AMENDED AND RESTATED REVOLVING
CREDIT AND TERM LOAN AGREEMENT
This AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT is
made as of the 6th day of August, 1997 by and among XXXXXXX WASTE SYSTEMS, INC.,
a Delaware corporation (the "Parent"), its Subsidiaries listed on Schedule 1
hereto (the "Subsidiaries," the Parent and such Subsidiaries herein collectively
referred to as the "Borrowers"), each of which Borrowers (unless otherwise
listed on Schedule 1 hereto) having its principal place of business at 00 Xxxxxx
Xxxx Xxxx, Xxxxxxx, Xxxxxxx and BANKBOSTON, N.A., ("BankBoston"), a national
banking association having its principal place of business at 000 Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, KEYBANK NATIONAL ASSOCIATION, USTRUST, BANK
OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, BHF-BANK AKTIENGESELLSCHAFT,
COMERICA BANK and such banks or other financial institutions which may become a
party hereto pursuant to ss.19 hereof (the "Banks") and BANKBOSTON as Agent for
the Banks (the "Agent").
WHEREAS, the Borrowers, BankBoston, USTrust, KeyBank and the Agent were
parties to that certain Revolving Credit and Term Loan Agreement dated as of
January 25, 1995, as amended to date (as so amended, the "Original Credit
Agreement"), pursuant to which such Banks agreed to make Loans to the Borrowers
as set forth therein;
WHEREAS, the Borrowers, BankBoston, USTrust, KeyBank and the Agent
amended and restated the Original Credit Agreement in its entirety as set forth
in that certain Amended and Restated Revolving Credit and Term Loan Agreement
dated as of June 17, 1997 (the "Prior Credit Agreement"), pursuant to which such
Banks agreed to make Loans to Borrowers as set forth therein;
WHEREAS, the Borrowers have requested, and the Banks and the Agent have
agreed to amend and restate the Prior Credit Agreement in its entirety as set
forth herein;
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:
ss.1. DEFINITIONS AND RULES OF INTERPRETATION.
ss.1.1. Definitions. The following terms shall have the meanings set
forth in this ss.1 or elsewhere in the provisions of this Agreement referred to
below:
Accountants. See ss.6.4(a).
Agreement. This Amended and Restated Revolving Credit and Term Loan
Agreement, including the Schedules and Exhibits hereto.
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Agent. BankBoston acting as agent for the Banks.
Agent's Head Office. The Agent's head office is located at 000 Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other location as the Agent may
designate from time to time.
Applicable Laws. See ss.7.10.
Applicable Rate. The applicable rate per annum of interest on the Loans
set forth in the following table:
@@
=============== =============== ================= ================ ================ =============== ================
(1) (1)
Applicable
Applicable Applicable Rate Applicable Applicable Applicable Rate for
Rate for for Revolving Rate for Rate for Rate for portion of
Revolving Credit Loans portion of portion of portion of Series B Term
Credit Loans which are Series A Term Series A Term Series B Term Loan which is
Pricing Ratio which are Eurodollar Rate Loan which is Loan which is Loan which is Eurodollar
Base Rate Loans Base Rate Loan Eurodollar Base Rate Loan Rate Loan
Loans Rate Loan
=============== =============== ================= ================ ================ =============== ================
less than Base Rate Eurodollar Rate Base Rate Eurodollar Base Rate Eurodollar
2.00:1 plus 1.75% per Rate plus plus 0.50% Rate plus
annum 1.75% per annum per annum 3.00% per annum
=============== =============== ================= ================ ================ =============== ================
greater than Base Rate Eurodollar Rate Base Rate Eurodollar Base Rate Eurodollar
or equal to plus 2.00% per Rate plus plus 0.50% Rate plus
2.00:1 and annum 2.00% per annum per annum 3.00% per annum
less than
2.50:1
=============== =============== ================= ================ ================ =============== ================
greater than Base Rate Eurodollar Rate Base Rate Eurodollar Base Rate Eurodollar
or equal to plus 2.25% per Rate plus plus 0.50% Rate plus
2.50:1 and annum 2.25% per annum per annum 3.00% per annum
less than
3.00:1
=============== =============== ================= ================ ================ =============== ================
greater than Base Rate Eurodollar Rate Base Rate Eurodollar Base Rate Eurodollar
or equal to plus 2.50% per Rate plus plus 0.50% Rate plus
3.00:1 and annum 2.50% per annum per annum 3.00% per annum
less than
3.50:1
=============== =============== ================= ================ ================ =============== ================
greater than Base Rate Eurodollar Rate Base Rate plus Eurodollar Base Rate Eurodollar
or equal to plus 0.25% plus 2.75% per 0.25% per annum Rate plus plus 0.50% Rate plus
3.50:1 per annum annum 2.75% per annum per annum 3.00% per annum
=============== =============== ================= ================ ================ =============== ================
@@
(1) Provided, however if EBITDA as of the end of any fiscal quarter for the
period of the four (4) fiscal quarters then ended is greater than
$30,000,000 or if the Parent raises $30,000,000 of net proceeds from an
equity offering (after redemption of all the Parent's stock (common and
preferred) in connection with the equity offering) after the Closing
Date, the Applicable Rate for Revolving Credit Loans which are
Eurodollar Rate Loans and for portions of Series A Term Loans which are
Eurodollar Rate Loans shall be reduced for such quarter and all future
quarters by 0.25% per annum. If the Parent raises $40,000,000 of net
proceeds from an equity offering (after redemption of all the Parent's
stock (common and preferred) in connection with the equity offering)
after the Closing Date, the Applicable Rate for Revolving Credit Loans
which are Eurodollar Rate Loans and for portions of Series A Term Loans
which are Eurodollar Rate Loans shall be reduced for such quarter and
all future quarters by 0.35% per annum.
Each Applicable Rate shall become effective on the first day after
receipt by the Banks of financial statements delivered pursuant to ss.ss.7.4(a)
or (b) hereof which indicate a change in the Pricing Ratio and in the Applicable
Rate in accordance with the above table.
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If at any time the financial statements required to be delivered pursuant to
ss.7.4(a) or (b) hereof are not delivered within 10 days after the time periods
specified in such subsections, the Applicable Rate shall be the rate set forth
in the table for a Pricing Ratio greater than or equal to 3.50:1, subject to
adjustment upon actual receipt of such financial statements.
Balance Sheet Date. April 30, 1997.
BankBoston. BankBoston, N.A., f/k/a The First National Bank of Boston.
Base Rate. The higher of (a) the annual rate of interest announced from
time to time by the Agent at its head office in Boston, Massachusetts, as its
"base rate" (it being understood that such rate is a reference rate and not
necessarily the lowest rate of interest charged by the Bank) or (b) one percent
(1%) above the overnight federal funds effective rate, as published by the Board
of Governors of the Federal Reserve System, as in effect from time to time.
Base Rate Loans. Revolving Credit Loans and all or any portion of the
Term Loan bearing interest calculated by reference to the Base Rate.
Borrowers. See Preamble.
Business Day. Any day on which banking institutions in Boston,
Massachusetts are open for the transaction of banking business, and, in the case
of Eurodollar Rate Loans, also a day which is a Eurodollar Business Day.
Capital Assets. Fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and good will); provided that Capital Assets shall not
include any item customarily charged directly to expense or depreciated over a
useful life of twelve (12) months or less in accordance with GAAP.
Capital Expenditures. Amounts paid or indebtedness incurred by any
Person in connection with the purchase and lease by such Person of Capital
Assets that would be required to be capitalized and shown on the balance sheet
of such Person in accordance with GAAP.
Casella Associates Leases. The leases between the Borrowers and Casella
Associates, a Vermont partnership, for the property in Rutland, Vermont and
Montpelier, Vermont.
Casella TIRES Real Estate. The Real Property in Elliot, Maine owned by
Casella T.I.R.E.S., Inc.
Certified. With respect to the financial statements of any Person, such
statements as audited by a firm of independent auditors, whose report expresses
the opinion, without qualification, that such financial statements present
fairly the financial position of such Person.
CFO. See ss.7.4(b).
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Clinton Lease. The Operation, Management and Lease Agreement dated as
of July 10, 1996 between the Parent and Clinton County, New York for the lease
of the Clinton County Landfill and related assets.
Closing Date. The date on which the conditions precedent set forth in
ss.9 are satisfied.
Code. The Internal Revenue Code of 1986, as amended and in effect from
time to time.
Collateral. All of the property, rights and interests of the Borrowers
that are or are intended to be subject to the security interests and mortgages
created by the Security Documents.
Collateral Assignment of Contracts and Permits. The Amended and
Restated Collateral Assignment of Contracts and Permits dated as of the Closing
Date among the Borrowers and the Agent, in form and substance satisfactory to
the Agent.
Commitment. With respect to each Bank, the amount determined by
multiplying such Bank's Commitment Percentage by the aggregate amount of the
Banks' Total Commitment to make Revolving Credit Loans to the Borrowers, as the
same may be reduced from time to time.
Commitment Fee Percentage. The applicable percentage per annum as set
forth below used in calculating the commitment fee payable pursuant to
ss.5.2(a), which percentage shall vary from time to time in accordance with the
Pricing Ratio:
@@
============================================= ==================================
Pricing Ratio Commitment Fee Percentage
============================================= ==================================
less than 2.00:1 1/4%
============================================= ==================================
greater than or equal to 2.00:1 and less 3/8%
than 2.50:1
============================================= ==================================
greater than or equal to 2.50:1 and less 3/8%
than 3.00:1
============================================= ==================================
greater than or equal to 3.00:1 and less 1/2%
than 3.50:1
============================================= ==================================
greater than or equal to 3.50:1 1/2%
============================================= ==================================
@@
The Commitment Fee Percentage shall become effective on the first day
after receipt by the Banks of financial statements delivered pursuant to
ss.7.4(a) or ss.7.4(b) which indicate a change in the Pricing Ratio and in the
Commitment Fee Percentage in accordance with the above table.
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If at any time the financial statements required to be delivered
pursuant to ss.7.4(a) or (b) hereof are not delivered with 10 days after the
time periods specified in such subsections, the Applicable Rate shall be the
rate set forth in the table for a Pricing Ratio greater than or equal to 3.50:1,
subject to adjustment upon actual receipt of such financial statements.
Commitment Percentage. With respect to each Bank, the percentage set
forth beside its name on Schedule 2 hereto as the amount of such Bank's
percentage of the aggregate Commitments of all of the Banks (subject to
adjustment upon any assignment pursuant to ss.19):
Compliance Certificate. See ss.7.4(c).
Consolidated or consolidated. With reference to any term defined
herein, shall mean that term as applied to the accounts of the Borrowers
consolidated in accordance with GAAP.
Consolidated Current Assets. All assets of the Borrowers on a
consolidated basis that, in accordance with GAAP, are properly classified as
current assets, provided that notes and accounts receivable shall be included
only if good and collectible as determined by the Borrowers in accordance with
established practice consistently applied and, with respect to such notes, only
if payable on demand or within one (1) year from the date as of which
Consolidated Current Assets are to be determined and if not directly or
indirectly renewable or extendable at the option of the debtors, by their terms,
or by the terms of any instrument or agreement relating thereto, beyond such
year, and, with respect to such accounts receivable, only if payable and
outstanding not more than one hundred twenty (120) days after the date of the
shipment of goods or provision of services or other transaction out of which any
such account receivable arose; and such notes and accounts receivable shall be
taken at their face value less reserves determined to be sufficient in
accordance with GAAP.
Consolidated Current Liabilities. All liabilities of the Borrowers on a
consolidated basis maturing on demand or within one (1) year from the date as of
which Consolidated Current Liabilities are to be determined (but excluding the
current portion or current maturities of long term debt and the lease
obligations under the Waste USA Lease) and such other liabilities as may
properly be classified as current liabilities in accordance with GAAP.
Consolidated Earnings Before Interest and Taxes or EBIT. For any
period, the Consolidated Net Income (or Deficit) of the Borrowers determined in
accordance with GAAP, plus (a) interest expense, and (b) income tax expense.
Consolidated Earnings Before Interest Taxes Depreciation and
Amortization or EBITDA. For any period, the Consolidated Net Income (or Deficit)
of the Borrowers determined in accordance with GAAP, plus (a) interest expense,
(b) income taxes (c) amortization expense and (d) depreciation expense for such
period.
Consolidated Fixed Charges. For any period, the sum of (a) Consolidated
Total Interest Expense plus (b) scheduled payments on operating leases and
capitalized leases of the Borrowers during such period (to the extent not
already included in the calculation of Consolidated Total
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Interest Expense or in the scheduled principal payments described in clause (b)
of this definition but excluding lease payments made under the Waste USA Lease),
plus (c) scheduled principal payments that are due and payable during such
period with respect to Indebtedness of the Borrowers for borrowed money which
(i) is not payable on demand or (ii) matures more than one (1) year from the
date such Indebtedness was incurred, plus (d) dividends and other Distributions
paid or required to be paid to holders of the preferred stock of any of the
Borrowers during such period, all as determined in accordance with GAAP.
Consolidated Net Income (or Deficit). The consolidated net income (or
deficit) of the Borrowers after deduction of all expenses, taxes and proper
charges and before deduction of [(a) the special pre-tax, one-time charges in
the amount of $650,000 incurred in the fiscal quarter ended April 30, 1997 in
connection with the settlement of the Meridian Litigation and (b)] the $100,000
charge incurred in the fiscal quarter ended April 30, 1997 in connection with
the establishment of a reserve for the Casella T.I.R.E.S., Inc. stockpile in
Hampden, Maine.
Consolidated Net Worth. The excess of Consolidated Total Assets over
Consolidated Total Liabilities.
Consolidated Senior Liabilities. The sum of Consolidated Total
Liabilities minus the outstanding principal amount of Subordinated Debt (in each
case, excluding lease obligations under the Waste USA Lease to the extent
included in the calculation of Consolidated Total Liabilities or the outstanding
principal amount of Subordinated Debt).
Consolidated Total Interest Expense. For any period, the aggregate
amount of interest expense required to be paid or accrued by the Borrowers
during such period on all Indebtedness of the Borrowers outstanding during all
or any part of such period, including capitalized interest expense for such
period, but excluding therefrom (a) the non-cash amortization of debt issuance
costs and (b) non-cash charges related to the amortization of the Parent's
Series C Redeemable Preferred Stock.
Consolidated Total Assets. All assets of the Borrowers determined on a
consolidated basis in accordance with GAAP.
Consolidated Total Liabilities. All liabilities of the Borrowers
determined on a consolidated basis in accordance with GAAP.
Consulting Engineer. An environmental consulting firm acceptable to the
Banks.
Conversion Request. A notice given by the Borrowers to the Agent of the
Borrowers' election to convert or continue a Loan in accordance with ss.5.12.
Default. See ss.13.
Depository Accounts. See ss.6.23.
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Disposal. See "Release".
Distribution. The declaration or payment of any dividend on or in
respect of any shares of any class of capital stock of any Person, other than
dividends payable solely in shares of common stock of such Person; the purchase,
redemption, or other retirement of any shares of any class of capital stock of
such Person, directly or indirectly through a Subsidiary or otherwise; the
return of capital by any Person to its shareholders as such; or any other
distribution on or in respect of any shares of any class of capital stock of
such Person.
Dollars or $. Dollars in lawful currency of the United States of
America.
EBIT. See definition of Consolidated Earnings Before Interest and
Taxes.
EBITDA. See definition of Consolidated Earnings Before Interest, Taxes,
Depreciation and Amortization.
Employee Benefit Plan. Any employee benefit plan within the meaning of
ss.3(3) of ERISA maintained or contributed to by any Borrower or any ERISA
Affiliate, other than a Multiemployer Plan.
Environmental Laws. See ss.6.16(a).
ERISA. The Employee Retirement Income Security Act of 1974, as amended
and in effect from time to time.
ERISA Affiliate. Any Person which is treated as a single employer with
any Borrower under ss.414 of the Code.
ERISA Reportable Event. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of ss.4043 of ERISA and the regulations
promulgated thereunder as to which the requirement of notice has not been
waived.
Eurocurrency Reserve Rate. For any day with respect to a Eurodollar
Rate Loan, the maximum rate (expressed as a decimal) at which any Bank subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.
Eurodollar Business Day. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other Dollar interbank market as may be selected by the Agent in its sole
discretion acting in good faith.
8
Eurodollar Rate. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (i) the arithmetic rate per annum
(rounded upwards to the nearest 1/16 of one percent) at which Dollar deposits
are offered to the Agent by prime banks in whatever Eurodollar market may be
selected by the Agent in its sole discretion, acting in good faith at or about
10:00 a.m. local time in such interbank market two Eurodollar Business Days
prior to the beginning of such Interest Period, for delivery on the first day of
such Interest Period for the number of days comprised therein and in an amount
comparable to the amount of the Eurodollar Rate Loan to which such Interest
Period applies, divided by (ii) a number equal to 1.00 minus the Eurocurrency
Reserve Rate, if applicable.
Eurodollar Rate Loans. Revolving Credit Loans and all or any portion of
the Term Loan bearing interest calculated by reference to the Eurodollar Rate.
Event of Default. See ss.13.
Generally Accepted Accounting Principles or GAAP. When used in general,
Generally Accepted Accounting Principles means (1) principles that are
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, in effect for the fiscal year
ended on the Balance Sheet Date, as shall be concurred in by independent
certified public accountants of recognized standing whose report expresses an
unqualified opinion (other than a qualification regarding changes in Generally
Accepted Accounting Principles) as to financial statements in which such
principles have been applied; and (2) when used with reference to the Borrowers,
such principles shall include (to the extent consistent with such principles)
the accounting practices reflected in the consolidated financial statements for
the year ended on the Balance Sheet Date.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of ss.3(2) of ERISA maintained or contributed to by any Borrower or any
ERISA Affiliate the benefits of which are guaranteed on termination in full or
in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
Hazardous Substances. See ss.6.16(b).
Indebtedness. All obligations, contingent and otherwise, that in
accordance with GAAP should be classified upon the obligor's balance sheet as
liabilities, or to which reference should be made by footnotes thereto,
including in any event and whether or not so classified: (a) all debt and
similar monetary obligations (including capitalized leases and operating leases
with a term longer than 3 years), whether direct or indirect; (b) all
liabilities secured by any mortgage, pledge, security interest, lien, charge, or
other encumbrance existing on property owned or acquired subject thereto,
whether or not the liability secured thereby shall have been assumed; and (c)
all guarantees, endorsements and other contingent obligations in respect of
indebtedness of others, whether direct or indirect, including any obligation to
supply funds to or in any manner to invest in, directly or indirectly, the
debtor, to purchase indebtedness, or to assure the owner of indebtedness against
loss, through an agreement to purchase goods, supplies, or services for the
9
purpose of enabling the debtor to make payment of the indebtedness held by such
owner or otherwise, and the obligations to reimburse the issuer in respect of
any letters of credit.
Interest Period. With respect to each Eurodollar Loan:
(a) initially, the period commencing on the date of a
conversion from a Base Rate Loan into a Eurodollar Loan or the making
of a Eurodollar Loan, and ending one (1), two (2), three (3) months or
six (6) thereafter, as the case may be, as the Borrowers may select
pursuant to the provisions of this Agreement; and
(b) thereafter, each subsequent Interest Period shall begin on
the last day of the preceding Interest Period, and end one (1), two
(2), (3) months or six (6) thereafter, as the case may be, as the
Borrowers may select pursuant to the provisions of this Agreement;
provided that all of the foregoing provisions relating to Interest
Periods are subject to the following:
(A) if any Interest Period would otherwise end on a
day that is not a Eurodollar Business Day, that Interest Period shall
be extended to the next succeeding Eurodollar Business Day unless the
result of such extension would be to carry such Interest Period into
another calendar month, in which event such Interest Period shall end
on the immediately preceding Eurodollar Business Day;
(B) if the Borrowers shall fail to give notice as
provided in ss.5.12, the Borrowers shall be deemed to have requested a
conversion of the affected Eurodollar Rate Loan to a Base Rate Loan and
the continuance of all Base Rate Loans as Base Rate Loans on the last
day of the then current Interest Period with respect thereto;
(C) any Interest Period relating to any Eurodollar
Rate Loan that begins on the last Eurodollar Business Day of a calendar
month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on
the last Eurodollar Business Day of a calendar month; and
(D) no Interest Period shall extend beyond the
Revolving Credit Maturity Date (if related to a Revolving Credit Loan)
or the Series A Term Loan Maturity Date (if related to Term Loan (I) or
a portion thereof) or the Series B Term Loan Maturity Date (if related
to Term Loan (II) or a portion thereof).
Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (a) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (b) there
shall be included as an Investment all interest accrued
10
with respect to Indebtedness constituting an Investment unless and until such
interest is paid; (c) there shall be deducted in respect of each such Investment
any amount received as a return of capital (but only by repurchase, redemption,
retirement, repayment, liquidating dividend or liquidating distribution); (d)
there shall not be deducted in respect of any Investment any amounts received as
earnings on such Investment, whether as dividends, interest or otherwise, except
that accrued interest included as provided in the foregoing clause (b) may be
deducted when paid; and (e) there shall not be deducted from the aggregate
amount of Investments any decrease in the value thereof.
KeyBank. KeyBank National Association, f/k/a Key Bank of Vermont.
Letters of Credit. Standby Letters of Credit issued or to be issued by
the Agent under ss.3 hereof for the account of the Borrowers.
Letter of Credit Applications. Letter of Credit Applications in such
form as may be agreed upon by any Borrower and the Agent from time to time which
are entered into pursuant to ss.3 hereof as such Letter of Credit Applications
are amended, varied or supplemented from time to time.
Letter of Credit Fee. See ss.5.2(b).
Letter of Credit Participation. See ss.3.1(b).
Loan Documents. This Agreement, the Notes, the Letter of Credit
Applications, the Letters of Credit, the Security Documents, the Stockholders
Stand-off Agreement and the Subordination Agreements.
Loan and Letter of Credit Request. See ss.2.6.
Loans. The Revolving Credit Loans and the Term Loan.
Maximum Drawing Amount. The maximum aggregate amount from time to time
that the beneficiaries may draw under outstanding Letters of Credit.
Meridian Litigation. The civil action brought by Xxxx X. Xxxxxxx, Xx.
and Xxxx X. Xxxxxxx derivatively on behalf of Meridian Group, Inc. against the
Parent and certain other parties in Rutland (Vermont) Superior Court.
Mortgages. The mortgages and deeds of trust, as amended and in effect
from time to time, from the Borrowers to the Agent with respect to the fee and
leasehold interests of the Borrowers in the Sanco Landfill, the Xxxxxx Real
Estate, the Casella TIRES Real Estate, the Superior Real Estate, and the Waste
USA Landfill, each in form and substance satisfactory to the Agent, and any
other mortgages or deeds of trust requested by the Agent pursuant to ss.7.19.
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Multiemployer Plan. Any multiemployer plan within the meaning of
ss.3(37) of ERISA maintained or contributed to by any Borrower or any ERISA
Affiliate.
Notes. Collectively, the Revolving Credit Notes and the Term Notes.
Obligations. All indebtedness, obligations and liabilities of the
Borrowers to any of the Banks and the Agent, individually or collectively,
existing on the date of this Agreement or arising thereafter, direct or
indirect, joint or several, absolute or contingent, matured or unmatured,
liquidated or unliquidated, secured or unsecured, arising by contract, operation
of law or otherwise, arising or incurred under this Agreement or any of the
other Loan Documents or in respect of any of the Loans made or Reimbursement
Obligations incurred or the Letters of Credit, the Notes, interest rate
protection arrangements provided by any of the Banks or any other instrument at
any time evidencing any thereof.
PBGC. The Pension Benefit Guaranty Corporation created by ss.4002 of
ERISA and any successor entity or entities having similar responsibilities.
Permit Note. The promissory note of New England Waste Services of
Vermont, Inc. dated January 25, 1995 and payable to the order of Waste USA in
the principal amount of $200,000.
Permitted Liens. See ss.8.2.
Person. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
Pricing Ratio. At the end of any fiscal quarter of the Borrowers, the
ratio of Indebtedness of the Borrowers for borrowed money and capitalized leases
(excluding the first $1,600,000 of Indebtedness under or in respect of the
Casella Associates Leases and Indebtedness with respect to the Waste USA Lease)
to (b) EBITDA (minus interest, depreciation and amortization expense related to
the Casella Associates Leases and the Waste USA Lease) for the period of four
(4) consecutive fiscal quarters then ended, as calculated on the Compliance
Certificate delivered by the Borrowers pursuant to ss.7.4(c).
Prior Credit Agreement. See Recitals.
Real Property. All real property heretofore, now, or hereafter owned or
leased by the Borrowers.
Reimbursement Obligation. The Borrowers' obligation to reimburse the
Agent and the Banks on account of any drawing under any Letter of Credit as
provided in ss.3.2.
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Release. Shall have the meaning specified in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.
ss.ss.9601 et seq. ("CERCLA") and the term "Disposal" (or "Disposed") shall have
the meaning specified in the Resource Conservation and Recovery Act of 1976, 42
U.S.C. ss.ss.6901 et seq. ("RCRA") and regulations promulgated thereunder;
provided, that in the event either CERCLA or RCRA is amended so as to broaden
the meaning of any term defined thereby, such broader meaning shall apply as of
the effective date of such amendment and provided further, to the extent that
the laws of a state wherein the property lies establishes a meaning for
"Release" or "Disposal" which is broader than specified in either CERCLA or
RCRA, such broader meaning shall apply.
Required Banks. As of any date, the Banks holding sixty-six and two
thirds percent (66 2/3%) of the outstanding principal amount of the Loans on
such date; and if no such principal is outstanding, the Banks whose aggregate
Commitments constitute sixty-six and two thirds percent (66 2/3%) of the Total
Commitment.
Revolving Credit Loans. Revolving credit loans made or to be made by
the Banks to the Borrowers pursuant to ss.2.
Revolving Credit Maturity Date. July 31, 2002.
Revolving Credit Notes. See ss.2.3.
Sanco Landfill. The Landfill in Bethlehem, New Hampshire, owned and
operated by North Country Environmental Services, Inc.
Xxxxxx Real Estate. The Real Property in Hampden, Maine owned by Xxxxxx
Environmental Services and Xxxxxx Environmental Recovery Facilities, Inc.
Security and Pledge Agreement. The Amended and Restated Security and
Pledge Agreement, dated the Closing Date, among the Borrowers and the Agent in
form and substance satisfactory to the Agent.
Security Documents. The Security and Pledge Agreement, the Collateral
Assignment of Contracts and Permits, and the Mortgages, each as amended and in
effect from time to time, and any additional documents evidencing or perfecting
the Agent's lien on the assets of the Borrowers for the benefit of the Banks,
including Uniform Commercial Code financing statements.
Series A Term Loan. The loan made or deemed made by the Banks pursuant
to ss.4A.1 hereof.
Series A Term Loan Maturity Date. July 31, 2002.
Series A Term Loan Percentage. With respect to the Banks listed below,
the percentage set forth beside is name below (subject to adjustment upon any
assignment pursuant to ss.19):
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BankBoston 24.2105%
KeyBank 21.0526%
USTrust 13.6842%
Bank of America 15.7895%
Comerica Bank 12.6316%
BHF-Bank Aktiengsellschaft 12.6316%
Series A Term Note. See ss.4A.2.
Series B Term Loan. The loan made or deemed made by the Banks pursuant
to ss.4B.1 hereof.
Series B Term Loan Bank(s). BankBoston, KeyBank and USTrust.
Series B Term Loan Percentage. With respect to the Series B Term Loan
Banks listed below, the percentage set forth beside its name below (subject to
adjustment upon any assignment pursuant to ss.19):
BankBoston 46.6667%
KeyBank 33.3333%
USTrust 20.0000%
Series B Term Loan Maturity Date. July 31, 2004.
Series B Term Note. See ss.4B.2.
Settlement. The making of, or receiving of, payments in immediately
available funds, by the Banks to or from the Agent in accordance with ss.2.7 to
the extent necessary to cause each Bank's actual share of the outstanding amount
of the Loans to be equal to each Bank's Commitment Percentage of the outstanding
amount of such Loans, in any case where, prior to such event or action, the
actual share is not so equal.
Settlement Amount. See ss.2.7(b).
Settlement Date. (a) The Drawdown Date relating to any Loan and Letter
of Credit Request, (b) the last Business Day of each week, (c) the Business Day
immediately following the Agent becoming aware of the existence of an Event of
Default, (d) any Business Day on which the amount of Revolving Credit Loans
outstanding from BankBoston is equal to or greater than BankBoston's Commitment,
or (e) the Business Day immediately following any Business Day on which the
amount of Revolving Credit Loans outstanding increases or decreases by more than
$1,000,000 as compared to the previous Settlement Date.
Settling Bank. See ss.2.7(b).
14
Stockholders Stand-off Agreement. The Stand-off Agreement, dated as of
December 22, 1995, among the Agent, the Parent and the holders of the Parent's
Series A Redeemable Preferred Stock, Series B Redeemable Preferred Stock, Series
C Redeemable Preferred Stock and Series D Convertible Preferred Stock, in form
and substance satisfactory to the Agent and the Banks.
Subordinated Debt. Indebtedness of the Borrowers which has been
subordinated and made junior to the payment and performance in full of the
Obligations, and evidenced as such by the Subordination Agreements or by another
written instrument containing subordination provisions in form and substance
satisfactory to the Banks, including without limitation, the Permit Note and the
obligations to Waste USA under the Waste USA Lease; provided that (a) at the
time such Subordinated Debt is incurred, no Default or Event of Default has
occurred or would occur as a result of such incurrence, (b) the aggregate
Subordinated Debt incurred after the date hereof does not exceed $15,000,000;
and (c) the documentation evidencing such Subordinated Debt shall have been
delivered to the Agent and shall contain all of the following characteristics:
(i) it shall be unsecured, (ii) it shall bear a market rate of interest, (iii)
it shall have a final maturity of at least five (5) years, (iv) it shall not
require unscheduled principal repayments thereof prior to the maturity date, (v)
it shall have financial covenants (including covenants relating to incurrence of
indebtedness) which are meaningfully less restrictive than those set forth
herein, (vi) it shall have no restrictions on the Borrower's ability to grant
liens securing indebtedness ranking senior to such Subordinated Debt, (vii) it
shall permit the incurrence of senior indebtedness under this Credit Agreement,
(viii) it may be cross-accelerated with the Obligations and other senior
indebtedness of the Borrowers (but shall not be cross-defaulted except for
payment defaults which the senior lenders have not waived) and may be
accelerated upon bankruptcy, (ix) it shall provide that (A) upon any payment or
distribution of the assets of the Borrowers (including after the commencement of
a bankruptcy proceeding) of any kind or character, all of the Obligations
(including interest accruing after the commencement of any bankruptcy proceeding
at the rate specified for the applicable Obligation, whether or not such
interest is an allowable claim in any such proceeding) shall be paid in full
prior to any payment being received by the holders of the Subordinated Debt and
(B) until all of the Obligations (including the interest described in subclause
(A) above) are paid in full in cash, any payment or distribution to which the
holders of the Subordinated Debt would be entitled but for the subordination
provisions of the type described in clauses (x) and (xi) hereof shall be made to
the holders of the Obligations, (x) it shall provide that in the event of a
payment default under ss.13.1(a) or (b) hereof, the Borrowers shall not be
required to pay the principal of, or any interest, fees and all other amounts
payable with respect to the Subordinated Debt until the Obligations have been
paid in full in cash, (xi) it shall provide that in the event of any other Event
of Default, the Banks shall be permitted to block payments of principal,
interest, fees and all other amounts payable with respect to the Subordinated
Debt for a period of 180 days, and (xii) it shall acknowledge that none of the
provisions outlined in part (c) of this definition can be amended, modified or
otherwise altered without the prior written consent of the Banks.
Subordination Agreements. Collectively, (a) the Waste USA Subordination
Agreement, (b) the Subordination Agreement dated as of August 1, 1995 among the
Agent, the Parent and Green Mountain Sanitation, Inc., Xxxxxxxx Recycling and
Salvage, Inc., Morrisville Maintenance, Inc. and Northern Transfer, Inc.
subordinating the $500,000 promissory note of the
15
Parent referenced therein, (c) any Subordination Agreement among the Agent,
Xxxxxxx Waste Management, Inc. and Northeast Waste Services, Ltd. subordinating
certain obligations of Xxxxxxx Waste Management, Inc. to Northeast Waste
Services, Ltd. referenced therein, (d) any Subordination Agreement among the
Agent, the Parent, and the sellers of the capital stock of Xxxxxx Environmental
Recovery Facilities, Inc. and Xxxxxx Environmental Services (such sellers,
collectively, the "Xxxxxx Sellers"), subordinating certain obligations of the
Parent to the Xxxxxx Sellers referenced therein and (e) any other subordination
agreements entered into by the Agent, the Borrowers and any sellers of assets to
any Borrower, subordinating the obligations of such Borrower to such seller to
the Obligations in substantially the form of Exhibit __ hereto.
Subsidiary. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority of the
outstanding capital stock or other interest entitled to vote generally.
Superior Real Estate. The Real Property in Newfield, New York owned by
Casella 15 Waste Management of N.Y., Inc.
Term Loan. Collectively, Series A Term Loan and Series B Term Loan.
Term Notes. Collectively, the Series A Term Notes and the Series B Term
Notes.
Total Commitment. $85,000,000, or such lesser amount as may result from
reductions pursuant to ss.2.2.
Total Leverage Ratio. See ss.9.2.
Type. As to any Revolving Credit Loan or all or portion of the Term
Loan, its nature as a Base Rate Loan or a Eurodollar Rate Loan.
Waste USA. Waste U.S.A., Inc., a Vermont corporation.
Waste USA Landfill. The Landfill in Coventry, Vermont acquired from
Waste USA by New England Waste Services of Vermont, Inc.
Waste USA Lease. The lease of the airspace at the Waste USA Landfill
between the lessor thereunder and New England Waste Services of Vermont, Inc.
Waste USA Purchase Agreement. The Asset Purchase, Stock Purchase and
Lease Agreement dated as of May 6, 1994 among Waste USA, 161531 Canada Ltd. and
New England Waste Services, Inc., which agreement has been assigned by New
England Waste Services, Inc. to New England Waste Services of Vermont, Inc.
Waste USA Subordination Agreement. The Subordination Agreement dated as
of January 25, 1995, among the Agent and Waste USA.
16
ss.1.2. Rules of Interpretation.
(a) A reference to any document or agreement shall include
such document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Agreement.
(b) The singular includes the plural and the plural includes
the singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted
successors and permitted assigns.
(e) Accounting terms capitalized but not otherwise defined
herein have the meanings assigned to them by Generally Accepted Accounting
Principles applied on a consistent basis by the accounting entity to which they
refer.
(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by Generally
Accepted Accounting Principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of Massachusetts, have the
meanings assigned to them therein.
(h) Reference to a particular "ss." refers to that section of
this Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of
like import shall refer to this Agreement as a whole and not to any particular
section or subdivision of this Agreement.
ss.2. THE REVOLVING CREDIT LOANS.
ss.2.1. Commitment to Lend. Subject to the terms and conditions set
forth in this Agreement, each of the Banks severally agrees to lend to the
Borrowers and the Borrowers may borrow, repay, and reborrow from time to time
between the Closing Date and the Revolving Credit Maturity Date upon notice by
the Borrowers to the Agent given in accordance with ss.2.6, such Bank's
Commitment Percentage of such sums as are requested by the Borrowers in the
minimum aggregate amount of $250,000 or an integral multiple thereof; provided,
that except as otherwise provided herein, the outstanding amount of Revolving
Credit Loans and the Maximum Drawing Amount of the Letters of Credit shall not
exceed the Total Commitment at any time. Revolving Credit Loans made hereunder
shall be made pro rata in accordance with each Bank's Commitment Percentage.
Each request for a Revolving Credit Loan hereunder shall constitute a
representation and warranty by the Borrowers that the conditions set forth in
ss.10 and ss.11, as the
17
case may be, have been satisfied on the date of such request. Any unpaid
Reimbursement Obligation under the Letters of Credit shall for all purposes be a
Revolving Credit Loan hereunder.
ss.2.2. Reduction of Total Commitment. (a) The Borrowers shall have the
right at any time and from time to time upon two (2) Business Days' prior
written notice to the Agent to reduce by $1,000,000 or an integral multiple
thereof or terminate entirely the Total Commitment, whereupon the Commitments of
the Banks shall be reduced pro rata in accordance with their respective
Commitment Percentages of the amount specified in such notice or, as the case
may be, terminated. The Agent will notify the Banks promptly after receiving any
notice of the Borrowers delivered pursuant to this ss.2.2.
(b) No reduction or termination of the Total Commitment once
made may be revoked; the portion of the Total Commitment reduced or terminated
may not be reinstated; and amounts in respect of such reduced or terminated
portion may not be reborrowed.
ss.2.3. The Revolving Credit Notes. The Revolving Credit Loans shall be
evidenced by promissory notes of the Borrowers in substantially the form of
Exhibit A hereto (each a "Revolving Credit Note"), dated as of the Closing Date
and completed with appropriate insertions. One Revolving Credit Note shall be
payable to the order of each Bank in a principal amount equal to such Bank's
Commitment or, if less, the outstanding amount of all Revolving Credit Loans
made by such Bank, plus interest accrued thereon, as set forth below. The
Borrowers irrevocably authorize each Bank to make or cause to be made, in
connection with a drawdown date of any Revolving Credit Loan or at the time of
receipt of any payment of principal on such Bank's Revolving Credit Note, an
appropriate notation on such Bank's records reflecting the making of such
Revolving Credit Loan or the receipt of such payment (as the case may be). The
outstanding amount of the Revolving Credit Loans set forth on such Bank's record
shall be prima facie evidence of the principal amount thereof owing and unpaid
to such Bank, but the failure to record, or any error in so recording, any such
amount shall not limit or otherwise affect the obligations of the Borrowers
hereunder or under any Revolving Credit Note to make payments of principal of or
interest on any Revolving Credit Note when due.
ss.2.4. Maturity of the Revolving Credit Loans. The Revolving Credit
Loans shall be due and payable on the Revolving Credit Maturity Date. The
Borrowers promise to pay on the Revolving Credit Maturity Date all Revolving
Credit Loans outstanding on such date, together with any and all accrued and
unpaid interest thereon. The Banks shall effect a Settlement on the Revolving
Credit Maturity Date.
ss.2.5. Mandatory Repayments of the Revolving Credit Loans. If at any
time the outstanding amount of the Revolving Credit Loans plus the Maximum
Drawing Amount of all outstanding Letters of Credit exceeds the Total
Commitment, whether by reduction of the Total Commitment or otherwise, then the
Borrowers shall immediately pay the amount of such excess to the Agent for
application to the Revolving Credit Loans, subject to Settlement among the Banks
in accordance with ss.2.7(b) hereof, or if no Revolving Credit Loans shall be
outstanding, to be held by the Agent as collateral security for the
Reimbursement Obligations provided,
18
however, that if the amount of cash collateral held by the Agent pursuant to
this ss.2.5 exceeds the amount of the Obligations, the Agent shall return such
excess to the Borrowers.
ss.2.6. Requests for Revolving Credit Loans. (a) The Borrowers shall
give to the Agent written notice in the form of Exhibit D hereto (or telephonic
notice confirmed by telecopy on the same Business Day in the form of Exhibit D
hereto) of each Revolving Credit Loan requested hereunder (a "Loan and Letter of
Credit Request") not later than 11:00 a.m. Boston time (i) no less than one (1)
Business Day prior to the proposed drawdown date (the "Drawdown Date") of any
Base Rate Loan and (ii) no less than three (3) Eurodollar Business Days prior to
the proposed Drawdown Date of any Eurodollar Rate Loan. Each such notice shall
specify (A) the amount of such Revolving Credit Loan, (B) the proposed Drawdown
Date of such Revolving Credit Loan, (C) the Type of such Revolving Credit Loan,
and (D) the Interest Period for such Revolving Credit Loan (if a Eurodollar Rate
Loan).
(b) Notwithstanding the notice and minimum amount requirements
set forth in ss.2.6(a), but otherwise in accordance with the terms and
conditions of this Credit Agreement, the Agent may, in its sole discretion and
without conferring with the Banks, make Revolving Credit Loans which are Base
Rate Loans to the Borrowers by entry of credits to the Borrowers' operating
account(s) with the Agent or such other account designated by the Parent and
agreed to by the Agent to cover checks which the Borrowers have drawn or made
against such account. The Borrowers hereby request and authorize the Agent to
make from time to time such Revolving Credit Loans by means of appropriate
entries of such credits sufficient to cover checks then presented. The Borrowers
acknowledge and agree that the making of such Revolving Credit Loans shall, in
each case, be subject in all respects to the provisions of this Credit Agreement
as if they were Revolving Credit Loans covered by a Loan and Letter of Credit
Request including, without limitation, the limitations set forth in ss.2.1 and
the requirements that the applicable provisions of ss.10 (in the case of
Revolving Credit Loans made on the Closing Date) and ss.11 be satisfied. All
actions taken by the Agent pursuant to the provisions of this ss.2.6(b) shall be
conclusive and binding on the Borrowers absent manifest error or the Agent's
gross negligence or willful misconduct. Prior to a Settlement, interest on
Revolving Credit Loans made pursuant to this ss.2.6(b) shall be for the account
of the Agent.
ss.2.7. Funds for Loans; Settlements.
(a) Upon receipt of the documents required by ss.ss.10 and 11
and the satisfaction of the other conditions set forth therein, to the extent
applicable, the Agent will deposit into the account of the Parent at the Agent's
Head Office the amount of such Revolving Credit Loans requested by the Borrowers
pursuant to ss.2.6 hereunder in immediately available funds not later than 2:00
p.m. (Boston time) on the proposed Drawdown Date.
(b) The Banks shall effect Settlements on each Settlement
Date. On or before 12:00 p.m. (Boston time) on each such Settlement Date, the
Agent shall give telephonic notice to the Banks of (i) (A) the respective
outstanding amount of Revolving Credit Loans made by each Bank from the
immediately preceding Settlement Date through the close of business on the prior
day and (B) the unfunded amount, if any, of each Revolving Credit Loan requested
pursuant to
19
ss.2.7(a) as of such time on such date, (ii) the amount that any Bank, as
applicable (the "Settling Bank"), shall pay to effect a Settlement (the
"Settlement Amount") and (iii) the portion (if any) of the aggregate Settlement
Amount to be paid to each Bank. A statement of the Agent submitted to the Banks
with respect to any amounts owing under this ss.2.7(b) shall be prima facie
evidence of the amount due and owing. Each Settling Bank shall, as promptly as
practical during normal business hours on each Settlement Date, effect a wire
transfer of immediately available funds to the Agent in the amount of its
Settlement Amount. The Agent shall, as promptly as practicable during normal
business hours on each Settlement Date, effect a wire transfer of immediately
available funds to each Bank of the Settlement Amount to be paid to such Bank.
All funds advanced by any Bank as a Settling Bank pursuant to this ss.2.7(b)
shall for all purposes be treated as a Revolving Credit Loan made by such
Settling Bank to the Borrowers and all funds received by any Bank pursuant to
this ss.2.7(b) shall for all purposes be treated as repayment of amounts owed by
the Borrowers with respect to Revolving Credit Loans made by such Bank as of the
date received by the Agent. In the event that any bankruptcy, reorganization,
liquidation, receivership or similar cases or proceedings in which any of the
Borrowers is a debtor prevents a Settling Bank from making any Revolving Credit
Loan to effect a Settlement as contemplated hereby, such Settling Bank will make
such disposition and arrangements with the other Banks and the Agent with
respect to such Revolving Credit Loans, either by way of purchase of
participations, distribution, pro tanto assignment of claims, subrogation or
otherwise as shall result in each Bank's share of the outstanding Revolving
Credit Loans being equal, as nearly as may be, to such Bank's Commitment
Percentage of the outstanding amount of the Revolving Credit Loans.
(c) The Agent may (unless notified to the contrary by a
Settling Bank by 2:00 p.m. (Boston time) on the Settlement Date) assume that
each Settling Bank has made available to the Agent the Settlement Amount with
respect to its Revolving Credit Loans, and the Agent may (but shall not be
required to), in reliance upon such assumption, make available to the Borrowers
the aggregate Settlement Amount. If the Settlement Amount is made available to
the Agent (or, conversely, if the Agent makes the Settlement Amount available to
a Bank entitled thereto) on a date after the Settlement Date, such Settling Bank
shall pay the Agent (or, conversely, the Agent shall pay such Bank entitled to
such Settlement Amount) on demand an amount equal to the product of (i) the
average computed for the period referred to in clause (iii) below, of the
weighted average annual interest rate paid by the Agent or such Bank, as
applicable, for federal funds acquired by the Agent or such Bank, as applicable
during each day included in such period times (ii) the Settlement Amount, times
(iii) a fraction, the numerator of which is the number of days that elapse from
and including such Settlement Date to but not including the date on which the
Settlement Amount shall become immediately available to the Agent or such Bank,
as applicable, and the denominator of which is 365; upon payment of such amount
the Settling Bank shall be deemed to have delivered the Settlement Amount of
such Settling Bank on the Settlement Date and shall become entitled to interest
payable by the Borrowers with respect to such Bank's Settlement Amount as if
such share were delivered on the Settlement Date. If the Settlement Amount is
not in fact made available to the Agent by the Settling Bank within three (3)
Business Days of such Settlement Date, the Agent shall be entitled to debit the
Borrowers' accounts to recover such amount from the Borrowers, with interest
thereon at the rate per annum applicable to any Loans made on such Settlement
Date.
20
(d) The failure or refusal of any of the Banks to make
available to the Agent at the aforesaid time on any date the amount of the Loans
to be made by such Bank shall not relieve any other Bank from its obligations
hereunder to make Settlements and Loans, on such Drawdown Date or on any
subsequent Drawdown Date, but in no event shall any Bank or the Agent be
responsible for funding or otherwise be liable for the failure of any other Bank
to make the Loans to be made by such other Bank.
ss.2.8. Optional Prepayments or Repayments of Loans. The Borrowers
shall have the right, at their election, to repay or prepay the outstanding
amount of the Revolving Credit Loans, as a whole or in part, at any time without
penalty or premium; provided (i) each partial prepayment shall be in the
principal amount of $250,000 or an integral multiple thereof, and (ii) that the
full or partial prepayment of the outstanding amount of any Eurodollar Rate
Loans pursuant to this ss.2.9 may be made only on the last day of the Interest
Period relating thereto. The Borrowers shall give the Agent, no later than 11:00
a.m. (Boston time) (a) at least one (1) Business Day written notice (or
telephonic notice confirmed in writing) of such proposed prepayment or
repayment, written notice (or telephonic notice confirmed in writing) of any
proposed prepayment or repayment pursuant to this ss.2.9 of Base Rate Loans and
(b) at least three (3) Eurodollar Business Days written notice (or telephonic
notice confirmed in writing) of any proposed prepayment or repayment pursuant to
this ss.2.9 of Eurodollar Rate Loans, in each case, specifying the proposed date
of prepayment or repayment of Revolving Credit Loans and the principal amount to
be paid. Each such partial prepayment shall be applied first to the principal of
Base Rate Loans and then to the principal of Eurodollar Rate Loans.
ss.3. LETTERS OF CREDIT.
ss.3.1. Letter of Credit Commitments.
(a) Subject to the terms and conditions hereof and the
execution and receipt of a Loan and Letter of Credit Request reflecting the
Maximum Drawing Amount of all Letters of Credit (including the requested Letter
of Credit) and a Letter of Credit Application, the Agent, on behalf of the Banks
and in reliance upon the agreement of the Banks set forth in ss.3.1(b) and upon
the representations and warranties of the Borrowers contained herein, agrees to
issue standby letters of credit, in such form as may be requested from time to
time by the Borrowers and agreed to by the Agent; provided, however, that, after
giving effect to such request, (i) the aggregate Maximum Drawing Amount of all
letters of credit issued at any time under this ss.3.1(a) (the "Letters of
Credit") shall not exceed $10,000,000 and (ii) the aggregate Maximum Drawing
Amount of all Letters of Credit plus the sum of the outstanding amount of the
Revolving Credit Loans shall not exceed the Total Commitment; and provided
further that no Letter of Credit shall have an expiration date later than the
earlier of (i) one year after the date of issuance of the Letter of Credit, or
(ii) thirty (30) days prior to the Revolving Credit Maturity Date.
(b) Each Bank severally agrees that it shall be absolutely
liable, without regard to the occurrence of any Default or Event of Default or
any other condition precedent whatsoever, to the extent of such Bank's
Commitment Percentage thereof, to reimburse the Agent
21
on demand for the amount of each draft paid by the Agent under each Letter of
Credit to the extent that such amount is not reimbursed by the Borrowers
pursuant to ss.3.2 (such agreement for a Bank being called herein the "Letter of
Credit Participation" of such Bank). The Agent shall not issue any Letter of
Credit unless all of the conditions precedent under ss.11 hereof have been
satisfied.
(c) Each such payment made by a Bank shall be treated as the
purchase by such Bank of a participating interest in the Borrowers'
Reimbursement Obligation under ss.3.2 in an amount equal to such payment. Each
Bank shall share in accordance with its participating interest in any interest
which accrues pursuant to ss.3.2.
ss.3.2. Reimbursement Obligation of the Borrowers. In order to induce
the Agent to issue, extend and renew each Letter of Credit and the Banks to
participate therein, the Borrowers hereby agree to reimburse or pay to the Agent
with respect to each Letter of Credit issued, extended or renewed by the Agent
hereunder as follows:
(a) on each date that any draft presented under any Letter of
Credit is honored by the Agent or the Agent otherwise makes payment with respect
thereto, (i) the amount paid by the Agent under or with respect to such Letter
of Credit, and (ii) the amount of any taxes, fees, charges or other costs and
expenses whatsoever incurred by the Agent or any Bank in connection with any
payment made by the Agent or any Bank under, or with respect to, such Letter of
Credit; and
(b) upon the Revolving Credit Maturity Date or the
acceleration of the Reimbursement Obligations with respect to all Letters of
Credit in accordance with ss.13, an amount equal to the then Maximum Drawing
Amount of all Letters of Credit, which amount shall be held by the Agent for the
benefit of the Banks and the Agent as cash collateral for all Reimbursement
Obligations.
Each such payment shall be made to the Agent at the Agent's Head Office
in immediately available funds. Interest on any and all amounts remaining unpaid
by the Borrowers under this ss.3.2 at any time from the date such amounts become
due and payable (whether as stated in this ss.3.2, by acceleration or otherwise)
until payment in full (whether before or after judgment) shall be payable to the
Agent on demand at the rate specified in ss.5.7 for overdue amounts.
ss.3.3. Letter of Credit Payments. If any draft shall be presented or
other demand for payment shall be made under any Letter of Credit, the Agent
shall notify the Borrowers of the date and amount of the draft presented or
demand for payment and of the date and time when it expects to pay such draft or
honor such demand for payment. On the date that such draft is paid or other
payment is made by the Agent, the Agent shall promptly notify the Banks of the
amount of any unpaid Reimbursement Obligation. All such unpaid Reimbursement
Obligations with respect to Letters of Credit shall, provided that no Event of
Default under ss.13(g) or 13(h) has occurred, become automatically a Revolving
Credit Loan. No later than 3:00 p.m. (Boston time) on the Business Day next
following the receipt of such notice, each Bank shall make available to the
Agent, at the Agent's Head Office, in immediately available funds, such Bank's
Commitment
22
Percentage of such unpaid Reimbursement Obligation, together with an amount
equal to the product of (a) the average, computed for the period referred to in
clause (c) below, of the weighted average interest rate paid by the Agent for
federal funds acquired by the Agent during each day included in such period,
times (b) the amount equal to such Bank's Commitment Percentage of such unpaid
Reimbursement Obligation, times (c) a fraction, the numerator of which is the
number of days that have elapsed from and including the date the Agent paid the
draft presented for honor or otherwise made payment until the date on which such
Bank's Commitment Percentage of such unpaid Reimbursement Obligation shall
become immediately available to the Agent, and the denominator of which is 365.
The responsibility of the Agent to the Borrowers and the Banks shall be only to
determine that the documents (including each draft) delivered under each Letter
of Credit in connection with such presentment shall be in conformity in all
material respects with such Letter of Credit.
ss.3.4. Obligations Absolute. The Borrowers' obligations under this
ss.3 shall be absolute and unconditional under any and all circumstances and
irrespective of the occurrence of any Default or Event of Default or any
condition precedent whatsoever or any setoff, counterclaim or defense to payment
which the Borrowers may have or have had against the Agent, any Bank or any
beneficiary of a Letter of Credit. Subject to the obligations of the Banks
pursuant to Article V of the Uniform Commercial Code, the Borrowers further
agree with the Agent and the Banks that the Agent and the Banks shall not be
responsible for, and the Borrowers' Reimbursement Obligations under ss.3.2 shall
not be affected by, among other things, the validity or genuineness of documents
or of any endorsements thereon, even if such documents should in fact prove to
be in any or all respects invalid, fraudulent or forged, or any dispute between
or among the Borrowers, the beneficiary of any Letter of Credit or any financing
institution or other party to which any Letter of Credit may be transferred or
any claims or defenses whatsoever of the Borrowers against the beneficiary of
any Letter of Credit or any such transferee. The Agent and the Banks shall not
be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit. The Borrowers agree that any action taken
or omitted by the Agent or any Bank under or in connection with each Letter of
Credit and the related drafts and documents, if done in good faith, shall be
binding upon the Borrowers and shall not result in any liability on the part of
the Agent or any Bank to the Borrowers.
ss.3.5. Reliance by Agent. To the extent not inconsistent with ss.3.4,
the Agent shall be entitled to rely, and shall be fully protected in relying
upon, any Letter of Credit, draft, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons
and upon advice and statements of legal counsel, independent accountants and
other experts selected by the Agent.
23
ss.4. THE TERM LOAN FACILITIES.
ss.4A. Series A Term Loan.
ss.4A.1. Commitment to Lend.
Subject to the terms and conditions set forth herein and subject to
ss.27 hereof, each Bank agrees to lend to the Borrowers on the Closing Date, a
term loan in the amount of its Series A Term Loan Percentage of the principal
amount of $10,000,000, the proceeds of which shall be used for acquisitions,
debt refinancings and general corporate purposes (the "Series A Term Loan").
ss.4A.2. The Series A Term Notes. Series A Term Loan shall be evidenced
by separate promissory notes of the Borrowers in substantially the form of
Exhibit F hereto (each a "Series A Term Note"), dated as of the Closing Date and
completed with appropriate insertions. One Series A Term Note shall be payable
to the order of each Bank in a principal amount equal to such Bank's Series A
Term Loan Percentage of Series A Term Loan and representing the obligation of
the Borrowers to pay to such Bank such principal amount or, if less, the
outstanding amount of such Bank's Series A Term Loan Percentage of Series A Term
Loan, plus interest accrued thereon, as set forth below. The Borrowers
irrevocably authorize each Bank to make or cause to be made a notation on such
Bank's records reflecting the original principal amount of such Bank's Series A
Term Loan Percentage of Series A Term Loan and, at or about the time of such
Bank's receipt of any principal payment on such Bank's Series A Term Note, an
appropriate notation on such Bank's records reflecting such payment. The
aggregate unpaid amount set forth on such Bank's records shall be prima facie
evidence of the principal amount thereof owing and unpaid to such Bank, but the
failure to record, or any error in so recording, any such amount shall not limit
or otherwise affect the obligations of the Borrowers hereunder or under any
Series A Term Note to make payments of principal of and interest on any Series A
Term Note when due.
ss.4A.3. Scheduled Repayments of Series A Term Loan. The Borrowers
promise to pay to the Agent for the account of the Banks the principal amount of
Series A Term Loan plus interest thereon as set forth in ss.5.1 hereof, in equal
consecutive quarterly installments, such installments to be due and payable on
January 31, April 30, July 31 and October 31, commencing October 31, 1997 with a
final payment on the Series A Term Loan Maturity Date in an amount equal to the
unpaid balance of Series A Term Loan.
ss.4A.4. Optional Prepayment of Series A Term Loan. The Borrowers shall
have the right at any time to prepay the Series A Term Notes on or before the
Series A Term Loan Maturity Date, as a whole, or in part, upon not less than
five (5) Business Days prior written notice to the Agent, without premium or
penalty, provided that (i) each partial prepayment shall be in the principal
amount of $250,000 or an integral multiple thereof, (ii) the full or partial
prepayment of the outstanding amount of any Eurodollar Rate Loan pursuant to
this ss.4A.4 may be made only on the last day of the Interest Period relating
thereto, and (iii) each partial prepayment shall be allocated among the Banks,
in proportion to the respective outstanding amount of each Bank's Series A Term
Note. Any optional prepayment of principal of Series A
24
Term Loan (I) pursuant to this ss.4A.4 shall include all interest accrued to the
date of prepayment and shall be applied against the scheduled installments of
principal due on Series A Term Loan in the inverse order of maturity. No amount
repaid with respect to Series A Term Loan may be reborrowed.
ss.4B. Series B Term Loan.
ss.4B.1. Commitment to Lend. Subject to the terms and conditions set
forth herein, each Series B Term Loan Bank agrees to lend to the Borrowers on
the Closing Date, a term loan in the amount of its Series B Term Loan Percentage
of the principal amount of $15,000,000, the proceeds of which shall be used for
acquisitions, debt refinancings and general corporate purposes (the "Series B
Term Loan").
ss.4B.2. The Series B Term Notes. Series B Term Loan shall be evidenced
by separate promissory notes of the Borrowers in substantially the form of
Exhibit F hereto (each a "Series B Term Note"), dated as of the Closing Date and
completed with appropriate insertions. One Series B Term Note shall be payable
to the order of each Series B Term Loan Bank in a principal amount equal to such
Bank's Series B Term Loan Percentage of Series B Term Loan and representing the
obligation of the Borrowers to pay to such Bank such principal amount or, if
less, the outstanding amount of such Bank's Series B Term Loan Percentage of
Series B Term Loan, plus interest accrued thereon, as set forth below. The
Borrowers irrevocably authorize each Series B Term Loan Bank to make or cause to
be made a notation on such Bank's records reflecting the original principal
amount of such Bank's Series B Term Loan Percentage of Series B Term Loan and,
at or about the time of such Bank's receipt of any principal payment on such
Bank's Series B Term Note, an appropriate notation on such Bank's records
reflecting such payment. The aggregate unpaid amount set forth on such Series B
Term Loan Bank's records shall be prima facie evidence of the principal amount
thereof owing and unpaid to such Bank, but the failure to record, or any error
in so recording, any such amount shall not limit or otherwise affect the
obligations of the Borrowers hereunder or under any Series B Term Note to make
payments of principal of and interest on any Series B Term Note when due.
ss.4B.3. Scheduled Repayments of Series B Term Loan. The Borrowers
promise to pay to the Agent for the account of the Series B Term Loan Banks the
principal amount of the Series B Term Loan plus interest thereon as set forth in
ss.5.1 hereof in (i) four (4) consecutive annual installments of $250,000 each,
such installments to be due and payable on July 31, 1999 through July 31, 2002
and (ii) thereafter the then remaining balance to be paid in equal consecutive
quarterly installments amortized over the remaining term of the Series B Term
Loan, such installments to be due and payable on the last day of each calendar
quarter commencing on October 31, 2002, with a final payment on the Series B
Term Loan Maturity Date in an amount equal to the unpaid balance of Series B
Term Loan.
ss.4B.4. Optional Prepayment of Series B Term Loan. The Borrowers shall
have the right at any time to prepay the Series B Term Notes on or before the
Series B Term Loan Maturity Date, as a whole, or in part, upon not less than
five (5) Business Days prior written notice to the Agent, provided that (i) each
partial prepayment shall be in the principal amount of
25
$250,000 or an integral multiple thereof, (ii) the full or partial prepayment of
the outstanding amount of any Eurodollar Rate Loan pursuant to this ss.4B.4 may
be made only on the last day of the Interest Period relating thereto, (iii) each
partial prepayment shall be allocated among the Banks, in proportion to the
respective outstanding amount of each Bank's Series B Term Note and (iv) if the
Borrowers prepay the Series B Term Loan, in whole or in part, on or before the
date which is one year from the Closing Date, the Borrowers shall pay a premium
with respect to each such prepayment in an amount equal to 0.50% of the amount
prepaid. Any optional prepayment of principal of Series B Term Loan pursuant to
this ss.4B.4 shall include all interest accrued to the date of prepayment and
shall be applied against the scheduled installments of principal due on Series B
Term Loan in the inverse order of maturity. No amount repaid with respect to
Series B Term Loan may be reborrowed.
ss.5. INTEREST, FEES, PAYMENTS, AND COMPUTATIONS; JOINT AND SEVERAL
LIABILITY.
ss.5.1. Interest. Except as otherwise provided in ss.5.7, the
outstanding principal amount of the Loans shall bear interest at the rate per
annum equal to the Applicable Rate. Interest shall be payable (a) quarterly in
arrears on the last Business Day of each calendar quarter for the quarter ending
on such date, for Base Rate Loans, (b) on the earlier of (i) the last day of the
applicable Interest Period or (ii) ninety (90) days after the Drawdown Date, on
Eurodollar Rate Loans, and (c) on the Revolving Credit Maturity Date, Series A
Term Loan Maturity Date or Series B Term Loan Maturity Date, as applicable. Any
change in the interest rate resulting from a change in the Base Rate is to be
effective at the beginning of the day of such change in the Base Rate.
ss.5.2. Fees.
(a) Commitment Fee. The Borrowers agree to pay to Agent for
the benefit of the Banks a commitment fee in an amount equal to the Commitment
Fee Percentage of the unused portion of the Total Commitment during each
calendar quarter or portion thereof from the Closing Date to the Revolving
Credit Maturity Date (or to the date of termination in full of the Total
Commitment, if earlier). This commitment fee shall be payable quarterly in
arrears on the first day of each calendar quarter for the immediately preceding
calendar quarter, with a final payment on the Revolving Credit Maturity Date.
The Agent agrees to pay to the Banks the commitment fee received under this
ss.5.2(a) pro-rata in accordance with their respective Commitment Percentages.
(b) Letter of Credit Fee. The Borrowers shall pay a fee (the
"Letter of Credit Fee") to the Agent equal to (i) the product of (A) two percent
(2%) multiplied by (B) the Maximum Drawing Amount of each Letter of Credit, plus
(ii) the Agent's customary issuance fee, payable in accordance with the Agent's
customary practice. That portion of the Letter of Credit Fee equal to one eighth
of one percent (1/8%) of the Maximum Drawing Amount of each Letter of Credit
shall be paid solely to the Agent, and the balance (other than the issuance fee)
shall be shared pro-rata by each of the Banks in accordance with their
respective Commitment Percentages. The Letter of Credit Fee shall be payable
quarterly in arrears on the first day of
26
each calendar quarter for the immediately preceding calendar quarter, with a
final payment on the expiration date of each Letter of Credit.
(c) The Borrowers shall pay to the Agent an agent's fee and an
underwriting fee as set forth in a separate letter agreement between the
Borrowers and the Agent.
ss.5.3. Payments.
(a) All payments of principal, interest, Reimbursement
Obligations, fees and any other amounts due hereunder or under any of the other
Loan Documents shall be made to the Agent, for the respective accounts of the
Banks and the Agent, received at the Agent's Head Office in immediately
available funds by 12:00 p.m. (Boston time) on any due date.
(b) All payments by the Borrowers hereunder and under any of
the other Loan Documents shall be made without setoff or counterclaim and free
and clear of and without deduction for any taxes, levies, imposts, duties,
charges, fees, deductions, withholdings, compulsory loans, restrictions or
conditions of any nature now or hereafter imposed or levied by any jurisdiction
or any political subdivision thereof or taxing or other authority therein unless
the Borrowers are compelled by law to make such deduction or withholding. If any
such obligation is imposed upon the Borrowers with respect to any amount payable
by them hereunder or under any of the other Loan Documents, the Borrowers will
pay to the Agent, for the account of the Banks or (as the case may be) the
Agent, on the date on which such amount is due and payable hereunder or under
such other Loan Document, such additional amount in Dollars as shall be
necessary to enable the Banks or the Agent to receive the same net amount which
the Banks or the Agent would have received on such due date had no such
obligation been imposed upon the Borrowers. In the event that the Borrowers are
required to make such deduction or withholding as a result of the fact that a
Bank is organized outside of the United States, such Bank shall use its
reasonable best efforts to transfer its Loans to an affiliate organized within
the United States if such transfer would have no adverse effect on such Bank or
the Loans. The Borrowers will deliver promptly to the Bank certificates or other
valid vouchers for all taxes or other charges deducted from or paid with respect
to payments made by the Borrowers hereunder or under such other Loan Document.
ss.5.4. Computations. All computations of interest on the Loans and of
Letter of Credit Fees or other fees shall, unless otherwise expressly provided
herein, be based on a 360-day year and paid for the actual number of days
elapsed. Except as otherwise provided in the definition of the term "Interest
Period" with respect to Eurodollar Rate Loans, whenever a payment hereunder or
under any of the other Loan Documents becomes due on a day that is not a
Business Day, the due date for such payment shall be extended to the next
succeeding Business Day, and interest shall accrue during such extension.
ss.5.5. Capital Adequacy. If any present or future law, governmental
rule, regulation, policy, guideline or directive (whether or not having the
force of law) or the interpretation thereof by a court or governmental authority
with appropriate jurisdiction affects the amount of capital required or expected
to be maintained by any Bank or the Agent or any corporation
27
controlling such Bank or the Agent and such Bank or the Agent determines that
the amount of capital required to be maintained by it is increased by or based
upon the existence of such Bank's or the Agent's Loans, Letter of Credit
Participations or Letters of Credit, or commitment with respect thereto, then
such Bank or the Agent may notify the Borrowers of such fact. To the extent that
the costs of such increased capital requirements are not reflected in the Base
Rate (if relating to Base Rate Loans), the Borrowers and such Bank or (as the
case may be) the Agent shall thereafter attempt to negotiate in good faith,
within thirty (30) days of the day on which the Borrowers receive such notice,
an adjustment payable hereunder that will adequately compensate such Bank or the
Agent in light of these circumstances. If the Borrowers and such Bank or the
Agent are unable to agree to such adjustment within thirty (30) days of the date
on which the Borrowers receive such notice, then commencing on the date of such
notice (but not earlier than the effective date of any such increased capital
requirement), the fees payable hereunder shall increase by an amount that will,
in such Bank's or the Agent's reasonable determination, provide adequate
compensation. Each Bank and the Agent shall allocate such cost increases among
its customers in good faith and on an equitable basis.
ss.5.6. Certificate. A certificate setting forth any additional amounts
payable pursuant to ss.5.5 and a reasonable explanation of such amounts which
are due, submitted by any Bank or the Agent to the Borrowers, shall be
conclusive, absent manifest error, that such amounts are due and owing.
ss.5.7. Interest on Overdue Amounts. Overdue principal and (to the
extent permitted by applicable law) interest on the Loans and all other overdue
amounts payable hereunder or under any of the other Loan Documents shall bear
interest compounded monthly and payable on demand at a rate per annum equal to
the Base Rate plus 4% until such amount shall be paid in full (after as well as
before judgment).
ss.5.8. Interest Limitation. Notwithstanding any other term of this
Agreement or any Note or any other document referred to herein or therein, the
maximum amount of interest which may be charged to or collected from any person
liable hereunder or under any Note by any Bank shall be absolutely limited to,
and shall in no event exceed, the maximum amount of interest which could
lawfully be charged or collected under applicable law (including, to the extent
applicable, the provisions of Section 5197 of the Revised Statutes of the United
States of America, as amended, 12 U.S.C. Section 85, as amended), so that the
maximum of all amounts constituting interest under applicable law, howsoever
computed, shall never exceed as to any person liable therefor such lawful
maximum, and any term of this Agreement, the Notes, the Letter of Credit
Applications, or any other document referred to herein or therein which could be
construed as providing for interest in excess of such lawful maximum shall be
and hereby is made expressly subject to and modified by the provisions of this
paragraph.
ss.5.9. Additional Costs, Etc. If any present or future applicable law,
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Bank by any
28
central bank or other fiscal, monetary or other authority (whether or not having
the force of law), shall impose on any Bank any tax, levy, impost, duty, charge
fees, deduction or withholdings of any nature or requirements with respect to
this Agreement, the other Loan Documents, the Loans, such Bank's Commitment, the
Letters of Credit or any class of loans or commitments or letters of credit of
which any of the Loans, the Commitment or the Letters of Credit forms a part,
and the result of any of the foregoing is:
(i) to increase the cost to such Bank of making,
funding, issuing, renewing, extending or maintaining the Loans, such
Bank's Commitment, or the Letters of Credit; or
(ii) to reduce the amount of principal, interest or
other amount payable to such Bank hereunder on account of such Bank's
Commitment, the Loans, drawings under the Letters of Credit, or
(iii) to require such Bank to make any payment or to
forego any interest or other sum payable hereunder, the amount of which
payment or foregone interest or other sum is calculated by reference to
the gross amount of any sum receivable or deemed received by such Bank
from the Borrowers hereunder,
then, and in each such case, the Borrowers will, upon demand made by such Bank
at any time and from time to time and as often as the occasion therefor may
arise, pay to such Bank such additional amounts as will be sufficient to
compensate such Bank for such additional cost, reduction, payment or foregone
interest or other sum (after such Bank shall have allocated the same fairly and
equitably among all customers of any class generally affected thereby).
ss.5.10. Concerning Joint and Several Liability of the Borrowers.
(a) Each of the Borrowers is accepting joint and several
liability hereunder and under the other Loan Documents in consideration
of the financial accommodations to be provided by the Banks under this
Agreement, for the mutual benefit, directly and indirectly, of each of
the Borrowers and in consideration of the undertakings of each other
Borrower to accept joint and several liability for the Obligations.
(b) Each of the Borrowers, jointly and severally, hereby
irrevocably and unconditionally accepts, not merely as a surety but
also as a co-debtor, joint and several liability with the other
Borrowers, with respect to the payment and performance of all of the
Obligations (including, without limitation, any Obligations arising
under this ss.5.10), it being the intention of the parties hereto that
all the Obligations shall be the joint and several Obligations of each
of the Borrowers without preferences or distinction among them.
(c) If and to the extent that any of the Borrowers shall fail
to make any payment with respect to any of the Obligations as and when
due or to perform any of the
29
Obligations in accordance with the terms thereof, then in each such
event the other Borrowers will make such payment with respect to, or
perform, such Obligation.
(d) The Obligations of each of the Borrowers under the
provisions of this ss.5.10 constitute full recourse Obligations of each
of the Borrowers enforceable against each such corporation to the full
extent of its properties and assets, irrespective of the validity,
regularity or enforceability of this Agreement or any other
circumstance whatsoever.
(e) Except as otherwise expressly provided in this Agreement,
each of the Borrowers hereby waives notice of acceptance of its joint
and several liability, notice of any Loans made under this Agreement,
notice of any action at any time taken or omitted by the Banks under or
in respect of any of the Obligations, and, generally, to the extent
permitted by applicable law, all demands, notices and other formalities
of every kind in connection with this Agreement. Each of the Borrowers
hereby assents to, and waives notice of, any extension or postponement
of the time for the payment of any of the Obligations, the acceptance
of any payment of any of the Obligations, the acceptance of any partial
payment thereon, any waiver, consent or other action or acquiescence by
the Banks at any time or times in respect of any default by any of the
Borrowers in the performance or satisfaction of any term, covenant,
condition or provision of this Agreement, any and all other indulgences
whatsoever by the Banks in respect of any of the Obligations, and the
taking, addition, substitution or release, in whole or in part, at any
time or times, of any security for any of the Obligations or the
addition, substitution or release, in whole or in part, of any of the
Borrowers. Without limiting the generality of the foregoing, each of
the Borrowers assents to any other action or delay in acting or failure
to act on the part of the Banks with respect to the failure by any of
the Borrowers to comply with any of its respective Obligations,
including, without limitation, any failure strictly or diligently to
assert any right or to pursue any remedy or to comply fully with
applicable laws or regulations thereunder, which might, but for the
provisions of this ss.5.10, afford grounds for terminating, discharging
or relieving any of the Borrowers, in whole or in part, from any of its
Obligations under this ss.5.10, it being the intention of each of the
Borrowers that, so long as any of the Obligations hereunder remain
unsatisfied, the Obligations of such Borrowers under this ss.5.10 shall
not be discharged except by performance and then only to the extent of
such performance. The Obligations of each of the Borrowers under this
ss.5.10 shall not be diminished or rendered unenforceable by any
winding up, reorganization, arrangement, liquidation, re-construction
or similar proceeding with respect to any of the Borrowers or the
Banks. The joint and several liability of the Borrowers hereunder shall
continue in full force and effect notwithstanding any absorption,
merger, amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any of the Borrowers
or the Banks.
(f) The provisions of this ss.5.10 are made for the benefit of
the Banks and their successors and assigns, and may be enforced in good
faith against them from time to time against any or all of the
Borrowers as often as occasion therefor may arise and
30
without requirement on the part of the Banks first to marshal any of
their claims or to exercise any of their rights against any other
Borrower or to exhaust any remedies available to them against any other
Borrower or to resort to any other source or means of obtaining payment
of any of the Obligations hereunder or to elect any other remedy. The
provisions of this ss.5.10 shall remain in effect until all of the
Obligations shall have been paid in full or otherwise fully satisfied.
If at any time, any payment, or any part thereof, made in respect of
any of the Obligations, is rescinded or must otherwise be restored or
returned by the Banks upon the insolvency, bankruptcy or reorganization
of any of the Borrowers, or otherwise, the provisions of this ss.5.10
will forthwith be reinstated in effect, as though such payment had not
been made.
ss.5.11. New Borrowers. Any newly-created or newly-acquired
Subsidiaries shall become Borrowers hereunder by signing Notes, entering into an
amendment to this Agreement with the other parties hereto providing that such
Subsidiary shall become a Borrower hereunder, and providing such other
documentation as the Banks or the Agent may reasonably request including,
without limitation, documentation with respect to conditions noted in ss.10
hereof. In such event, the Agent is hereby authorized by the parties to amend
Schedule 1 hereto to include such Subsidiary as a Borrower hereunder.
ss.5.12. Election of Eurodollar Rate; Notice of Election; Interest
Periods; Minimum Amounts. (a) At the Borrowers' option, so long as no Default or
Event of Default has occurred and is then continuing, the Borrowers may (i)
elect to convert any Base Rate Loan or a portion thereof to a Eurodollar Rate
Loan, (ii) at the time of any Loan and Letter of Credit Request, specify that
such requested Revolving Credit Loan shall be a Eurodollar Rate Loan, or (iii)
upon expiration of the applicable Interest Period, elect to maintain an existing
Eurodollar Rate Loan as such, provided that the Borrowers gives notice to the
Agent pursuant to ss.5.12(b) hereof. Upon determining any Eurodollar Rate, the
Agent shall forthwith provide notice thereof to the Borrowers and each Bank, and
each such notice to the Borrowers shall be considered prima facie correct and
binding, absent manifest error.
(b) Three (3) Eurodollar Business Days prior to the making of
any Eurodollar Rate Loan or the conversion of any Base Rate Loan to a Eurodollar
Rate Loan, or, in the case of an outstanding Eurodollar Rate Loan, the
expiration date of the applicable Interest Period, the Borrowers shall give
written, telex or telecopy notice received by the Agent not later than 11:00
a.m. (Boston time) of its election pursuant to ss.5.12(a). Each such notice
delivered to the Agent shall specify the aggregate principal amount of the Loans
to be borrowed or maintained as or converted to Eurodollar Rate Loans and the
requested duration of the Interest Period that will be applicable to such
Eurodollar Rate Loan, and shall be irrevocable and binding upon the Borrower. If
the Borrowers shall fail to give the Agent notice of its election hereunder
together with all of the other information required by this ss.5.12(b) with
respect to any Loan, whether at the end of an Interest Period or otherwise, such
Loan shall be deemed a Base Rate Loan, and, if such Loan is an existing
Eurodollar Rate Loan, shall be automatically converted to a Base Rate Loan on
the last day of the Interest Period relating thereto. No Eurodollar Rate Loan
may be continued as such when any Default or Event of Default has occurred and
is continuing, but shall be automatically converted to a Base Rate Loan on the
last day of the Interest Period relating
31
thereto. The Agent shall promptly notify each Bank in writing (or by telephone
confirmed in writing or by telecopy) of such election by the Borrower hereunder.
(c) Notwithstanding anything herein to the contrary, the
Borrowers may not specify an Interest Period that would extend beyond the
maturity date of any Loan.
(d) All Eurodollar Rate Loans shall be in a minimum amount of
not less than $1,000,000. In no event shall the Borrowers have more than five
(5) different maturities of borrowings of Eurodollar Rate Loans outstanding at
any time.
ss.5.13. Eurodollar Indemnity. The Borrowers agree to indemnify the
Banks and the Agent and to hold them harmless from and against any reasonable
loss, cost or expense that the Banks and the Agent may sustain or incur as a
consequence of (a) default by the Borrowers in payment of the principal amount
of or any interest on any Eurodollar Rate Loans as and when due and payable,
including any such loss or expense arising from interest or fees payable by any
Bank or the Agent to lenders of funds obtained by it in order to maintain its
Eurodollar Rate Loans, (b) default by the Borrowers in making a borrowing or
conversion after the Borrowers have given (or are deemed to have given) notice
pursuant to ss.2.6 or ss.5.12, and (c) the making of any payment of a Eurodollar
Rate Loan or the making of any conversion of any such Eurodollar Rate Loan to a
Base Rate Loan on a day that is not the last day of the applicable Interest
Period with respect thereto, including interest or fees payable by such Bank to
lenders of funds obtained by it in order to maintain any such Loans.
ss.5.14. Illegality; Inability to Determine Eurodollar Rate.
Notwithstanding any other provision of this Agreement (other than ss.5.8) if,
(a) the introduction of, any change in, or any change in the interpretation of,
any law, regulation, treaty or directive applicable to any Bank or the Agent
shall make it unlawful, or any central bank or other governmental authority
having jurisdiction thereof shall assert that it is unlawful, for any Bank or
the Agent to perform its obligations in respect of any Eurodollar Rate Loans, or
(b) if the Agent shall reasonably determine or be notified by the Required Banks
that (i) by reason of circumstances affecting any Eurodollar interbank market,
adequate and reasonable methods do not exist for ascertaining the Eurodollar
Rate which would otherwise be applicable during any Interest Period, or (ii)
deposits of Dollars in the relevant amount for the relevant Interest Period are
not available in any Eurodollar interbank market, or (iii) the Eurodollar Rate
does not or will not accurately reflect the cost of obtaining or maintaining the
applicable Eurodollar Rate Loans during any Interest Period, then the Agent
shall promptly give telephonic, telex or cable notice of such determination to
the Borrowers and the Banks (which notice shall be conclusive and binding upon
the Borrower and the Banks). Upon such notification by the Agent, the obligation
of the Banks and the Agent to make Eurodollar Rate Loans or convert Base Rate
Loans to Eurodollar Rate Loans shall be suspended until the Agent or the
Required Banks, as the case may be, determine that such circumstances no longer
exist, and to the extent permitted by law the outstanding Eurodollar Rate Loans
shall continue to bear interest at the applicable rate based on the Eurodollar
Rate until the end of the applicable Interest Period, and shall be automatically
converted to Base Rate Loans in equal principal amounts on the last day of each
Interest Period applicable to such Eurodollar Rate Loans, or within such earlier
period as may be required by applicable law.
32
ss.6. REPRESENTATIONS AND WARRANTIES. The Borrowers jointly and
severally represent and warrant to the Banks that on and as of the date of this
Agreement (any disclosure on a schedule pursuant to this ss.6 shall be deemed to
apply to all relevant representations and warranties, regardless of whether such
schedule is referenced in each relevant representation):
ss.6.1. Corporate Authority.
(a) Incorporation; Good Standing. Each of the Borrowers (i) is
a corporation duly organized, validly existing and in good standing or
in current status under the laws of its respective state of
incorporation, (ii) has all requisite corporate power to own its
property and conduct its business as now conducted and as presently
contemplated, and (iii) is in good standing as a foreign corporation
and is duly authorized to do business in each jurisdiction in which its
property or business as presently conducted or contemplated makes such
qualification necessary except where a failure to be so qualified would
not have a material adverse effect on the business, assets or financial
condition of such Borrower.
(b) Authorization. The execution, delivery and performance of
its Loan Documents and the transactions contemplated hereby and thereby
(i) are within the corporate authority of each of the Borrowers, (ii)
have been duly authorized by all necessary corporate proceedings, (iii)
do not conflict with or result in any material breach or contravention
of any provision of law, statute, rule or regulation to which any of
the Borrowers is subject or any judgment, order, writ, injunction,
license or permit applicable to any of the Borrowers so as to
materially adversely affect the assets, business or any activity of the
Borrowers, and (iv) do not conflict with any provision of the corporate
charter or bylaws of the Borrowers or any agreement or other instrument
binding upon the Borrowers.
(c) Enforceability. The execution, delivery and performance of
the Loan Documents will result in valid and legally binding obligations
of the Borrowers enforceable against each in accordance with the
respective terms and provisions hereof and thereof, except as
enforceability is limited by bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or affecting generally the
enforcement of creditors' rights and except to the extent that
availability of the remedy of specific performance or injunctive relief
or other equitable remedy is subject to the discretion of the court
before which any proceeding therefor may be brought.
ss.6.2. Governmental Approvals. The execution, delivery and performance
by the Borrowers of the Loan Documents and the transactions contemplated hereby
and thereby do not require any approval or consent of, or filing with, any
governmental agency or authority other than those already obtained.
33
ss.6.3. Title to Properties; Leases. The Borrowers own all of the
assets reflected in the consolidated balance sheets as at the Balance Sheet Date
or acquired since that date (except property and assets sold or otherwise
disposed of in the ordinary course of business since that date), subject to no
mortgages, capitalized leases, conditional sales agreements, title retention
agreements, liens or other encumbrances except Permitted Liens. Schedule 6.3
sets forth a list of all of the Real Property of the Borrowers.
ss.6.4. Financial Statements; Solvency.
(a) There has been furnished to the Banks (i) consolidated
balance sheets of the Borrowers dated the Balance Sheet Date and
consolidated statements of operations for the fiscal year then ended,
Certified by Xxxxxx Xxxxxxxx & Co. or an independent accounting firm of
national standing acceptable to the Banks (the "Accountants") and (ii)
unaudited consolidated balance sheets of the Borrowers dated January
31, 1997 and unaudited consolidated statements of operations for the
nine (9) month period then ended. Said balance sheets and statements of
operations have been prepared in accordance with GAAP, fairly present
in all material respects the financial condition of the Borrowers, on a
consolidated basis, as at the close of business on the date thereof and
the results of operations for the period then ended. There are no
contingent liabilities of the Borrowers as of such date involving
material amounts, known to the officers of the Borrowers which have not
been disclosed in said balance sheets and the related notes thereto, as
the case may be.
(b) The Borrowers (both before and after giving effect to the
transactions contemplated by this Agreement) are solvent (i.e., they
have assets having a fair value in excess of the amount required to pay
their probable liabilities on their existing debts as they become
absolute and matured) and have, and expect to have, the ability to pay
their debts from time to time incurred in connection therewith as such
debts mature.
ss.6.5. No Material Changes, Etc. Since the Balance Sheet Date, there
have occurred no material adverse changes in the financial condition or business
of the Borrowers as shown on or reflected in the consolidated balance sheet of
the Borrowers as at the Balance Sheet Date, or the consolidated statement of
income for the fiscal year then ended other than changes in the ordinary course
of business which have not had any material adverse effect either individually
or in the aggregate on the business or financial condition of the Parent, the
Borrowers. Since the Balance Sheet Date, there has not been any Distribution.
ss.6.6. Permits, Franchises, Patents, Copyrights, Etc. Each of the
Borrowers possesses all franchises, patents, copyrights, trademarks, trade
names, licenses and permits, and rights in respect of the foregoing, adequate
for the conduct of its business substantially as now conducted without known
conflict with any rights of others.
ss.6.7. Litigation. Except as shown on Schedules 6.7 and 6.16 hereto,
there are no actions, suits, proceedings or investigations of any kind pending
or, to the knowledge of the Borrowers, threatened against any Borrower before
any court, tribunal or administrative agency
34
or board which, if adversely determined, might, either in any case or in the
aggregate, materially adversely affect the properties, assets, financial
condition or business of the Borrowers, considered as a whole, or materially
impair the right of the Borrowers, considered as a whole, to carry on business
substantially as now conducted, or result in any substantial liability not
adequately covered by insurance, or for which adequate reserves are not
maintained on the consolidated balance sheet or which question the validity of
any of the Loan Documents, or any action taken or to be taken pursuant hereto or
thereto.
ss.6.8. No Materially Adverse Contracts, Etc. None of the Borrowers is
subject to any charter, corporate or other legal restriction, or any judgment,
decree, order, rule or regulation which in the judgment of the Borrowers'
officers has or is expected in the future to have a materially adverse effect on
the business, assets or financial condition of the Borrowers as a whole. None of
the Borrowers is a party to any contract or agreement which in the judgment of
the Borrowers' officers has or is expected to have any materially adverse effect
on the business of the Borrowers as a whole, except as otherwise reflected in
adequate reserves.
ss.6.9. Compliance With Other Instruments, Laws, Etc. None of the
Borrowers is violating any provision of its charter documents or by-laws or any
agreement or instrument by which any of them may be subject or by which any of
them or any of their properties may be bound or any decree, order, judgment, or
any statute, license, rule or regulation, in a manner which could result in the
imposition of substantial penalties or materially and adversely affect the
financial condition, properties or business of any of the Borrowers.
ss.6.10. Tax Status. The Borrowers have made or filed all federal and
state income and all other tax returns, reports and declarations required by any
jurisdiction to which any of them are subject (unless and only to the extent
that any Borrower has set aside on its books provisions reasonably adequate for
the payment of all unpaid and unreported taxes); and have paid all taxes and
other governmental assessments and charges that are material in amount, shown or
determined to be due on such returns, reports and declarations, except those
being contested in good faith; and have set aside on their books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the
periods to which such returns, reports or declarations apply. There are no
unpaid taxes in any material amount claimed to be due by the taxing authority of
any jurisdiction, and the officers of the Borrowers know of no basis for any
such claim.
ss.6.11. No Event of Default. Except as set forth on Schedule 6.11
hereto, no Default or Event of Default has occurred and is continuing as of the
date of this Agreement.
ss.6.12. Holding Company and Investment Company Acts. None of the
Borrowers is a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company", as such terms are defined in
the Public Utility Holding Company Act of 1935; nor is any of them a "registered
investment company", or an "affiliated company" or a "principal underwriter" of
a "registered investment company", as such terms are defined in the Investment
Company Act of 1940, as amended.
35
ss.6.13. Absence of Financing Statements, Etc. Except as contemplated
by ss.8.2 of this Agreement and as set forth on Schedule 6.13 hereto, there is
no financing statement, security agreement, chattel mortgage, real estate
mortgage or other document filed or recorded with any filing records, registry,
or other public office, which purports to cover, affect or give notice of any
present or possible future lien on, or security interest in, any assets or
property of any of the Borrowers or rights thereunder.
ss.6.14. Employee Benefit Plans.
(a) In General. Each Employee Benefit Plan has been maintained
and operated in compliance in all material respects with the provisions
of ERISA and, to the extent applicable, the Code, including but not
limited to the provisions thereunder respecting prohibited
transactions.
(b) Terminability of Welfare Plans. Under each Employee
Benefit Plan which is an employee welfare benefit plan within the
meaning of ss.3(1) or ss.3(2)(B) of ERISA, no benefits are due unless
the event giving rise to the benefit entitlement occurs prior to plan
termination (except as required by Title I, part 6 of ERISA.) Each
Borrower or ERISA Affiliate, as appropriate, may terminate each such
Plan at any time (or at any time subsequent to the expiration of any
applicable bargaining agreement) in the discretion of such Borrower or
ERISA Affiliate without liability to any Person.
(c) Guaranteed Pension Plans. None of the Borrowers is a
sponsor of, or contributor to, a Guaranteed Pension Plan.
(d) Multiemployer Plans. No Borrower, nor any ERISA Affiliate
has incurred any material liability (including secondary liability) to
any Multiemployer Plan as a result of a complete or partial withdrawal
from such Multiemployer Plan under ss.4201 of ERISA or as a result of a
sale of assets described in ss.4204 of ERISA. No Borrower, nor any
ERISA Affiliate has been notified that any Multiemployer Plan is in
reorganization or is insolvent under and within the meaning of ss.4241
or ss.4245 of ERISA or that any Multiemployer Plan intends to terminate
or has been terminated under ss.4041A of ERISA.
ss.6.15. Use of Proceeds. The proceeds of the Loans shall be used as
follows: (a) the Term Loan shall have been used for the purposes set forth in
ss.4A.1 and ss.4B.1 of the Prior Credit Agreement; and (b) the Revolving Credit
Loans shall be used solely for working capital and other general corporate
purposes, Letters of Credit, to refinance other indebtedness of the Borrowers,
and to fund acquisitions permitted pursuant to ss.8.4 hereof. No proceeds of the
Loans shall be used in any way that will violate Regulations G, T, U or X of the
Board of Governors of the Federal Reserve System.
ss.6.16. Environmental Compliance. The Borrowers have taken all
necessary steps to investigate the past and present condition and usage of the
Real Properties and the operations conducted thereon and, based upon such
diligent investigation, have determined that, except as shown on Schedule 6.16:
36
(a) None of the Borrowers, nor any operator of their
properties, is in violation, or alleged violation, of any judgment,
decree, order, law, permit, license, rule or regulation pertaining to
environmental matters, including without limitation, those arising
under the Resource Conservation and Recovery Act ("RCRA"), the
Comprehensive Environmental Response, Compensation and Liability Act of
1980 as amended ("CERCLA"), the Superfund Amendments and
Reauthorization Act of 1986 ("XXXX"), the Federal Clean Water Act, the
Federal Clean Air Act, the Toxic Substances Control Act, or any state
or local statute, regulation, ordinance, order or decree relating to
health, safety or the environment (the "Environmental Laws"), which
violation would have a material adverse effect on the business, assets
or financial condition of the Borrowers on a consolidated basis.
(b) None of the Borrowers has received notice from any third
party including, without limitation: any federal, state or local
governmental authority, (i) that any one of them has been identified by
the United States Environmental Protection Agency ("EPA") as a
potentially responsible party under CERCLA with respect to a site
listed on the National Priorities List, 40 C.F.R. Part 000 Xxxxxxxx X;
(ii) that any hazardous waste, as defined by 42 U.S.C. ss.6903(5), any
hazardous substances as defined by 42 U.S.C. ss.9601(14), any pollutant
or contaminant as defined by 42 U.S.C. ss.9601(33) and any toxic
substance, oil or hazardous materials or other chemicals or substances
regulated by any Environmental Laws ("Hazardous Substances") which any
one of them has generated, transported or disposed of has been found at
any site at which a federal, state or local agency or other third party
has conducted or has ordered that any Borrower conduct a remedial
investigation, removal or other response action pursuant to any
Environmental Law; or (iii) that it is or shall be a named party to any
claim, action, cause of action, complaint, legal or administrative
proceeding arising out of any third party's incurrence of costs,
expenses, losses or damages of any kind whatsoever in connection with
the release of Hazardous Substances.
(c) (i) No portion of the Real Property has been used for the
handling, processing, storage or disposal of Hazardous Substances
except in material compliance with applicable Environmental Laws; and
no underground tank or other underground storage receptacle for
Hazardous Substances is located on such properties; (ii) in the course
of any activities conducted by the Borrowers, or operators of the Real
Property, no Hazardous Substances have been generated or are being used
on such properties except in material compliance with applicable
Environmental Laws; (iii) there have been no unpermitted Releases or
threatened Releases of Hazardous Substances on, upon, into or from the
Real Property, which Releases would have a material adverse effect on
the value of such properties; (iv) to the best of the Borrowers'
knowledge, there have been no Releases on, upon, from or into any real
property in the vicinity of the Real Property which, through soil or
groundwater contamination, may have come to be located on, and which
would have a material adverse effect on the value of, such properties;
and (v) in addition, any Hazardous Substances that have been generated
on the Real Property have been transported offsite only by carriers
having an identification number issued by the
37
EPA, treated or disposed of only by treatment or disposal facilities
maintaining valid permits as required under applicable Environmental
Laws, which transporters and facilities, to the best of the Borrowers'
knowledge, have been and are operating in material compliance with such
permits and applicable Environmental Laws.
(d) none of the Real Property is or shall be subject to any
applicable environmental clean-up responsibility law or environmental
restrictive transfer law or regulation, by virtue of the transactions
set forth herein and contemplated hereby.
ss.6.17. Perfection of Security Interests. All filings, assignments,
pledges and deposits of documents or instruments have been made and all other
actions have been taken that are necessary under applicable law, or reasonably
requested by the Agent or any of the Banks, to establish and perfect the Agent's
security interests in the Collateral as described in the Security Documents
(including the notation of the Agent's security interests in motor vehicles on
the certificates of title relating to such vehicles). The Collateral and the
Agent's rights with respect to the Collateral are not subject to any setoff,
claims, withholdings or other defenses, except for Permitted Liens. The
Borrowers are the owners of the Collateral free from any lien, security
interest, encumbrance and any other claim or demand, except for Permitted Liens.
ss.6.18. Certain Transactions. Except as set forth on Schedule 6.18 and
except for arm's length transactions pursuant to which the Borrowers make
payments in the ordinary course of business upon terms no less favorable than
the Borrowers could obtain from third parties, none of the officers, directors,
or employees of the Borrowers are presently a party to any transaction with the
Borrowers (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
director or such employee or, to the knowledge of the Borrowers, any
corporation, partnership, trust or other entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director,
trustee or partner.
ss.6.19. Subsidiaries. Schedule 6.19 sets forth a complete and accurate
list of the Subsidiaries, including the name of each Subsidiary and its
jurisdiction of incorporation, together with the number of authorized and
outstanding shares of each Subsidiary. Each Subsidiary is directly or indirectly
wholly owned by the Parent. The Parent has good and marketable title to all of
the shares it purports to own of the stock of each Subsidiary, free and clear in
each case of any lien. All such shares have been duly issued and are fully paid
and non-assessable.
ss.6.20. Capitalization.
(a) Capital Stock. As of the Closing Date, the authorized
capital stock of the Parent consists of (i) 7,000,000 shares of Class A Common
stock (par value $.01 per share) of which 2,874,445 shares are outstanding, (ii)
1,000,000 shares of Class B Common Stock (par value $.01 per share) of which
1,000,000 shares are outstanding, (iii) 516,620 shares of Series A Redeemable
Preferred Stock (par value $.01 per share) of which 516,620 shares are
outstanding, (iv) 1,294,579 shares of Series B Redeemable Preferred Stock (par
value $.01 per share) of
38
which 1,294,579 shares are outstanding, (v) 1,000,000 shares of Series C
Redeemable Preferred Stock (par value $.01 per share) of which 424,306 shares
are outstanding, and (vi) 1,922,169 shares of Series D Convertible Preferred
Stock (par value $.01 per share) of which 1,922,169 shares are outstanding. All
such shares have been duly issued and are full paid and non-assessable.
(b) Options, Etc. Except as set forth on Schedule 6.20(b), no
Person has outstanding any rights (either pre-emptive or other) or options
(except for the options for common stock issued to management employees, in
accordance with a bona fide option plan approved by the Board of Directors of
the Parent) to subscribe for or purchase from the Parent, or any warrants or
other agreements providing for or requiring the issuance by the Parent of, any
capital stock or any securities convertible into or exchangeable for its capital
stock.
ss.6.21. True Copies of Charter and Other Documents. The Borrowers have
furnished the Agent copies, in each case true and complete as of the Closing
Date, of (a) all charter and other incorporation documents (together with any
amendments thereto) and (b) by-laws (together with any amendments thereto).
ss.6.22. Disclosure. No representation or warranty made by the
Borrowers in this Agreement or in any agreement, instrument, document,
certificate, statement or letter furnished to the Banks or the Agent by or on
behalf of or at the request of the Borrowers in connection with any of the
transactions contemplated by the Loan Documents contains any untrue statement of
a material fact or omits to state a material fact necessary in order to make the
statements contained therein not misleading in light of the circumstances in
which they are made.
ss.6.23. Deposit Accounts. Other than the accounts maintained at the
Agent's Head Office (the "Depository Accounts"), the Borrowers maintain the
deposit accounts listed on Schedule 6.23 hereto and no other deposit accounts,
unless approved in writing by the Agent. The aggregate amount of collected funds
held in each such deposit account at the close of any Business Day shall not
exceed the amount specified for such account on Schedule 6.23; any amounts in
excess of the amounts specified in Schedule 6.23 shall be immediately
transferred to the Depository Accounts.
ss.7. AFFIRMATIVE COVENANTS OF THE BORROWERS. The Borrowers jointly and
severally covenant and agree that, so long as any Loan or Note is outstanding or
the Banks have any obligation to make Loans or the Agent has any obligation to
issue, extend, or renew any Letters of Credit hereunder:
ss.7.1. Punctual Payment. The Borrowers will duly and punctually pay or
cause to be paid the principal and interest on the Loans, all Reimbursement
Obligations, fees and other amounts provided for in this Agreement and the other
Loan Documents, all in accordance with the terms of this Agreement and such
other Loan Documents.
39
ss.7.2. Maintenance of Office. The Borrowers will maintain their chief
executive offices at the locations set forth on Schedule 1 attached hereto, or
at such other place in the United States of America as each Borrower shall
designate upon 30 days prior written notice to the Agent.
ss.7.3. Records and Accounts. Each of the Borrowers will keep true and
accurate records and books of account in which full, true and correct entries
will be made in accordance with GAAP and with the requirements of all regulatory
authorities and maintain adequate accounts and reserves for all taxes (including
income taxes), depreciation, depletion, obsolescence and amortization of its
properties, all other contingencies, and all other proper reserves.
ss.7.4. Financial Statements, Certificates and Information. The
Borrowers will deliver to the Banks:
(a) as soon as practicable, but, in any event not later than
90 days after the end of each fiscal year of the Borrowers, the
consolidated and consolidating balance sheets of Borrowers as at the
end of such year, statements of cash flows, and the related
consolidated and consolidating statements of operations, each setting
forth in comparative form the figures for the previous fiscal year, all
such consolidated and consolidating financial statements to be in
reasonable detail, prepared, in accordance with GAAP and, with respect
to the consolidated financial statements, Certified by the Accountants.
In addition, simultaneously therewith, the Borrowers shall use their
best efforts to provide the Banks with a written statement from such
Accountants to the effect that the Borrowers are in compliance with the
covenants set forth in ss.9 hereof, and that, in making the examination
necessary to said certification, nothing has come to the attention of
such Accountants that would indicate that any Default or Event of
Default exists, or, if such accountants shall have obtained knowledge
of any then existing Default or Event of Default they shall disclose in
such statement any such Default or Event of Default; provided, that
such Accountants shall not be liable to the Banks for failure to obtain
knowledge of any Default or Event of Default;
(b) as soon as practicable, but in any event not later than 45
days after the end of each fiscal quarter of the Borrowers, copies of
the consolidated and consolidating balance sheets and statement of
operations of the Borrowers as at the end of such quarter including
profit and loss statements by division, subject to year end
adjustments, and the related statement of cash flows, all in reasonable
detail and prepared in accordance with GAAP with a certification by the
principal financial or accounting officer of the Borrowers (the "CFO")
that the consolidated financial statements are prepared in accordance
with GAAP and fairly present the consolidated financial condition of
the Borrowers as at the close of business on the date thereof and the
results of operations for the period then ended;
(c) simultaneously with the delivery of the financial
statements referred to in (a) and (b) above, a statement in the form of
Exhibit G hereto (the "Compliance Certificate") certified by the CFO
that the Borrowers are in compliance with the covenants contained in
ss.ss.7, 8 and 9 hereof as of the end of the applicable period setting
40
forth in reasonable detail computations evidencing such compliance,
provided that if the Borrowers shall at the time of issuance of such
certificate or at any other time obtain knowledge of any Default or
Event of Default, the Borrowers shall include in such certificate or
otherwise deliver forthwith to the Banks a certificate specifying the
nature and period of existence thereof and what action the Borrowers
propose to take with respect thereto and a certificate of the
Borrowers' Chief Operating Officer in the form attached hereto as
Exhibit H with respect to environmental matters;
(d) contemporaneously with or promptly following the delivery
thereof to the board of directors of the Parent, copies of the
financial statements, financial projections, and variance reports
concerning the Parent in substantially the same form in which such
information is supplied to the board of directors of the Parent;
(e) contemporaneously with, or promptly following, the filing
or mailing thereof, copies of all material of a financial nature filed
with the Securities and Exchange Commission or sent to the stockholders
of the Parent or any of the Borrowers;
(f) from time to time such other financial data and other
information (including accountants' management letters) as the Banks
may reasonably request; and
(g) as soon as practicable, but in any event not later than
fifteen (15) days prior to the commencement of the next fiscal year of
the Borrowers, a copy of the annual budget for such fiscal year.
The Borrowers hereby authorize the Banks to disclose any information
obtained pursuant to this Agreement to all appropriate governmental regulatory
authorities where required by law; provided, however, that the Banks shall, to
the extent practicable and allowable under law, notify the Borrowers within a
reasonable period prior to the time any such disclosure is made; and provided
further, this authorization shall not be deemed to be a waiver of any rights to
object to the disclosure by the Banks of any such information which any Borrower
has or may have under the federal Right to Financial Privacy Act of 1978, as in
effect from time to time.
ss.7.5. Corporate Existence and Conduct of Business. Except where the
failure of a Borrower to remain so qualified would not materially adversely
impair the financial condition of the Borrowers on a consolidated basis, each
Borrower will do or cause to be done all things necessary to preserve and keep
in full force and effect its corporate existence, corporate rights and
franchises; effect and maintain its foreign qualifications, licensing,
domestication or authorization except as terminated by its Board of Directors in
the exercise of its reasonable judgment; use its best efforts to comply with all
applicable laws; and shall not become obligated under any contract or binding
arrangement which, at the time it was entered into would materially adversely
impair the financial condition of the Borrowers, on a consolidated basis. Each
Borrower will continue to engage primarily in the businesses now conducted by it
and in related businesses.
41
ss.7.6. Maintenance of Properties. The Borrowers will cause all
material properties used or useful in the conduct of their businesses to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Borrowers may be necessary so that the businesses carried on in
connection therewith may be properly and advantageously conducted at all times;
provided, however, that nothing in this section shall prevent any Borrower from
discontinuing the operation and maintenance of any of its properties if such
discontinuance is, in the judgment of such Borrower, desirable in the conduct of
its or their business and which does not in the aggregate materially adversely
affect the business of the Borrowers on a consolidated basis.
ss.7.7. Insurance. The Borrowers will maintain with financially sound
and reputable insurance companies, funds or underwriters' insurance of the
kinds, covering the risks (other than risks arising out of or in any way
connected with personal liability of any officers and directors thereof, which
risks may, but shall not be required by the Banks to be, covered by insurance
maintained by the Borrowers) and in the relative proportionate amounts usually
carried by reasonable and prudent companies conducting businesses similar to
that of the Borrowers, but in no event less than the amounts and coverages set
forth in Schedule 7.7 hereto. In addition, the Borrowers will furnish from time
to time, upon the Agent's request, a summary of the insurance coverage of each
of the Borrowers, which summary shall be in form and substance satisfactory to
the Agent and, if requested by the Agent, will furnish to the Agent copies of
the applicable policies.
ss.7.8. Taxes. The Borrowers will each duly pay and discharge, or cause
to be paid and discharged, before the same shall become overdue, all taxes,
assessments and other governmental charges (other than taxes, assessments and
other governmental charges imposed by foreign jurisdictions which in the
aggregate are not material to the business or assets of any Borrower on an
individual basis or of the Borrowers on a consolidated basis) imposed upon it
and its real properties, sales and activities, or any part thereof, or upon the
income or profits therefrom, as well as all claims for labor, materials, or
supplies, which if unpaid might by law become a lien or charge upon any of its
property; provided, however, that any such tax, assessment, charge, levy or
claim need not be paid if the validity or amount thereof shall currently be
contested in good faith by appropriate proceedings and if such Borrower shall
have set aside on its books adequate reserves with respect thereto; and
provided, further, that such Borrower will pay all such taxes, assessments,
charges, levies or claims forthwith upon the commencement of proceedings to
foreclose any lien which may have attached as security therefor.
ss.7.9. Inspection of Properties, Books, and Contracts. The Borrowers
shall permit the Banks, the Agent or any of their designated representatives,
upon reasonable notice, to visit and inspect any of the properties of the
Borrowers, to examine the books of account of the Borrowers (including the
making of periodic accounts receivable reviews), or contracts (and to make
copies thereof and extracts therefrom), and to discuss the affairs, finances and
accounts of the Borrowers with, and to be advised as to the same by, their
officers, all at such times and intervals as the Banks may reasonably request.
42
ss.7.10. Compliance with Laws, Contracts, Licenses and Permits;
Maintenance of Material Licenses and Permits. Each Borrower will (i) comply with
the provisions of its charter documents and by-laws and all agreements and
instruments by which it or any of its properties may be bound; (ii) comply with
all applicable laws and regulations (including Environmental Laws), decrees,
orders, judgments, licenses and permits, including, without limitation, all
environmental permits hereto ("Applicable Laws"), except where noncompliance
with such Applicable Laws would not have a material adverse effect in the
aggregate on the consolidated financial condition, properties or businesses of
the Borrowers; (iii) comply in all material respects with all agreements and
instruments by which it or any of its properties may be bound; (iv) maintain all
material operating permits for all landfills now owned or hereafter acquired;
and (v) dispose of hazardous waste only at licensed disposal facilities
operating, to the best of such Borrower's knowledge after reasonable inquiry, in
compliance with Environmental Laws. If at any time while the Notes, or any Loan
or Letter of Credit is outstanding or any Bank or the Agent has any obligation
to make Loans or issue Letters of Credit hereunder, any authorization, consent,
approval, permit or license from any officer, agency or instrumentality of any
government shall become necessary or required in order that any Borrower may
fulfill any of its obligations hereunder, such Borrower will immediately take or
cause to be taken all reasonable steps within the power of such Borrower to
obtain such authorization, consent, approval, permit or license and furnish the
Banks with evidence thereof.
ss.7.11. Environmental Indemnification. The Borrowers covenant and
agree that they will indemnify and hold the Banks harmless from and against any
and all claims, expense, damage, loss or liability incurred by the Banks
(including all costs of legal representation incurred by the Banks) relating to
(a) any Release or threatened Release of Hazardous Substances on the Real
Property; (b) any violation of any Environmental Laws with respect to conditions
at the Real Property or the operations conducted thereon; or (c) the
investigation or remediation of offsite locations at which the Borrowers, or
their predecessors are alleged to have directly or indirectly Disposed of
Hazardous Substances. It is expressly acknowledged by the Borrowers that this
covenant of indemnification shall survive any foreclosure or any modification,
release or discharge of any or all of the Security Documents or the payment of
the Loans and shall inure to the benefit of the Banks, their successors and
assigns.
ss.7.12. Further Assurances. The Borrowers will cooperate with the
Banks and execute such further instruments and documents as the Banks shall
reasonably request to carry out to the Banks' satisfaction the transactions
contemplated by this Agreement, including granting additional mortgages on Real
Property at the Banks' request as set forth in ss.7.19 hereof.
ss.7.13. Notice of Potential Claims or Litigation. The Borrowers shall
deliver to the Banks, within 30 days of receipt thereof, written notice of the
initiation of any action, claim, complaint, or any other notice of dispute or
potential litigation (including without limitation any alleged violation of any
Environmental Law), wherein the potential liability is in excess of $500,000,
together with a copy of each such notice received by any Borrower.
43
ss.7.14. Notice of Certain Events Concerning Insurance and
Environmental Claims.
(a) The Borrowers will provide the Banks with written notice
as to any cancellation or material change in any insurance of any of
the Borrowers within ten (10) Business Days after such Borrower's
receipt of any notice (whether formal or informal) of such cancellation
or change by any of its insurers.
(b) The Borrowers will promptly notify the Banks in writing of
any of the following events:
(i) upon any Borrower's obtaining knowledge of any
violation of any Environmental Law regarding the Real Property or any
Borrower's operations which violation could have a material adverse
effect on the Real Property or on any Borrower's operations; (ii) upon
any Borrower's obtaining knowledge of any potential or known Release,
or threat of Release, of any Hazardous Substance at, from, or into the
Real Property which it reports in writing or is reportable by it in
writing to any governmental authority and which is material in amount
or nature or which could materially affect the value of the Real
Property; (iii) upon any Borrower's receipt of any notice of violation
of any Environmental Laws or of any Release or threatened Release of
Hazardous Substances, including a notice or claim of liability or
potential responsibility from any third party (including without
limitation any federal, state or local governmental officials) and
including notice of any formal inquiry, proceeding, demand,
investigation or other action with regard to (A) any Borrower's, or any
Person's operation of the Real Property, (B) contamination on, from or
into the Real Property, or (C) investigation or remediation of offsite
locations at which any Borrower, or any of their predecessors are
alleged to have directly or indirectly Disposed of Hazardous
Substances; (iv) upon any Borrower's obtaining knowledge that any
expense or loss has been incurred by such governmental authority in
connection with the assessment, containment, removal or remediation of
any Hazardous Substances with respect to which any Borrower may be
liable or for which a lien may be imposed on the Real Property; or (v)
any setoff, claims (including, with respect to the Real Estate,
environmental claims), withholdings or other defenses to which any of
the Collateral, or the Agent's rights with respect to the Collateral,
are subject.
ss.7.15. Response Actions. The Borrowers covenant and agree that if any
Release or Disposal of Hazardous Substances shall occur or shall have occurred
on the Real Property, the Borrowers will cause the prompt containment and
removal of such Hazardous Substances and remediation of the Real Property as
necessary to comply with all Environmental Laws or to preserve the value of the
Real Property.
ss.7.16. Environmental Assessments. If (a) with respect to the Real
Property subject to a Mortgage, the Banks in their good faith judgment, after
discussion with the Borrowers, have reason to believe that the environmental
condition of such Real Property has deteriorated, after reasonable notice by the
Banks, whether or not an Event of Default shall have occurred, or (b) with
respect to Real Property not subject to a Mortgage, the Banks so request, the
Banks may,
44
from time to time, for the purpose of assessing the value of the Real
Property, obtain one or more environmental assessments or audits of the Real
Property prepared by a hydrogeologist, an independent engineer or other
qualified consultant or expert approved by the Banks to evaluate or confirm (i)
whether any Hazardous Substances are present in the soil or water at the Real
Property and (ii) whether the use and operation of the Real Property complies
with all Environmental Laws. Environmental assessments may include without
limitation detailed visual inspections of the Real Property including, without
limitation, any and all storage areas, storage tanks, drains, dry xxxxx and
leaching areas, and the taking of soil samples, surface water samples and ground
water samples, as well as such other investigations or analyses as the Banks
deem appropriate. All such environmental assessments shall be at the sole cost
and expense of the Borrowers.
ss.7.17. Notice of Default. The Borrowers will promptly notify the
Banks in writing of the occurrence of any Default or Event of Default. If any
Person shall give any notice or take any other action in respect of a claimed
default (whether or not constituting an Event of Default) under this Agreement
or any other note, evidence of indebtedness, indenture or other obligation
evidencing indebtedness in excess of $250,000 as to which any Borrower is a
party or obligor, whether as principal or surety, the Borrowers shall forthwith
give written notice thereof to the Banks, describing the notice of action and
the nature of the claimed default.
ss.7.18. Closure and Post Closure Liabilities. The Borrowers shall at
all times adequately accrue, in accordance with GAAP, and fund, as required by
applicable Environmental Laws, all closure and post closure liabilities with
respect to the operations of the Borrowers.
ss.7.19. Additional Mortgages. If after the Closing Date the Agent so
requests, the Borrowers shall forthwith execute and deliver to the Agent a fully
executed mortgage or deed of trust over Real Property of the Borrowers in
addition to the Sanco Landfill, the Waste USA Landfill, the Xxxxxx Real Estate
and the Casella TIRES Real Estate, in form and substance satisfactory to the
Agent, together with title insurance policies, surveys, evidences of insurance,
legal opinions and other documents and certificates with respect to such Real
Property as the Agent may request. The Borrowers agree that following the taking
of such actions with respect to such Real Property, the Agent shall have a valid
and enforceable first priority mortgage or deed of trust over such Real
Property, subject only to Permitted Liens. If after the Closing Date the Agent
so requests, the Borrowers shall forthwith execute and deliver to the Agent
fully executed amendments to the Mortgages, in form and substance satisfactory
to the Agent, together with title insurance policy endorsements, legal opinions
and other documents and certificates with respect to such amendments as the
Agent may request in order to confirm the Agent's first priority security
interest in the Real Property subject to such Mortgages.
ss.7.20. Subsidiaries. The Parent shall at all times directly or
indirectly through a Subsidiary own all of the shares of the capital stock of
each Subsidiary.
ss.7.21. Interest Rate Protection. The Borrower shall enter into an
interest rate protection arrangement satisfactory to the Agent in respect of a
notional principal amount of not less than fifty percent (50%) of the sum of the
Total Commitment plus the outstanding principal
45
amount of the Term Loans plus the principal amount of capitalized leases and
other Indebtedness for borrowed money if the Parent does not complete an equity
offering by November 30, 1997 which raises net proceeds (after payment of all
fees and expenses relating to such offering and redemption of the Parent's
Series C Redeemable Preferred Stock) in excess of $30,000,000. The Borrower
shall maintain such arrangements in full force and effect as provided therein
until the Commitments are terminated and all Loans have been repaid in full, and
shall not modify, terminate, or transfer such arrangements during such period
without the prior written consent of the Agent.
ss.8. CERTAIN NEGATIVE COVENANTS OF THE BORROWERS. The Borrowers agree
that, so long as any Loan or any Note is outstanding or the Banks have any
obligation to make Loans or the Agent has any obligation to issue, extend or
renew any Letters of Credit hereunder:
ss.8.1. Restrictions on Indebtedness. None of the Borrowers shall
become or be a guarantor or surety of, or otherwise create, incur, assume, or be
or remain liable, contingently or otherwise, with respect to any Indebtedness,
or become or be responsible in any manner (whether by agreement to purchase any
obligations, stock, assets, goods or services, or to supply or advance any
funds, assets, goods or services or otherwise) with respect to any undertaking
or Indebtedness of any other Person, or incur any Indebtedness other than:
(a) Indebtedness to the Banks and the Agent arising under this
Agreement or the Loan Documents;
(b) Subject to ss.8.9, Subordinated Debt;
(c) Existing Indebtedness with respect to loans and
capitalized leases listed on Schedule 8.1(c) hereto in an amount not to
exceed $3,500,000, on the terms and conditions in effect as of the date
hereof, together with any renewals, extensions or refinancings thereof
on terms which are not materially different than those in effect as of
the date hereof; provided that no such Indebtedness may be prepaid
without prior written consent of the Required Banks;
(d) Current liabilities incurred in the ordinary course of
business not incurred through (i) the borrowing of money, or (ii) the
obtaining of credit except for credit on an open account basis
customarily extended and in fact extended in connection with normal
purchases of goods and services;
(e) Indebtedness in respect of taxes, assessments,
governmental charges or levies and claims for labor, materials and
supplies to the extent that payment therefor shall not at the time be
required to be made in accordance with the provisions of ss.7.8 and
Indebtedness of the Borrowers secured by liens of carriers,
warehousemen, mechanics and materialmen permitted by ss.8.2;
46
(f) Indebtedness in respect of judgments or awards which have
been in force for less than the applicable period for taking an appeal
so long as execution is not levied thereunder or in respect of which
any Borrower shall at the time in good faith be prosecuting an appeal
or proceedings for review and in respect of which a stay of execution
shall have been obtained pending such appeal or review and in respect
of which the Borrowers have maintained adequate reserves;
(g) Indebtedness of any Borrower with respect to guaranty,
suretyship or indemnification obligations in connection with such
Borrower's performance of services for its respective customers in the
ordinary course of its business;
(h) [Intentionally omitted];
(i) Indebtedness of any Subsidiary owing to the Parent;
(j) Intercompany Indebtedness among the Subsidiaries;
(k) Indebtedness in respect of a letter of credit issued by
Allbank Bank in the face amount of $168,000; provided that if the
Agent, in its sole and absolute discretion, at any time and for any
reason so requests, the Borrowers shall promptly replace such letter of
credit with a Letter of Credit issued by the Agent pursuant to the
terms of this Credit Agreement;
(l) Indebtedness incurred in connection with the acquisition
after the date hereof of any personal property by the Borrowers under
any lease; provided that the aggregate outstanding principal amount of
such Indebtedness of the Borrowers shall not exceed $10,000,000 at any
time;
(m) Indebtedness incurred in connection with the acquisition
by the Borrowers of real or personal property; provided that the
aggregate principal amount of such Indebtedness of the Borrowers shall
not exceed $5,000,000 at any time;
(n) Indebtedness in an aggregate amount not to exceed
$10,501,284 payable to Clinton County, New York under and in accordance
with the terms of the Clinton Lease; and
(o) Indebtedness in respect of non-compete payments in the
amount of $600,000 payable to Xxxxxxx Xxxx payable over a term of four
(4) years, with payments of $200,000 in each of 1998 and 1999 and
payments of $100,000 in each of 2000 and 2001.
(p) Indebtedness under fuel price swaps, fuel price caps, and
fuel price collar or floor agreements, and similar agreements or
arrangements designed to protect against or manage fluctuations in fuel
prices with respect to fuel purchased in the ordinary course of
business of the Borrowers, provided that the aggregate amount of such
agreements do
47
not exceed $500,000, the maturity of such agreements do not exceed six
(6) months and the terms are consistent with past practices of the
Borrowers.
ss.8.2. Restrictions on Liens. None of the Borrowers will create or
incur or suffer to be created or incurred or to exist any lien, encumbrance,
mortgage, pledge, negative pledge, charge, restriction or other security
interest of any kind upon any property or assets of any character, whether now
owned or hereafter acquired, or upon the income or profits therefrom; or
transfer any of such property or assets or the income or profits therefrom for
the purpose of subjecting the same to the payment of Indebtedness or performance
of any other obligation in priority to payment of its general creditors; or
acquire, or agree or have an option to acquire, any property or assets upon
conditional sale or other title retention or purchase money security agreement,
device or arrangement; or suffer to exist for a period of more than 30 days
after the same shall have been incurred any Indebtedness or claim or demand
against it which if unpaid might by law or upon bankruptcy or insolvency, or
otherwise, be given any priority whatsoever over its general creditors; or sell,
assign, pledge or otherwise transfer any accounts, contract rights, general
intangibles or chattel paper, with or without recourse, except as follows (the
"Permitted Liens"):
(a) purchase money security interests in or purchase money
liens on property other than the Mortgaged Property to secure
Indebtedness permitted under ss.8.1(m) hereof, provided that such Liens
(i) shall encumber only the property or assets so acquired, (ii) shall
not exceed the fair market value thereof and (iii) shall not encumber
property with a value in excess of $10,000,000;
(b) Liens to secure taxes, assessments and other government
charges or claims for labor, material or supplies in respect of
obligations not overdue;
(c) Deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
(d) Liens in respect of judgments or awards, the Indebtedness
with respect to which is permitted by ss.8.1(e);
(e) Liens of carriers, warehousemen, mechanics and
materialmen, and other like liens, in existence less than 120 days from
the date of creation thereof in respect of obligations not overdue;
(f) Encumbrances consisting of easements, rights of way,
zoning restrictions, restrictions on the use of real property and
defects and irregularities in the title thereto, landlord's or lessor's
liens under leases to which any Borrower is a party, and other minor
liens or encumbrances none of which in the opinion of the respective
Borrower interferes materially with the use of the property affected in
the ordinary conduct of the business of such Borrower, which defects do
not individually or in the aggregate have a material adverse effect on
the business of such Borrower individually or of the Borrowers on a
consolidated basis;
48
(g) Liens existing as of the date hereof securing Indebtedness
permitted under ss.8.1(c) hereof and listed on Schedule 8.2(g) hereto;
(h) Liens granted pursuant to the Security Documents;
(i) A second mortgage lien on the Waste USA Landfill in favor
of the sellers of the Waste USA Landfill, subordinated to the Agent's
Mortgage on terms acceptable to the Banks;
(j) Liens on the assets of Bristol Waste Management, Inc.
granted to secure the Indebtedness permitted by ss.8.1(k) hereof and
listed on Schedule 8.2(k) hereto; and
(k) Liens granted to secure the Indebtedness permitted by
ss.8.1(l) hereof.
ss.8.3. Restrictions on Investments. None of the Borrowers shall make
or permit to exist or to remain outstanding any other Investment other than:
(a) Investments in obligations of the United States of America
and agencies thereof and obligations guaranteed by the United States of
America that are due and payable within one year from the date of
acquisition;
(b) certificates of deposit, time deposits or repurchase
agreements which are fully insured or are issued by commercial banks
organized under the laws of the United States of America or any state
thereof and having a combined capital, surplus, and undivided profits
of not less than $100,000,000;
(c) commercial paper, maturing not more than nine months from
the date of issue, provided that, at the time of purchase, such
commercial paper is not rated lower than "P-1" by Xxxxx'x Investors
Service, Inc., or "A-1" by Standard & Poor's Corporation;
(d) Investments associated with insurance policies required or
allowed by state law to be posted as financial assurance for landfill
closure and post-closure liabilities;
(e) Investments by any Borrower in any wholly owned Subsidiary
which is also a Borrower;
(f) other Investments not to exceed $500,000 in the aggregate
at any time outstanding; and
(g) Investments existing on the date hereof and listed on
Schedule 8.3(g) hereto;
49
(h) Any money market account, short-term asset management
account or similar investment account maintained with one of the Banks;
provided; that none of the Borrowers shall make or permit to exist or to remain
outstanding any Investment in any Subsidiary unless both before and after giving
effect thereto there does not exist a Default or Event of Default and no Default
or Event of Default would be created by the making of such Investment.
ss.8.4. Mergers, Consolidations, Sales. None of the Borrowers shall be
a party to any merger, consolidation or exchange of stock, or purchase or
otherwise acquire all or substantially all of the assets or stock of, or any
partnership or joint venture interest in, any other Person (except as otherwise
provided in this ss.8.4), or sell, transfer, convey or lease any stock or assets
or group of assets (except for (i) sales of equipment in the ordinary course of
business and (ii) sales of other assets so long as the aggregate book value of
such assets to be sold, together with the aggregate book value of all other such
assets sold by the Borrowers during the term of this Agreement, does not exceed
5% of Consolidated Total Assets at the time of such sale) or sell or assign,
with or without recourse, any receivables, provided, however notwithstanding the
foregoing so long as no Default or Event of Default has occured and is
continuing and the proposed transaction will not otherwise create an Event of
Default as a result thereof, the Borrowers shall be permitted (i) simultaneosuly
with the consummation of its initial public offering to exchange any of its
preferred stock into shares of common stock and (ii) to authorize and issue
additional shares of its capital stock. Notwithstanding the foregoing, a
Borrower may purchase or otherwise acquire for cash, stock or other
consideration all or substantially all of the assets or stock of any class of
any Person provided that (a) the Banks shall have been provided with a
Compliance Certificate demonstrating that the Borrowers are in current
compliance with and, giving effect to the proposed acquisition (including any
borrowings made or to be made in connection therewith), will continue to be in
compliance with, all of the covenants in ss.9 hereof; (b) no Event of Default
has occurred and is continuing and the proposed transaction will not otherwise
create an Event of Default hereunder; (c) the business or assets to be acquired
involves solid waste collection, hauling, recycling or transfer or related
businesses; (d) the business or assets to be acquired operates in the United
States; (e) all of the assets to be acquired shall be pledged to the Agent for
the benefit of the Banks and shall be owned by an existing or newly created
Subsidiary of the Parent, 100% of the stock of which has been or will be pledged
to the Agent on behalf of the Banks and which is a Borrower or, in the case of a
stock acquisition, the acquired company shall become or shall be merged with a
wholly-owned Subsidiary of the Parent that is a Borrower; (f) a copy of the
purchase agreement, together with audited (if available, or otherwise unaudited)
financial statements for any business to be acquired for the preceding two (2)
fiscal years and due diligence summaries shall have been furnished to the Banks,
if the purchase price, excluding the payment of all fees and expenses relating
to such purchase, exceeds $1,000,000; (g) if such acquisition is made by a
merger, such Borrower shall be the surviving entity; (h) the cash consideration
in connection with any such acquisition (including the aggregate amount of all
liabilities assumed) shall not exceed $5,000,000; and (i) the Borrower shall
provide to the Banks written consent or approval of the board of directors or
equivalent governing body of the entity whose business or assets are to be
acquired. Notwithstanding the foregoing, no Person may acquire a controlling
interest in any Borrower,
50
nor may a Borrower purchase or otherwise acquire all or substantially all of the
assets or stock of any class of another Borrower, in each case, without the
prior written consent of the Banks. In addition, notwithstanding the foregoing,
no Borrower shall merge with or into any Person except for mergers of a
non-Borrower into a Borrower as permitted by clause (g) of the second sentence
of this ss.8.4; provided, however, that so long as (x) no Default or Event of
Default has occurred and is continuing, or would occur after giving effect
thereto, and (y) the surviving entity becomes a Borrower hereunder and all
assets of such surviving entity are pledged to the Agent for the benefit of the
Banks, North Country Environmental Services, Inc. may merge with a newly created
corporation which is formed solely for the purpose of acquiring the assets of
North Country Environmental Services, Inc. only and which is directly or
indirectly wholly-owned by the Parent.
ss.8.5. Sale and Leaseback. None of the Borrowers shall enter into any
arrangement, directly or indirectly, whereby any Borrower shall sell or transfer
any property owned by it in order then or thereafter to lease such property or
lease other property which such Borrower intends to use for substantially the
same purpose as the property being sold or transferred, without the prior
written consent of the Banks.
ss.8.6. Restricted Distributions and Redemptions. None of the Borrowers
will declare or pay any cash Distributions (other than from insurance proceeds);
provided that any Subsidiary may declare or pay cash Distributions to the
Parent. In addition, the Borrowers shall not redeem, convert, retire or
otherwise acquire shares of any class of capital stock of the Borrowers in
aggregate amount in excess of $100,000 during the term of this Agreement;
provided, that the Parent may (a) repurchase the shares of Series A Redeemable
Preferred Stock or Series B Redeemable Preferred Stock pursuant to the terms of
Section C.8(e)(i) of the Parent's Amended and Restated Certificate of
Incorporation simultaneously with or following the exercise, for cash, of the
common stock purchase warrants dated July 26, 1993 and May 25, 1994 issued to
certain of the stockholders of the Parent, (b) redeem shares of the Parent's
Series C Redeemable Preferred Stock held by The Vermont Venture Capital Fund, L.
P. and North Atlantic Venture Fund, L. P. in three (3) installments of $150,000
each on January 31, 1997, July 31, 1997 and January 31, 1998 and (c) redeem
shares of the Parent's Series C Redeemable Preferred Stock from the proceeds of
an initial public offering of the Parent's stock so long as such initial public
offering occurs on or before December 31, 1997 and the net proceeds to the
Parent from such initial public offering (after payment of all fees and expenses
relating to such initial public offering and after redemption of all of the
Parent's Series C Redeemable Preferred Stock) equal or exceed $25,000,000;
provided that Parent may call 100,000 Stock Purchase Warrants to Subscribe for
and Purchase Class A Common Stock of Xxxxxxx Waste Systems Inc., issued to
Springer Sanitation Service, Inc. at $7 per warrant, provided Parent has filed
its Form S-1 with the Securities and Exchange Commission on or before December
31, 1997 and provides to the Agent a Compliance Certificate, certified by the
CFO pursuant to ss.7.4(c) hereof, dated as of the date of the call which takes
into account such call. The Borrowers shall not effect or permit any change in
or amendment to the charter documents or by-laws of any Borrower or any document
or instrument pertaining to the terms of the Parent's capital stock.
51
ss.8.7. Employee Benefit Plans. None of the Borrowers nor any ERISA
Affiliate will:
(a) engage in any "prohibited transaction" within the meaning
of ss.406 of ERISA or ss.4975 of the Code which could result in a
material liability for any Borrower; or
(b) permit any Guaranteed Pension Plan to incur an
"accumulated funding deficiency", as such term is defined in ss.302 of
ERISA, whether or not such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner
which, could result in the imposition of a lien or encumbrance on the
assets of any Borrower pursuant to ss.302(f) or ss.4068 of ERISA; or
(d) permit or take any action which would result in the
aggregate benefit liabilities (with the meaning of ss.4001 of ERISA) of
all Guaranteed Pension Plans exceeding the value of the aggregate
assets of such Plans, disregarding for this purpose the benefit
liabilities and assets of any such Plan with assets in excess of
benefit liabilities.
The Borrowers will (i) promptly upon filing the same with the
Department of Labor or Internal Revenue Service, furnish to the Banks a copy of
the most recent actuarial statement required to be submitted under ss.103(d) of
ERISA and Annual Report, Form 5500, with all required attachments, in respect of
each Guaranteed Pension Plan and (ii) promptly upon receipt or dispatch, furnish
to the Banks any notice, report or demand sent or received in respect of a
Guaranteed Pension Plan under ss.ss.302, 4041, 4042, 4043, 4063, 4065, 4066 and
4068 of ERISA, or in respect of a Multiemployer Plan, under ss.ss.4041A, 4202,
4219, or 4245 of ERISA.
ss.8.8. Capital Expenditures. As at the end of any fiscal quarter, the
Borrowers will not permit the amount of Capital Expenditures (excluding any
acquisitions permitted by ss.8.4 hereof) made by the Borrowers in the period of
four (4) consecutive fiscal quarters then ended to exceed an amount equal to 1.5
times the sum of depreciation and landfill amortization expense for such period.
ss.8.9. Subordinated Debt. None of the Borrowers will amend,
supplement, or otherwise modify the terms of the Subordinated Debt, the
Subordination Agreements, the Stockholder Stand-off Agreement or the Waste USA
Lease without the prior written consent of the Banks. None of the Borrowers will
prepay the Waste USA Lease, terminate the Waste USA Lease or exercise any option
of purchase the leasehold estate subject to the Waste USA Lease during the term
of this Credit Agreement without the prior written consent of the Banks. None of
the Borrowers will amend, supplement or otherwise modify the terms of the
Clinton Lease, prepay the Clinton Lease, terminate the Clinton Lease, or
exercise any option to purchase the landfill and related property subject to the
Clinton Lease during the term of this Agreement without the prior written
consent of the Banks. The Borrowers will not make any payments of the
52
Subordinated Debt other than scheduled payments of principal and interest
permitted under the Subordination Agreements; provided that Parent may make an
unscheduled principal payment not to exceed $500,000 on the Subordinated
Promissory Note dated July 9, 1996, to Seaward Realty Trust provided Parent has
filed its Form S-1 with the Securities and Exchange Commission on or before
December 31, 1997 and provides to the Agent a Compliance Certificate, certified
by the CFO pursuant to ss.7.4(c) hereof, dated as of the date of the unscheduled
principal payment which takes into account such unscheduled principal payment.
ss.9. FINANCIAL COVENANTS OF THE BORROWERS. The Borrowers agree that,
so long as any Loan or any Note is outstanding or the Banks have any obligation
to make Loans or the Agent has any obligation to issue, extend or renew any
Letters of Credit hereunder:
ss.9.1. Interest Coverage Ratios. As of the end of any fiscal quarter,
for the period of the four consecutive fiscal quarters then ended, the ratio of
EBITDA to Consolidated Total Interest Expense shall not be less than 3.5:1.
ss.9.2. Profitable Operations. The Borrowers will not permit
Consolidated Net Income to be less than $0 in any quarter.
ss.9.3. Debt-to-EBITDA. As at the end of any fiscal quarter, the ratio
of (a) Indebtedness of the Borrowers for borrowed money and capitalized leases
(excluding Indebtedness with respect to the Waste USA Lease) to (b) EBITDA
(minus interest, depreciation and amortization expense related to the Waste USA
Lease) for the period of four consecutive fiscal quarters ending on such date
(subject to the provisions below) shall not exceed the stated ratio for the
respective periods set forth below:
Period Ratio
------ -----
Closing Date through 4/30/98 4.00:1
5/1/98 through 4/30/99 3.75:1
Thereafter 3.50:1
For purposes of calculating the Debt to EBITDA ratio (a) for (i) the
fiscal quarter ending July 31, 1997, EBITDA shall be deemed equal to four (4)
times EBITDA for the three month period then ended, (ii) the fiscal quarter
ending October 31, 1997, EBITDA shall be deemed equal to two (2) times EBITDA
for the six month period then ended and (iii) the fiscal quarter ending January
31, 1998, EBITDA shall be deemed equal to one and one-third (1 1/3) times EBITDA
for the nine month period then ended and (b) the financial results of any
businesses acquired after May 1, 1997 by the Borrowers during such fiscal period
shall be included in the calculation of EBITDA so long as (i) the acquired
business had annual revenue of at least $5,000,000 for the most recent fiscal
year, (ii) the Agent is satisfied that the financial information for the
acquired business fairly presents the financial condition of such business and
(iii) the Agent receives a letter in form and substance satisfactory to the
Banks from the Borrowers' Accountants as to adjustments for non-recurring
expenses.
53
ss.9.4. Fixed Charge Coverage Ratio. As of the end of any fiscal
quarter, the Borrowers shall not permit the ratio of (a) EBITDA for the period
of four (4) consecutive fiscal quarters then ended to (b) Consolidated Fixed
Charges for such period to be less than 1.50 to 1.0.
ss.10. CLOSING CONDITIONS.
The obligations of the Banks to make the Loans and the Agent to issue
Letters of Credit on the Closing Date and otherwise be bound by the terms of
this Agreement shall be subject to the satisfaction of each of the following
conditions precedent:
ss.10.1. Corporate Action. All corporate action necessary for the valid
execution, delivery and performance by each Borrower of the Loan Documents shall
have been duly and effectively taken, and evidence thereof satisfactory to the
Agent shall have been provided to the Agent.
ss.10.2. Loan Documents, Etc. Each of the Loan Documents shall have
been duly and properly authorized, executed and delivered by the respective
parties thereto and shall be in full force and effect in a form satisfactory to
the Banks.
ss.10.3. Certified Copies of Charter Documents. The Agent shall have
received from the Borrowers a copy, certified by a duly authorized officer of
such Person to be true and complete on the Closing Date, of each of (a) its
charter or other incorporation documents (including certificates of merger and
name changes) as in effect on such date of certification, and (b) its by-laws as
in effect on such date.
ss.10.4. Incumbency Certificate. The Agent shall have received an
incumbency certificate, dated as of the Closing Date, signed by duly authorized
officers giving the name and bearing a specimen signature of each individual who
shall be authorized: (a) to sign the Loan Documents on behalf of the Borrowers;
(b) to make Loan and Letter of Credit Requests; and (c) to give notices and to
take other action on the Borrowers' behalf under the Loan Documents.
ss.10.5. Validity of Liens. The Security Documents shall be effective
to create in favor of the Agent a legal, valid and enforceable first security
interest in and lien upon the Collateral, subject only to Permitted Liens. All
filings, recordings, deliveries of instruments and other actions necessary or
desirable in the opinion of the Agent to protect and preserve such security
interests, including, without limitation, delivery of the Mortgage for the
Superior Real Estate and any necessary amendments to the other Mortgages, shall
have been duly effected. The Agent shall have received evidence thereof in form
and substance satisfactory to the Agent.
ss.10.6 UCC Search Results. The Agent shall have received the results
of UCC searches with respect to the Collateral owned by the Borrowers indicating
no liens other than Permitted Liens and otherwise in form and substance
satisfactory to the Agent.
ss.10.7. Title Insurance. The Agent shall have received mortgagee
policies of title insurance or commitments to issue such policies or
satisfactory endorsements of existing
54
policies, in form and substance satisfactory to the Banks, together with proof
of payment of all fees and premiums for such policies or endorsements, from
title insurers and in amounts satisfactory to the Agent, insuring the interest
of the Agent as first mortgagee under the Mortgages and otherwise subject only
to Permitted Liens, together with endorsements thereto relating to any
amendments to the Mortgages.
ss.10.8. Certificates of Insurance. The Agent shall have received (i) a
certificate of insurance from an independent insurance broker dated as of the
Closing Date, or within 15 days prior thereto, identifying insurers, types of
insurance, insurance limits, and policy terms, and otherwise describing the
insurance obtained in accordance with the provisions of the Security Documents
and (ii) copies of all policies evidencing such insurance (or certificates
therefor signed by the insurer or an agent authorized to bind the insurer).
ss.10.9. Opinion of Counsel. The Banks shall have received
(a) from Xxxxxx, Xxxxxxxxx & Xxxxxx, Ltd., an opinion
addressed to the Banks, dated the Closing Date, in form and substance
satisfactory to the Banks, as to (i) authorization, enforceability of
Loan Documents and other corporate matters; (ii) Vermont security and
real estate matters.
(b) from Xxxxxx & Xxxxxxx, P.A., an opinion addressed to the
Banks, dated the Closing Date, in form and substance satisfactory to
the Banks, as to New Hampshire security and real estate matters.
(c) from Xxxxxx Xxxxxx, an opinion addressed to the Banks,
dated the Closing Date, in form and substance satisfactory to the
Banks, as to Maine security and real estate matters.
(d) from Xxxxxx X. Xxxxxxxxxx, P.C., an opinion addressed to
the Banks, dated the Closing Date, in form and substance satisfactory
to the Banks, as to New York security and real estate matters.
ss.10.10. Payment of Fees. The Borrowers shall have paid to the Agent
for the accounts of the Bank or its own account, as applicable, all fees and
expenses that are due and payable as of the Closing Date in accordance with this
Agreement.
ss.10.11. Good Standing Certificates. The Agent shall have received
certificates from governmental officials evidencing the legal existence, good
standing and foreign qualifications of each Borrower.
ss.10.12. Affirmation of Subordination Agreements. The Agent shall have
received an opinion of Xxxxxx, Xxxxxxxxx & Xxxxxx, Ltd. that such a
reaffirmation of the Waste USA Subordination Agreement is not required to allow
the provisions of such agreement to remain in full force and effect.
55
ss.11. CONDITIONS OF ALL LOANS.
The obligations of the Banks to make any Loan (including without
limitation the obligation of the Agent to issue any Letter of Credit) on and
subsequent to the Closing Date is subject to the following conditions precedent:
ss.11.1. Representations True; No Event of Default. Each of the
representations and warranties of the Borrowers contained in this Agreement or
in any document or instrument delivered pursuant to or in connection with this
Agreement shall be true as of the date as of which they were made and shall also
be true at and as of the time of the making of the Loan with the same effect as
if made at and as of that time (except to the extent of changes resulting from
transactions contemplated or permitted by this Agreement and changes occurring
in the ordinary course of business which singly or in the aggregate are not
materially adverse, and to the extent that such representations and warranties
relate expressly to an earlier date) and no Default or Event of Default shall
have occurred and be continuing.
ss.11.2 Performance; No Event of Default. The Borrowers shall have
performed and complied with all terms and conditions herein required to be
performed or complied with by them prior to or at the time of any Loan, and at
the time of any Loan, there shall exist no Event of Default or condition which
would result in an Event of Default upon consummation of such Loan (including
without limitation any amounts to be drawn under a Letter of Credit). Each
request by the Borrowers for a Loan (including without limitation each request
for issuance of a Letter of Credit) subsequent to the first Loan shall
constitute certification by the Borrowers that the conditions specified in
ss.ss.10.1 and 10.2 will be duly satisfied on the date of such Loan or Letter of
Credit issuance.
ss.11.3. No Legal Impediment. No change shall have occurred in any law
or regulations thereunder or interpretations thereof which in the reasonable
opinion of the Banks would make it illegal for the Banks to make Loans
hereunder.
ss.11.4. Governmental Regulation. The Banks shall have received such
statements in substance and form reasonably satisfactory to the Banks as they
shall require for the purpose of compliance with any applicable regulations of
the Comptroller of the Currency or the Board of Governors of the Federal Reserve
System.
ss.11.5. Proceedings and Documents. All proceedings in connection with
the transactions contemplated by this Agreement and all documents incident
thereto shall have been delivered to the Banks as of the date hereof in
substance and in form satisfactory to the Banks, including without limitation a
Letter of Credit and Loan Request in the form attached hereto as Exhibit D, and
the Banks shall have received all information and such counterpart originals or
certified or other copies of such documents as the Banks may reasonably request.
ss.12. COLLATERAL SECURITY. The Obligations shall be secured by a
perfected security interest (having, with respect to each category of
Collateral, the respective rights and priorities set forth in the Security
Documents) in all of the assets of the Borrowers, whether now
56
owned or hereafter acquired, pursuant to the terms of the Security Documents to
which the Borrowers are parties. It is the intention of the parties that all of
the Revolving Credit Loans (including any increase in the amount of the
Revolving Credit Loans pursuant to ss.2 hereof) be secured by the Mortgages,
whether or not the Mortgages, or any one of them, is amended in order to reflect
the full amount of and/or any increase in the amount of the Revolving Credit
Loans.
ss.13. EVENTS OF DEFAULT; ACCELERATION; TERMINATION OF COMMITMENT.
ss.13.1. Events of Default and Acceleration. If any of the following
events ("Events of Default" or, if the giving of notice or the lapse of time or
both is required, then, prior to such notice and/or lapse of time, "Defaults")
shall occur:
(a) if the Borrowers shall fail to pay any principal of the
Loans when the same shall become due and payable, whether at the
Maturity Date or any accelerated date of maturity or at any other date
fixed for payment;
(b) if the Borrowers shall fail to pay any interest or fees or
other amounts owing hereunder within five (5) Business Days after the
same shall become due and payable whether at the Maturity Date or any
accelerated date of maturity or at any other date fixed for payment;
(c) if the Borrowers shall fail to comply with the covenants
contained in ss.ss.7 (other than ss.ss.7.6, 7.14, 7.15 and 7.18), 8 or
9 hereof;
(d) if the Borrowers shall fail to perform any term, covenant
or agreement contained herein or in any of the other Loan Documents
(other than those specified in subsections (a), (b), and (c) above)
within 30 days after written notice of such failure has been given to
the Borrowers by the Banks;
(e) if any representation or warranty contained in this
Agreement or in any document or instrument delivered pursuant to or in
connection with this Agreement shall prove to have been false in any
material respect upon the date when made or repeated;
(f) if any Borrower shall fail to pay at maturity, or within
any applicable period of grace, any and all obligations for borrowed
money or any guaranty with respect thereto in an aggregate amount
greater than $250,000, or fail to observe or perform any material term,
covenant or agreement contained in any agreement by which it is bound,
evidencing or securing borrowed money in an aggregate amount greater
than $250,000 for such period of time as would, or would have permitted
(assuming the giving of appropriate notice if required) the holder or
holders thereof or of any obligations issued thereunder to accelerate
the maturity thereof; or
57
(g) if any Borrower makes an assignment for the benefit of
creditors, or admits in writing its inability to pay or generally fails
to pay its debts as they mature or become due, or petitions or applies
for the appointment of a trustee or other custodian, liquidator or
receiver of any Borrower or of any substantial part of the assets of
any Borrower or commences any case or other proceeding relating to any
Borrower under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation or similar law of any
jurisdiction, now or hereafter in effect, or takes any action to
authorize or in furtherance of any of the foregoing, or if any such
petition or application is filed or any such case or other proceeding
is commenced against any Borrower and or any Borrower indicates its
approval thereof, consent thereto or acquiescence therein;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating any Borrower bankrupt
or insolvent, or approving a petition in any such case or other
proceeding, or a decree or order for relief is entered in respect of
any Borrower in an involuntary case under federal bankruptcy laws as
now or hereafter constituted, and such decree or order remains in
effect for more than sixty (60) days, whether or not consecutive;
(i) if there shall remain in force, undischarged, unsatisfied
and unstayed, for more than thirty (30) days, whether or not
consecutive, any final judgment against any Borrower which, with other
outstanding final judgments, against the Borrowers exceeds in the
aggregate $250,000 after taking into account any undisputed insurance
coverage;
(j) with respect to any Guaranteed Pension Plan, an ERISA
Reportable Event shall have occurred and the Banks shall have
determined in their reasonable discretion that such event reasonably
could be expected to result in liability of any Borrower to the PBGC or
the Plan in an aggregate amount exceeding $250,000 and such event in
the circumstances occurring reasonably could constitute grounds for the
termination of such Plan by the PBGC or for the appointment by the
appropriate United States District Court of a trustee to administer
such Plan; or a trustee shall have been appointed by the United States
District Court to administer such Plan; or the PBGC shall have
instituted proceedings to terminate such Plan;
(k) any of the Subordinated Debt shall be in default or all or
any part of the Subordinated Debt shall be paid, prepaid, redeemed or
repurchased in whole or in part other than as permitted under the terms
of the Subordination Agreements, hereof and thereof; or
(l) if any of the Loan Documents shall be cancelled,
terminated, revoked or rescinded otherwise than in accordance with the
terms thereof or with the express prior written agreement, consent or
approval of the Banks, or any action at law, suit or in equity or other
legal proceeding to cancel, revoke or rescind any of the Loan Documents
shall be commenced by or on behalf of the Borrowers or any of their
respective stockholders, or any court or any other governmental or
regulatory authority or agency of
58
competent jurisdiction shall make a determination that, or issue a
judgment, order, decree or ruling to the effect that, any one or more
of the Loan Documents is illegal, invalid or unenforceable in
accordance with the terms thereof;
(m) Xxxx Xxxxxxx and Xxxxx Xxxxxx shall cease to serve as
senior management of the Parent and shall fail to be replaced by other
Persons reasonably acceptable to the Banks within 30 days;
then, and in any such event, so long as the same may be continuing, the Agent
shall upon the request of the Required Banks, by notice in writing to the
Borrowers, declare all amounts owing with respect to this Agreement, the Notes
and the other Loan Documents and all Reimbursement Obligations to be, and they
shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrowers; provided that in the event of any
Event of Default specified in ss.13.1(g) or 13.1(h), all such amounts shall
become immediately due and payable automatically and without any requirement of
notice from the Agent or any Bank. Upon demand by the Banks after the occurrence
of any Event of Default, the Borrowers shall immediately provide to the Agent
cash in an amount equal to the aggregate Maximum Drawing Amount of all Letters
of Credit outstanding, to be held by the Agent as collateral security for the
Obligations.
ss.13.2. Termination of Commitments. If any Event of Default shall
occur, any unused portion of the Total Commitment hereunder shall forthwith
terminate and the Banks shall be relieved of all obligations to make Loans to or
issue Letters of Credit for the account of any of the Borrowers; or if on any
Drawdown Date the conditions precedent to the making of the Loans to be made on
such Drawdown Date or the issuance of any Letters of Credit to be issued on such
date are not satisfied (except as a consequence of a default on the part of the
Banks), the Banks may by notice to the Borrowers, terminate the unused portion
of the Total Commitment hereunder, and upon such Notice being given, such unused
portion of the Total Commitment hereunder shall terminate immediately and the
Banks shall be relieved of all further obligations to make Loans to or issue
Letters of Credit for the account of the Borrowers hereunder. No termination of
any portion of the Total Commitment hereunder shall relieve the Borrowers of any
of their existing Obligations to the Banks hereunder or elsewhere.
ss.13.3. Remedies. Subject to ss.15.8, in case any one or more of the
Events of Default shall have occurred and be continuing, and whether or not the
Banks shall have accelerated the maturity of the Loans pursuant to ss.13.1, each
Bank, if owed any amount with respect to the Loans or the Reimbursement
Obligations, may proceed to protect and enforce its rights by suit in equity,
action at law or other appropriate proceeding, whether for the specific
performance of any covenant or agreement contained in this Agreement and the
other Loan Documents or any instrument pursuant to which the Obligations or the
Guaranteed Obligations to such Bank are evidenced, including, without
limitation, as permitted by applicable law the obtaining of the ex parte
appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any legal or
equitable right of such Bank. No remedy herein conferred upon any Bank or the
Agent or the holder of any Note or purchaser of any Letter of Credit
Participation is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to
59
every other remedy given hereunder or now or hereafter existing at law or in
equity or by statute or any other provision of law.
ss.14. SETOFF. Regardless of the adequacy of any collateral, during the
continuance of an Event of Default, any deposits or other sums credited by or
due from any Bank to the Borrowers and any securities or other property of the
Borrowers in the possession of such Bank may be applied to or set off against
the payment of the Obligations and any and all other liabilities, direct, or
indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, of the Borrowers to the Banks. Each of the Banks agrees with
each other Bank that (a) if an amount to be set off is to be applied to
Indebtedness of the Borrowers to such Bank, other than Indebtedness evidenced by
the Notes held by such Bank or constituting Reimbursement Obligations owed to
such Bank, such amount shall be applied ratably to such other Indebtedness and
to the Indebtedness evidenced by all such Notes held by such Bank or
constituting Reimbursement Obligations owed to such Bank, and (b) if such Bank
shall receive from the Borrowers, whether by voluntary payment, exercise of the
right of setoff, counterclaim, cross action, enforcement of the claim evidenced
by the Notes held by, or constituting Reimbursement Obligations owed to, such
Bank by proceedings against the Borrowers at law or in equity or by proof
thereof in bankruptcy, reorganization, liquidation, receivership or similar
proceedings, or otherwise, and shall retain and apply to the payment of the Note
or Notes held by, or Reimbursement Obligations owed to, such Bank any amount in
excess of its ratable portion of the payments received by all of the Banks with
respect to the Notes held by, and Reimbursement Obligations owed to, all of the
Banks, such Bank will make such disposition and arrangements with the other
Banks with respect to such excess, either by way of distribution, pro tanto
assignment of claims, subrogation or otherwise as shall result in each Bank
receiving in respect of the Notes held by it or Reimbursement Obligations owed
it, such Bank's proportionate payment as contemplated by this Agreement;
provided that if all or any part of such excess payment is thereafter recovered
from such Bank, such disposition and arrangements shall be rescinded and the
amount restored to the extent of such recovery, but without interest.
ss.15. THE AGENT.
ss.15.1 Appointment of Agent, Powers and Immunities. Each Bank hereby
irrevocably appoints and authorizes the Agent to act as its agent hereunder and
under the other Loan Documents. The Agent hereby acknowledges that it does not
have the authority to negotiate any agreement which would bind the Banks or
agree to any amendment, waiver or modification of any of the Loan Documents or
bind the Banks except as set forth in this Agreement or the Loan Documents.
Except as provided in this ss.15 and in the other Loan Documents, the Agent
shall take action or refrain from acting only upon instructions of the Banks and
no action taken or failure to act without the consent of the Banks shall be
binding on any Bank which has not consented. Each Bank irrevocably authorizes
the Agent to execute the Security Documents and all other instruments relating
thereto and to take such action on behalf of each of the Banks and to exercise
all such powers as are expressly delegated to the Agent hereunder and in the
Security Documents and all related documents, together with such other powers as
are reasonably incidental thereto. It is agreed that the duties, rights,
privileges and immunities of the Agent, in its capacity as issuer of Letters of
Credit hereunder, shall be identical to its duties, rights,
60
privileges and immunities as Bank as provided in this ss.15. The Agent shall not
have any duties or responsibilities or any fiduciary relationship with any Bank
except those expressly set forth in this Agreement. Neither the Agent nor any of
its affiliates shall be responsible to the Banks for any recitals, statements,
representations or warranties made by the Borrowers or any other Person whether
contained herein or otherwise or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement, the other Loan
Documents or any other document referred to or provided for herein or therein or
for any failure by the Borrowers or any other Person to perform its obligations
hereunder or thereunder or in respect of the Notes. The 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. Neither the Agent nor any of its directors, officers, employees
or agents shall be responsible for any action taken or omitted to be taken by it
or them hereunder or in connection herewith, except for its or their own gross
negligence or willful misconduct. The Bank in its separate capacity as a Bank
shall have the same rights and powers hereunder as any other Bank.
ss.15.2. Actions By Agent. The Agent shall be fully justified in
failing or refusing to take any action under this Agreement as it reasonably
deems appropriate unless it shall first have received such advice or concurrence
of the Banks and shall be indemnified to its reasonable satisfaction by the
Banks against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement or any of the Loan Documents in accordance with a request of the
Banks, and such request and any action taken or failure to act pursuant thereto
shall be binding upon the Banks and all future holders of the Notes or any
Letter of Credit Participation.
ss.15.3. Indemnification. Without limiting the obligations of the
Borrowers hereunder or under any other Loan Document, the Banks agree to
indemnify the Agent, ratably in accordance with their respective Commitment
Percentages, for any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements or any
kind or nature whatsoever which may at any time be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of this
Agreement or any other Loan Document or any documents contemplated by or
referred to herein or therein or the transactions contemplated hereby or thereby
or the enforcement of any of the terms hereof or thereof or of any such other
documents; provided, that no Bank shall be liable for any of the foregoing to
the extent they arise from the gross negligence or willful misconduct of the
Agent (or any agent thereof).
ss.15.4. Reimbursement. Without limiting the provisions of ss.15.3, the
Banks and the Agent hereby agree that the Agent shall not be obliged to make
available to any Person any sum which the Agent is expecting to receive for the
account of that Person until the Agent has determined that it has received that
sum. The Agent may, however, disburse funds prior to determining that the sums
which the Agent expects to receive have been finally and unconditionally paid to
the Agent, if the Agent wishes to do so. If and to the extent that the Agent
does disburse funds and it later becomes apparent that the Agent did not then
receive a payment in an amount equal to the sum paid out, then any Person to
whom the Agent made the funds available shall, on demand from the Agent, refund
to the Agent the sum paid to that
61
Person. If, in the opinion of the Agent, the distribution of any amount received
by it in such capacity hereunder or under the Loan Documents might involve it in
liability, it may refrain from making distribution until its right to make
distribution shall have been adjudicated by a court of competent jurisdiction.
If a court of competent jurisdiction shall adjudge that any amount received and
distributed by the Agent is to be repaid, each Person to whom any such
distribution shall have been made shall either repay to the Agent its
proportionate share of the amount so adjudged to be repaid or shall pay over the
same in such manner and to such Persons as shall be determined by such court.
ss.15.5. Documents. The Agent will forward to each Bank, promptly after
the Agent's receipt thereof, a copy of each notice or other document furnished
to the Agent for such Bank hereunder; provided, however, that, notwithstanding
the foregoing, the Agent may furnish to the Banks a monthly summary with respect
to Letters of Credit issued hereunder in lieu of copies of the related Letter of
Credit Applications.
ss.15.6. Non-Reliance on Agent and Other Banks. Each Bank represents
that it has, independently and without reliance on the Agent or any other Bank,
and based on such documents and information as it has deemed appropriate, made
its own appraisal of the financial condition and affairs of the Borrowers and
decision to enter into this Agreement and the other Loan Documents and agrees
that it will, independently and without reliance upon the Agent or any other
Bank, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own appraisals and decisions in taking or not
taking action under this Agreement or any other Loan Document. The Agent shall
not be required to keep informed as to the performance or observance by the
Borrowers of this Agreement, the other Loan Documents or any other document
referred to or provided for herein or therein or by any other Person of any
other agreement or to make inquiry of, or to inspect the properties or books of,
any Person. Except for notices, reports and other documents and information
expressly required to be furnished to the Banks by the Agent hereunder, the
Agent shall not have any duty or responsibility to provide any Bank with any
credit or other information concerning any person which may come into the
possession of the Agent or any of its affiliates. Each Bank shall have access to
all documents relating to the Agent's performance of its duties hereunder at
such Bank's request. Unless any Bank shall promptly object to any action taken
by the Agent hereunder (other than actions to which the provisions of ss.15.8
are applicable and other than actions which constitute gross negligence or
willful misconduct by the Agent), such Bank shall conclusively be presumed to
have approved the same.
ss.15.7. Resignation of Agent. The Agent may resign at any time by
giving 60 days prior written notice thereof to the Banks and the Borrowers. Upon
any such resignation, the Banks shall have the right to appoint a successor
Agent. If no successor Agent shall have been so appointed by the Banks and shall
have accepted such appointment within 30 days after the retiring Agent's giving
of notice of resignation, then the retiring Agent may, on behalf of the Banks,
appoint a successor Agent, which shall be a financial institution having a
combined capital and surplus in excess of $150,000,000. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the
62
retiring Agent shall be discharged from its duties and obligations hereunder.
After any retiring Agent's resignation, the provisions of this Agreement shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Agent. Any new Agent appointed pursuant to
this ss.15.7 shall immediately issue new Letters of Credit in place of Letters
of Credit previously issued by the Agent.
ss.15.8. Action by the Banks, Consents, Amendments, Waivers, Etc.
Except as otherwise expressly provided in this ss.15.8, any action to be taken
(including the giving of notice) may be taken or any consent or approval
required or permitted by the Agreement or any other Loan Document to be given by
the Banks may be given, and any term of this Agreement, any other Loan Document
or any other instrument, document or agreement related to this Agreement or the
other Loan Documents or mentioned therein may be amended and the performance or
observance by the Borrowers or any other person of any of the terms thereof and
any Default or Event of Default (as defined in any of the above-referenced
documents or instruments) may be waived (either generally or in a particular
instance and either retroactively or prospectively) only with the written
consent of the Required Banks; provided, however, that no such consent or
amendment which affects the rights, duties or liabilities of the Agent shall be
effective without the written consent of the Agent. Notwithstanding the
foregoing, no amendment, waiver or consent shall, do any of the following unless
in writing and signed by ALL of the Banks (a) increase the principal amount of
the Total Commitment (or subject the Banks to any additional obligations), (b)
reduce the principal of or interest on the Notes (including, without limitation,
interest on overdue amounts) or any fees payable hereunder, (c) postpone any
date fixed for any payment in respect of principal or interest (including,
without limitation, interest on overdue amounts) on the Notes, or any fees
payable hereunder; (d) change the definition of "Required Banks" or number of
Banks which shall be required for the Banks or any of them to take any action
under the Loan Documents; (e) amend this ss.15.8; (f) change the Commitment
Percentage of any Bank, except as permitted under ss.19 hereof; or (g) except as
otherwise permitted hereunder, release any Collateral.
ss.16. EXPENSES. Whether or not the transactions contemplated herein
shall be consummated, the Borrowers hereby promise to (a) reimburse Agent as
well as the Agent's affiliates for all reasonable out-of-pocket fees and
disbursements (including all reasonable attorneys' fees, collateral evaluation
costs and Consulting Engineer's fees), incurred or expended in connection with
the preparation, filing or recording, or interpretation of this Agreement, the
other Loan Documents, or any amendment, modification, approval, consent or
waiver hereof or thereof, or with the enforcement of any Obligations or the
satisfaction of any indebtedness of the Borrowers hereunder or thereunder, or in
connection with any litigation, proceeding or dispute hereunder in any way
related to the credit hereunder and (b) reimburse all reasonable out-of-pocket
fees and disbursements (including all reasonable attorneys' fees) incurred by
any Bank in connection with the enforcement of or preservation of rights under
any of the Loan Documents against the Borrowers or the administration thereof
after the occurrence of a Default or Event of Default and (ii) any litigation,
proceeding or dispute hereunder in any way related to the credit hereunder. The
Borrowers will pay any taxes (including any interest and penalties in respect
thereof) other than the Banks' federal and state income taxes, payable on or
with respect to the
63
transactions contemplated by this Agreement (the Borrowers hereby agreeing to
indemnify the Banks with respect thereto).
ss.17. INDEMNIFICATION. The Borrowers agree to indemnify and hold
harmless the Banks, as well as the Banks' shareholders, directors, agents,
officers, subsidiaries and affiliates, from and against all damages, losses,
settlement payments, obligations, liabilities, claims, suits, penalties,
assessments, citations, directives, demands, judgments, actions or causes of
action, whether statutory created or under the common law, and reasonable costs
and expenses incurred, suffered, sustained or required to be paid by an
indemnified party by reason of or resulting from the transactions contemplated
hereby, except any of the foregoing which result from the gross negligence or
willful misconduct of the indemnified party. In any investigation, proceeding or
litigation, or the preparation therefor, each Bank shall be entitled to select
its own counsel and, in addition to the foregoing indemnity, the Borrowers agree
to pay promptly the reasonable fees and expenses of such counsel. In the event
of the commencement of any such proceeding or litigation, the Borrowers shall be
entitled to participate in such proceeding or litigation with counsel of their
choice at their expense, provided that such counsel shall be reasonably
satisfactory to the Banks. The covenants of this ss.17 shall survive payment or
satisfaction of payment of amounts owing with respect to the Notes or any other
Loan Document.
ss.18. SURVIVAL OF COVENANTS, ETC. Unless otherwise stated herein, all
covenants, agreements, representations and warranties made herein, in the other
Loan Documents or in any documents or other papers delivered by or on behalf of
the Borrowers pursuant hereto shall be deemed to have been relied upon by the
Banks and the Agent, notwithstanding any investigation heretofore or hereafter
made by any of them, and shall survive the making by the Banks of the Loans and
the issuance, extension or renewal of any Letters of Credit, as herein
contemplated, and shall continue in full force and effect so long as any amount
due under this Agreement, any Letter of Credit or the Notes remains outstanding
and unpaid or any Bank has any obligation to make any Loans or issue any Letters
of Credit hereunder. All statements contained in any certificate or other paper
delivered by or on behalf of the Borrowers pursuant hereto or in connection with
the transactions contemplated hereby shall constitute representations and
warranties by the Borrowers hereunder.
ss.19. SYNDICATION AND PARTICIPATION. It is understood and agreed that
each Bank shall have the right to assign at any time its portion of the Total
Commitment and interests in the risk relating to any Loans in an amount equal to
or greater than $5,000,000, to additional banks or other financial institutions
acceptable to Agent and Parent, which acceptances shall not be unreasonably
withheld, so long as (1) BankBoston will be the Agent hereunder, and that each
bank or other financial institution which executes and delivers to the Banks and
the Borrowers hereunder a counterpart joinder in form and substance satisfactory
to the Banks and such bank or financial institution shall, on the date specified
in such counterpart joinder, become a party to this Agreement and the other Loan
Documents for all purposes of this Agreement and the other Loan Documents, and
its Commitment shall be as set forth in such counterpart joinder. Upon the
execution and delivery of such counterpart joinder, (a) the Borrowers shall
issue to the bank or other financial institution Notes in the amount of such
bank's or other financial institution's Commitment dated the Closing Date or
such other date as may be specified by the Agent and
64
otherwise completed in substantially the form of the Notes executed and
delivered on the Closing Date; (b) the Agent shall distribute to the Borrowers,
the Banks and such bank or financial institution a schedule reflecting such
changes; (c) this Agreement shall be appropriately amended to reflect (i) the
status of such bank or financial institution as a party hereto and (ii) the
status and rights of the Banks and Agent hereunder; (d) the Borrowers shall take
such action as the Agent may reasonably request to perfect any security
interests or mortgages in favor of the Banks, including any bank or financial
institution which becomes a party to this Agreement; and (e) the assignee bank
or financial institution shall pay a processing and recordation fee of $2,500 to
the Agent. Each Bank shall also have the right to grant participations to one or
more banks or other financial institutions in or to all or any part of any Loans
owing to such Bank and the Note held by such Bank. The documents evidencing any
such participation may provide that, except with the consent of the bank or
financial institution that is a party thereto, such Bank will not consent to (a)
the reduction in or forgiveness of the stated principal of or rate of interest
on or Commitment Fee with respect to the portion of any Loan subject to such
participation or assignment, (b) the extension or postponement of any stated
date fixed for payment of principal or interest or Commitment Fee with respect
to the portion of any Loan subject to such participation or assignment, or (c)
the waiver or reduction of any right to indemnification of such Bank hereunder,
or (d) except as otherwise permitted hereunder, the release of any Collateral;
provided that such participating Bank shall not have more rights then those set
forth in this sentence. Notwithstanding the foregoing, no syndication,
assignment or participation shall operate to increase the Total Commitment or
the amount of the Term Loans hereunder or reduce the sum of (a) the Commitment
of any Bank plus (b) the principal amount of such Bank's Term Loans to be an
amount less than $5,000,000 or otherwise alter the substantive terms of this
Agreement.
ss.20. PARTIES IN INTEREST. All the terms of this Agreement and the
other Loan Documents shall be binding upon and inure to the benefit of and be
enforceable by the respective successors and assigns of the parties hereto and
thereto; provided, that no Borrower shall assign or transfer its rights
hereunder without the prior written consent of the Banks.
ss.21. NOTICES, ETC. Except as otherwise expressly provided in this
Agreement, all notices and other communications made or required to be given
pursuant to this Agreement or the other Loan Documents shall be in writing and
shall be delivered in hand, mailed by United States first-class mail, postage
prepaid, or sent by telegraph, telex or telecopier and confirmed by letter,
addressed as follows:
(a) if to the Borrowers, at 00 Xxxxxx Xxxx Xxxx, X.X. Xxx 000,
Xxxxxxx, Xxxxxxx 00000, Attention: President, telecopy number
000-000-0000;
(b) if to the Agent or BankBoston, at 000 Xxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000, XXX, Attention: Xxxxxx X. Xxxxxxxx, Vice
President, telecopy number 000-000-0000;
or such other address for notice as shall have last been furnished in writing to
the Person giving the notice.
65
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (a) if delivered by hand to a responsible
officer of the party to which it is directed, at the time of the receipt thereof
by such officer, (b) if sent by registered or certified first-class mail,
postage prepaid, five Business Days after the posting thereof, and (c) if sent
by telex or cable, at the time of the dispatch thereof, if in normal business
hours in the country of receipt, or otherwise at the opening of business on the
following Business Day.
ss.22. MISCELLANEOUS. The rights and remedies herein expressed are
cumulative and not exclusive of any other rights which the Banks or Agent would
otherwise have. The captions in this Agreement are for convenience of reference
only and shall not define or limit the provisions hereof. This Agreement and any
amendment hereof may be executed in several counterparts and by each party on a
separate counterpart, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one instrument. In proving
this Agreement it shall not be necessary to produce or account for more than one
such counterpart signed by the party against whom enforcement is sought.
ss.23. ENTIRE AGREEMENT, ETC. The Loan Documents and any other
documents executed in connection herewith or therewith express the entire
understanding of the parties with respect to the transactions contemplated
hereby. Neither this Agreement nor any term hereof may be changed, waived,
discharged or terminated, except as provided in ss.14.8. No waiver shall extend
to or affect any obligation not expressly waived or impair any right consequent
thereon. No course of dealing or omission on the part of the Agent or any Bank
in exercising any right shall operate as a waiver thereof or otherwise be
prejudicial thereto. No notice to or demand upon the Borrowers shall entitle the
Borrowers to other or further notice or demand in similar or other
circumstances.
ss.24. WAIVER OF JURY TRIAL. EACH OF THE BORROWERS HEREBY WAIVES ITS
RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY
DISPUTE IN CONNECTION WITH THIS AGREEMENT, THE NOTES OR ANY OF THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE
OF SUCH RIGHTS AND OBLIGATIONS. EXCEPT AS PROHIBITED BY LAW, EACH BORROWER
HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION
REFERRED TO IN THE PRECEDING SENTENCE ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES. THE BORROWERS (a) CERTIFY THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OR
ANY BANK OF THE AGENT HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH BANK OR
THE AGENT WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVERS AND (b) ACKNOWLEDGE THAT THE AGENT AND THE BANKS HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY
BECAUSE OF, AMONG
66
OTHER THINGS, THE BORROWERS' WAIVERS AND CERTIFICATIONS CONTAINED HEREIN.
ss.25. GOVERNING LAW. THIS AGREEMENT AND, EXCEPT AS OTHERWISE
SPECIFICALLY PROVIDED THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS
UNDER THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID COMMONWEALTH
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE BORROWERS
CONSENT TO THE JURISDICTION OF ANY OF THE FEDERAL OR STATE COURTS LOCATED IN THE
COMMONWEALTH OF MASSACHUSETTS IN CONNECTION WITH ANY SUIT TO ENFORCE THE RIGHTS
OF ANY BANK OR THE AGENT UNDER THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS.
ss.26. SEVERABILITY. The provisions of this Agreement are severable and
if any one clause or provision hereof shall be held invalid or unenforceable in
whole or in part in any jurisdiction, then such invalidity or unenforceability
shall affect only such clause or provision, or part thereof, in such
jurisdiction, and shall not in any manner affect such clause or provision in any
other jurisdiction, or any other clause or provision of this Agreement in any
jurisdiction.
ss.27. TRANSITIONAL ARRANGEMENTS.
ss.27.1. Prior Credit Agreement Superseded. This Agreement shall amend
and supersede and replace the Prior Credit Agreement in its entirety, except as
provided in this ss.27. On the Closing Date, the rights and obligations of the
parties under the Prior Credit Agreement and the "Notes" as defined therein
shall be subsumed within and be governed by this Agreement and the Notes issued
hereunder. All "Revolving Credit Loans" or "Letters of Credit", (as defined in
the Prior Credit Agreement) outstanding under the Prior Credit Agreement on the
Closing Date shall become Revolving Credit Loans or Letters of Credit hereunder,
as the case may be, and "Term Loan (I)" and "Term Loan (II)" (as defined in the
Prior Credit Agreement) outstanding under the Prior Credit Agreement on the
Closing Date shall become the Series A Term Loan hereunder. The Banks' interest
in such Loans and participation in such Letters of Credit will be reallocated on
the Closing Date in accordance with each Bank's applicable Commitment Percentage
and Series A Term Loan Percentage.
ss.27.2. Interest and Fees Under Prior Credit Agreement. All interest
and all commitment, facility and other fees and expenses owing or accruing under
or in respect of the Prior Credit Agreement shall be calculated as of the
Closing Date (prorated in the case of any fractional periods), and shall be paid
on the Closing Date in accordance with the terms of the Prior Credit Agreement.
ss.28. PARI PASSU TREATMENT. Notwithstanding anything to the contrary
set forth herein, each payment or prepayment of principal and interest received
after the occurrence of an Event of Default hereunder shall be distributed pari
passu among the Banks, in accordance with
67
the aggregate outstanding principal amount of the Obligations owing to each Bank
divided by the aggregate outstanding principal amount of all Obligations.
68
IN WITNESS WHEREOF, the undersigned have duly executed this Amended and
Restated Revolving Credit and Term Loan Agreement under seal as of the date
first set forth above.
BANKBOSTON, N.A.,
individually and as Agent
By: ___________________________________________
Name: _________________________________________
Title: ________________________________________
KEYBANK NATIONAL ASSOCIATION
By: ___________________________________________
Name: _________________________________________
Title: ________________________________________
USTRUST
By: ___________________________________________
Name: _________________________________________
Title: ________________________________________
[SIGNATURES CONTINUED ON NEXT PAGE]
69
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION
By: ___________________________________________
Name: _________________________________________
Title: ________________________________________
BHF-BANK AKTIENGESELLSCHAFT
By: ___________________________________________
Name: _________________________________________
Title: ________________________________________
COMERICA BANK
By: ___________________________________________
Name: _________________________________________
Title: ________________________________________
[SIGNATURES CONTINUED ON NEXT PAGE]
70
XXXXXXX WASTE SYSTEMS, INC.
NEW ENGLAND WASTE
SERVICES OF VERMONT, INC.
NEWBURY WASTE
MANAGEMENT, INC.
NEW ENGLAND WASTE
SERVICES OF N.Y., INC.
XXXXXXX WASTE MANAGEMENT
OF N.Y., INC.
XXXXXXX WASTE MANAGEMENT
OF PENNSYLVANIA, INC.
By: ______________________________________________
Name: Xxxx X. Xxxxxxx
Title: President of each of the
companies listed above
[SIGNATURES CONTINUED ON NEXT PAGE]
71
XXXXXXX WASTE MANAGEMENT,
INC.
NEW ENGLAND WASTE
SERVICES, INC.
BRISTOL WASTE MANAGEMENT,
INC.
SUNDERLAND WASTE
MANAGEMENT, INC.
NORTH COUNTRY
ENVIRONMENTAL SERVICES,
INC.
XXXXXX ENVIRONMENTAL
RECOVERY FACILITIES, INC.
XXXXXX ENVIRONMENTAL
SERVICES
CASELLA T.I.R.E.S., INC.
XXXXX HOLLOW REGENERATION CORP.
By: _____________________________________________
Name: Xxxx X. Xxxxxxx
Title: Vice President/Secretary of
each of the companies listed
above
72
SCHEDULE 1
SUBSIDIARIES OF XXXXXXX WASTE SYSTEMS, INC.
Parent: Xxxxxxx Waste Systems, Inc.,
a Delaware corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Subsidiaries: Xxxxxxx Waste Management, Inc.,
a Vermont corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
New England Waste Services, Inc.,
a Vermont corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Xxx Xxxxxxx Waste Services of Vermont, Inc.,
a Vermont corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
North Country Environmental Services, Inc.,
a Virginia corporation
000 Xxxxx Xxxxxx, Xxx X, Xxxxx 000
Bow, New Hampshire 03304
Newbury Waste Management, Inc.,
a Vermont corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Bristol Waste Management, Inc.,
a Vermont corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Sunderland Waste Management, Inc.,
a Vermont corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
73
Xxxxxx Environmental Recovery Facilities, Inc.,
a Maine Corporation
000 Xxxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxx 00000
Xxxxxx Environmental Services,
a Maine corporation
000 Xxxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxx 00000
Xxxxxxx T.I.R.E.S., Inc.,
a Maine corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
New England Waste Services of N.Y., Inc.,
a New York corporation
Xxxxx 0, Xxxxxxxx Xxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Xxxxxxx Waste Management of N.Y., Inc.,
a New York corporation
Xxxxx 0, Xxxxxxxx Xxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Xxxxxxx Waste Management of Pennsylvania, Inc.,
a Pennsylvania corporation
00 Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Xxxxx Hollow Regeneration Corp.,
a New York corporation
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, Xxx Xxxx 00000
74
SCHEDULE 2
Banks' Commitment Percentages
BankBoston 24.2105%
KeyBank 21.0526%
USTrust 13.6842%
Bank of America 15.7895%
Comerica Bank 12.6316%
BHF-Bank Aktiengsellschaft 12.6316%
----------
100.0000%
Exhibits
Exhibit A -- Form of Revolving Credit Note
Exhibit B -- Form of Loan and Letter of Credit Request
Exhibit C -- Form of Term Note
Exhibit D -- Form of Compliance Certificate
Exhibit E -- Form of Environmental Compliance Certificate
Schedules
Schedule 1 - Subsidiaries of the Parent which are Borrowers
Schedule 2 - Banks' Commitment Percentages
Schedule 6.3 - Real Property
Schedule 6.7 - Litigation
Schedule 6.11 - Defaults
Schedule 6.13 - Financing Statements
Schedule 6.16 - Environmental Compliance
Schedule 6.18 - Certain Transactions
Schedule 6.19 - Subsidiaries of the Parent
Schedule 6.20(b) - Options, Etc.
Schedule 6.23 - Depository Accounts
Schedule 7.7 - Insurance
Schedule 8.1(c) - Existing Debt
Schedule 8.2(g) - Existing Liens
Schedule 8.2(k) - Bristol Waste Management Liens
Schedule 8.3(g) - Existing Investments
Schedule 27 - Outstanding Amounts on Closing Date
