
COMMITMENT AND ACCEPTANCE
Date
LaSalle Bank National Association
[address]
Attention: [____________]
Ladies and Gentlemen:
Reference is hereby made to that certain Second Amended and Restated Loan
Agreement dated _____________ by and among TALX Corporation, as Borrower, [list
Guarantors], as Guarantor, the financial institutions party thereto as Lenders
and LaSalle Bank National Association, in its individual capacity as a Lender
and as Agent (as amended, restated, supplemented or otherwise modified, the
"Loan Agreement"). Defined terms used herein and not otherwise defined herein
shall have the meanings given to them in the Loan Agreement.
Pursuant to Section [3.4.1] of the Loan Agreement, the Borrower has
requested an increase in the Aggregate Revolving Loan Commitment in the amount
of $__________ from $____________ to $____________. Such increase in the
Aggregate Revolving Loan Commitment is to become effective on the date (the
"Effective Date") which is the later of (i) __________, _____ and (ii) the date
on which the conditions precedent set forth in Section 3 in respect of such
increase have been satisfied. In connection with such requested increase in the
Aggregate Revolving Loan Commitment, the Administrative Agent and
_______________ (the "Accepting Bank") hereby agree as follows:
1. Effective as of the Effective Date, the Accepting Bank shall become a
party to the Loan Agreement as a Lender and shall have all of the rights and
obligations of a Lender thereunder and shall thereupon have a [Revolving Loan
Commitment under and for purposes of the Loan Agreement in an amount equal to
the] or [the Revolving Loan Commitment of the Accepting Bank under the Loan
Agreement shall be increased from $_________ to the] amount set forth opposite
the Accepting Bank's name on the signature page hereof.
2. The Accepting Bank hereby (i) confirms that it has received a copy of
the Loan Agreement, together with copies of such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into this Commitment and Acceptance agreement; (ii) agrees that it will,
independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it shall deemed
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Agreement; (iii) appoints and authorizes the
Administrative Agent to take such action as contractual representative on its
behalf and to exercise such powers under the Loan Agreement and the other Loan
Documents as are delegated to the Administrative Agent
by the terms thereof, together with such powers as are reasonably incidental
thereto; and (iv) agrees that it will perform in accordance with their terms all
of the obligations which by the terms of the Loan Agreement are required to be
performed by it as a Lender.
[Name of Lender]
By: _________________________________
Name:
Title:
LASALLE BANK NATIONAL ASSOCIATION,
as Administrative Agent
By: _________________________________
Name:
Title:
TALX CORPORATION,
as Borrower
By: _________________________________
Name:
Title:
EXHIBIT 7.10
LOAN REQUEST CERTIFICATE
(REVOLVING LOAN)
To: LaSalle Bank Nation Association
From: TALX Corporation (the "Company")
This Loan Request Certificate is delivered pursuant to the Second Amended
and Restated Loan Agreement (the "Loan Agreement") dated ______________, 200_ by
and among LaSalle Bank National Association, as a Lender and as Administrative
Agent ("Agent"), and the other lender parties thereto and TALX Corporation
("Borrower"). All terms used herein shall have the meaning set forth in the Loan
Agreement.
The undersigned hereby gives irrevocable notice of a request for a borrowing as
follows:
1. New Loan Request: The undersigned
hereby requests Lender to make and
disburse a Loan to Borrower in the
amount of: $ ______________________
2. INTEREST RATE REQUESTED: The (1) _______ Adjusted Base Rate
undersigned hereby elects for (2) _______ One-month Eurodollar
interest to accrue on the Revolving (3) _______ Two-month Eurodollar
Loan requested herein on the basis (4) _______ Three-month Eurodollar
of (Select One): (5) _______ Six-month Eurodollar
3. ADVANCE DATE REQUESTED:
The undersigned hereby represents, warrants, ratifies and confirms that, on
the date hereof and as of the date of the advance as set forth above, all
representations and warranties of Borrower contained in the Loan Agreement are
true and correct, that Borrower is in compliance with all covenants of Borrower
contained in the Loan Agreement, that no Event of Default under the Loan
Agreement has occurred and is continuing and no event that but for the passage
of time or the giving of notice would be an Event of Default under the Loan
Agreement has occurred and is continuing, that all information contained in this
Loan Request Certificate is true and correct and that the new loan request
amount set forth above does not exceed the Maximum Available Amount.
EXECUTED this _____ day of ______________________, 200__.
TALX CORPORATION,
a Missouri corporation
By: __________________________________
Name: ________________________________
Title: _________________________________
EXHIBIT 10.1.1
DOCUMENTS AND REQUIREMENTS LIST
Closing Checklist
EXHIBIT 12
DISCLOSURE SCHEDULE OF BORROWER
(See attached Disclosure Schedules)
EXHIBIT 14.14
FORM OF COMPLIANCE CERTIFICATE
TO: LaSalle Bank National Association, as Administrative Agent
This Compliance Certificate is furnished pursuant to that certain Second Amended
and Restated Loan Agreement effective _____________, 2005 (as it may be amended,
modified, restated or replaced from time to time, the Loan Agreement), among
TALX Corporation (referred to herein both collectively and individually as
Borrower), LaSalle Bank National Association, as Administrative Agent
(Administrative Agent) and the Lenders as defined in the Loan Agreement
(Lenders). Unless otherwise defined herein, capitalized terms used in this
Compliance Certificate have the meanings defined in the Loan Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the Chief Financial Officer of Borrower.
2. I have reviewed the terms of the Loan Agreement and the Loan Documents
and I have made, or have caused to be made under my supervision, a
review of the transactions and conditions of Borrower and each other
Covered Person during the accounting period covered by the attached
Financial Statements.
3. The examinations described in paragraph 2 did not disclose, and I have
no knowledge of, the existence of any condition or event which
constitutes an Default or Event of Default as of the date of this
Compliance Certificate; and to my knowledge all of the Representations
and Warranties (including those of each Guarantor in its Guaranty) are
true in all material respects.
4. (Use for annual financial statements: Schedule I attached hereto
contains the Financial Statements for Borrower for the fiscal year
ended _____, which are complete and correct in all material respects
and have been prepared in accordance with GAAP applied consistently
throughout the period and with prior periods (except as disclosed
therein).)
(Use for quarterly and monthly financial statements: Schedule I
attached hereto contains the Financial Statements for Borrower for the
fiscal (quarter) (month) ended _____, which are complete and correct
in all material respects (subject to normal year-end audit
adjustments) and have been prepared in accordance with GAAP applied
consistently throughout the period and with prior periods (except as
disclosed therein).)
5. Borrower and every other Covered Person is in compliance with all of
the covenants in the Loan Agreement, including the financial covenants
in Section 16, and Schedule II attached hereto contains calculations
based on Borrower's financial statements and other financial records
that show Borrower's compliance with such financial covenants. The
calculations and the data upon which they are based are believed by me
to be complete and correct.
This Compliance Certificate, together with the Schedules hereto, is executed and
delivered this day of _______________________
By: __________________________________
Print Name: __________________________
Title: _______________________________
SCHEDULE I TO COMPLIANCE CERTIFICATE
SEE CURRENT FINANCIAL STATEMENTS.
SCHEDULE II TO COMPLIANCE CERTIFICATE
All calculations done in accordance with GAAP on a consolidated basis, in
accordance with the provisions of the Second Amended and Restated Loan Agreement
and based on the period ended __________________. Any inconsistencies between
the descriptions of the items set forth in this Schedule II and the terms of any
of Sections 16.1 through 16.6 shall be resolved in favor of the terms set forth
in Sections 16.1 through 16.6. Reference should be made to Sections 16.1 through
16.6 of the Second Amended and Restated Loan Agreement for more specific
instructions regarding the calculation periods and how the components of the
financial covenants should be calculated.
I. EBITDA (for preceding four fiscal quarters) (Section 16.1):
(i) Net Income $_________
(ii) Interest Expense $_________
(iii) Federal, State and Local Income
Tax expense accrued for as a liability $_________
(iv) Amortization of good will and
other intangible assets and depreciation
expense taken or accrued for in such period,
without duplication $_________
(v) Extraordinary losses in such period incurred
or accrued for in such period, without
duplication $_________
(vi) Payments or noncash charges made pursuant
to the SEC Settlement $_________
(vii) Share based compensation expense $_________
(viii) Sum of Items (i) through (vii) $_________
(ix) Extraordinary income/gain in such period
incurred or accrued for in such period,
without duplication $_________
(x) Noncash gains in connection with the
SEC Settlement $_________
(xi) Sum of Items (ix) and (x) $_________
(xii) Items(viii) minus Item (xi) -- EBITDA $_________
II. EBIT (for preceding four fiscal quarters) (Section 16.1):
(i) Net Income $_________
(ii) Interest Expense $_________
(iii) Federal, State and Local Income
Tax expense accrued for as a liability $_________
(iv) Share based compensation expense $_________
(v) Sum of Items (i) through (iv) -- EBIT $_________
III. MINIMUM INTEREST COVERAGE (for preceding four fiscal quarters) (Section
16.3)
A. EBIT (for preceding four fiscal quarters) $_________
Less: (i) Dividends $_________
(ii)Federal, State and Local Income Tax expense
accrued for as a liability $_________
B. Subtotal (EBIT minus (i) and (ii)) $_________
C. Interest Expense $_________
D. Ratio of Item B to Item C _____:1.0
E. Minimum ratio required by Section 16.3: 2.0 to 1.
IV. TOTAL INDEBTEDNESS TO EBITDA (for preceding four fiscal quarters) (Section
16.4)
A. Total Indebtedness $_________
B. EBITDA (for preceding four fiscal quarters per Item I
(xii)) $_________
C. Ratio of Item A to Item B ______:1.0
D. Maximum Ratio of Total Indebtedness to EBITDA permitted
by Section 16.4: 2.50 to 1.
V. MINIMUM EBITDA (for preceding four fiscal quarters) (Section 16.6)
A. EBITDA (for preceding four fiscal quarters per Item
1 (xii)) $_________
B. 75% EBITDA of Target One $_________
C. 75% EBITDA of Target Two $_________
D. Minimum EBITDA required by Section 16.6: $37,000,000 plus 75% EBITDA
of Target One and Target Two
EXHIBIT 20.4.1
FORM
ASSIGNMENT AND ACCEPTANCE
DATED: ___________, ______
Loan Agreement effective ___________ (as it may be amended, modified,
restated or replaced from time to time, the Loan Agreement) among TALX
Corporation (referred to herein both collectively and individually as Borrower),
LaSalle Bank National Association, as Administrative Agent (Administrative
Agent) and the Lenders as defined in the Loan Agreement (Lenders). Terms defined
in the Loan Agreement are used herein with the same meaning.
The Assignor and the Assignee referred to on Schedule 1 agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, without recourse and
without representation or warranty except as expressly set forth herein,
and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Loan
Agreement and the other Loan Documents as of the date hereof equal to the
percentage interest specified on Schedule 1 of all outstanding rights and
obligations under the Loan Agreement and the other Loan Documents. After
giving effect to such sale and assignment, the Assignee's Commitment and
the amount of the Loans owing to the Assignee will be as set forth on
Schedule 1.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to
any statements, warranties or representations made in or in connection with
the Loan Documents or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Documents or any other
instrument or document furnished pursuant thereto; (iii) makes no
representation or warranty and assumes no responsibility with respect to
the financial condition of any Covered Person or the performance or
observance by any Covered Person of any of its obligations under the Loan
Documents or any other instrument or document furnished pursuant thereto;
and (iv) attaches the Note (s) held by the Assignor and requests that
Administrative Agent exchange such Note (s) for new Note (s) payable to the
order of the Assignee in an amount equal to the Commitment assumed by the
Assignee pursuant hereto and to the Assignor in an amount equal to the
Commitment retained by the Assignor, if any, as specified on Schedule 1.
3. The Assignee (i) confirms that it has received a copy of the Loan
Agreement, together with copies of the financial statements referred to in
Section thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon Administrative Agent, the Assignor or any other
Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Agreement; (iii) confirms that
it is an Eligible Assignee; (iv) appoints and
authorizes Administrative Agent to take such action as agent on its behalf
and to exercise such powers and discretion under the Loan Agreement as are
delegated to Administrative Agent by the terms thereof, together with such
powers and discretion as are reasonably incidental thereto; (v) agrees that
it will perform in accordance with their terms all of the obligations that
by the terms of the Loan Agreement are required to be performed by it as a
Lender; and (vi) attaches any U.S. Internal Revenue Service or other forms
required under Section
4. Following the execution of this Assignment and Acceptance, it will be
delivered to Administrative Agent for acceptance and recording by
Administrative Agent. The effective date for this Assignment and Acceptance
(the Effective Date) shall be the date of acceptance hereof by
Administrative Agent, unless otherwise specified on Schedule 1.
5. Upon such acceptance and recording by Administrative Agent, as of the
Effective Date, (i) the Assignee shall be a party to the Loan Agreement
and, to the extent provided in this Assignment and Acceptance, have the
rights and obligations of a Lender thereunder and (ii) the Assignor shall,
to the extent provided in this Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Loan Agreement.
6. Upon such acceptance and recording by Administrative Agent, from and after
the Effective Date, Administrative Agent shall make all payments under the
Loan Agreement and the Notes in respect of the interest assigned hereby
(including, without limitation, all payments of principal, interest and
commitment fees with respect thereto) to the Assignee. The Assignor and
Assignee shall make all appropriate adjustments in payments under the Loan
Agreement and the Notes for periods prior to the Effective Date directly
between themselves.
7. This Assignment and Acceptance shall be governed by, and construed in
accordance with, the laws of the State of Illinois.
8. This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery
of an executed counterpart of Schedule 1 to this Assignment and Acceptance
by telecopier shall be effective as delivery of a manually executed
counterpart of this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule 1 to
this Assignment and Acceptance to be executed by their officers thereunto duly
authorized as of the date specified thereon.
SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
Percentage interest assigned: ___________%
Assignee's Commitment: $ _________
Aggregate outstanding principal
amount of Loans assigned: $ _________
Principal amount of Note payable to Assignee: $ __________
Principal amount of Note payable to Assignor: $ __________
Effective Date (if other than date of
acceptance by Administrative Agent): * _____________, _______
[NAME OF ASSIGNOR], as Assignor
By: ____________________________________
Title: _________________________________
Dated: ___________________________, ____
[NAME OF ASSIGNEE], as Assignee
By: ___________________________________
Title: ________________________________
Applicable Lending Office:
*This date should be no earlier than five Business Days after the delivery of
this Assignment and Acceptance to Administrative Agent.
Accepted [and Approved]
This __________ day of _______________, _____
LaSalle Bank National Association, as Administrative Agent
By: _________________________________________
Title: ______________________________________
Accepted [and Approved]**
This __________ day of _______________, _____
TALX Corporation,
By: _________________________________________
Title: ______________________________________
**Approval of Borrower required only if there is no Existing Default
