1
SENIOR CREDIT AGREEMENT
by and among
SIMULA, INC.,
and its Subsidiaries
The Banks Named Herein
and
BANK ONE, ARIZONA, NA
as Administrative Agent
and
as Issuing Bank
Dated as of
November 6, 1998
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TABLE OF CONTENTS
Page
RECITALS.......................................................................1
ARTICLE 1. DEFINITION OF TERMS.................................................2
1.1 Definitions....................................................2
1.2 Terms Generally...............................................16
ARTICLE 2. THE RLC............................................................18
2.1 RLC Commitment................................................18
2.2 Revolving Line................................................18
2.3 RLC Notes.....................................................18
2.4 RLC...........................................................19
2.5 Excess Balance Repayment......................................22
2.6 Reduction of RLC Commitment...................................22
2.7 Conditions....................................................22
2.8 Other RLC Advances............................................22
2.9 Assignment....................................................22
2.10 Issuance of Letters of Credit.................................23
2.11 Issuance Procedure for Letters of Credit......................24
2.12 Letter of Credit Fees.........................................24
2.13 Disbursements.................................................25
2.14 Reimbursement Obligations of Borrower.........................25
2.15 Nature of Reimbursement Obligations...........................25
2.16 Banks Obligation..............................................26
2.17 Certain Requirements..........................................26
2.18 Risk Participations, Drawings, and Reimbursements.............27
2.19 Repayment of Participations...................................28
2.20 Role of the Issuing Bank......................................29
ARTICLE 2A THE TERM A LOAN....................................................30
2A.1 Term A Loan Commitment........................................30
2A.2 Term A Notes..................................................30
2A.3 Term A Loan...................................................30
2A.4 Notice of Term A Loan Advances................................32
2A.5 Conditions....................................................32
2A.6 Assignment....................................................33
ARTICLE 2B THE TERM B LOAN....................................................34
2B.1 Term B Loan Commitment........................................34
2B.2 Term B Notes..................................................34
2B.3 Term B Loan...................................................34
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2B.4 Notice of Term B Loan Advances................................37
2B.5 Conditions....................................................38
2B.6 Assignment....................................................38
ARTICLE 3. PAYMENTS, FEES AND EURODOLLAR PROVISIONS...........................39
3.1 Payments......................................................39
3.2 Fees..........................................................39
3.3 Computations..................................................40
3.4 Maintenance of Accounts.......................................40
3.5 Certain Contingencies.........................................40
3.6 Increased Capital Requirements................................41
3.7 Special Provisions for LIBOR Based Rate Advances..............41
ARTICLE 4. SECURITY DOCUMENTS CONTINUING GUARANTIES...........................44
4.1 Security......................................................44
4.2 Security Documents............................................44
4.3 Continuing Guaranties.........................................44
ARTICLE 5. CONDITIONS PRECEDENT...............................................45
5.1 Initial Advance...............................................45
5.2 No Event of Default...........................................47
5.3 No Material Adverse Change....................................47
5.4 Representations and Warranties................................47
ARTICLE 6. REPRESENTATIONS AND WARRANTIES.....................................48
6.1 Organization and Good Standing................................48
6.2 Authorization and Power.......................................48
6.3 No Conflicts or Consents......................................48
6.4 Enforceable Obligations.......................................48
6.5 Financial Condition...........................................48
6.6 Full Disclosure...............................................49
6.7 No Default....................................................49
6.8 Significant Debt Agreements...................................49
6.9 No Litigation.................................................49
6.10 Taxes.........................................................49
6.11 ERISA.........................................................49
6.12 Compliance with Law...........................................49
6.13 Survival of Representations, Etc..............................50
6.14 Recitals......................................................50
6.15 No Stock Purchase.............................................50
6.16 Solvent.......................................................50
6.17 Advances......................................................50
6.18 Subsidiaries..................................................50
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6.19 Year 2000 Compliance..........................................50
6.20 Existing Subordinated Debt....................................51
ARTICLE 7. AFFIRMATIVE COVENANTS..............................................52
7.1 Financial Statements, Reports and Documents...................52
7.2 Payment of Taxes and Other Indebtedness.......................53
7.3 Maintenance of Existence and Rights; Conduct of Business......53
7.4 Notice of Default.............................................53
7.5 Other Notices.................................................54
7.6 Compliance with Credit Documents..............................54
7.7 Compliance with Significant Debt Agreements...................54
7.8 Operations and Properties.....................................54
7.9 Books and Records; Access.....................................54
7.10 Compliance with Law...........................................54
7.11 Authorizations and Approvals..................................54
7.12 ERISA Compliance..............................................54
7.13 Further Assurances............................................55
7.14 News Releases.................................................55
7.15 Insurance.....................................................55
7.16 New Subsidiaries; Co-Borrower.................................56
7.17 Change in Control or Management...............................56
7.18 Year 2000 Compliance..........................................56
7.19 Discontinued Operations.......................................57
ARTICLE 8. NEGATIVE COVENANTS.................................................58
8.1 No Debt.......................................................58
8.2 Liens.........................................................58
8.3 No Merger.....................................................58
8.4 Amendments to Organizational Documents........................59
8.5 Margin Stock..................................................59
8.6 Fiscal Year...................................................59
8.7 Insider Loans; Payments.......................................59
8.8 Transfer Licenses or Patents..................................59
8.9 Financial Covenants...........................................59
ARTICLE 9. EVENTS OF DEFAULT..................................................61
9.1 Events of Default.............................................61
9.2 Remedies Upon Event of Default................................63
9.3 Performance by the Banks......................................65
ARTICLE 9A ADMINISTRATIVE AGENT...............................................66
9A.1 Appointment and Authorization.................................66
9A.2 Exculpation...................................................66
9A.3 Administrative Agent and Affiliates...........................66
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9A.4 Banks' Credit Decisions.......................................66
9A.5 Indemnification...............................................67
9A.6 Administration................................................67
9A.7 Default by a Bank.............................................68
9A.8 Collections; Sharing of Payments..............................69
9A.9 Successor Administrative Agent................................69
9A.10 Issuing Bank..................................................70
ARTICLE 10. MISCELLANEOUS.....................................................71
10.1 Modification..................................................71
10.2 Waiver........................................................71
10.3 Payment of Expenses...........................................71
10.4 Notices.......................................................71
10.5 Governing Law.................................................72
10.6 Invalid Provisions............................................72
10.7 Binding Effect................................................72
10.8 Entirety......................................................72
10.10 Time of the Essence...........................................73
10.11 Good Faith Standard...........................................73
10.12 Assignments and Participations; Transferees...................73
10.13 Headings......................................................76
10.14 Survival......................................................76
10.15 No Third Party Beneficiary....................................76
10.16 Schedules and Exhibits Incorporated...........................76
10.17 Setoff........................................................76
10.18 Arbitration...................................................76
10.19 JURY WAIVER...................................................77
10.20 Counterparts..................................................78
Schedule 1.1 - Pro Rata Share and Notice Address of Each Bank
Schedule 6.18 - Subsidiaries
Schedule 8.1(e) - Existing Subordinated Debt
Schedule 8.1(f) - Existing Indebtedness
Schedule 8.2 - Permitted Liens
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Exhibit "A" - Form of Compliance Certificate
Exhibit "B" - Form of Assumption Agreement
Exhibit "C" - Form of Continuing Guarantee
Exhibit "D" - Form of Notes
Exhibit "E" - Administrative Details Reply Form
Exhibit "F" - Form of Assignment and Acceptance
Exhibit "G" - Form of Security Agreement
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SENIOR CREDIT AGREEMENT
BY THIS SENIOR CREDIT AGREEMENT (together with any amendments or
modifications, the "Senior Credit Agreement"), entered into as of the 6th day of
November, 1998 by and between SIMULA, INC., an Arizona corporation (the
"Company"), all present and future Subsidiaries (as hereinafter defined) of the
Company (with the Company, the "Borrower"), the banks listed from time to time
in Schedule 1.1 (the "Banks"), and BANK ONE, ARIZONA, NA, a national banking
association, as administrative agent for the Banks (in such capacity, together
with any successor agent appointed hereunder, the "Administrative Agent") and as
Issuing Bank (as hereinafter defined), in consideration of the mutual promises
herein contained and for other valuable consideration, the parties hereto do
hereby agree as follows:
RECITALS
A. Borrower has requested that the Banks establish the following
financial accommodations:
1. A revolving line of credit (the "RLC") in the principal
amount of $20,000,000.00 to provide working capital financing and the issuance
from time to time of letters of credit;
2. A term loan facility (the "Term A Loan") in the principal
amount of $5,000,000.00 to refinance existing term debt; and
3. A term loan facility (the "Term B Loan") in the principal
amount of $5,000,000.00 to refinance certain Existing Subordinated Debt (as
hereinafter defined).
B. The Banks have agreed to do so upon the terms, conditions and
provisions set forth herein.
Accordingly, the parties hereto agree as follows:
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ARTICLE 1.
DEFINITION OF TERMS
1.1 Definitions. For the purposes of this Senior Credit Agreement,
unless the context otherwise requires, the following terms shall have the
respective meanings assigned to them in this Article 1 or in the section hereof
referred to below:
"Administrative Questionnaire" means that Administrative
Questionnaire substantially in the form of Exhibit "E" attached hereto delivered
to the Agent pursuant to Section 10.12.
"Advance" means an RLC Advance, a Term A Loan Advance or a
Term B Loan Advance.
"Affiliate" of any Person means any Person which, directly or
indirectly, controls, is controlled by, or is under common control with, such
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether by contract or otherwise.
"Assignment and Acceptance" means that Assignment and
Acceptance substantially in the form of Exhibit "F" attached hereto delivered to
the Agent pursuant to Section 10.12.
"Authorized Officer" means one or more officers of the Company
duly authorized (and so certified to the Banks by the corporate secretary of
Borrower pursuant to a certificate of authority and incumbency from time to time
satisfactory to the Banks in the exercise of the Banks' reasonable discretion),
acting alone, to request Advances under the provisions of this Senior Credit
Agreement and execute and deliver documents, instruments, agreements, reports,
statements and certificates in connection herewith.
"Bank One" means Bank One, Arizona, NA, a national banking
association.
"Banks": See the Preamble hereto.
"Bond Documents" means, as to the related Bonds, the
Indenture, the Bond Letter of Credit and any other documents delivered by the
Borrower with respect to the issuance of such Bonds.
"Bond Letter of Credit" means a Letter of Credit issued with
respect to an issuance of Bonds.
"Bonds" means tax-exempt bonds whose proceeds are being loaned
to Borrower.
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"Borrower": See the Preamble hereto.
"Business Day" means a day of the year on which commercial
banks are not required or authorized to close in Phoenix, Arizona, and, with
respect to a LIBOR Based Rate RLC Advance or a LIBOR Based Rate Term Portion, a
day other than a Saturday, Sunday or any other day on which commercial banks in
London are ordered to be closed by law or executive order.
"Change in Control" means the occurrence or existence of
either of the following events or conditions without the prior written consent
of the Banks, if different than the state of affairs as of the Closing Date:
(a) the acquisition by any Person or two or more
Persons acting in concert of "beneficial ownership" (within
the meaning of Rule 13d-3 promulgated by the SEC under the
Exchange Act or as otherwise specified under the provisions of
this Senior Credit Agreement) of securities of Borrower having
more than 50% of the ordinary voting power for the election of
directors; or
(b) the acquisition by any Person or two or more
Persons acting in concert of Control of Borrower.
"Closing Date" means November 6, 1998.
"CMLTD" means the current maturities of Borrower's
consolidated long-term debt, as construed in accordance with GAAP, less unless
previously refinanced the approximately $4,750,000.00 Existing Subordinated Debt
maturing in September 1999.
"Co-Borrowers," each a "Co-Borrower" means the Subsidiaries
that are a party to this Senior Credit Agreement from time to time.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commitment" means the RLC Commitment, the Term A Loan
Commitment, and the Term B Loan Commitment.
"Company": See the Preamble hereto.
"Continuing Guarantee": See Section 4.3 hereof.
"Control" when used with respect to any Person means the
power, directly or indirectly, to direct the management policies of such Person,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
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"Controlled Group" means, severally and collectively, the
members of the group controlling, controlled by and/or in common control of
Borrower, within the meaning of Section 4001(b) of ERISA.
"Credit Documents" means this Senior Credit Agreement, the
Notes (including any renewals, extensions, restatements and refundings thereof),
the Continuing Guarantees and any written agreements, certificates or documents
(and with respect to this Senior Credit Agreement, the Notes, the Continuing
Guarantees and such other written agreements and documents, any amendments or
supplements thereto or modifications thereof) executed or delivered pursuant to
the terms of this Senior Credit Agreement.
"Credit Facilities" means the RLC, the Term A Loan, and the
Term B Loan.
"Current Assets" means all assets of Borrower classified as
current assets under GAAP, determined on a consolidated basis.
"Current Liabilities" means all liabilities of Borrower
classified as current liabilities under GAAP, determined on a consolidated
basis, except to the extent applicable adjusted in accordance with the
definition of CMLTD.
"Current Ratio" means as of any date the ratio of Current
Assets as of such date to Current Liabilities as of such date.
"Debt Coverage Ratio" means for any date the ratio of NIDA to
CMLTD.
"Default Rate" means an interest rate per annum equal to three
percent (3.0%) above the rate that would otherwise be payable under the terms of
the respective Notes.
"Disbursement": See Section 2.13.
"Disbursement Date": See Section 2.13.
"Discontinued Operations" means the discontinuance of
operations previously conducted by the Company's Subsidiaries known as Artcraft
Industries Corp. and Coach and Car Equipment Corp.
"Dollars" and the sign "$" mean lawful currency of the United
States of America.
"EBITDA" means Net Income, plus the sum of all interest
expense, depreciation and amortization deducted in computing such Net Income,
less any debt service on Subordinated Debt, all calculated as follows:
(i) for the fiscal quarter ending June 30, 1998, the
EBITDA for the period of January 1, 1998 to June 30, 1998 multiplied by
2;
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(ii) for the fiscal quarter ending September 30,
1998, the EBITDA for the period of January 1, 1998 to September 30,
1998, multiplied by 1.33; and
(iii) thereafter, the EBITDA for the prior four
fiscal quarters, using a rolling four quarter period;
provided, however, that any losses recorded in the fiscal quarter ending June
30, 1998 due to the Discontinued Operations shall be disregarded in the
calculation of Net Income.
"EBITDA Ratio" means as of any date the ratio of Funded Debt
to EBITDA.
"Equity" means Borrower's stockholders' equity, determined on
a consolidated basis in accordance with GAAP.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, together with all final and permanent regulations issued
pursuant thereto. References herein to sections and subsections of ERISA are
deemed to refer to any successor or substitute provisions therefor.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors to the Federal Reserve System, as
in effect from time to time.
"Eurodollar Rate Reserve Percentage" for the Interest Period
for each LIBOR Based Rate RLC Advance and each LIBOR Based Rate Term Portion
means the reserve percentage applicable two (2) Business Days before the first
day of such Interest Period under regulations issued from time to time by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including, but not limited to, any
emergency, supplemental, or other marginal reserve requirement) for a member
bank of the Federal Reserve System in San Francisco with respect to liabilities
or assets consisting of or including Eurocurrency Liabilities (or with respect
to any other category of liabilities which includes deposits by reference to
which the interest rate on LIBOR Based Rate RLC Advances and LIBOR Based Rate
Term Portions is determined) having a term equal to such Interest Period.
"Event of Default": See Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Existing Subordinated Debt" means Subordinated Debt listed on
Schedule 8.1(e) attached hereto, including without limitation any refinancing
thereof.
"Federal Funds Rate" means, as of any date of determination,
the rate set forth in the weekly statistical release designated as H.15(519), or
any successor publication, published by the Federal Reserve Board (including any
such successor, "H.15(519)") for such date opposite the
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caption "Federal Funds (Effective)." If for any relevant date such rate is not
yet published in H.15(519), the rate for such date will be the rate set forth in
the daily statistical release designated as the Composite 3:30 p.m. Quotations
for U.S. Government Securities, or any successor publication, published by the
Federal Reserve Bank of New York (including any such successor, the "Composite
3:30 p.m. Quotation") for such date under the caption "Federal Funds Effective
Rate." If on any relevant date the appropriate rate for such date is not yet
published in either H.15(519) or the Composite 3:30 p.m. Quotations, the rate
for such date will be the arithmetic mean of the rates for the last transaction
in overnight Federal funds arranged prior to 9:00 a.m. (New York City time) on
that date by each of three leading brokers of Federal funds transactions in New
York City selected by the Agent.
"Financial Covenants": See Section 8.9 hereof.
"Funded Debt" means, with respect to any Person, its
Indebtedness, less its normal accounts payable and accruals, its Subordinated
Debt, advances on contracts and an amount equal to Restricted Bond Proceeds.
"GAAP" means those generally accepted accounting principles
and practices which are recognized as such by the American Institute of
Certified Public Accountants acting through its Accounting Principles Board or
by the Financial Accounting Standards Board or through other appropriate boards
or committees thereof and which are consistently applied for all periods after
the date hereof so as to properly reflect the financial condition, and the
results of operations and changes in the financial position, of Borrower,
including without limitation accounting rules promulgated pursuant to
Regulations SX and SK, except that any accounting principle or practice required
to be changed by the said Accounting Principles Board or Financial Accounting
Standards Board (or other appropriate board or committee of the said Boards) in
order to continue as a generally accepted accounting principle or practice may
be so changed.
"Governmental Authority" means any government (or any
political subdivision or jurisdiction thereof), court, bureau, agency or other
governmental authority having jurisdiction over Borrower or any of its business,
operations or properties.
"Guarantor" means each Subsidiary that has delivered a
Continuing Guarantee to the Banks.
"Honor Date" has the meaning specified in Section 2.18(b).
"Imperial" means Imperial Bank Arizona, an Arizona banking
corporation.
"Indebtedness" means, with respect to any Person, all of its
monetary and contingent obligations and liabilities, including without
limitation each of the following (without duplication): (a) obligations of that
Person to any other Person for payment of borrowed money, (b) capital lease
obligations, (c) notes and drafts drawn or accepted by that Person payable to
any other Person, whether or not representing obligations for borrowed money
(but without duplication
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of indebtedness for borrowed money), (d) any obligation for the purchase price
of property the payment of which is deferred for more than one year or evidenced
by a note or equivalent instrument, (e) guarantees of Indebtedness of third
parties, and (f) a recourse or nonrecourse payment obligation of any other
Person that is secured by a Lien on any property of the first Person, whether or
not assumed by the first Person, up to the fair market value (from time to time)
of such property (absent manifest evidence to the contrary, the fair market
value of such property shall be the amount determined under GAAP for financial
reporting purposes), but excluding any trades accounts payables and any
accruals.
"Indenture" means the Indenture as defined in the related Bond
Letter of Credit pursuant to which Bonds have been issued.
"Insolvency Proceeding" means any proceeding undertaken under
the Debtor Relief Laws.
"Interest Period" means:
(a) For each LIBOR Based Rate RLC Advance, the period
commencing on the date of such LIBOR Based Rate RLC Advance and ending
on the last day of the period selected by Borrower pursuant to the
provisions herein and, thereafter, each subsequent period commencing on
the date after the last day of the immediately preceding Interest
Period and ending on the last day of the period selected by Borrower
pursuant to the provisions herein. The duration of each Interest Period
shall be one month, two months or three months, as selected by Borrower
(A), for a new RLC Advance, in the request for a LIBOR Based Rate RLC
Advance or (B), for an outstanding RLC Advance, in the request for a
LIBOR Based Rate RLC Advance to continue bearing interest at the LIBOR
Based Rate or (C), for an outstanding Variable Rate RLC Advance, in the
request to convert to a LIBOR Based Rate RLC Advance; provided,
however, that:
(i) Interest Periods commencing on the same date
shall be of the same duration;
(ii) Whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day, provided that if such
extension would cause the last day of such Interest Period to
occur in the next following calendar month, the last day of
such Interest Period shall occur on the next preceding
Business Day; and
(iii) No Interest Period with respect to any RLC
Advance shall extend beyond the RLC Maturity Date.
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(b) For each LIBOR Based Rate Term Portion, the period
commencing on the date of such LIBOR Based Rate Term Portion and ending
on the last day of the period pursuant to the provisions herein and,
thereafter, each subsequent period commencing on the day after the last
day of the immediately preceding Interest Period and ending on the last
day of the period pursuant to the provisions herein. The duration of
each Interest Period shall be one month, two months or three months, as
selected by Borrower (A), for a new Term Loan Advance, in the request
for a LIBOR Based Rate Term Loan Advance or (B), for an outstanding
Term Loan Advance, in the request for a LIBOR Based Rate Term Loan
Advance to continue bearing interest at the LIBOR Based Rate or (C),
for an outstanding Variable Rate Term Loan Advance, in the request to
convert to a LIBOR Based Rate Term Loan Advance; provided, however,
that:
(i) Whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day, provided that if such
extension would cause the last day of such Interest Period to
occur in the next following calendar month, the last day of
such Interest Period shall occur on the next preceding
Business Day; and
(ii) No Interest Period shall extend beyond the Term
A Maturity Date or the Term B Maturity date, as applicable.
"Interest Portion" of a Bond Letter of Credit means the
Interest Portion as stated in the Bond Letter of Credit.
"Issuance Date" means the date on which a Letter of Credit is
delivered to the beneficiary thereof.
"Issuance Request" means a request for a Letter of Credit duly
executed by Borrower in a form satisfactory to the Issuing Bank.
"Issue" means, with respect to any Letter of Credit, to issue
or, by amendment or otherwise, to extend the expiry of, or to renew or increase
or decrease the amount of, such Letter of Credit; and the terms "Issued,"
"Issuing" and "Issuance" have corresponding meanings.
"Issuing Bank" means Bank One in its capacity as issuer of one
or more Letters of Credit hereunder, together with any replacement Letter of
Credit issuer arising under this Senior Credit Agreement.
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"LC Borrowing" means an extension of credit resulting from a
drawing under any Letter of Credit which shall not have been reimbursed on the
date when made nor converted into a Variable Rate Advance.
"LC Obligations" means at any time the sum of (a) the
Outstanding LC Balance under the RLC, plus (b) the amount of all unreimbursed
drawings under all Letters of Credit, including all outstanding LC Borrowings.
"Letter of Credit" means a letter of credit issued by the
Issuing Bank for the account of Borrower pursuant to Article 2.
"Letter of Credit Fee": See Section 2.12 hereof.
"LIBOR Based Rate" means the rate per annum equal to the sum
of (i) the LIBOR Based Rate Factor per annum in effect, and (ii) the rate per
annum obtained by dividing (A) the offered rate for United States dollar
deposits of not less than $1,000,000.00 for a period of time equal to each
Interest Period as of 11:00 A.M. City of London, England time two London
Business Days prior to the first date of each Interest Period as shown on the
display designated as "British Bankers Assoc. Interest Settlement Rates" on the
Telerate System ("Telerate"), Page 3750 or Page 3740, or such other page or
pages as may replace such pages on Telerate for the purpose of displaying such
rate; provided, however, that if such rate is not available on Telerate then
such offered rate shall be otherwise independently determined by the
Administrative Agent from an alternate, substantially similar independent source
available to the Administrative Agent or shall be calculated by the
Administrative Agent by a substantially similar methodology as that theretofore
used to determine such offered rate in Telerate, by (B) a percentage equal to
one hundred percent (100%) minus the Eurodollar Rate Reserve Percentage for the
period equal to such Interest Period. "London Business Day" means any day other
than a Saturday, Sunday or a day on which banking institutions are generally
authorized or obligated by law or executive order to close in the City of
London, England. The LIBOR Based Rate will change to the extent of any change in
the LIBOR Based Rate Factor. The LIBOR Based Rate Factor shall be recalculated
sixty (60) days after the end of each fiscal quarter based on the EBITDA Ratio
for the prior fiscal quarter.
"LIBOR Based Rate Factor" means:
(a) 1.50% if the EBITDA Ratio is less than or equal to 1.0 to
1.0.
(b) 1.75% if the EBITDA Ratio is less than or equal to 1.5 to
1.0, but greater than 1.0 to 1.0.
(c) 2.0% if the EBITDA Ratio is less than or equal to 2.0 to
1.0, but greater than 1.5 to 1.0.
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(d) 2.25% if the EBITDA Ratio is less than or equal to 2.5 to
1.0, but greater than 2.0 to 1.0.
(e) 2.5% if the EBITDA Ratio is less than or equal to 3.0 to
1.0, but greater than 2.5 to 1.0.
"LIBOR Based Rate RLC Advance" means an RLC Advance that bears
or is requested to bear interest at a LIBOR Based Rate. Each LIBOR Based Rate
RLC Advance shall be in a minimum amount of $1,000,000.00 with integral
multiples of $500,000.00 in excess thereof.
"LIBOR Based Rate Term Loan Advance" means a Term Loan Advance
that bears or is requested to bear interest at the LIBOR Based Rate.
"LIBOR Based Rate Term Portion" means any portion of a Term
Loan that at any time bears interest at a LIBOR Based Rate. Each LIBOR Based
Rate Term Portion shall be in a minimum amount of $1,000,000.00 with integral
multiples of $500,000.00 in excess thereof. At no time shall the aggregate
unpaid principal amount of LIBOR Based Rate Term Portions for a Term Loan exceed
an amount equal to the outstanding amount of the Term Loan less the sum of
twelve (12) Principal Payments for the Term Loan.
"Lien" means any lien, mortgage, security interest, tax lien,
pledge, encumbrance, conditional sale or title retention arrangement, or any
other interest in property designed to secure the repayment of Indebtedness
whether arising by agreement or under any statute or law, or otherwise.
"Loans" means together the RLC, the Term A Loan and the Term B
Loan, each being a Loan.
"Loan Fees": See Section 3.2 hereof.
"Material Adverse Effect" means any circumstance or event
which (i) has any material adverse effect upon the validity or enforceability of
any Credit Document, (ii) materially impairs the ability of Borrower to fulfill
its obligations under the Credit Documents, or (iii) causes an Event of Default
or any event which, with notice or lapse of time or both, would become an Event
of Default.
"Maturity Date" means the RLC Maturity Date, the Term A Loan
Maturity Date, or the Term B Loan Maturity Date, as applicable.
"Maximum LC Commitment" means FIVE MILLION AND NO/100 DOLLARS
($5,000,000.00).
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"Net Income" means for any period the pre-income tax net
income of Borrower for such period in accordance with GAAP, determined on a
consolidated basis.
"New Subsidiary": See Section 7.16 hereof.
"NIDA" means Net Income plus the sum of all depreciation and
amortization deducted in computing such Net Income, less any income taxes paid
in cash, all calculated as follows:
(i) for the fiscal quarter ending June 30, 1998, the
NIDA for the period of January 1, 1998 to June 30, 1998, multiplied by
2;
(ii) for the fiscal quarter ending September 30,
1998, the NIDA for the period of January 1, 1998 to September 30, 1998,
multiplied by 1.33; and
(iii) thereafter, the NIDA for the prior four fiscal
quarters, using a rolling four quarter period;
provided, however, that any losses recorded in the fiscal quarter ending June
30, 1998 due to the Discontinued Operations shall be disregarded in the
calculation of Net Income.
"Notes" means the RLC Note, the Term A Note and the Term B
Note, each being a Note.
"Obligation" means all present and future indebtedness,
obligations and liabilities of Borrower to the Banks, and all renewals and
extensions thereof, or any part thereof, arising pursuant to this Senior Credit
Agreement or represented by the Notes, including without limitation the Loans
and all interest accruing thereon, and attorneys' fees incurred in the
enforcement or collection thereof, regardless of whether such indebtedness,
obligations and liabilities are direct, indirect, fixed, contingent, joint,
several or joint and several; together with all indebtedness, obligations and
liabilities of Borrower evidenced or arising pursuant to any of the other Credit
Documents, and all renewals and extensions thereof, or part thereof.
"Outstanding LC Balance" in effect at any time means the
maximum aggregate amount available to be drawn at such time under all
outstanding Letters of Credit, the determination of such maximum amount to
assume compliance with all conditions for a Disbursement. With respect to a Bond
Letter of Credit, such determination shall also assume no reduction for (i) any
amount drawn by the respective Trustee to make a regularly scheduled payment of
interest on the respective Bonds, or (ii) any amount not available to be drawn
because such Bonds are held by or for the account of the Borrower or pursuant to
the respective Pledged Bond Agreement; the maximum aggregate amount available to
be drawn under a Bond Letter of Credit shall equal the sum of one hundred
percent (100%) of the aggregate principal amount of the respective Bonds then
outstanding, plus the applicable Interest Portion.
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"Outstanding Period": See Section 2.12.
"Payment Date" means the first day of each month, provided
that if any such day is not a Business Day, then such Payment Date shall be the
next successive Business Day, commencing (i) as to the RLC, December 1, 1998,
(ii) as to the Term A Loan, December 1, 1998, and (ii) as to interest on the
Term B Loan, December 1, 1998, and as to principal of the Term B Loan, November
1, 1999.
"PBGC" means the Pension Benefit Guaranty Corporation, and any
successor to all or substantially all of the Pension Benefit Guaranty
Corporation's functions under ERISA.
"Permitted Liens" means Liens which consist of the following:
(a) Liens for taxes, assessments or governmental charges not
yet delinquent;
(b) Liens to which the Banks shall consent in writing, in
their sole and absolute discretion; and
(c) Liens listed on Schedule 8.2.
"Person" includes an individual, a corporation, a joint
venture, a partnership, a trust, a limited liability company, an unincorporated
organization or a government or any agency or political subdivision thereof.
"Plan" means an employee defined benefit plan or other plan
maintained by Borrower for employees of Borrower and covered by Title IV of
ERISA, or subject to the minimum funding standards under Section 412 of the
Code.
"Pledged Bond Agreement" means a Custody, Pledge and Security
Agreement as to a certain issue of Bonds by and among Borrower, the
Administrative Agent and the related Trustee, granting the Banks a security
interest in any such Bonds purchased with a Disbursement of the related Bond
Letter of Credit and in Borrower's right, title and interest in any funds held
by said Trustee under the related Indenture for the Borrower.
"Prime Rate" means the interest rate per annum publicly
announced by Bank One, or its successors, in Phoenix, Arizona as its "prime
rate" as in effect from time to time. Borrower acknowledges that the Prime Rate
is not necessarily the best or lowest rate offered by Bank One and Bank One may
lend to its customers at rates that are at, above or below its Prime Rate.
"Principal Payment" means an amount sufficient to fully
amortize the respective Term Loan over sixty (60) equal monthly payments of
principal.
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"Pro Rata Share" means, as to each Bank, that amount shown at
any time on Schedule 1.1 attached hereto as that Bank's share of each
Commitment, each Advance and each Letter of Credit.
"Regulation U" means Regulation U promulgated by the Board of
Governors of the Federal Reserve System, 12 C.F.R. Part 221, or any other
regulation hereafter promulgated by said Board to replace the prior Regulation U
and having substantially the same function.
"Regulatory Change" means any change effective after the date
of this Senior Credit Agreement in United States federal, state, or foreign law,
regulations, or rules or the adoption or making after such date of any
interpretation, directive, or request applying to a class of banks including the
Banks, of or under any United States federal, state, or foreign law, regulation
or rule (whether or not having the force of law) by any court or governmental or
monetary authority charged with the interpretation or administration thereof.
"Reportable Event" means any "reportable event" as described
in Section 4043(b) of ERISA with respect to which the thirty (30) day notice
requirement has not been waived by the PBGC.
"Required Banks" means, at any time, Banks having Pro Rata
Shares representing at least 100.0% of the aggregate Commitment.
"Restricted Bond Proceeds" means the proceeds of any Bonds
held by the Trustee, the disbursement of which requires the consent of the
Banks.
"RLC": See Recital A hereto.
"RLC Advance" means a disbursement of the proceeds of the RLC.
"RLC Balance" means (i) with respect to the RLC on any date,
the aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of RLC Advances occurring on such date;
plus (ii) with respect to any outstanding LC Obligations on any date, the amount
of such LC Obligations on such date after giving effect to any Issuances of
Letters of Credit occurring on such date and any other changes in the aggregate
amount of the LC Obligations as of such date, including changes occurring as a
result of any reimbursements of outstanding unpaid drawings under any Letters of
Credit or any reductions in the maximum amount available for drawing under
Letters of Credit taking effect on such date.
"RLC Commitment" means TWENTY MILLION AND NO/100 DOLLARS
($20,000,000.00).
"RLC Maturity Date" means August 31, 2000.
"RLC Non-Use Fee": See Section 3.2(a).
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"RLC Note" means a Revolving Promissory Note of even date
herewith substantially in the form attached hereto as Exhibit D-1, in the amount
of a Bank's Pro Rata Share of the RLC Commitment, executed by Borrower and
delivered to a Bank pursuant to the terms of this Senior Credit Agreement,
together with any renewals, extensions, modifications, restatements or
replacements thereof.
"SEC" means the Securities and Exchange Commission.
"Security Agreement": See Section 4.1.
"Security Documents": See Section 4.2.
"Senior Credit Agreement": See the Preamble hereto.
"Significant Debt Agreement" means all documents, instruments
and agreements executed by Borrower, evidencing, securing or ensuring any
Indebtedness of Borrower or any guaranty in excess of $500,000 in outstanding
principal (or principal equivalent) amount and includes all documents relating
to the Existing Subordinated Debt.
"Stated Amount" of a Letter of Credit means the Stated Amount
as stated in the Letter of Credit.
"Stated Expiry Date" of a Letter of Credit means the Stated
Expiry Date as stated in the Letter of Credit.
"Subordinated Debt" means Indebtedness whose payment is
subordinated in writing to the payment of the Loans and the other obligations of
Borrower under this Senior Credit Agreement, to the satisfaction of the Banks.
"Subsidiaries" means all business associations directly or
indirectly controlled by the Company.
"Tangible Net Worth Percentage" means (i) Equity plus
Subordinated Debt less the book value of all intangible assets, divided by (ii)
all assets less the book value of all intangible assets and less an amount equal
to Restricted Bond Proceeds, all determined on a consolidated basis in
accordance with GAAP. All capitalized financing costs to the extent not
otherwise included in intangible assets, shall be deemed for this purpose to be
intangible assets.
"Term A Loan": See Recital A hereto.
"Term A Loan Advance" means a disbursement of the proceeds of
the Term A Loan.
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"Term A Loan Balance" means the aggregate outstanding
principal amount of all Term A Loan Advances, after giving effect to any
borrowings and prepayments or repayments of Term A Loan Advances occurring on
such date.
"Term A Loan Commitment" means FIVE MILLION AND NO/100 DOLLARS
($5,000,000.00).
"Term A Maturity Date" means August 31, 2003.
"Term A Note" means a Promissory Note of even date herewith
substantially in the form attached hereto as Exhibit D-2 in the amount of a
Bank's Pro Rata Share of the Term A Loan Commitment executed by Borrower and
delivered to a Bank pursuant to the terms of this Senior Credit Agreement,
together with any renewals, extensions, modifications or replacements thereof.
"Term B Loan": See Recital A hereto.
"Term B Loan Advance" means a disbursement of the proceeds of
the Term B Loan.
"Term B Loan Balance" means the aggregate outstanding
principal amount of all Term B Loan Advances, after giving effect to any
borrowings and prepayments or repayments of Term B Loan Advances occurring on
such date.
"Term B Loan Commitment" means FIVE MILLION AND NO/100 DOLLARS
($5,000,000.00).
"Term B Loan Expiration Date" means October 1, 1999.
"Term B Maturity Date" means October 1, 2004.
"Term B Note" means a Promissory Note of even date herewith
substantially in the form attached hereto as Exhibit D-3 in the amount of a
Bank's Pro Rata Share of the Term B Loan Commitment executed by Borrower and
delivered to a Bank pursuant to the terms of this Senior Credit Agreement,
together with any renewals, extensions, modifications, restatements or
replacements thereof.
"Term Loans," each a "Term Loan," means the Term A Loan and
the Term B Loan.
"Term Loan Advance" means a Term A Loan Advance or a Term B
Loan Advance.
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"Term Portion" means either a LIBOR Based Rate Term Portion or
a Variable Rate Term Portion, as may be applicable.
"Trustee" means the Trustee for the holders of certain Bonds,
as defined in the related Indenture.
"Variable Rate" means the rate per annum equal to the sum of
(i) the Variable Rate Factor per annum, and (ii) the Prime Rate per annum as in
effect from time to time. The Variable Rate will change (i) on each day that the
"Prime Rate" changes and (ii) to the extent of any change in the Variable Rate
Factor.
"Variable Rate Advance" means an Advance that bears, or is
requested to bear, interest at the Variable Rate.
"Variable Rate Factor" means:
(a) 0% if the EBITDA Ratio is less than or equal to 2.5 to
1.0;
(b) 0.25% if the EBITDA Ratio is less than 3.0 to 1.0, but
greater than 2.5 to 1.0.
"Variable Rate RLC Advance" means an RLC Advance that bears or
that is requested to bear interest at the Variable Rate.
"Variable Rate Term Loan Advance" means a Term Loan Advance
that bears or is requested to bear interest at the Variable Rate.
"Variable Rate Term Portion" means any portion of a Term Loan
that bears interest at the Variable Rate.
1.2 Terms Generally.
(a) The definitions in Section 1.1 shall apply equally to both
the singular and plural forms of the terms defined.
(b) Whenever the context may require, any pronoun shall
include the corresponding masculine, feminine and neuter forms.
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(c) All references herein to Articles, Sections, Exhibits and
Schedules shall be deemed references to Articles and Sections of, and
Exhibits and Schedules to, this Agreement unless the context shall
otherwise require.
(d) Except as otherwise expressly provided herein, all terms
of an accounting or financial nature shall be construed in accordance
with GAAP, as in effect from time to time.
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ARTICLE 2.
THE RLC
2.1 RLC Commitment. Each Bank agrees, severally but not jointly, to
loan to or for the benefit of Borrower, and Borrower shall be entitled to draw
upon and borrow, in the manner and upon the terms and conditions contained in
this Senior Credit Agreement, an amount that shall not exceed that Bank's Pro
Rata Share of the RLC Commitment.
2.2 Revolving Line.
(a) Subject to the terms and conditions set forth in this
Senior Credit Agreement, each Bank shall provide to Borrower a
revolving line of credit (each, a "RLC"), against which a Bank shall
fund its Pro Rata Share of each RLC Advance to be made to Borrower,
repaid by Borrower, and readvanced to Borrower, as Borrower may
request, and the Issuing Bank shall issue such Letters of Credit as
Borrower shall request, which may be terminated or repaid by Borrower
and reissued provided that (i) there is no Event of Default under any
provision of this Senior Credit Agreement, (ii) no RLC Advance shall be
made or Letter of Credit issued that would cause the RLC Balance to
exceed the RLC Commitment, (iii) no Bank shall be obligated under any
circumstances to fund an RLC Advance in excess of that Bank's Pro Rata
Share of the requested RLC Advance, (iv) the aggregate amount of a
Bank's funding of the RLC Balance at any one time outstanding shall not
exceed its Pro Rata Share of the RLC Commitment, and (v) no Letter of
Credit shall be issued with a Stated Expiry Date later than the RLC
Maturity Date. The Banks shall not be obligated to fund their Pro Rata
Share of any RLC Advance if, after giving effect thereto, any of the
foregoing limitations would be exceeded.
(b) The failure of any Bank to fund its Pro Rata Share of an
RLC Advance in accordance with its Pro Rata Share of the RLC Commitment
shall not relieve any other Bank of its several obligations hereunder,
but no Bank shall be liable with respect to the obligation of any other
Bank hereunder.
(c) RLC Advances may be made for the purpose of providing to
Borrower working capital financing or in connection with a Disbursement
under a Letter of Credit.
2.3 RLC Notes. The RLC of each Bank shall be evidenced by an RLC Note
and shall bear interest and be payable to the order of such Bank upon the terms
and conditions contained therein. The aggregate amount funded by a Bank under
its RLC Note less all repayments of principal thereof shall be the principal
amount owing and unpaid on its RLC Note and its RLC. The principal amount funded
by a Bank and all principal payments and prepayments thereof may be noted by
such Bank on a schedule attached to its RLC Note and shall be entered by the
Bank
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on its ledgers and computer records; provided that the failure of the Bank to
make such notations or entries shall not affect the principal amount owing and
unpaid on its RLC Note. The entries made in the ordinary course of business by a
Bank on its ledgers and computer records and any notations made in the ordinary
course of business by a Bank on any such schedule annexed to its RLC Note shall
be presumed to be accurate until the contrary is established. If requested,
Borrower shall confirm in writing to the Administrative Agent each RLC Advance.
2.4 RLC. The RLC shall bear interest and be payable to the Banks upon
the terms and conditions contained therein, which include the following
provisions:
(a) Interest shall accrue:
(i) Except to the extent that an RLC Advance bears
interest at the LIBOR Based Rate, on the unpaid principal of
each RLC Advance at the Variable Rate.
(ii) To the extent Borrower shall elect and to the
extent not otherwise provided herein, on the unpaid principal
of an RLC Advance at the LIBOR Based Rate.
(b) All interest shall be computed on the basis of a 360-day
year and accrue on a daily basis for the actual number of days elapsed.
All accrued interest shall be due and payable on each Payment Date.
(c) The entire unpaid principal balance, all accrued and
unpaid interest, and all other amounts payable under the RLC Note shall
be due and payable in full on the RLC Maturity Date.
(d) Each request for an RLC Advance shall, in addition to
complying with the other requirements in this Senior Credit Agreement,
(i) specify the date and amount of the requested RLC Advance, (ii)
specify whether the RLC Advance shall be an RLC Advance that bears
interest at the Variable Rate or shall be an RLC Advance that bears
interest at the LIBOR Based Rate, and (iii), if the RLC Advance is to
bear interest at the LIBOR Based Rate, (A) specify the Interest Period,
(B) be delivered to Administrative Agent before 9:00 a.m. (Phoenix,
Arizona local time) at least two (2) Business Days prior to the date of
the requested RLC Advance, and (C) be in a minimum amount of
$1,000,000.00 with integral multiples of $500,000.00 in excess thereof.
Any RLC Advance not complying with the foregoing requirements for an
RLC Advance bearing interest at the LIBOR Based Rate shall bear
interest at the Variable Rate.
(e) After receiving a request for an RLC Advance in the manner
provided herein, the Administrative Agent shall promptly, before 11:30
a.m. (Phoenix, Arizona local time) on the date an RLC Advance is
requested, notify
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each Bank by telephone (confirmed promptly in writing), telefacsimile
or cable of the terms of such request and such Bank's Pro Rata Share of
the requested RLC Advance. Each Bank shall, before 1:00 p.m. (Phoenix,
Arizona local time) on the date an RLC Advance is to be made as
specified in a request for an RLC Advance, deposit with the
Administrative Agent such Bank's Pro Rata Share of the requested RLC
Advance in immediately available funds. Upon fulfillment of all
applicable conditions set forth herein and after receipt by the
Administrative Agent of such funds, the Administrative Agent shall pay
or deliver all funds so received to the order of Borrower at the
principal office of the Administrative Agent. The failure of any Bank
to fund its Pro Rata Share of any RLC Advance required of it hereunder
shall not relieve any other Bank of its obligation to fund its Pro Rata
Share of any RLC Advance hereunder. If any Bank fails to fund its Pro
Rata Share of the requested RLC Advance and if all conditions to such
RLC Advance have apparently been satisfied, the Administrative Agent
will make available to Borrower the funds received by it from the other
Bank. Neither the Administrative Agent nor any Bank shall be
responsible for the performance by any other Bank of its obligations
hereunder.
Unless the Administrative Agent shall have received notice
from a Bank prior to the date of any RLC Advance that such Bank will
not make available to the Administrative Agent such Bank's Pro Rata
Share of the requested RLC Advance, the Administrative Agent may assume
that such Bank has made such amount available to the Administrative
Agent on the date of such RLC Advance in accordance with this Section
and the Administrative Agent may, in reliance upon such assumption,
make available a corresponding amount to or on behalf of Borrower on
such date. If and to the extent any Bank shall not have so made its Pro
Rata Share of the requested RLC Advance available to the Administrative
Agent (the "Principal Shortfall Amount"), Borrower agrees to repay the
Principal Shortfall Amount to the Administrative Agent forthwith on
demand, together with interest thereon for each day from (and
including) the date such amount is made available to or on behalf of
Borrower to (but excluding) the date such amount is repaid to the
Administrative Agent, at the rate per annum equal to the rate otherwise
applicable to the RLC Advance in question.
(f) If Borrower desires that a LIBOR Based Rate RLC Advance
continue to bear interest at the LIBOR Based Rate after the end of an
existing Interest Period, Borrower shall deliver to the Administrative
Agent a notice making such election and specifying the new Interest
Period. If Borrower does not deliver such notice within such time, then
after the existing Interest Period the LIBOR Based Rate RLC Advance
shall become a Variable Rate RLC Advance and shall bear interest at the
Variable Rate.
(g) Borrower may upon written notice to and received by the
Administrative Agent not later than 9:00 a.m. (Phoenix, Arizona local
time) (i) on
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the second Business Day, in the case of any conversion of a Variable
Rate RLC Advance into a LIBOR Based Rate RLC Advance and (ii) on the
first Business Day in the case of any conversion of a LIBOR Based Rate
RLC Advance into a Variable Rate RLC Advance, prior to the date of the
proposed conversion, convert any RLC Advance of one type into an RLC
Advance of the other type, provided, however, that any conversion of a
LIBOR Based Rate RLC Advance (A) shall only be made on the last day of
the applicable Interest Period except as otherwise provided herein, and
(B) shall be made only as to an RLC Advance in a minimum amount of
$1,000,000.00 with integral multiples of $500,000.00 in excess thereof.
Each such notice of a conversion shall specify the date of such
conversion and the RLC Advance(s) to be converted. After receiving any
such notice, the Administrative Agent shall promptly notify each Bank
by telephone, telefacsimile or cable and deliver a copy thereof to each
Bank.
(h) Each request for an RLC Advance as well as each election
by the Borrower that an RLC Advance continue to bear interest at the
LIBOR Based Rate after the end of an existing Interest Period and each
conversion request shall be irrevocable and binding on Borrower once
the request is received by the Administrative Agent and the
Administrative Agent notifies the Banks of the request. Prior to the
Administrative Agent's notice of the request to the Banks, Borrower may
revoke the request. Borrower shall indemnify each Bank against any
cost, loss or expense incurred by any Bank as a result of Borrower's
failure to fulfill, on or before the date specified for an RLC Advance
in any request for an RLC Advance, the conditions to such RLC Advance
set forth herein, including any cost, loss or expense incurred by
reason of the liquidation or reemployment of deposits or other funds
acquired by a Bank to fund such RLC Advance when such RLC Advance, as a
result of such failure, is not made on the date so specified.
(i) No RLC Advance shall be requested by Borrower to bear a
LIBOR Based Rate, whether pursuant to a request for an RLC Advance or a
conversion hereunder, so long as there shall have occurred an Event of
Default and such Event of Default is continuing.
(j) Nothing herein shall be deemed to relieve any Bank from
its obligation to fulfill its Pro Rata Share of the RLC Commitment
hereunder or to prejudice any right which the Administrative Agent or
the Borrower may have against any Bank as a result of any default by
such Bank hereunder.
(k) Upon an Event of Default, including failure to pay upon
final maturity, the Banks, at their option, may also, if permitted
under applicable law, do one or both of the following: (a) increase the
applicable interest rate to the Default Rate, and/or (b) add any unpaid
accrued interest to principal and such sum will bear interest therefrom
until paid at the rate provided herein (including any
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increased rate). The interest rate will not exceed the maximum rate
permitted by applicable law.
2.5 Excess Balance Repayment. There shall be due and payable from
Borrower to the Banks, and Borrower shall immediately repay to the Banks,
without notice or demand, from time to time, any amount by which the RLC Balance
exceeds the RLC Commitment.
2.6 Reduction of RLC Commitment. Borrower shall have the right at any
time upon at least seven days' prior written notice to the Administrative Agent
to reduce the aggregate amount of the RLC Commitment; provided, that the amount
of each such reduction shall be in a minimum aggregate amount of $1,000,000.00
or an integral aggregate multiple of $100,000.00 in excess thereof and that no
such reduction shall reduce (i) the amount of the RLC Commitment to less than
the RLC Balance, or (ii) the amount of a Bank's Pro Rata Share of the RLC
Commitment to less than the amount of the RLC Balance funded by such Bank. Any
reduction in the aggregate amount of the RLC Commitment shall reduce each Bank's
share of the RLC Commitment by its Pro Rata Share of the aggregate amount of
such reduction. The Administrative Agent shall promptly notify each Bank of any
such notice of reduction received from the Borrower. Any reduction in the RLC
Commitment may not be reinstated without the mutual prior consent of the
Borrower and the Banks.
2.7 Conditions. The Banks shall have no obligation to fund their Pro
Rata Shares of any RLC Advance unless and until all of the conditions and
requirements of this Senior Credit Agreement are fully satisfied. However, the
Banks in their sole and absolute discretion may elect to make one or more RLC
Advances prior to full satisfaction of one or more such conditions and/or
requirements. Notwithstanding that such an RLC Advance or RLC Advances are made,
such unsatisfied conditions and/or requirements shall not be waived or released
thereby. Borrower shall be and continue to be obligated to fully satisfy such
conditions and requirements, and the Banks, at any time, in their sole and
absolute discretion, may stop making RLC Advances until all conditions and
requirements are fully satisfied.
2.8 Other RLC Advances. The Administrative Agent, at the direction of
the Banks, after giving written notice to Borrower, from time to time, may make
RLC Advances in any amount in payment of (i) insurance premiums, taxes,
assessments, liens or encumbrances existing against Borrower's property, (ii)
interest accrued and payable upon the RLC, (iii) any indebtedness, charges and
expenses that are the obligation of Borrower under this Senior Credit Agreement,
and (iv) any charges or matters necessary to cure any Event of Default.
2.9 Assignment. Borrower shall have no right to any RLC Advance other
than to have the same disbursed by the Administrative Agent in accordance with
the disbursement provisions contained in this Senior Credit Agreement. Any
assignment or transfer, voluntary or involuntary, of this Senior Credit
Agreement or any right hereunder shall not be binding upon or in any way affect
the Banks without their written consent; the Administrative Agent, at the
direction of the Banks may make RLC Advances under the disbursement provisions
herein, notwithstanding any such assignment or transfer.
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2.10 Issuance of Letters of Credit.
(a) Subject to the terms and conditions of this Senior Credit
Agreement, (i) the Issuing Bank agrees from time to time before the RLC
Maturity Date to issue Letters of Credit for the account of the
Borrower either to credit enhance Bonds or for normal business
purposes; and (ii) the Banks severally agree to participate in Letters
of Credit issued for the account of the Borrower, subject to the prior
approval by each Bank of the provisions of each Letter of Credit. Each
reference in this Senior Credit Agreement to the "issue" or "issuance"
or other forms of such words in relation to Letters of Credit shall be
deemed to include any extension or renewal of a Letter of Credit.
(b) Each Letter of Credit shall (i) by its terms be issued in
a Stated Amount; (ii) have a Stated Expiry Date no later than the RLC
Maturity Date; (iii) expire or be terminated by the beneficiary
thereunder on or before its Stated Expiry Date; (iv) not cause the RLC
Balance after the issuance of said Letter of Credit to exceed the RLC
Commitment; and (v) not cause the Outstanding LC Balance after the
issuance of said Letter of Credit to exceed the Maximum LC Commitment.
(c) In addition to the conditions otherwise specified in this
Section, the obligation of the Issuing Bank to issue a Letter of Credit
shall be subject to the further condition precedent that the following
statements shall be correct, and each of the application for such
Letter of Credit and the issuance of such Letter of Credit shall
constitute a representation and warranty by Borrower that on the date
of the issuance of such Letter of Credit such statements are correct:
(i) The representations and warranties in Article 6
are correct on and as of the date of the issuance of such
Letter of Credit, before and after giving effect to such
issuance, as though made on and as of such date;
(ii) No Event of Default has occurred and is
continuing; and
(iii) The conditions in Section 2.2(a) are satisfied
as of the date of issuance of the Letter of Credit, before and
after giving effect to such issuance.
(d) In addition to the conditions otherwise specified in this
Section, the obligations of the Issuing Bank to issue a Letter of
Credit that is a Bond Letter of Credit shall be subject to the
satisfaction of the following conditions precedent as determined by
Lender in its reasonable discretion:
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(i) The terms and provisions of the related Bond
Documents shall be reasonably acceptable to the Banks, which
shall provide among other things that all disbursements of
proceeds of the related Bonds shall be subject to the Banks'
written consent.
(ii) Borrower shall have delivered to the Banks an
executed Pledged Bond Agreement with respect to the related
Bonds.
(iii) The Banks shall have received executed copies
of the Bond Documents together with copies of written opinions
of counsel as to the tax exemption of the related Bonds and
reliance letters addressed to the Banks, allowing the Banks to
rely on such opinions.
(iv) Borrower shall have delivered to the Banks such
documents, executed by Borrower, as the Banks may reasonably
require, granting the Banks a security interest in all
property, personal or real, financed with the proceeds of said
Bonds, as well as in any accounts established with respect
thereto, together with financing statements, an environmental
indemnity agreement, contract assignments, a lender's ALTA
extended coverage title insurance policy as to the Banks'
security interest in any real property, and a project budget.
2.11 Issuance Procedure for Letters of Credit. By delivery to the
Issuing Bank of an Issuance Request on or before 9:00 a.m. (Phoenix, Arizona
time) three (3) Business Days prior to the requested Issuance Date, and the
execution of such applications and agreements as the Issuing Bank may reasonably
request, Borrower may request the issuance of a Letter of Credit in such form as
Borrower may reasonably request. Each Issuance Request shall include the form of
the Letter of Credit, the amount and other terms thereof. Subject to the terms
and conditions of this Senior Credit Agreement, the Issuing Bank will issue such
Letter of Credit on the Issuance Date specified in the Issuance Request
submitted in connection therewith. The Issuing Bank and Borrower agree that all
Letters of Credit issued pursuant to the terms of this Article shall be subject
to the terms and conditions and entitled to the benefits of this Senior Credit
Agreement and the other Credit Documents.
2.12 Letter of Credit Fees. Borrower agrees to pay to the
Administrative Agent, for distribution to the Banks pursuant to Section 9A.8
hereof, a non-refundable Letter of Credit fee (the "Letter of Credit Fee") equal
to the LIBOR Based Rate Factor then in effect per annum on the Stated Amount of
each Letter of Credit, computed on a daily basis, from and including the
Issuance Date of such Letter of Credit to the Stated Expiry Date ("Outstanding
Period"). The Letter of Credit Fee shall be payable in advance upon the issuance
of a Letter of Credit, except as to a Bond Letter of Credit for which it shall
be payable quarterly in arrears until such Bond
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Letter of Credit's Stated Expiry Date. Upon an Event of Default, the Letter of
Credit Fee shall be equal to three hundred basis points (3.0%) above the LIBOR
Based Rate Factor. Borrower further agrees to pay to the Issuing Bank a charge
for all reasonable administrative expenses of the Issuing Bank in connection
with the issuance, amendment or modification (if any) and administration of the
Letter of Credit upon demand from time to time, which charge shall not exceed
$150.00 per draw, transfer or transaction.
2.13 Disbursements. The Issuing Bank will notify Borrower of the
presentment for payment of a Letter of Credit by any beneficiary thereto,
together with notice of the date (the "Disbursement Date") such payment shall be
made. Subject to the terms and provisions of the Letter of Credit, the Issuing
Bank shall make such payment (a "Disbursement") to the beneficiary of the Letter
of Credit. Each such Disbursement shall be deemed to be an RLC Advance
hereunder.
2.14 Reimbursement Obligations of Borrower. Borrower's obligation under
Section 2.13 to reimburse the Banks with respect to each Disbursement (including
interest thereon) in respect of any Letter of Credit shall be absolute and
unconditional under any and all circumstances and irrespective of any setoff,
counterclaim, or defense to payment which Borrower may have or have had against
the Banks, the Issuing Bank, the Administrative Agent or the beneficiary
thereof, including any defense based upon the occurrence of any Event of
Default, any draft, demand or certificate or other document presented under the
Letter of Credit proving to be forged, fraudulent, invalid or insufficient, the
failure of any Disbursement to conform to the terms of the Letter of Credit (if,
in Issuing Bank's good faith opinion, such Disbursement is determined to be
appropriate) or any non-application or misapplication by the beneficiary of the
proceeds of such Disbursement, or the legality, validity, form, regularity or
enforceability of the Letter of Credit; provided, however, that nothing herein
shall adversely affect the right of Borrower to commence any proceeding against
Issuing Bank for any wrongful Disbursement made by Issuing Bank under the Letter
of Credit as a result of acts or omissions constituting gross negligence or
wilful misconduct on the part of Issuing Bank.
2.15 Nature of Reimbursement Obligations. Borrower shall assume all
risks of the acts, omissions or misuse of any Letter of Credit by the
beneficiary thereof. Neither the Banks nor the Issuing Bank (except to the
extent of its own gross negligence or wilful misconduct) shall be responsible
for:
(a) the form, validity, sufficiency, accuracy, genuineness or
legal effect of any Letter of Credit or any document submitted by any
party in connection with the issuance of any Letter of Credit, even if
such document should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged;
(b) the form, validity, sufficiency, accuracy, genuineness or
legal effect of any instrument transferring or assigning or purporting
to transfer or assign any Letter of Credit;
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(c) failure of any beneficiary of any Letter of Credit to
comply fully with conditions required in order to demand payment under
a Letter of Credit;
(d) errors, omissions, interruption or delays in transmission
or delivery of any messages, by mail, cable, telegraph, telex or
otherwise; or
(e) any loss or delay in the transmission or otherwise of any
document or draft required by or from a beneficiary of a Letter of
Credit in order to make a Disbursement under a Letter of Credit or of
the proceeds thereof.
None of the foregoing shall affect, impair or prevent the vesting of any of the
rights or powers granted the Banks or the Issuing Bank hereunder. In furtherance
and extension, and not in limitation or derogation of any of the foregoing, any
action taken or omitted to be taken by the Banks or the Issuing Bank in good
faith shall be binding upon the Borrower and shall not put the Banks or the
Issuing Bank under any resulting liability to Borrower.
2.16 Banks Obligation. Nothing herein shall be deemed to relieve any
Bank from its obligations to fulfill its Pro Rata Share of the RLC Commitment
hereunder or to prejudice any right which the Administrative Agent or the
Borrower may have against any Bank as a result of any default by such Bank
hereunder.
2.17 Certain Requirements. The Issuing Bank is under no obligation to
Issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or
restrain the Issuing Bank from Issuing such Letter of Credit, or any
requirement of law applicable to the Issuing Bank or any request or
directive (with which it is customary for banks in the relevant
jurisdiction to comply whether or not having the force of law) from any
Governmental Authority with jurisdiction over the Issuing Bank shall
prohibit, or request that the Issuing Bank refrain from, the Issuance
of letters of credit generally or such Letter of Credit in particular
or shall impose upon the Issuing Bank with respect to such Letter of
Credit any restriction, reserve, or capital requirement (for which the
Issuing Bank is not otherwise compensated hereunder) not in effect on
the Closing Date, or shall impose upon the Issuing Bank any
unreimbursed loss, cost, or expense which was not applicable on the
Closing Date and which the Issuing Bank in good xxxxx xxxxx material to
it;
(ii) the Issuing Bank has received written notice
from any Bank, the Administrative Agent or Borrower, on or prior to the
Business Day prior to the requested date of Issuance of such Letter of
Credit, that one or more of the applicable conditions contained in
Article 5 is not then satisfied;
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(iii) the Stated Expiry Date of any requested Letter
of Credit is not in accord with the requirements of Section 2.10(b),
unless all of the Banks have approved such Stated Expiry Date;
(iv) any requested Letter of Credit does not provide
for drafts, or is not otherwise in form and substance acceptable to the
Issuing Bank, or the Issuance of a Letter of Credit shall violate any
applicable policies of the Issuing Bank; or
(v) such Letter of Credit is to be used for a purpose
other than as provided herein or denominated in a currency other than
Dollars.
2.18 Risk Participations, Drawings, and Reimbursements.
(a) Immediately upon the Issuance of each Letter of Credit,
each Bank shall be deemed to, and hereby irrevocably and unconditionally agrees
to, purchase from the Issuing Bank a participation in such Letter of Credit and
each drawing thereunder in an amount equal to the product of (i) the Pro Rata
Share of such Bank, times (ii) the maximum amount available to be drawn under
such Letter of Credit and the amount of any drawing, respectively. For purposes
of the applicable Commitment, each Issuance of a Letter of Credit shall be
deemed to utilize each Bank's Pro Rata Share of said Commitment by an amount
equal to the amount of such participation.
(b) In the event of any request for a drawing under a Letter
of Credit by the beneficiary or transferee thereof, the Issuing Bank will
promptly notify the Borrower. The Issuing Bank shall honor any Disbursement
request under any Letter of Credit only if (i) such request is delivered to the
Issuing Bank by the beneficiary of such Letter of Credit, and (ii) such request
is accompanied by the original documents required by the Letter of Credit for
any Disbursement. Except as otherwise provided herein, the Borrower shall
reimburse the Issuing Bank prior to 11:00 a.m. (Phoenix, Arizona local time) on
each date that any amount is paid by the Issuing Bank under any Letter of Credit
(each such date, an "Honor Date"), in an amount equal to the amount so paid by
the Issuing Bank. In the event the Borrower is required but fails to reimburse
the Issuing Bank for the full amount of any drawing under any Letter of Credit
by 11:00 a.m. (Phoenix, Arizona local time) on the Honor Date, the Issuing Bank
will promptly notify the Administrative Agent and the Administrative Agent will
promptly notify each Bank thereof. Any notice given by the Issuing Bank or the
Administrative Agent pursuant to this Section may be oral if immediately
confirmed in writing (including by facsimile); provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding effect of
such notice.
(c) Each Bank shall upon any notice pursuant to this Section
make available to the Administrative Agent for the account of the Issuing Bank
an amount in Dollars and in immediately available funds equal to its Pro Rata
Share of the amount of the drawing, whereupon the Banks shall (subject to
paragraph (d)) each be deemed to have made a Variable Rate RLC Advance to the
Borrower in that amount. If any Bank so notified fails to make available to the
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Administrative Agent for the account of the Issuing Bank the amount of such
Bank's Pro Rata Share of the amount of the drawing by no later than 3:00 p.m.
(Phoenix, Arizona local time) on the Honor Date, then interest shall accrue on
such Bank's obligation to make such payment, from the Honor Date to the date
such Bank makes such payment, at a rate per annum equal to the Federal Funds
Rate in effect from time to time during such period and such amount and interest
shall be immediately due and payable to the Administrative Agent; the obligation
of such Bank to make such payment to the Administrative Agent shall not be
waived by the Administrative Agent without the prior written consent of the
Borrower. The Administrative Agent will promptly give notice of the occurrence
of the Honor Date, but failure of the Administrative Agent to give any such
notice on the Honor Date or in sufficient time to enable any Bank to effect such
payment on such date shall not relieve such Bank from its obligations under this
Section.
(d) With respect to any unreimbursed drawing, the Borrower
shall be deemed to have incurred from the Issuing Bank a Variable Rate RLC
Advance in the amount of such drawing.
(e) Each Bank's obligation in accordance with this Senior
Credit Agreement to make the Variable Rate Advance, as contemplated by this
Section, as a result of a drawing under a Letter of Credit, shall be absolute
and unconditional and without recourse to the Issuing Bank and shall not be
affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense, or other right which such Bank may have against the Issuing
Bank, the Borrower, or any other Person for any reason whatsoever, (ii) the
occurrence or continuance of a default, an Event of Default, or a Material
Adverse Effect, or (iii) any other circumstance, happening, or event whatsoever,
whether or not similar to any of the foregoing.
2.19 Repayment of Participations.
(a) Upon (and only upon) receipt by the Administrative Agent
for the account of the Issuing Bank of immediately available funds from the
Borrower (i) in reimbursement of any payment made by the Issuing Bank under a
Letter of Credit with respect to which any Bank has paid the Administrative
Agent for the account of the Issuing Bank for such Bank's participation in such
Letter of Credit pursuant to Section 2.18, or (ii) in payment of interest
thereon, the Administrative Agent will pay to each Bank, in the same funds as
those received by the Administrative Agent for the account of the Issuing Bank,
the amount of such Bank's Pro Rata Share of such funds, and the Issuing Bank
shall receive the amount of the Pro Rata Share of such funds of any Bank that
did not so pay the Administrative Agent for the account of the Issuing Bank.
(b) If the Administrative Agent or the Issuing Bank is
required at any time to return to the Borrower, or to a trustee, receiver,
liquidator, custodian, or any official in any Insolvency Proceeding, any portion
of the payments made by the Borrower to the Administrative Agent for the account
of the Issuing Bank pursuant to paragraph (a) in reimbursement of a payment made
under a Letter of Credit or interest or fee thereon, each Bank shall, on demand
of the Administrative Agent, forthwith return to the Administrative Agent or the
Issuing Bank the
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amount of its Pro Rata Share of any amounts so returned by the Administrative
Agent or the Issuing Bank plus interest thereon from the date such demand is
made to the date such amounts are returned by such Bank to the Administrative
Agent or the Issuing Bank, at a rate per annum equal to the Federal Funds Rate
in effect from time to time.
2.20 Role of the Issuing Bank.
(a) Each Bank and Borrower agree that, in paying any drawing
under a Letter of Credit, the Issuing Bank shall not have any responsibility to
obtain any document (other than any sight draft and certificates expressly
required by the Letter of Credit) or to ascertain or inquire as to the validity
or accuracy of any such document or the authority of the Person executing or
delivering any such document.
(b) No Administrative Agent-related Person nor any of the
respective correspondents, participants or assignees of the Issuing Bank shall
be liable to any Bank for: (i) any action taken or omitted in connection
herewith at the request or with the approval of the Banks or (ii) any action
taken or omitted in the absence of gross negligence or willful misconduct.
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ARTICLE 2A
THE TERM A LOAN
2A.1 Term A Loan Commitment.
(a) Subject to the conditions set forth herein, each Bank,
from time to time, shall fund, severally but not jointly, its Pro Rata Share of
such Term A Loan Advances as Borrower may request, provided that (a) the Term A
Loan Balance at any one time outstanding shall not exceed the Term A Loan
Commitment, and (b) the aggregate amount of a Bank's funding of the Term A Loan
Balance at any one time outstanding shall not exceed its Pro Rata Share of the
Term A Loan Commitment. The loan of each Bank shall be a single-advance term
loan, against which a Bank shall fund its Pro Rata Share of each Term A Loan
Advance to be made to Borrower provided that (i) there is no Event of Default
under any provision of this Senior Credit Agreement, (ii) no Term A Loan Advance
shall be made that would cause the Term A Loan Balance to exceed the Term A Loan
Commitment, and (iii) no Bank shall be obligated under any circumstances to fund
a Term A Loan Advance in excess of that Bank's Pro Rata Share of the requested
Term A Loan Advance. The Banks shall not be obligated to fund their Pro Rata
Share of any Term A Loan Advance if, after giving effect thereto, any of the
foregoing limitations would be exceeded.
(b) The failure of any Bank to fund its Pro Rata Share of a
Term A Loan Advance in accordance with its Pro Rata Share of the Term A Loan
Commitment shall not relieve any other Bank of its several obligations
hereunder, but no Bank shall be liable with respect to the obligation of any
other Bank hereunder.
2A.2 Term A Notes. The Term A Loan of each Bank shall be evidenced by a
Term A Note, and shall bear interest and be payable to the order of each Bank
upon the terms and conditions contained therein. The aggregate amount funded by
a Bank under its Term A Loan Note shall be the principal amount owing and unpaid
on its Term A Note and its Term A Loan. The principal amount funded by a Bank
and all principal payments and prepayments thereof may be noted by such Bank on
a schedule attached to its Term A Note and shall be entered by the Bank on its
ledgers and computer records; provided that the failure of the Bank to make such
notations or entries shall not affect the principal amount owing and unpaid on
its Term A Note. The entries made in the ordinary course of business by a Bank
on its ledgers and computer records and any notations made in the ordinary
course of business by a Bank on any such schedule annexed to its Term A Note
shall be presumed to be accurate until the contrary is established. If
requested, Borrower shall confirm in writing to the Administrative Agent each
Term A Loan Advance.
2A.3 Term A Loan. The Term A Loan shall bear interest and be payable to
the Banks upon the terms and conditions contained therein, which include the
following provisions:
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(a) Interest shall accrue:
(i) Except to the extent that a portion of the Term A
Loan bears interest at the LIBOR Based Rate, on the unpaid
principal of the Term A Loan at the Variable Rate.
(ii) To the extent Borrower shall elect and to the
extent not otherwise provided herein, on the unpaid principal
of the Term A Loan at the LIBOR Based Rate.
(b) Principal shall be due and payable on the Payment Date in
consecutive monthly installments equal to the Principal Payment,
together with interest until the Term A Maturity Date.
(c) All interest shall be computed on the basis of a 360-day
year and accrue on a daily basis for the actual number of days elapsed.
No Interest Period shall begin on any day other than a Payment Date.
(d) The entire unpaid principal balance, all accrued and
unpaid interest, and all other amounts payable under the Term A Note
shall be due and payable in full on the Term A Maturity Date.
(e) The proceeds of the Term A Loan shall be disbursed in a
single Term A Loan Advance.
(f) Borrower may, upon written notice to and received by the
Administrative Agent not later than 9:00 a.m. (Phoenix, Arizona local
time) (i) on the second Business Day, in the case of any conversion of
a Variable Rate Term Portion into a LIBOR Based Rate Term Portion and
(ii) on the first Business Day in the case of any conversion of a LIBOR
Based Rate Term Portion into a Variable Rate Term Portion, prior to the
date of the proposed conversion, convert any Term Portion of one type
into a Term Portion of the other type, provided, however, that any
conversion of a LIBOR Based Rate Term Portion (A) shall only be made on
the last day of the applicable Interest Period except as otherwise
provided herein, and (B) shall be made only as to a Term Portion in a
minimum amount of $1,000,000.00 with integral multiples of $500,000.00
in excess thereof. Each such notice of a conversion shall specify the
date of such conversion and the Term Portion(s) to be converted. After
receiving any such notice, the Administrative Agent shall promptly
notify each Bank by telephone, telefacsimile or cable and deliver a
copy thereof to each Bank.
(g) Each request for a Term A Loan Advance as well as each
election by the Borrower that a Term A Loan Advance continue to bear
interest at the LIBOR Based Rate after the end of an existing Interest
Period and each conversion
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request shall be irrevocable and binding on Borrower once the request
is received by the Agent and the Agent notifies the Banks of the
request. Prior to the Agent's notice of the request to the Banks,
Borrower may revoke the request. Borrower shall indemnify each Bank
against any cost, loss or expense incurred by any Bank as a result of
Borrower's failure to fulfill, on or before the date specified for a
Term A Loan Advance in any request for a Term A Loan Advance, the
conditions to such Term A Loan Advance set forth herein, including any
cost, loss or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by a Bank to fund such
Term A Loan Advance when such Term A Loan Advance, as a result of such
failure, is not made on the date so specified.
(h) No Term A Loan Advance shall be requested by Borrower to
bear a LIBOR Based Rate, whether pursuant to a request for a Term A
Loan Advance or a conversion hereunder, so long as there shall have
occurred an Event of Default and such Event of Default is continuing.
(i) Nothing herein shall be deemed to relieve any Bank from
its obligations to fulfill its Pro Rata Share of the Term A Loan
Commitment hereunder or to prejudice any right which the Agent or the
Borrower may have against any Bank as a result of any default by such
Bank hereunder.
(j) Upon default, including failure to pay upon final
maturity, the Banks, at their option, may also, if permitted under
applicable law, do one or both of the following: (a) increase the
applicable interest rate to the Default Rate, and/or (b) add any unpaid
accrued interest to principal and such sum will bear interest therefrom
until paid at the rate provided herein (including any increased rate).
The interest rate will not exceed the maximum rate permitted by
applicable law.
2A.4 Notice of Term A Loan Advances. Term A Loan Advances shall be made
by the Banks to Borrower upon oral, telephonic or written notice from an
Authorized Officer to the Administrative Agent specifying the date and amount of
the requested Term A Loan Advance, provided that such oral or telephonic notice
shall be forthwith confirmed by an Authorized Officer in writing. Term A Loan
Advances may only be made to repay existing term Indebtedness of Borrower or for
such other purposes as the Banks shall permit in their sole and absolute
discretion. Notwithstanding anything herein to the contrary, the proceeds of the
Term A Loan shall be disbursed in a single Term A Loan Advance at the closing of
the Loans.
2A.5 Conditions. The Banks shall have no obligation to make a Term A
Loan Advance unless and until all of the conditions and requirements of this
Senior Credit Agreement are fully satisfied. However, the Banks in their sole
and absolute discretion may elect to make a Term A Loan Advance prior to full
satisfaction of one or more such conditions and/or requirements. Notwithstanding
that a Term A Loan Advance is made, such unsatisfied conditions and/or
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requirements shall not be waived or released thereby. Borrower shall be and
continue to be obligated to fully satisfy such conditions and requirements.
2A.6 Assignment. Borrower shall have no right to a Term A Loan Advance
other than to have the same made by the Banks in accordance with the provisions
contained in this Senior Credit Agreement. Any assignment or transfer, voluntary
or involuntary, of this Senior Credit Agreement or any right hereunder shall not
be binding upon or in any way affect the Banks without their written consent;
the Banks may make a Term A Loan Advance under the provisions herein,
notwithstanding any such assignment or transfer.
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ARTICLE 2B
THE TERM B LOAN
2B.1 Term B Loan Commitment.
(a) Subject to the conditions set forth herein, each Bank,
from time to time, shall fund, severally but not jointly, its Pro Rata Share of
such Term B Loan Advances as Borrower may request, provided that (a) the Term B
Loan Balance at any one time outstanding shall not exceed the Term B Loan
Commitment, and (b) the aggregate amount of a Bank's funding of the Term B Loan
Balance at any one time outstanding shall not exceed its Pro Rata Share of the
Term B Loan Commitment. The loan of each Bank shall be a multiple-advance line
of credit, against which a Bank shall fund its Pro Rata Share of each Term B
Loan Advance to be made to Borrower provided that (i) there is no Event of
Default under any provision of this Senior Credit Agreement, (ii) no Term B Loan
Advance shall be made that would cause the Term B Loan Balance to exceed the
Term B Loan Commitment, and (iii) no Bank shall be obligated under any
circumstances to fund a Term B Loan Advance in excess of that Bank's Pro Rata
Share of the requested Term B Loan Advance. The Banks shall not be obligated to
fund their Pro Rata Share of any Term B Loan Advance if, after giving effect
thereto, any of the foregoing limitations would be exceeded.
(b) The failure of any Bank to fund its Pro Rata Share of a
Term B Loan Advance in accordance with its Pro Rata Share of the Term B Loan
Commitment shall not relieve any other Bank of its several obligations
hereunder, but no Bank shall be liable with respect to the obligation of any
other Bank hereunder.
2B.2 Term B Notes. The Term B Loan of each Bank shall be evidenced by a
Term B Note, and shall bear interest and be payable to the order of each Bank
upon the terms and conditions contained therein. The aggregate amount funded by
a Bank under its Term A Note shall be the principal amount owing and unpaid on
its Term B Note and its Term B Loan. The principal amount funded by a Bank and
all principal payments and prepayments thereof may be noted by such Bank on a
schedule attached to its Term B Note and shall be entered by the Bank on its
ledgers and computer records; provided that the failure of the Bank to make such
notations or entries shall not affect the principal amount owing and unpaid on
its Term B Note. The entries made in the ordinary course of business by a Bank
on its ledgers and computer records and any notations made in the ordinary
course of business by a Bank on any such schedule annexed to its Term B Note
shall be presumed to be accurate until the contrary is established. If
requested, Borrower shall confirm in writing to the Administrative Agent each
Term B Loan Advance.
2B.3 Term B Loan. The Term B Loan shall be evidenced by the Term B
Note, and shall bear interest and be payable to the Banks upon the terms and
conditions contained therein, which include the following provisions:
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(a) Interest shall accrue:
(i) Except to the extent that a portion of the Term B
Loan bears interest at the LIBOR Based Rate, on the unpaid
principal of the Term B Loan at the Variable Rate.
(ii) To the extent Borrower shall elect and to the
extent not otherwise provided herein, on the unpaid principal
of the Term B Loan at the LIBOR Based Rate.
(b) Principal shall be due and payable on the Payment Date in
consecutive monthly installments equal to the Principal Payment,
together with interest until the Term B Maturity Date.
(c) All interest shall be computed on the basis of a 360-day
year and accrue on a daily basis for the actual number of days elapsed.
No Interest Period shall begin on any day other than a Payment Date.
(d) The entire unpaid principal balance, all accrued and
unpaid interest, and all other amounts payable under the Term B Note
shall be due and payable in full on the Term B Maturity Date.
(e) Each request for a Term B Loan Advance shall, in addition
to complying with the other requirements in this Senior Credit
Agreement, (i) specify the date and amount of the requested Term B Loan
Advance, (ii) specify whether the Term B Loan Advance shall be a Term B
Loan Advance that bears interest at the Variable Rate or shall be a
Term B Loan Advance that bears interest at the LIBOR Based Rate, and
(iii), if the Term B Loan Advance is to bear interest at the LIBOR
Based Rate, (A) specify the Interest Period, (B) be delivered to
Administrative Agent before 9:00 a.m. (Phoenix, Arizona local time) at
least two (2) Business Days prior to the date of the requested Term B
Loan Advance, and (C) be in a minimum amount of $1,000,000.00 with
integral multiples of $500,000.00 in excess thereof. Any Term B Loan
Advance not complying with the foregoing requirements for a Term B Loan
Advance bearing interest at the LIBOR Based Rate shall bear interest at
the Variable Rate.
(f) After receiving a request for a Term B Loan Advance in the
manner provided herein, the Administrative Agent shall promptly, before
11:30 a.m. (Phoenix, Arizona local time) on the date a Term B Loan
Advance is requested, notify each Bank by telephone (confirmed promptly
in writing), telefacsimile or cable of the terms of such request and
such Bank's Pro Rata Share of the requested Term B Loan Advance. Each
Bank shall, before 1:00 p.m. (Phoenix, Arizona local time) on the date
a Term B Loan Advance is to be made as specified in a request for a
Term B Loan Advance, deposit with the Administrative Agent such
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Bank's Pro Rata Share of the requested Term B Loan Advance in
immediately available funds. Upon fulfillment of all applicable
conditions set forth herein and after receipt by the Administrative
Agent of such funds, the Administrative Agent shall pay or deliver all
funds so received to the order of Borrower at the principal office of
the Administrative Agent. The failure of any Bank to fund its Pro Rata
Share of any Term B Loan Advance required of it hereunder shall not
relieve any other Bank of its obligation to fund its Pro Rata Share of
any Term B Loan Advance hereunder. If any Bank fails to fund its Pro
Rata Share of the requested Term B Loan Advance and if all conditions
to such Term B Loan Advance have apparently been satisfied, the
Administrative Agent will make available to Borrower the funds received
by it from the other Bank. Neither the Administrative Agent nor any
Bank shall be responsible for the performance by any other Bank of its
obligations hereunder.
Unless the Administrative Agent shall have received notice
from a Bank prior to the date of any Term B Loan Advance that such Bank
will not make available to the Administrative Agent such Bank's Pro
Rata Share of the requested Term B Loan Advance, the Administrative
Agent may assume that such Bank has made such amount available to the
Administrative Agent on the date of such Term B Loan Advance in
accordance with this Section and the Administrative Agent may, in
reliance upon such assumption, make available a corresponding amount to
or on behalf of Borrower on such date. If and to the extent any Bank
shall not have so made its Pro Rata Share of the requested Term B Loan
Advance available to the Administrative Agent (the "Term Principal
Shortfall Amount"), Borrower agrees to repay the Term Principal
Shortfall Amount to the Administrative Agent forthwith on demand,
together with interest thereon for each day from (and including) the
date such amount is made available to or on behalf of Borrower to (but
excluding) the date such amount is repaid to the Administrative Agent,
at the rate per annum equal to the rate otherwise applicable to the
Term B Loan Advance in question.
(g) If Borrower desires that a LIBOR Based Rate Term Portion
continue to bear interest at a LIBOR Based Rate after the end of an
existing Interest Period, Borrower shall deliver to the Administrative
Agent a notice making such election and specifying the new Interest
Period. If Borrower does not deliver such notice within such time, then
after the existing Interest Period the LIBOR Based Rate Term Portion
shall become a Variable Rate Term Portion and shall bear interest at
the Variable Rate.
(h) Borrower may, upon written notice to and received by the
Administrative Agent not later than 9:00 a.m. (Phoenix, Arizona local
time) (i) on the second Business Day, in the case of any conversion of
a Variable Rate Term Portion into a LIBOR Based Rate Term Portion and
(ii) on the first Business Day in the case of any conversion of a LIBOR
Based Rate Term Portion into a Variable
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Rate Term Portion, prior to the date of the proposed conversion,
convert any Term Portion of one type into a Term Portion of the other
type, provided, however, that any conversion of a LIBOR Based Rate Term
Portion (A) shall only be made on the last day of the applicable
Interest Period except as otherwise provided herein, and (B) shall be
made only as to a Term Portion in a minimum amount of $1,000,000.00
with integral multiples of $500,000.00 in excess thereof. Each such
notice of a conversion shall specify the date of such conversion and
the Term Portion(s) to be converted. After receiving any such notice,
the Administrative Agent shall promptly notify each Bank by telephone,
telefacsimile or cable and deliver a copy thereof to each Bank.
(i) Each request for a Term B Loan Advance as well as each
election by the Borrower that a Term B Loan Advance continue to bear
interest at the LIBOR Based Rate after the end of an existing Interest
Period and each conversion request shall be irrevocable and binding on
Borrower once the request is received by the Agent and the Agent
notifies the Banks of the request. Prior to the Agent's notice of the
request to the Banks, Borrower may revoke the request. Borrower shall
indemnify each Bank against any cost, loss or expense incurred by any
Bank as a result of Borrower's failure to fulfill, on or before the
date specified for a Term B Loan Advance in any request for a Term B
Loan Advance, the conditions to such Term B Loan Advance set forth
herein, including any cost, loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by a
Bank to fund such Term B Loan Advance when such Term B Loan Advance, as
a result of such failure, is not made on the date so specified.
(j) No Term B Loan Advance shall be requested by Borrower to
bear a LIBOR Based Rate, whether pursuant to a request for a Term B
Loan Advance or a conversion hereunder, so long as there shall have
occurred an Event of Default and such Event of Default is continuing.
(k) Nothing herein shall be deemed to relieve any Bank from
its obligations to fulfill its Pro Rata Share of the Term Loan
Commitment hereunder or to prejudice any right which the Agent or the
Borrower may have against any Bank as a result of any default by such
Bank hereunder.
(l) Upon default, including failure to pay upon final
maturity, the Banks at their option, may also, if permitted under
applicable law, do one or both of the following: (a) increase the
applicable interest rate to the Default Rate, and/or (b) add any unpaid
accrued interest to principal and such sum will bear interest therefrom
until paid at the rate provided herein (including any increased rate).
The interest rate will not exceed the maximum rate permitted by
applicable law.
2B.4 Notice of Term B Loan Advances. Term B Loan Advances shall be made
by the Banks to Borrower upon oral, telephonic or written notice from an
Authorized Officer to the
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Administrative Agent specifying the date and amount of the requested Term B Loan
Advance, provided that such oral or telephonic notice shall be forthwith
confirmed by an Authorized Officer in writing. Term B Loan Advances may only be
made to repay Existing Subordinated Debt of Borrower prior to the Term B Loan
Expiration Date. No Term B Loan Advance shall be made after the Term B Loan
Expiration Date.
2B.5 Conditions. The Banks shall have no obligation to make a Term B
Loan Advance unless and until all of the conditions and requirements of this
Senior Credit Agreement are fully satisfied. However, the Banks in their sole
and absolute discretion may elect to make a Term B Loan Advance prior to full
satisfaction of one or more such conditions and/or requirements. Notwithstanding
that a Term B Loan Advance is made, such unsatisfied conditions and/or
requirements shall not be waived or released thereby. Borrower shall be and
continue to be obligated to fully satisfy such conditions and requirements.
2B.6 Assignment. Borrower shall have no right to a Term B Loan Advance
other than to have the same made by the Banks in accordance with the provisions
contained in this Senior Credit Agreement. Any assignment or transfer, voluntary
or involuntary, of this Senior Credit Agreement or any right hereunder shall not
be binding upon or in any way affect the Banks without their written consent;
the Banks may make a Term B Loan Advance under the provisions herein,
notwithstanding any such assignment or transfer.
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ARTICLE 3.
PAYMENTS, FEES AND EURODOLLAR PROVISIONS
3.1 Payments.
(a) All payments and prepayments by the Borrower of principal
of and interest on the Notes and all fees, expenses and any other
Obligation payable to the Administrative Agent or the Banks in
connection with the Loans shall be nonrefundable and made in Dollars or
immediately available funds to the Banks not later than 11:00 a.m.
(Phoenix, Arizona local time) on the dates called for under this Senior
Credit Agreement, at the main office of the Administrative Agent (or
the Issuing Bank, if the payment is governed by Section 3.11(b) hereof)
in Phoenix, Arizona. Funds received after such hour shall be deemed to
have been received by the Administrative Agent (or the Issuing Bank, if
applicable) on the next Business Day. Payment to the Administrative
Agent as aforesaid shall be deemed payment to the Banks as well,
regardless of whether the Administrative Agent makes the distributions
contemplated by Section 9A.8(a) hereof.
(b) Unless otherwise required by applicable law, payments will
be applied first to accrued, unpaid interest, then to principal, and
any remaining amount to any unpaid collection costs, late charges and
other charges; provided, however, upon delinquency or other default,
the Banks reserve the right to apply payments among principal,
interest, late charges, collection costs and other charges at its
discretion.
(c) Interest shall be due and payable on each Loan on each
Payment Date and on each applicable Maturity Date.
(d) Whenever any payment to be made hereunder shall be stated
to be due on a day which is not a Business Day, such payment shall be
made on the next succeeding Business Day, and such extension of time
shall in such case be included in the computation of interest,
commission or fee, as the case may be.
3.2 Fees.
(a) RLC Non-Use Fee. Borrower agrees to pay the Administrative
agent for distribution to the Banks pursuant to Section 9A.8 hereof a
quarterly fee (the "RLC Non-Use Fee") in an annualized amount equal to
one-half percent (0.5%) of the average daily undrawn balance of the RLC
Commitment during the prior calendar quarterly period. For purposes of
calculating the RLC Non-Use Fee, the Outstanding LC Balance on any date
shall be deemed to have been drawn. The RLC Non-Use Fee shall initially
accrue from the Closing Date and shall be due
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and payable in arrears within three (3) Business Days after written
notice of such amount due by the Administrative Agent to Borrower and
shall be non-refundable.
(b) Term B Loan Non-Use Fee. Borrower agrees to pay
Administrative agent for distribution to the Banks pursuant to Section
9A.8 hereof a quarterly fee (the "Term B Loan Non-Use Fee") in an
annualized amount equal to one-half percent (0.5%) of the average daily
undrawn balance of the Term B Loan Commitment during the prior calendar
quarterly period. The Term B Loan Non-Use Fee shall accrue from the
Closing Date until the Term B Loan Expiration Date and shall be due and
payable in arrears within three (3) Business Days after written notice
of such amount due by the Administrative Agent to Borrower and shall be
non-refundable.
(c) Termination Fee. Borrower agrees to pay Administrative
agent for distribution to the Banks pursuant to Section 9A.8 hereof a
termination fee (the "Termination Fee") in an amount equal to one
percent (1.0%) of the RLC Commitment and the aggregate outstanding
balances of the Term Loans in the event that the Loans are cancelled or
prepaid due to a sale or merger of Borrower's business.
(d) Letter of Credit Fee. See Section 2.12.
3.3 Computations. All fees and interest on each Note shall be computed
on the basis of a year of 360-days/year and accrue on a daily basis for the
actual number of days elapsed.
3.4 Maintenance of Accounts. The Banks shall maintain, in accordance
with their usual practice, an account or accounts evidencing the indebtedness of
the Borrower and the amounts payable and paid from time to time hereunder. In
any legal action or proceeding in respect of this Senior Credit Agreement, the
entries made in the ordinary course of business in such account or accounts
shall be presumptive, absent manifest error, evidence of the existence and
amounts of the obligations of the Borrower therein recorded. The failure to
record any such amount shall not, however, limit or otherwise affect the
obligations of the Borrower hereunder to repay all amounts owed hereunder,
together with all interest accrued thereon as provided in the Notes.
3.5 Certain Contingencies.
(a) If the contingency contemplated by Section 3.6, 3.7(b) or
3.7(c) should occur, the Borrower may at any time after receipt of such
notice, and as long as the circumstances giving rise to the relevant
claim continue, require the Banks to terminate upon not less than
thirty days' notice the participation agreement with such participant,
unless such participant has waived any claim to payment under those
provisions.
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(b) If circumstances arise which would (or would upon the
giving of notice) entitle a Bank to receive additional payments
pursuant to Section 3.6, 3.7(b) or 3.7(c), then the Bank shall
promptly, upon becoming aware of such circumstances, notify the
Borrower and, to the extent that it can legally do so without material
prejudice to its own position, the Bank shall take such reasonable
steps as may be available to it to mitigate the effects of such
circumstances.
3.6 Increased Capital Requirements. In the event that, as a result of
any Regulatory Change, compliance by any Bank with any applicable law or
governmental rule, requirement, regulation, guideline or order (with which it is
customary for banks in the relevant jurisdiction to comply whether or not having
the force of law) has or would have the effect of reducing the rate of return on
the capital of the Bank or any institution controlling the Bank as a consequence
of or with reference to any Commitment, the issuance of a Letter of Credit or
amounts outstanding under the Notes to a level below that which the Bank or such
other corporation could have achieved but for such change or compliance (taking
into consideration the policies of the Bank or such other corporation with
respect to capital), then from time to time the Borrower shall pay to such Bank
such additional amount or amounts as will compensate the Bank for such
reduction. The Bank will notify the Borrower of any Regulatory Change that will
entitle the Bank to compensation pursuant to this Section as promptly as
practicable, but in any event within ninety (90) days after the Bank obtains
knowledge thereof; provided, however, that if the Bank fails to give such notice
within ninety (90) days after it obtains knowledge of such a Regulatory Change,
the Bank shall, with respect to compensation payable in respect of any costs
resulting from such Regulatory Change, only be entitled to payment for costs
incurred from and after the date that the Bank does give such notice. Such Bank
shall deliver to the Borrower a written certificate which states the additional
amount(s) due and payable, showing in reasonable detail the calculation of such
amount and provide evidence to substantiate the Bank's claim for such amount(s).
3.7 Special Provisions for LIBOR Based Rate Advances.
(a) Funding: Notwithstanding any provision of the Credit
Documents to the contrary, the Banks shall be entitled to fund and
maintain their funding of all or any part of any Advance in any manner
they see fit, provided, however, that for the purposes of the Notes,
all determinations thereunder shall be made as if the Banks had
actually funded and maintained each Advance bearing interest at the
LIBOR Based Rate during the Interest Period therefor through the
purchase of deposits having a maturity corresponding to the last day of
the Interest Period and bearing an interest rate equal to the LIBOR
Based Rate for such Interest Period.
(b) Inadequacy of Eurodollar Pricing: If, due to any
Regulatory Change, there shall be any increase in the cost to a Bank of
agreeing to make or making, funding, or maintaining Advances bearing
interest at the LIBOR Based Rate (including, without limitation, any
increase in any applicable reserve requirement), then the Borrower
shall from time to time, upon demand by the Bank, pay to the Bank such
amounts as the Bank may reasonably determine to be necessary to
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compensate the Bank for any additional costs that the Bank reasonably
determines are attributable to such Regulatory Change. The Bank will
notify the Borrower of any Regulatory Change that will entitle the Bank
to compensation pursuant to this paragraph as promptly as practicable,
but in any event within ninety (90) days after the Bank obtains
knowledge thereof; provided, however, that if the Bank fails to give
such notice within ninety (90) days after it obtains knowledge of such
a Regulatory Change, the Bank shall, with respect to compensation
payable in respect of any costs resulting from such Regulatory Change,
only be entitled to payment for costs incurred from and after the date
that the Bank does give such notice. The Bank will furnish to the
Borrower a certificate setting forth in reasonable detail the basis for
the amount of each request by the Bank for compensation under this
paragraph. Determinations by the Bank of the amounts required to
compensate the Bank shall be conclusive, absent manifest error. The
Bank shall be entitled to compensation in connection with any
Regulatory Change only for costs actually incurred by the Bank.
(c) Illegality: Notwithstanding any provision of the Credit
Documents, if a Bank shall notify the Borrower that as a result of a
Regulatory Change it is unlawful for the Bank to make Advances at the
LIBOR Based Rate, or to fund or maintain Advances bearing interest at
the LIBOR Based Rate , (i) the obligations of the Bank to make Advances
at the LIBOR Based Rate and to convert Advances to the LIBOR Based Rate
shall be suspended until the Bank shall notify the Borrower that the
circumstances causing such suspension no longer exist, and (ii) in the
event such Regulatory Change makes the maintenance of Advances at the
LIBOR Based Rate unlawful, the Borrower shall forthwith prepay in full
all Advances bearing interest at the LIBOR Based Rate then outstanding,
together with interest accrued thereon and all amounts in connection
with such prepayment specified herein, unless the Borrower, within five
(5) Business Days of notice from the Bank, converts all Advances
bearing interest at the LIBOR Based Rate then outstanding into Advances
bearing interest at the Variable Rate pursuant to the conversion
procedures herein and pays all amounts in connection with such
prepayments or conversions specified herein.
(d) Market Disruption: Notwithstanding any other provision of
the Credit Documents, if prior to the commencement of any Interest
Period, the Banks shall determine (i) that United States dollar
deposits in the amount of any Advance bearing interest at the LIBOR
Based Rate to be outstanding during such Interest Period are not
readily available to the Banks in the London interbank market, or (ii)
by reason of circumstances affecting the London interbank market,
adequate and reasonable means do not exist for ascertaining the LIBOR
Based Rate for such Interest Period in the manner prescribed in the
definition of "LIBOR Based Rate," then the Administrative Agent shall
promptly give notice thereof to the Borrower and the obligation of the
Banks to create, continue, or effect by conversion any Advance bearing
interest at the LIBOR Based Rate in such amount and for such
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Interest Period shall terminate until United States dollar deposits in
such amount and for the Interest Period shall again be readily
available in the London interbank market and adequate and reasonable
means exist for ascertaining the LIBOR Based Rate.
(e) Prepayment: Borrower may, upon at least two (2) Business
Days' notice in the case of LIBOR Based Rate Advances and one (1)
Business Day's notice in the case of Variable Rate Advances to the
Administrative Agent stating the proposed date and aggregate principal
amount of the prepayment, and if such notice is given Borrower shall,
prepay the outstanding principal balance of the Loan in whole or in
part at any time prior to the applicable Maturity Date as stated in
such notice by Borrower. With any prepayment of a LIBOR Based Rate
Advance or with any conversion of a LIBOR Based Rate Advance to a
Variable Rate Advance, in either case other than on the last Business
Day of the Interest Period for such LIBOR Based Rate Advance (including
any such prepayment made voluntarily or involuntarily as a result of
the acceleration of maturity upon a default or otherwise), Borrower
shall pay all accrued interest on the principal amount prepaid with
such prepayment and, on demand, shall reimburse the Banks and hold the
Banks harmless from all losses and expenses incurred by the Banks as a
result of such prepayment, including, without limitation, any losses
and expenses arising from the liquidation or reemployment of deposits
acquired to fund or maintain the principal amount prepaid. Such
reimbursement shall be calculated as though the Banks funded the
principal amount prepaid through the purchase of U.S. Dollar deposits
in the London, England interbank market having a maturity corresponding
to such Interest Period and bearing an interest rate equal to the LIBOR
Based Rate for such Interest Period, whether in fact that is the case
or not. The Banks' determination of the amount of such reimbursement
shall be conclusive in the absence of manifest error.
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ARTICLE 4.
SECURITY DOCUMENTS
CONTINUING GUARANTIES
4.1 Security.
(a) So long as any Loan is outstanding, Borrower shall cause
such Loan and Borrower's obligations under this Senior Credit Agreement
to be secured at all times by a valid and effective security agreement
(each, a "Security Agreement"), each duly executed and delivered by or
on behalf of each Borrower, granting the Administrative Agent on behalf
of the Banks and the Issuing Bank a valid and enforceable security
interest in all of its assets other than its real property, subject to
no prior Lien other than Permitted Liens.
(b) On and after the date hereof, each Borrower will not
create or suffer to exist any Lien upon its property, real or personal,
except as permitted under Section 8.2.
4.2 Security Documents. All of the documents required by this Article 4
shall be in form satisfactory to the Banks, the Issuing Bank and their counsel,
and, together with any Financing Statements for filing and/or recording, and any
other items required by the Banks and the Issuing Bank to fully perfect and
effectuate the liens and security interests of the Banks and the Issuing Bank
contemplated by the Security Agreement and this Senior Credit Agreement, may
heretofore or hereinafter be referred to as the "Security Documents."
4.3 Continuing Guaranties. So long as any Loan is outstanding, Borrower
shall cause such Loan and Borrower's obligations under this Senior Credit
Agreement to be guaranteed at all times by a continuing guarantee (each a
"Continuing Guarantee") from each Subsidiary for the benefit of the Banks.
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ARTICLE 5.
CONDITIONS PRECEDENT
The obligations of the Banks to make the Loans and to make the initial
Advance hereunder or the Issuing Bank's obligation to issue the initial Letter
of Credit is subject to the full prior satisfaction of each of the following
conditions precedent and, as to each future Advance, to the full prior
satisfaction at each such time of each of the conditions precedent in Sections
5.2, 5.3 and 5.4 hereof:
5.1 Initial Advance. Prior to its making the initial Advance, the
Administrative Agent shall have received the following, each in form and
substance satisfactory to the Required Banks:
(a) This Senior Credit Agreement. This Senior Credit
Agreement, duly executed by Borrower.
(b) The Notes. The Notes, each duly executed, as provided in
Articles 2, 2A and 2B hereof.
(c) Officer's Certificate. A certificate signed by an
Authorized Officer of the Company, stating that (to the best knowledge
and belief of the Company, after reasonable inquiry and review of
matters pertinent to the subject matter of such certificate): (i) all
of the representations and warranties contained in Article 6 of this
Senior Credit Agreement and in the other Credit Documents are, in all
material respects, true and correct as of the date hereof (other than
those of such representations which by their express terms speak to a
date prior to such date, which representations are, in all material
respects, true and correct as of such respective dates); (ii) no event
has occurred and is continuing, or would result from the advance of the
proceeds of the Loans, which would constitute an Event of Default, and
(iii) no change or changes having a Material Adverse Effect have
occurred in the business or financial condition of Borrower since the
date of the last financial statements of Borrower heretofore delivered
to the Banks.
(d) Organizational Documents. A copy of the current
organizational documents of Company and of each existing Subsidiary,
including all amendments thereto, certified as current and complete by
the appropriate authority of the state of said corporation's
incorporation, together with evidence of said corporation's good
standing in said corporation's state of incorporation and in every
other state in which it is doing business or the conduct of said
corporation's business requires such standing for the enforcement of
material contracts except with respect to any foreign subsidiary.
(e) Secretary's Certificate and Resolution. A certificate of
the corporate secretary or assistant secretary of Company and each
Subsidiary, signed by the
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duly appointed secretary thereof and issued as of the Closing Date,
certifying that (i) attached thereto is a true and complete copy of the
corporate by-laws of said corporation in effect on the date of passage
of the corporate resolutions described immediately below and at all
subsequent times to and including the date of the certificate, (ii) no
change has been made to said corporation's charter documents other than
as reflected in the certified copies submitted in connection with the
delivery of this Senior Credit Agreement or as approved in writing by
the Administrative Agent, and (iii) attached thereto are proper
resolutions, authorizations and certificates relating to the authority
of any person executing documents on behalf of such entity.
(f) Security Agreement. Security Agreements executed by the
Company and each existing Subsidiary.
(g) Financing Statements. UCC-1 Financing Statements executed
by the Company and each existing Subsidiary (other than a foreign
Subsidiary) for each state in which the Company and/or a Subsidiary has
a business location.
(h) Continuing Guarantee. A Continuing Guarantee executed by
each existing Subsidiary.
(i) Compliance Certificate. A Compliance Certificate executed
by the Company, indicating that Borrower is in compliance with all
Financial Covenants as of September 30, 1998.
(j) Opinion of Counsel. An opinion of counsel to Borrower (or
its general counsel) and each Guarantor (except with respect to any
foreign Subsidiary) as to those matters reasonably required by the
Banks, including without limitation stating that as to payment by
Borrower the Existing Subordinated Debt is subordinated to the payment
of the Loans and the other Obligations of Borrower hereunder.
(k) Financial Statements. A draft of Borrower's consolidated
quarterly financial statements as of September 30, 1998, showing a
pre-tax net loss no greater than $1,000,000.00.
(l) Xxxxx Fargo. Confirmation that the Company has maintained
a satisfactory credit relationship with Xxxxx Fargo Bank, N.A. and
evidence that all Liens for the benefit of Xxxxx Fargo have been
terminated.
(m) Costs. Payment of costs of the Administrative Agent and
the Banks.
(n) Liens. No Liens other than Permitted Liens shall be
outstanding. All other Liens shall have been terminated.
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(o) Additional Information. Such other information and
documents as may reasonably be required by the Banks or their counsel.
5.2 No Event of Default. No Event of Default known to Borrower shall
have occurred and be continuing, or result from the making of the Loans.
5.3 No Material Adverse Change. Since the date of the most recent
financial statements provided to the Banks by Borrower, no change shall have
occurred in the business or financial condition of Borrower that could have a
Material Adverse Effect.
5.4 Representations and Warranties. The representations and warranties
contained in Article 6 hereof shall be true and correct in all material
respects, with the same force and effect as though made on and as of the Closing
Date (other than those of such representations which by their express terms
speak to a date prior to that date, which representations shall, in all material
respects, be true and correct as of such respective date).
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ARTICLE 6.
REPRESENTATIONS AND WARRANTIES
To induce the Banks to make the Loans, Company and each Co-Borrower to
the extent applicable represents and warrants to the Banks that:
6.1 Organization and Good Standing. It is duly organized under the laws
of the state of its organization, is validly existing and is in good standing,
to the extent required by law, in each state in which it is doing business. It
has the legal power and authority to own its properties and assets and to
transact the business in which it is engaged and is or will be qualified in
those states wherein the nature of its proposed business and property will make
such qualifications necessary or appropriate in the future.
6.2 Authorization and Power. It has the corporate power and requisite
authority to execute, deliver and perform this Senior Credit Agreement, the
Notes and the other Credit Documents to be executed by it; it is duly authorized
to, and has taken all action, corporate or otherwise, necessary to authorize it
to, execute, deliver and perform this Senior Credit Agreement, the Notes and
such other Credit Documents and is and will continue to be duly authorized to
perform this Senior Credit Agreement, the Notes and such other Credit Documents.
6.3 No Conflicts or Consents. Neither the execution and delivery of
this Senior Credit Agreement, the Notes or the other Credit Documents to which
it is a party, nor the consummation of any of the transactions herein or therein
contemplated, nor compliance with the terms and provisions hereof or with the
terms and provisions thereof, (a) will contravene or conflict with: (i) any
provision of law, statute or regulation to which it is subject, (ii) any
judgment, license, order or permit applicable to it, (iii) any indenture, loan
agreement, mortgage, deed of trust, or other agreement or instrument to which it
is a party or by which it may be bound, or to which it may be subject, or (b)
will violate any provision of its organizational documents. No consent,
approval, authorization or order of any court or Governmental Authority or other
Person is required in connection with the execution and delivery by it of the
Credit Documents or to consummate the transactions contemplated hereby or
thereby, or if required, such consent, approval, authorization or order shall
have been obtained.
6.4 Enforceable Obligations. This Senior Credit Agreement, the Notes
and the other Credit Documents are the legal, valid and binding obligations of
Borrower, enforceable against Borrower in accordance with their respective
terms, except as limited by bankruptcy, insolvency or other laws or equitable
principles of general application relating to the enforcement of creditors'
rights.
6.5 Financial Condition. Company has delivered to the Banks copies of
the Company's audited consolidated financial statements as most recently filed
with the SEC. Such financial statements, in all material respects, fairly
present the financial position of Borrower as of such date and have been
prepared in accordance with GAAP. Since the date thereof, Company has not
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discovered any obligations, liabilities or indebtedness (including contingent
and indirect liabilities and obligations or unusual forward or long-term
commitments) which in the aggregate are material and adverse to the financial
position or business of Company that should have been but were not reflected in
such financial statements. No changes having a Material Adverse Effect have
occurred in the financial condition or business of Company since its most recent
filings with the SEC.
6.6 Full Disclosure. There is no material fact that it has not
disclosed to the Banks that would have a Material Adverse Effect. No certificate
or statement delivered herewith or heretofore by it to the Banks in connection
with negotiations of this Senior Credit Agreement, contains any untrue statement
of a material fact or omits to state any material fact necessary to keep the
statements contained herein or therein from being misleading.
6.7 No Default. No event or condition has occurred and is continuing
that constitutes an Event of Default.
6.8 Significant Debt Agreements. It is not in default in any material
respect under any Significant Debt Agreement.
6.9 No Litigation. There are no actions, suits or legal, equitable,
arbitration or administrative proceedings pending, or to its actual knowledge
overtly threatened, against Borrower that would, if adversely determined, have a
Material Adverse Effect.
6.10 Taxes. It has filed or caused to be filed all returns and reports
which are required to be filed by any jurisdiction, and has paid or made
provision for the payment of all taxes, assessments, fees or other governmental
charges imposed upon its properties, income or franchises, as to which the
failure to file or pay would have a Material Adverse Effect, except such
assessments or taxes, if any, which are being contested in good faith by
appropriate proceedings.
6.11 ERISA. (a) No Reportable Event has occurred and is continuing with
respect to any Plan; (b) PBGC has not instituted proceedings to terminate any
Plan; (c) neither the Borrower, any member of the Controlled Group, nor any
duly-appointed administrator of a Plan (i) has incurred any liability to PBGC
with respect to any Plan other than for premiums not yet due or payable or (ii)
has instituted or intends to institute proceedings to terminate any Plan under
Section 4041 or 4041A of ERISA; and (d) each Plan of Borrower has been
maintained and funded in all material respects in accordance with its terms and
in all material respects in accordance with all provisions of ERISA applicable
thereto. Neither the Borrower nor any of its Subsidiaries participates in, or is
required to make contributions to, any Multi-employer Plan (as that term is
defined in Section 3(37) of ERISA).
6.12 Compliance with Law. It is in substantial compliance with all
laws, rules, regulations, orders and decrees that are applicable to it, or its
properties, noncompliance with which would have a Material Adverse Effect.
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6.13 Survival of Representations, Etc. All representations and
warranties by Borrower herein shall survive the making of the Loans and the
execution and delivery of the Notes; any investigation at any time made by or on
behalf of the Banks shall not diminish the Banks' right to rely on the
representations and warranties herein.
6.14 Recitals. The recitals and statements of intent appearing in this
Senior Credit Agreement are true and correct.
6.15 No Stock Purchase.
(a) No part of the proceeds of any financial accommodation
made by the Banks in connection with this Senior Credit Agreement will
be used to purchase or carry "margin stock," as that term is defined in
Regulation U, or to extend credit to others for the purpose of
purchasing or carrying such margin stock.
(b) No portion of any Advance or Loan made hereunder shall be
used directly or indirectly to purchase ineligible securities, as
defined by applicable regulations of the Federal Reserve Board,
underwritten by any affiliate of Banc One Corporation during the
underwriting period and for 30 days thereafter.
6.16 Solvent. It (both before and after giving effect to the Loans
contemplated hereby) is solvent, has assets having a fair value in excess of the
amount required to pay its probable liabilities on its existing debts as they
become absolute and matured, and has, and will have, access to adequate capital
for the conduct of its business and the ability to pay its debts from time to
time incurred in connection therewith as such debts mature.
6.17 Advances. Each request for an Advance or for the extension of any
financial accommodation by the Banks whatsoever shall constitute an affirmation
that the representations and warranties contained herein are, true and correct
as of the time of such request. All representations and warranties made herein
shall survive the execution of this Senior Credit Agreement, all advances of
proceeds of the Loans and the execution and delivery of all other documents and
instruments in connection with the Loans and/or this Senior Credit Agreement, so
long as any Bank has any commitment to lend hereunder and until the Loans have
been paid in full and all of Borrower's obligations under this Senior Credit
Agreement and the Notes been fully discharged.
6.18 Subsidiaries. Except for direct and indirect Subsidiaries listed
on Schedule 6.18, Borrower has no existing direct or indirect Subsidiary that
conducts any business or operations.
6.19 Year 2000 Compliance.
(a) All devices, systems, machinery, information technology,
computer software and hardware, and other date sensitive technology
(jointly and severally
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the "Systems") necessary for Borrower to carry on its business as
presently conducted and as contemplated to be conducted in the future
are Year 2000 Compliant or will be Year 2000 Compliant within a period
of time calculated to result in no material disruption of any of
Borrower's business operations. For purposes of these provisions, "Year
2000 Compliant" means that such Systems are designed to be used prior
to, during and after the Gregorian calendar year 2000 A.D. and will
operate during each such time period without error relating to date
data, specifically including any error relating to, or the product of,
date data which represents or references different centuries or more
than one century.
(b) Borrower has: (1) undertaken a detailed inventory, review,
and assessment of all areas within its business and operations that
could be adversely affected by the failure of Borrower to be Year 2000
Compliant on a timely basis; (2) developed a detailed plan and time
line for becoming Year 2000 Compliant on a timely basis, and (3) to
date, implemented that plan in accordance with that timetable in all
material respects.
6.20 Existing Subordinated Debt. The Obligation and the Loans are
senior in right of payment to the Existing Subordinated Debt.
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ARTICLE 7.
AFFIRMATIVE COVENANTS
Until payment in full of the Notes and the complete performance of the
Obligation, and so long as any Bank has any Commitment outstanding to any
Borrower, the Company and each Co-Borrower, to the extent applicable, agrees
that:
7.1 Financial Statements, Reports and Documents. Borrower shall
deliver, or cause to be delivered, to the Banks each of the following:
(a) Consolidated Quarterly Statements of the Company. As soon
as available, and in any event within forty-five (45) days after the
end of each fiscal quarter of the Company, copies of the consolidated
balance sheet of the Company as of the end of such fiscal quarter, and
consolidated statements of income of the Company for that fiscal
quarter and for the portion of the fiscal year ending with such fiscal
quarter, in each case setting forth in comparative form the figures for
the corresponding period of the preceding fiscal year, all in
reasonable detail and fairly stated and prepared in accordance with
GAAP.
(b) Consolidated Annual Statements of the Company. As soon as
available and in any event within one hundred twenty (120) days after
the close of each fiscal year of the Company, audited consolidated
financial statements of the Company, including its consolidated balance
sheet as of the close of such fiscal year and consolidated statements
of income of the Company for such fiscal year, in each case setting
forth in comparative form the figures for the preceding fiscal year,
all in reasonable detail and accompanied by an unqualified opinion
thereon of independent public accountants of recognized national
standing selected by the Company and acceptable to the Banks, to the
effect that such financial statements have been prepared in accordance
with GAAP (except for changes in which such accountants concur) and
that the examination of such accounts in connection with such financial
statements has been made in accordance with generally accepted auditing
standards and, accordingly, includes such tests of the accounting
records and such other auditing procedures as were considered necessary
in the circumstances.
(c) Compliance Certificate of the Company. Within forty-five
(45) days after the end of each fiscal quarter of the Company
hereafter, a certificate (the "Compliance Certificate") substantially
in the form of Exhibit "A" attached hereto signed by an Authorized
Officer, (i) stating that a review of the activities of Borrower during
such quarter or year has been made under his/her supervision, that, as
of such date, Borrower has observed, performed and fulfilled each and
every obligation and covenant contained herein and no Event of Default
exists under any of the same or, if any Event of Default shall have
occurred, specifying
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the nature and status thereof, and stating that all financial
statements delivered to the Banks during the respective period pursuant
to Section 7.1(a) and 7.1(b) hereof, to such officer's knowledge after
due inquiry, fairly present in all material respects the financial
position of the Company and the results of its operations at the dates
and for the periods indicated, and have been prepared in accordance
with GAAP, subject to year end audit and adjustments, (ii) setting
forth in such level of detail as the Banks shall reasonably require a
calculation of the Financial Covenants as of the end of that fiscal
quarter, and (iii) reporting on the profit status of its principal
contracts.
(d) Management Letters. With the audited fiscal year-end
statements submitted under Section 7.1(b) above, the management letter,
if any, of the Company's certified public accountants issued in
connection with such audit.
(e) SEC Filings. When filed, copies of each filing with the
SEC made by the Company, including without limitation its annual 10-K
and quarterly 10-Q reports.
(f) Fiscal Year Projections. No later than sixty (60) days
before the end of each fiscal year, financial statements of the Company
for the following fiscal year, based on its current financial
projections for such fiscal year.
(g) Other Information. Such other information concerning the
business, properties or financial condition of Borrower as the Banks
shall reasonably request.
7.2 Payment of Taxes and Other Indebtedness. Borrower will pay and
discharge (i) all income taxes and payroll taxes, (ii) all taxes, assessments,
fees and other governmental charges imposed upon it or upon its income or
profits, or upon any property belonging to it, before delinquent, which become
due and payable, (iii) all lawful claims (including claims for labor, materials
and supplies), which, if unpaid, might become a Lien upon any of its property,
and (iv) all of its Indebtedness as it becomes due and payable, except as
prohibited hereunder; provided, however, that it shall not be required to pay
any such tax, assessment, charge, levy, claims or Indebtedness if and so long as
the amount, applicability or validity thereof shall currently be contested in
good faith by appropriate actions and appropriate accruals and reserves therefor
have been established in accordance with GAAP.
7.3 Maintenance of Existence and Rights; Conduct of Business. Borrower
will preserve and maintain its corporate existence and all of its rights,
privileges and franchises necessary or desirable in the normal conduct of its
business, and conduct its business in an orderly and efficient manner consistent
with good business practices.
7.4 Notice of Default. Borrower will furnish to the Banks immediately
upon becoming actually aware of the existence of any event or condition that
constitutes an Event of Default, a
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written notice specifying the nature and period of existence thereof and the
action which it is taking or proposes to take with respect thereto.
7.5 Other Notices. Borrower will promptly notify the Banks of (a) any
Material Adverse Effect, (b) any waiver, release or default under any
Significant Debt Agreement, (c) except as to any claim not covered as a result
of an insurance deductible provision, any claim not covered by insurance against
Borrower or any of Borrower's properties, and (d) the commencement of, and any
material determination in, any litigation with any third party or any proceeding
before any Governmental Authority affecting it, except litigation or proceedings
which, if adversely determined, would not have a Material Adverse Effect.
7.6 Compliance with Credit Documents. Borrower will comply with any and
all covenants and provisions of this Senior Credit Agreement, the Notes and all
other Credit Documents.
7.7 Compliance with Significant Debt Agreements. Borrower will comply
in all material respects with all Significant Debt Agreements.
7.8 Operations and Properties. Borrower will keep in good working order
and condition, ordinary wear and tear excepted, all of its assets and properties
which are necessary to the conduct of its business.
7.9 Books and Records; Access. Borrower will give any authorized
representative of the Banks access during normal business hours to, and permit
such representative to examine, copy or make excerpts from, any and all books,
records and documents in its possession of and relating to the Loans, and to
inspect any of its properties. It will maintain complete and accurate books and
records of its transactions in accordance with good accounting practices.
7.10 Compliance with Law. Borrower will comply with all applicable
laws, rules, regulations, and all final, nonappealable orders of any
Governmental Authority applicable to it or any of its property, business
operations or transactions, a breach of which could result in a Material Adverse
Effect.
7.11 Authorizations and Approvals. Borrower will promptly obtain, from
time to time at its own expense, all such governmental licenses, authorizations,
consents, permits and approvals as may be required to enable it to comply with
its obligations hereunder and under the other Credit Documents and to operate
its businesses as presently or hereafter duly conducted.
7.12 ERISA Compliance. With respect to its Plans, Borrower shall (a) at
all times comply with the minimum funding standards set forth in Section 302 of
ERISA and Section 412 of the Code or shall have duly obtained a formal waiver of
such compliance from the proper authority; (b) at the Banks' request, within
thirty (30) days after the filing thereof, furnish to the Banks copies of each
annual report/return (Form 5500 Series), as well as all schedules and
attachments required to be filed with the Department of Labor and/or the
Internal Revenue Service
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pursuant to ERISA, in connection with each of its Plans for each year of the
plan; (c) notify the Banks within a reasonable time of any fact, including, but
not limited to, any Reportable Event arising in connection with any of its
Plans, which constitutes grounds for termination thereof by the PBGC or for the
appointment by the appropriate United States District Court of a trustee to
administer such Plan, together with a statement, if requested by the Banks, as
to the reason therefor and the action, if any, proposed to be taken with respect
thereto; and (d) furnish to the Banks within a reasonable time, upon the Banks'
request, such additional information concerning any of its Plans as may be
reasonably requested.
7.13 Further Assurances. Borrower will make, execute or endorse, and
acknowledge and deliver or file or cause the same to be done, all such notices,
certifications and additional agreements, undertakings or other assurances, and
take any and all such other action, as the Banks may, from time to time, deem
reasonably necessary or proper to fully evidence the Loan.
7.14 News Releases. Borrower shall promptly forward to the Banks copies
of all news releases made by it to the news media as to anything of material
significance with respect to its financial status.
7.15 Insurance. Borrower shall maintain in full force and effect at all
times:
(a) Policies of all risk coverage insurance covering (i) its
real property of every kind and description, and wherever located, in
coverage amounts not less than, from time to time, the full replacement
value of all insurable improvements situated thereon and (ii) its
tangible personalty in respective coverage amounts not less than, from
time to time, the fair market value thereof.
(b) Policies of insurance evidencing personal liability and
property damage liability coverages in amounts not less than
$2,000,000.00 (combined single limit for bodily injury and property
damage), and an umbrella excess liability coverage in an amount not
less than $30,000,000.00 shall be in effect with respect to Borrower.
(c) Policies of workers' compensation insurance in amounts and
with coverages as legally required.
(d) Policies of insurance evidencing product liability and
product recall liability coverages in amounts adequate to the levels of
Borrower's business operations and satisfactory to the Banks.
Without limitation of the foregoing, it shall at all times maintain insurance
coverages in scope and amount not less than, and not less extensive than, the
scope and amount of insurance coverages customary in the trades or businesses in
which it is from time to time engaged. All of the aforesaid insurance coverages
shall be issued by insurers reasonably acceptable to the Banks. Copies of all
policies of insurance evidencing such coverages in effect from time to time, or
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certificates of such policies satisfactory to the Banks, shall be delivered to
the Banks prior to the initial Advance under this Senior Credit Agreement and
upon reasonable notice upon issuance of new policies thereafter. From time to
time, promptly upon the Banks' request, it shall provide evidence satisfactory
to the Banks that required coverage in required amounts is in effect. At the
Banks' option, it shall deliver to the Banks certified copies of all such
policies of insurance in effect from time to time, to be retained by the Banks
so long as the Banks shall have any commitment to lend hereunder and/or any
portion of the Obligation shall be outstanding or unsatisfied. All such
insurance policies shall provide for at least thirty (30) days prior written
notice of the cancellation or modification thereof to the Banks.
7.16 New Subsidiaries; Co-Borrower. Borrower shall promptly and
diligently take all actions necessary to cause any existing Subsidiary not a
Guarantor and a Co-Borrower and that subsequently undertakes to conduct any
business or operations, and any new Subsidiary or Affiliate (each a "New
Subsidiary") to become a Guarantor, a Co-Borrower and a "Debtor" under the
Security Documents. Within thirty (30) days of being acquired, or in the case of
an existing Subsidiary within thirty (30) days of undertaking to conduct any
business or operations (the "Grace Period"), such New Subsidiary shall deliver
to the Banks an executed Continuing Guarantee in the form attached hereto as
Exhibit "C", an executed Assumption Agreement in the form attached hereto as
Exhibit "B", a Security Agreement in the form attached hereto as Exhibit "G", a
UCC-1 Financing Statement and such other documents as the Banks may reasonably
request. The term "Co-Borrower" shall mean that such Subsidiary shall be jointly
liable, and each severally and unconditionally liable, for the full payment and
satisfaction of the Loans and all other obligations of Borrower under this
Senior Credit Agreement. The term "Debtor" shall have the meaning set forth in
the Security Agreement.
7.17 Change in Control or Management. Should there be a Change in
Control or a material change in management as to the Company, the Loans shall be
immediately due and payable and until the Loans are paid in full, the Company
shall not repay or repurchase any Existing Subordinated Debt.
7.18 Year 2000 Compliance.
(a) Furnish such additional information, statements and other
reports with respect to Borrower's activities, course of action and
progress towards becoming Year 2000 Compliant as the Banks may request
from time to time.
(b) In the event of any change in circumstances that causes or
will likely cause any of Borrower's representations and warranties with
respect to its being or becoming Year 2000 Compliant to no longer be
true (hereinafter, referred to as a "Change in Circumstances") then
Borrower shall promptly, and in any event within ten (10) days of
receipt of information regarding a Change in Circumstances, provide the
Banks with written notice (the "Notice") that describes in reasonable
detail the Change in Circumstances and how such Change in Circumstances
caused or will likely cause Borrower's representations and warranties
with respect to being
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or becoming Year 2000 Compliant to no longer be true. Borrower shall,
within ten (10) days of a request, also provide the Banks with any
additional information the Banks request of Borrower in connection with
the Notice and/or a Change in Circumstances.
(c) Promptly upon its becoming available, furnish to the Banks
one copy of each financial statement, report, notice, or proxy
statement sent by Borrower to stockholders generally and of each
regular or periodic report, registration statement or prospectus filed
by Borrower with any securities exchange or the Securities and Exchange
Commission or any successor agency, and of any order issued by any
Governmental Authority in any proceeding to which Borrower is a party.
For purposes of these provisions, "Governmental Authority" shall mean
any government (or any political subdivision or jurisdiction thereof),
court, bureau, agency or other governmental entity having or asserting
jurisdiction over Borrower or any of its business, operations or
properties.
(d) Give any representative of the Banks access during all
business hours to, and permit such representative to examine, copy or
make excerpts from, any and all books, records and documents in the
possession of Borrower and relating to its affairs, and to inspect any
of the properties and Systems of Borrower, and to project test the
Systems to determine if they are Year 2000 Compliant in an integrated
environment, all at the sole cost and expense of the Banks.
(e) Perform all acts it may reasonably be able to undertake to
ensure that each of its key suppliers, vendors and customers whose
compliance is likely to be material to Borrower's business becomes Year
2000 Compliant in a timely manner.
7.19 Discontinued Operations. Upon its sale of the Discontinued
Operations, the Company shall apply the net proceeds from such sale to the
repayment of the Loans, first to the extent applicable the RLC, second to the
extent applicable the Term B Loan and third to the extent applicable the Term A
Loan.
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ARTICLE 8.
NEGATIVE COVENANTS
Until payment in full of the Notes and the performance of the
Obligation, and so long as any Bank has any Commitment outstanding to any
Borrower, the Company and each Co-Borrower, to the extent applicable, agrees
that:
8.1 No Debt. Borrower shall not become or remain obligated either
directly or as a guarantor or surety for any Indebtedness for borrowed money, or
for any Indebtedness incurred in connection with the acquisition of any
property, real or personal, tangible or intangible including, but not limited
to, lease purchase agreements, except:
(a) Indebtedness to the Banks hereunder;
(b) Unsecured trade, utility or accounts payable arising in
the ordinary course of its business;
(c) Off-balance sheet leases;
(d) Unsecured notes by a Borrower to a Co-Borrower or to its
Subsidiaries;
(e) Subordinated Debt, including without limitation the
Existing Subordinated Debt described on Schedule 8.1(e) attached
hereto, not exceeding in the aggregate $65,000,000.00;
(f) The existing Indebtedness described on Schedule 8.1(f)
attached hereto; and
(g) Equipment lease financing up to an aggregate of
$5,000,000.00 with Bank One and/or an Affiliate thereof.
8.2 Liens. On and after the date hereof, it will not create or suffer
to exist Liens upon its property, real or personal, except (i) Liens, if any,
for the benefit of the Banks, and (ii) Permitted Liens, including without
limitation Liens listed on Schedule 8.2 attached hereto.
8.3 No Merger. The Company shall not, and shall not permit any
Subsidiary to, dissolve or liquidate, or merge or consolidate with or into any
corporation or entity, or turn over the management or operation of its property,
assets or businesses to any other person, firm or corporation, or make any
material change in its ownership, or except for the Discontinued Operations sell
or otherwise dispose of, or part with control of, any shares of stock or
indebtedness of any Subsidiary to, except to Company or another Subsidiary,
except any Subsidiary may merge with Company (provided that Company shall be the
continuing or surviving
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corporation), or with any one or more other Subsidiaries, or sell, lease,
transfer or otherwise dispose of its assets to Company or another Subsidiary if
(i) written notice is given by Company to the Banks, and (ii) all actions to
protect the Banks' security interest in the assets of such Subsidiary are taken.
8.4 Amendments to Organizational Documents. Borrower will not amend its
organizational documents if the result thereof could result in the occurrence
directly or indirectly of a Material Adverse Effect.
8.5 Margin Stock. Borrower shall not use any proceeds of the Loans, or
any proceeds of any other or future financial accommodation from the Banks for
the purpose, whether immediate, incidental or ultimate, of purchasing or
carrying any "margin stock" as that term is defined in Regulation U or to reduce
or retire any indebtedness undertaken for such purposes within the meaning of
said Regulation U, and will not use such proceeds in a manner that would involve
Borrower in a violation of Regulation U or of any other Regulation of the Board
of Governors of its Federal Reserve System, nor use such proceeds for any
purpose not permitted by Section 7 of the Exchange Act, as amended, or any of
the rules or regulations respecting the extensions of credit promulgated
thereunder.
8.6 Fiscal Year. Except with prior notice to the Banks, Borrower will
not change the times of commencement or termination of its fiscal year or other
accounting periods; or change its methods of accounting other than to conform to
GAAP applied on a consistent basis. After any such changes, its method of
accounting shall conform to GAAP.
8.7 Insider Loans; Payments. It will not (i) make loans, receivables or
investments, on a consolidated basis, to officers of Borrower or any other
companies of said officers, except for normal advances for travel and
entertainment and for loans to individual officers which may not exceed
$100,000.00 per individual or $1,000,000.00 in the aggregate at any one time, or
(ii) raise salaries or declare bonuses significantly in excess of industry
standards.
8.8 Transfer Licenses or Patents. It will not assign, transfer or
convey any of its right, title and interest in its business licenses or patents
if such transfer would have a Material Adverse Effect.
8.9 Financial Covenants. It will not permit:
(a) Its EBITDA Ratio to be more than 3.0 to 1.0 at the end of
any fiscal quarter.
(b) Its Current Ratio to be less than 1.50 to 1.0 at the end
of any fiscal quarter.
(c) Its Debt Coverage Ratio to be less than 1.75 to 1.0 at the
end of any fiscal quarter.
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(d) Its Tangible Net Worth Percentage to be less than fifty
percent (50.0%) at the end of any fiscal quarter.
(e) Its Net Income for any two consecutive fiscal quarters,
beginning with the two fiscal quarters ending March 31, 1999, or for
any fiscal year beginning with the 1999 fiscal year to be less than
zero (i.e. net loss), provided that any decrease in Net Income in the
fiscal quarter ending June 30, 1998 resulting from the Discontinued
Operations shall be disregarded in the calculation of Net Income.
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ARTICLE 9.
EVENTS OF DEFAULT
9.1 Events of Default. An "Event of Default" shall exist if any one or
more of the following events (herein collectively called "Events of Default")
shall occur and be continuing:
(a) Borrower shall fail to pay any principal of, or interest
on, either Note when the same shall become due or payable and such
failure continues for five (5) days after notice thereof to Borrower;
(b) Any failure or neglect to perform or observe any of the
covenants, conditions, provisions or agreements of Borrower contained
herein, or in any of the other Credit Documents (other than a failure
or neglect described in one or more provisions of this Section 9.1) and
such failure or neglect continues unremedied for a period of thirty
(30) days after notice thereof to Borrower;
(c) Any material warranty, representation or statement
contained in this Senior Credit Agreement or any of the other Credit
Documents, or which is contained in any certificate or statement
furnished or made to the Banks pursuant hereto or in connection
herewith or with the Loans, shall be or shall prove to have been false
when made or furnished;
(d) The occurrence of any "event of default" or "default" by
Borrower under any agreement, now or hereafter existing, including
without limitation any agreement as to any interest rate swap cap,
collar or any similar transaction or any Master Agreement related
thereto, to which any Bank, or an Affiliate of any Bank, and Borrower
or an Affiliate of Borrower are a party, or the occurrence and
continuation of an event of default under the Bond Documents, in each
case after the expiration of any notice and cure period;
(e) Borrower shall (i) fail to pay any Indebtedness of
Borrower (other than the Notes, but including without limitation the
Subordinated Debt) due under any Significant Debt Agreement, or any
interest or premium thereon, when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise) or within any
applicable grace period, (ii) fail to perform or observe any term,
covenant, or condition on its part to be performed or observed under
any agreement or instrument relating to such Indebtedness, within any
applicable grace period when required to be performed or observed, if
the effect of such failure to perform or observe is to accelerate the
maturity of such Indebtedness, or any such Indebtedness shall be
declared to be due and payable, or required to be prepaid (other than
by a regularly scheduled prepayment), prior to the stated maturity
thereof, or (iii) allow the occurrence of any material event of default
with respect to such Indebtedness;
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(f) Any one or more of the Credit Documents shall have been
determined to be invalid or unenforceable against Borrower executing
the same in accordance with the respective terms thereof, or shall in
any way be terminated or become or be declared ineffective or
inoperative, so as to deny the Banks the substantial benefits
contemplated by such Credit Document or Credit Documents;
(g) Borrower shall (i) apply for or consent to the appointment
of a receiver, trustee, custodian, intervenor or liquidator of itself
or of all or a substantial part of its assets, (ii) file a voluntary
petition in bankruptcy or admit in writing that it is unable to pay its
debts as they become due, (iii) make a general assignment for the
benefit of creditors, (iv) file a petition or answer seeking
reorganization of an arrangement with creditors or to take advantage of
any bankruptcy or insolvency laws, (v) file an answer admitting the
material allegations of, or consent to, or default in answering, a
petition filed against it in any bankruptcy, reorganization or
insolvency proceeding, or (vi) take corporate action for the purpose of
effecting any of the foregoing;
(h) An involuntary petition or complaint shall be filed
against Borrower, seeking bankruptcy or reorganization of Borrower, or
the appointment of a receiver, custodian, trustee, intervenor or
liquidator of Borrower, or all or substantially all of its assets, and
such petition or complaint shall not have been dismissed within sixty
(60) days of the filing thereof; or an order, order for relief,
judgment or decree shall be entered by any court of competent
jurisdiction or other competent authority approving a petition or
complaint seeking reorganization of Borrower, appointing a receiver,
custodian, trustee, intervenor or liquidator of Borrower, or all or
substantially all of its assets, and such order, judgment or decree
shall continue unstayed and in effect for a period of sixty (60) days;
(i) Any final judgment(s) (excluding those the enforcement of
which is suspended pending appeal) for the payment of money in excess
of the sum of $50,000.00 in the aggregate (other than any judgment
covered by insurance where coverage has been acknowledged by the
insurer) shall be rendered against Borrower, and such judgment or
judgments shall not be satisfied, settled, bonded or discharged at
least ten (10) days prior to the date on which any of its assets could
be lawfully sold to satisfy such judgment;
(j) Either (i) proceedings shall have been instituted to
terminate, or a notice of termination shall have been filed with
respect to, any Plans (other than a Multi-Employer Pension Plan as that
term is defined in Section 4001(a)(3) of ERISA) by Borrower, any member
of the Controlled Group, PBGC or any representative of any thereof, or
any such Plan shall be terminated, in each case under Section 4041 or
4042 of ERISA, and such termination shall give rise to a liability of
the Borrower or the Controlled Group to the PBGC or the Plan under
ERISA having an effect in excess of $250,000.00 or (ii) a Reportable
Event, the
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occurrence of which would cause the imposition of a lien in excess of
$250,000.00 under Section 4062 of ERISA, shall have occurred with
respect to any Plan (other than a Multi-Employer Pension Plan as that
term is defined in Section 4001(a)(3) of ERISA) and be continuing for a
period of sixty (60) days;
(k) Any of the following events shall occur with respect to
any Multi-Employer Pension Plan (as that term is defined in Section
4001(a)(3) of ERISA) to which Borrower contributes or contributed on
behalf of its employees and the Banks determine in good faith that the
aggregate liability likely to be incurred by Borrower, as a result of
any of the events specified in Subsections (i), (ii) and (iii) below,
will have an effect in excess of $250,000.00; (i) Borrower incurs a
withdrawal liability under Section 4201 of ERISA; (ii) any such plan is
"in reorganization" as that term is defined in Section 4241 of ERISA;
or (iii) any such Plan is terminated under Section 4041A of ERISA;
(l) The occurrence of a Change in Control or a material change
in the management of the Company without the written consent of the
Banks;
(m) The dissolution, liquidation, sale, transfer, lease or
other disposal of all or substantially all of the assets or business of
Borrower;
(n) Any attachment, garnishment, levy or execution upon, or
judicial seizure of, any property of Borrower that has a fair market
value in excess of $50,000.00, that is not bonded or released within
thirty (30) days;
(o) The institution of any legal action or proceedings to
enforce a lien or security interest in any property of Borrower that
has a fair market value in excess of $50,000.00; or
(p) The occurrence of either any material adverse change in
the financial condition of Borrower or a material change in the
management of Borrower, in either case that results in a Material
Adverse Effect, or if the Banks in good faith shall believe that the
prospect of payment or performance of the Obligation is impaired.
9.2 Remedies Upon Event of Default. If an Event of Default shall have
occurred and be continuing, then the Administrative Agent, at the request of the
Required Banks may, at their sole option, exercise any one or more of the
following rights and remedies, and any other remedies provided in any of the
Credit Documents, as the Required Banks in their sole discretion may deem
necessary or appropriate, all of which remedies shall be deemed cumulative, and
not alternative:
(i) Cease making Advances or extensions of financial
accommodations in any form to or for the benefit of Borrower
and
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declare the principal of, and all interest then accrued on,
the Notes and any other liabilities hereunder to be forthwith
due and payable, whereupon the same shall become immediately
due and payable without presentment, demand, protest, notice
of default, notice of acceleration or of intention to
accelerate or other notice of any kind all of which Borrower
hereby expressly waives, anything contained herein or in the
Notes to the contrary notwithstanding;
(ii) Reduce any claim to judgment;
(iii) Without notice of default or demand, pursue and
enforce any of the Banks' and the Administrative Agent's
rights and remedies under the Credit Documents, or otherwise
provided under or pursuant to any applicable law or agreement;
(iv) Notify the respective Trustee of any Bonds for
which a Bond Letter of Credit is outstanding of such Event of
Default and direct such Trustee to take such action or actions
as permitted under the related Indenture; and/or
(v) Require the Borrower to deposit with the
Administrative Agent cash in an amount equal to the Outstanding
LC Balance;
provided, however, that if any Event of Default specified in Sections 9.1(g) and
9.1(h) shall occur, the principal of, and all interest on, the Notes and other
liabilities hereunder shall thereupon become due and payable concurrently
therewith, without any further action by the Banks and without presentment,
demand, protest, notice of default, notice of acceleration or of intention to
accelerate or other notice of any kind, all of which Borrower hereby expressly
waives.
Upon the occurrence and during the continuance of any Event of Default,
the Administrative Agent on behalf of the Banks, at the request of the Required
Banks is hereby authorized at any time and from time to time, without notice to
Borrower (any such notice being expressly waived by Borrower), to set off and
apply any and all moneys, securities or other property of Borrower and the
proceeds therefrom, now or hereafter held or received by or in transit to the
Banks or their agents, from or for the account of Borrower, whether for safe
keeping, custody, pledge, transmission, collection or otherwise, and also upon
any and all deposits (general or special) and credits of Borrower, and any and
all claims of Borrower against the Banks at any time existing. The Banks agree
to notify Borrower promptly after any such setoff and application, provided that
the failure to give such notice shall not affect the validity of such setoff and
application. The rights of the Banks under this Section are in addition to other
rights and remedies (including, without limitation, other rights of setoff)
which the Banks may have.
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Upon the occurrence and during the continuance of any Event of Default,
the Banks are also authorized to notify each Trustee of such Event of Default
and direct that each Trustee accelerate the maturity of all applicable Bonds
then outstanding and provide a copy of such notice to the Borrower and the
Issuer and/or request the Trustee to redeem the applicable Bonds in whole or in
part or to cause a mandatory tender thereof.
9.3 Performance by the Banks. Should Borrower fail to perform any
covenant, duty or agreement with respect to the payment of taxes, obtaining
licenses or permits, or any other requirement contained herein or in any of the
Credit Documents within the period provided herein, if any, for correction of
such failure, the Banks may, at their option, perform or attempt to perform such
covenant, duty or agreement on behalf of Borrower. In such event, Borrower
shall, at the request of the Required Banks, promptly pay any amount expended by
the Banks and/or the Administrative Agent in such performance or attempted
performance to the Administrative Agent at its main office in Phoenix, Arizona,
together with interest thereon at the Default Rate, from the date of such
expenditure until paid. Notwithstanding the foregoing, it is expressly
understood that neither the Banks nor the Administrative Agent assume any
liability or responsibility for the performance of any duties of Borrower
hereunder or under any of the Credit Documents or other control over the
management and affairs of Borrower.
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ARTICLE 9A
ADMINISTRATIVE AGENT
9A.1 Appointment and Authorization. Each Bank hereby irrevocably
appoints and authorizes the Administrative Agent to act on behalf of such Bank
to the extent provided herein or in any of the Credit Documents or any other
document or instrument delivered hereunder or in connection herewith, and to
take such other action as may be reasonably incidental thereto as determined by
Administrative Agent.
9A.2 Exculpation. Administrative Agent shall be entitled to rely upon
advice of counsel concerning legal matters, and upon this Senior Credit
Agreement, any Credit Documents and any schedule, certificate, statement,
report, notice or other writing which it believes to be genuine or to have been
presented by a proper person. Neither Administrative Agent nor any of its
directors, officers, employees, or agents shall (a) be responsible for any
recitals, representations or warranties contained in, or for the execution,
validity, genuineness, effectiveness or enforceability of, this Senior Credit
Agreement, any Credit Documents or any other instrument or document delivered
hereunder or in connection herewith, (b) be under any duty to inquire into or
pass upon any of the foregoing matters, or to make any inquiry concerning the
performance by the Borrower or any other obligor of its obligations, or (c) in
any event, be liable as such for any action taken or omitted by it or them,
except for its or their own gross negligence or wilful misconduct. The agency
hereby created shall in no way impair or affect any of the rights and powers of,
or impose any duties or obligations upon, Administrative Agent in its individual
capacity.
9A.3 Administrative Agent and Affiliates. Administrative Agent has the
same rights and powers hereunder and under the Credit Documents as any other
Bank and may exercise the same as though it were not the Administrative Agent.
Administrative Agent and its Affiliates may accept deposits from, lend money to,
and generally engage in any kind of banking, trust or other business with
Borrower and any Affiliate of Borrower, as if it were not the Administrative
Agent and without any duty to account therefor to the Banks. Administrative
Agent need not account to any other Bank for any monies received by it for
reimbursement of its costs and expenses as Administrative Agent hereunder, or
for any monies received by it in its capacity as a Bank hereunder, except as
otherwise provided herein.
9A.4 Banks' Credit Decisions. Each Bank has made, and shall continue to
make, its own independent investigation or evaluation of the operations,
business, property and condition, financial and otherwise, of the Borrower, in
connection with the making of its respective Commitment, and each has made its
own appraisal of the creditworthiness of the Borrower. Except as explicitly
provided herein, the Administrative Agent has no duty or responsibility, either
initially or on a continuing basis, to provide any Bank with any credit or other
information with respect to such operations, business, property, condition or
creditworthiness, whether such information comes into its possession on or
before an Event of Default or at any time thereafter. Each Bank agrees and
acknowledges that Administrative Agent makes no representations or
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warranties about the creditworthiness of the Borrower or with respect to the
legality, validity, sufficiency or enforceability of this Senior Credit
Agreement or any of the Credit Documents.
9A.5 Indemnification. Each Bank agrees to indemnify, hold harmless and
defend the Administrative Agent (to the extent not reimbursed by the Borrower),
ratably according to its Pro Rata Share, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against the Administrative Agent in any way
relating to or arising out of this Senior Credit Agreement or the Credit
Documents or any action taken or omitted by the Administrative Agent under the
Senior Credit Agreement or Credit Documents; provided, that no Bank shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the Administrative Agent's gross negligence or wilful misconduct. Without
limitation of the foregoing, each Bank agrees to reimburse the Administrative
Agent promptly upon demand for its Pro Rata Share of any out-of-pocket expenses
(including, without limitation, attorney's fees and expenses) incurred by the
Administrative Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respective
rights or responsibilities under, this Senior Credit Agreement and the Credit
Documents to the extent that the Administrative Agent is not reimbursed for such
expenses by the Borrower; provided, that no Bank shall be liable for any portion
of any such expenses resulting from the Administrative Agent's gross negligence
or wilful misconduct.
9A.6 Administration.
(a) Administrative Agent shall administer and manage the Loans
in the ordinary course of its business and in accordance with its usual
practices and that degree of care it would use in administering, managing, and
servicing facilities of similar size and type for its own account. Each Bank
expressly agrees that, except as expressly otherwise provided herein,
Administrative Agent shall, in accordance with such practices and degree of
care, make any and all decisions and is hereby authorized to do or cause to be
done any and all acts regarding the administration of the facilities in
accordance with its sole and absolute discretion.
(b) Unless in each case consented to in writing by all the
Banks, the Administrative Agent shall not (i) agree to the modification or
waiver of any of the terms of any of the Credit Documents, or (ii) consent to
any act or omission by the Borrower, or (iii) exercise any rights which the
Administrative Agent may have with respect to the Loans, the Notes, or any of
the other Credit Documents, if any such agreement, consent or exercise would:
(i) change or modify the interest rate and repayment
provisions set forth in the Credit Documents;
(ii) increase the RLC Commitment;
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(iii) extend the maturity date of the Loans;
(iv) postpone any date for payment or forgive the
payment of principal of, or interest on, the Loans or the
payment of any other sum due under the Credit Documents;
(v) change or modify or waive any Financial Covenant;
(vi) waive any Event of Default; or
(vii) allow any assignment by Borrower of any right
or interest in the Credit Documents.
(c) Other than upon the occurrence of an Event of Default
hereunder, any decision or consent required hereunder shall be made jointly by
the Banks and the Administrative Agent instructed accordingly. Upon the
occurrence of an Event of Default hereunder, the Banks shall consult with each
other and determine whether, and in what manner and to what extent, any and all
rights hereunder and under the Credit Documents shall be exercised. The course
of action so agreed upon shall set forth what matters, if any, shall require the
further consent of the Banks and shall be carried out by Administrative Agent in
its name on behalf of the Banks.
(d) As to any matters which are subject to the consent of all
of the Banks, the Administrative Agent shall not be permitted or required to
exercise any discretion or take any action except with such consent. The
Administrative Agent shall be fully protected by the Banks severally and in
accordance with their respective Pro Rata Share in so acting or in so refraining
from action, but in no event shall the Administrative Agent be required to take
any action which exposes the Administrative Agent to personal liability which is
contrary to this Senior Credit Agreement or the Credit Documents or applicable
law.
(e) All communications from the Administrative Agent to the
Banks requesting the Banks' determination, consent, approval or disapproval
shall be given in the form of a written notice to each Bank containing (i) a
reasonably detailed description of the matter or thing as to which such
determination, approval, consent or disapproval is requested, accompanied by
such information in Administrative Agent's possession which, in Administrative
Agent's opinion, is reasonably relevant to such determination, approval, consent
or disapproval, and (ii) the course of action and determination recommended by
the Administrative Agent in respect thereof. Each Bank shall reply within ten
(10) Business Days after such written notice is given by Administrative Agent,
and, if such reply is not so given by a Bank, such course of action shall be
deemed to have been approved by such Bank.
9A.7 Default by a Bank. In the event that any Bank (the "Defaulting
Bank") fails to make timely payment to Administrative Agent of any sum due under
this Senior Credit Agreement, including without limitation, such Bank's Pro Rata
Share of any Advance, Disbursement or liabilities, obligations, losses, damages,
penalties, actions, judgments, suits,
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costs and expenses or any other expenses or amounts due Administrative Agent,
the non-defaulting Bank may, but shall not be required to, advance such amount
and recover such amount on demand from the Defaulting Bank, together with
interest thereon at the Federal Funds Rate commencing on the date such amount
was made available to Administrative Agent and ending on the date Administrative
Agent recovers such amount. Until the full repayment is made to Administrative
Agent of such amount funded on behalf of the Defaulting Bank together with
interest thereon from the date advanced to the date repaid by the Defaulting
Bank at the Federal Funds Rate, the right of the Defaulting Bank to participate
in decisions or consents hereunder shall be suspended and the entire interest in
the Loans of the Defaulting Bank shall be subordinated to the interest of the
non-defaulting Bank and all payments or recoveries on the Loans received by
Administrative Agent from any source whatsoever that would otherwise be credited
by Administrative Agent to the Defaulting Bank shall instead be credited to the
non-defaulting Bank until full repayment is made to the non-defaulting Bank. In
addition, Administrative Agent shall be entitled to exercise any and all
remedies available to it at law or in equity against the Defaulting Bank.
9A.8 Collections; Sharing of Payments.
(a) Administrative Agent, upon receipt, shall promptly
distribute in like funds as received to each Bank its Pro Rata Share of
all payments of principal, interest and fees (including without
limitation any Letter of Credit Fees) received by Administrative Agent
on or with respect to the Loans, whether collected from Borrower, or
any security for the Loans, or otherwise, after first deducting any
costs, fees or other charges due Administrative Agent hereunder or
under the Credit Documents, with the exception of (i) the RLC "Non-Use
Fee" of which Imperial shall receive one-half of its Pro Rata Share,
(ii) the Termination Fee of which Imperial shall receive a share based
on its share of the Total Commitment, and (iii) any charge for the
administrative expenses of the Issuing Bank in connection with the
Letters of Credit paid by Borrower pursuant to Section 2.12, which
amounts shall be paid to the Issuing Bank.
(b) If any Bank shall receive and retain any payment, whether
by set off, application of deposit balance or security, or otherwise,
in respect of the obligations of Borrower hereunder in excess of such
Bank's Pro Rata Share, then such Bank shall purchase from the other
Bank (for cash and at face value and without recourse) such
participation in the Loans held by it as shall be necessary to cause
such excess payment to be shared ratably as aforesaid with the other
Banks; provided, that if such excess payment or part thereof is
thereafter recovered from such purchasing Bank, the related purchases
from the other Bank shall be rescinded ratably and the purchase price
restored as to the portion of such excess payments so recovered, but
without interest.
9A.9 Successor Administrative Agent. The Administrative Agent may
resign at any time by giving written notice thereof to the Banks and the
Borrower. Borrower and the Banks agree
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to execute and deliver to such successor Administrative Agent such documents and
agreements as such successor Administrative Agent may require to carry out the
succession contemplated herein.
9A.10 Issuing Bank. The Issuing Bank shall act on behalf of the Banks
with respect to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Administrative Agent may
agree at the request of all the Banks to act for such Issuing Bank with respect
thereto; provided, however, that the Issuing Bank shall have all of the benefits
and immunities (i) provided to the Administrative Agent in this Article 9A with
respect to any acts taken or omissions suffered by the Issuing Bank in
connection with Letters of Credit Issued by it or proposed to be Issued by it
and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as if the term "Administrative Agent," as used in
this Article 9A, included the Issuing Bank with respect to such acts or
omissions, and (ii) as additionally provided in this Senior Credit Agreement
with respect to the Issuing Bank.
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ARTICLE 10.
MISCELLANEOUS
10.1 Modification. All modifications, consents, amendments or waivers
of any provision of any Credit Document, or consent to any departure by Borrower
therefrom, shall be effective only if the same shall be in writing and accepted
by the Required Banks.
10.2 Waiver. No failure to exercise, and no delay in exercising, on the
part of the Banks, any right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise thereof preclude any other further exercise
thereof or the exercise of any other right. The rights of the Banks and
Administrative Agent hereunder and under the Credit Documents shall be in
addition to all other rights provided by law. No modification or waiver of any
provision of this Senior Credit Agreement, the Notes or any Credit Documents,
nor consent to departure therefrom, shall be effective unless in writing and no
such consent or waiver shall extend beyond the particular case and purpose
involved. No notice or demand given in any case shall constitute a waiver of the
right to take other action in the same, similar or other instances without such
notice or demand.
10.3 Payment of Expenses. Borrower shall pay all costs and expenses of
the Banks and the Administrative Agent (including, without limitation,
attorneys' fees and costs) incurred by the Banks and the Administrative Agent in
connection with the documentation of the Loans, and the preservation and
enforcement of rights of the Banks and the Administrative Agent under this
Senior Credit Agreement, the Notes, and/or the other Credit Documents; provided,
however, that notwithstanding the aforesaid, with respect to any legal action
between the parties hereto that is pursued to judgment the prevailing party only
shall be reimbursed by the other party for all costs and expenses (including,
without limitation, reasonable attorneys' fees and costs) incurred in connection
with the preservation and enforcement of its rights under this Senior Credit
Agreement, the Notes and/or other Credit Documents. In addition, Borrower shall
pay all costs and expenses of the Banks and the Administrative Agent in
connection with the negotiation, preparation, execution and delivery of any and
all amendments, modifications and supplements of or to this Senior Credit
Agreement, the Notes or any other Credit Document.
10.4 Notices. Except for telephonic notices permitted herein, any
notices or other communications required or permitted to be given by this Senior
Credit Agreement or any other documents and instruments referred to herein must
be (i) given in writing and personally delivered or mailed by prepaid certified
or registered mail, or (ii) made by telefacsimile delivered or transmitted, to
the party to whom such notice or communication is directed, to the address of
such party as follows:
Borrower: Simula, Inc.
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
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Administrative Agent: Bank One, Arizona, XX
Xxxx Xxxxxx Xxx 00
Xxxxxxx, Xxxxxxx 00000
Attention: Commercial Banking AZ1-1178
Banks: See Schedule 1.1.
Any notice to be personally delivered may be delivered to the principal offices
(determined as of the date of such delivery) of the party to whom such notice is
directed. Any such notice or other communication shall be deemed to have been
given (whether actually received or not) on the day it is personally delivered
as aforesaid; or, if mailed, on the third day after it is mailed as aforesaid;
or, if transmitted by telefacsimile, on the day that such notice is transmitted
as aforesaid. Any party may change its address for purposes of this Senior
Credit Agreement by giving notice of such change to the other parties pursuant
to this Section.
10.5 Governing Law. This Loan Agreement has been prepared, is being
executed and delivered, and is intended to be performed in the State of Arizona.
The substantive laws of the State of Arizona and the applicable federal laws of
the United States of America shall govern the validity, construction,
enforcement and interpretation of this Senior Credit Agreement and all of the
other Credit Documents, without regard to Arizona conflicts of law rules.
10.6 Invalid Provisions. If any provision of any Credit Document is
held to be illegal, invalid or unenforceable under present or future laws during
the term of this Senior Credit Agreement, such provision shall be fully
severable; such Credit Document shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part of such
Credit Document; and the remaining provisions of such Credit Document shall
remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance from such Credit
Document. Furthermore, in lieu of each such illegal, invalid or unenforceable
provision there shall be added as part of such Credit Document a provision
mutually agreeable to Borrower and the Banks as similar in terms to such
illegal, invalid or unenforceable provision as may be possible and be legal,
valid and enforceable.
10.7 Binding Effect. The Credit Documents shall be binding upon and
inure to the benefit of Borrower, the Banks and the Administrative Agent and
their respective successors, assigns and legal representatives; provided,
however, that Borrower may not, without the prior written consent of the Banks,
assign any rights, powers, duties or obligations thereunder.
10.8 Entirety. The Credit Documents embody the entire agreement between
the parties and supersede all prior agreements and understandings, if any,
relating to the subject matter hereof and thereof.
10.9 Relationship of the Banks and Borrower. The Banks and Borrower
each have separate and independent rights and obligations under this Senior
Credit Agreement. Nothing
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contained herein shall be construed as creating, forming or constituting any
partnership, joint venture, merger or consolidation of Borrower and the Banks
for any purpose or in any respect.
10.10 Time of the Essence. Time is expressly made of the essence of
this Senior Credit Agreement.
10.11 Good Faith Standard. Except where governed by a specific
provision of this Senior Credit Agreement for a specific purpose, whenever the
approval or consent of the Banks is required hereunder, the Banks shall consider
the request for approval or consent on a timely basis, but the Banks shall have
such time as may be reasonably necessary to review and consider such request, as
determined in their sole judgment, and the Banks shall have the right to not
give their approval or consent or to impose such conditions or additional
requirements with respect to their approval or consent as the Banks in their
sole judgment shall determine. Approvals or consents by the Banks shall be
effective only when given in writing, except when otherwise specifically
provided herein. The standard by which the Banks shall be governed with respect
to a request for approval or consent shall be "good faith" as that term is
defined in the Arizona Uniform Commercial Code.
10.12 Assignments and Participations; Transferees.
(a) This Senior Credit Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Borrower may not assign its
rights or obligations hereunder, under any Note or under any other
Credit Document without the prior written consent of all of the Banks.
(b) Each Bank may at any time grant participations in any
portion of the Loans and Credit Documents owned by it to an Affiliate
of such Bank without the consent of the other Banks. Otherwise each
Bank may sell, assign, transfer or otherwise dispose of any portion of
its interest therein (each such grant of a participation or interest so
sold, assigned, transferred or disposed of being herein called a
"Transferred Interest") to other financial institutions ("Transferees")
only with the consent of the other Banks. In addition, each Bank may
pledge any portion of its Notes for security purposes to any Federal
Reserve Bank. Without in any way limiting the rights of Transferees
hereunder, the Borrower agrees that each Transferee shall be entitled
to the benefits of the Credit Documents to the extent of its
Transferred Interest as if it were the "Bank" in an aggregate amount
equal to such Transferred Interest, and that each Transferee may
exercise any and all rights of banker's lien, setoff and counterclaim
available pursuant to law with respect to its Transferred Interest as
fully as if such Transferee were a direct lender to the Borrower.
Borrower shall not be obligated to deal with or communicate with any
such participant.
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(c) As to any such assignment to a Transferee, (i) each such
assignment shall be of a constant, and not a varying, percentage of all
the assigning Bank's rights and obligations under this Senior Credit
Agreement, (ii) the amount of the Commitment of the assigning Bank
subject to each such assignment (determined as of the date the
Assignment and Acceptance with respect to such assignment is delivered
to the Administrative Agent) shall not be less than $1,000,000.00,
(iii) the amount of the Commitment retained by the assigning Bank,
unless the Assignment and Acceptance covers all or the remaining
portion of the assigning Bank's interest, rights and obligations under
this Senior Credit Agreement, after each such assignment shall not be
less than $1,000,000.00, (iv) the parties to each such assignment shall
execute and deliver to the Administrative Agent an Assignment and
Acceptance, together with the Note or Notes subject to such assignment,
and (v) the Transferee, if it shall not be a Bank, shall deliver to the
Administrative Agent an Administrative Questionnaire. Upon acceptance
and recording pursuant to paragraph (f) of this Section, from and after
the effective date specified in each Assignment and Acceptance, (A) the
Transferee thereunder shall be a party hereto and shall become a "Bank"
hereunder, and, to the extent of the interest assigned by such
Assignment and Acceptance, have all the rights and obligations of a
Bank under this Senior Credit Agreement (including the obligation to
arbitrate all controversies and claims, as required by Section 10.17
hereof) and (B) the assigning Bank thereunder shall, to the extent of
the interest assigned by such Assignment and Acceptance, be released
from its obligations under this Senior Credit Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining
portion of an assigning Bank's rights and obligations under this Senior
Credit Agreement, such Bank shall cease to be a party hereto (but shall
continue to be entitled to the benefits of Sections 3.6, 3.7(b) and
10.3).
(d) By executing and delivering an Assignment and Acceptance,
the assigning Bank thereunder and the Transferee thereunder shall be
deemed to confirm to and agree with each other and the other parties
hereto as follows: (i) such assigning Bank warrants that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim and that its Commitment and the
outstanding balances of its Loans, without giving effect to assignments
thereof which have not become effective, are as set forth in such
Assignment and Acceptance, (ii) except as set forth in (i) above, such
assigning Bank makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Senior Credit
Agreement, or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Senior Credit Agreement, any
other Credit Document or any other instrument or document furnished
pursuant hereto or the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations
under this Senior Credit Agreement, any other Credit Document or any
other instrument or document furnished pursuant hereto; (iii) such
Transferee represents and warrants that it is
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legally authorized to enter into such Assignment and Acceptance; (iv)
such Transferee confirms that it has received a copy of this Senior
Credit Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 7.1 and such other documents
and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (v)
such Transferee will independently and without reliance upon the
Administrative Agent, such assigning Bank or any other Bank and based
on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking
action under this Senior Credit Agreement; (vi) such Transferee
appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Senior
Credit Agreement as are delegated to the Administrative Agent by the
terms hereof, together with such powers as are reasonably incidental
thereto; and (vii) such Transferee agrees that it will perform in
accordance with their terms all the obligations which by the terms of
this Senior Credit Agreement are required to be performed by it as a
Bank (including the obligation to arbitrate all controversies and
claims, as required by Section 10.17 hereof).
(e) The Administrative Agent shall maintain at one of its
offices in Phoenix, Arizona, a copy of each Assignment and Acceptance
delivered to it and a register for the recordation of the names and
addresses of the Banks, and the Commitment of, and principal amount of
the Loans owing to, each Bank pursuant to the terms hereof from time to
time (the "Register"). The entries in the Register shall be conclusive
in the absence of manifest error and the Borrower, the Administrative
Agent and the Banks may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Bank hereunder for all
purposes of this Senior Credit Agreement. The Register shall be
available for inspection by the Borrower and any Bank, at any
reasonable time and from time to time upon reasonable prior notice.
(f) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Bank and an Transferee together
with the Note or Notes subject to such assignment, an Administrative
Questionnaire completed in respect of the Transferee (unless the
Transferee shall already be a Bank hereunder), the Administrative Agent
shall (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register, and (iii) give prompt
notice thereof to the Banks. Within five Business Days after receipt of
notice, the Borrower, as applicable, shall execute and deliver to the
Administrative Agent, in exchange for the surrendered Note or Notes, a
new Note or Notes to the order of such assigning Bank in a principal
amount equal to the applicable Commitment retained by it. Such new Note
or Notes shall be in an aggregate principal amount equal to the
aggregate principal amount of such surrendered Note or Notes; such new
Notes shall be dated the date of the surrendered Notes which they
replace and shall otherwise be in substantially the applicable form of
Exhibit "D" hereto.
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10.13 Headings. Section headings are for convenience of reference only
and shall in no way affect the interpretation of this Senior Credit Agreement.
10.14 Survival. All representations and warranties made by Borrower
herein shall survive delivery of the Notes and the making of the Loans.
10.15 No Third Party Beneficiary. The parties do not intend the
benefits of this Senior Credit Agreement to inure to any third party, nor shall
this Senior Credit Agreement be construed to make or render the Banks and the
Administrative Agent liable to any materialman, supplier, contractor,
subcontractor, purchaser or lessee of any property owned by Borrower, or for
debts or claims accruing to any such persons against Borrower. Notwithstanding
anything contained herein or in the Notes, or in any other Credit Document, or
any conduct or course of conduct by any or all of the parties hereto, before or
after signing this Senior Credit Agreement or any of the other Credit Documents,
neither this Senior Credit Agreement nor any other Credit Document shall be
construed as creating any right, claim or cause of action against the Banks and
the Administrative Agent, or any of their officers, directors, agents or
employees, in favor of any materialman, supplier, contractor, subcontractor,
purchaser or lessee of any property owned by Borrower, nor to any other person
or entity other than Borrower.
10.16 Schedules and Exhibits Incorporated. All schedules and exhibits
attached hereto are hereby incorporated into this Senior Credit Agreement by
each reference thereto as if fully set forth at each such reference.
10.17 Setoff. The Banks are hereby authorized at any time and from time
to time, without prior notice to Borrower (any such notice being expressly
waived by the Borrower), to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held by the Banks, or
any branch, subsidiary, or affiliate of the Banks, and other indebtedness at any
time owing by the Banks, or any branch, subsidiary, or affiliate of the Banks,
to or for the credit or the account of Borrower, against any and all of the
obligations of Borrower now or hereafter existing under the Credit Documents,
irrespective of (i) whether or not the Banks shall have made any demand under
the Credit Documents and (ii) whether such obligations are contingent, matured,
or unmatured. The Banks agree promptly to notify Borrower after any such setoff
and application, provided that the failure to give such notice shall not affect
the validity or such setoff and application. The rights of the Banks under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of setoff) which the Banks may have.
10.18 Arbitration. The Banks, the Administrative Agent and Borrower
agree that upon the written demand of either party, whether made before or after
the institution of any legal proceedings, but prior to the rendering of any
judgment in that proceeding, all disputes, claims and controversies between
them, whether individual, joint, or class in nature, arising from this Senior
Credit Agreement, any Credit Document or otherwise, including without limitation
contract disputes and tort claims, shall be resolved by binding arbitration
pursuant to the Commercial Rules of the American Arbitration Association
("AAA"). Any arbitration proceeding held
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pursuant to this arbitration provision shall be conducted in the city nearest
the Borrower's address having an AAA regional office, or at any other place
selected by mutual agreement of the parties. No act to take or dispose of any
property shall constitute a waiver of this arbitration agreement or be
prohibited by this arbitration agreement. This arbitration provision shall not
limit the right of either party during any dispute, claim or controversy to
seek, use, and employ ancillary, or preliminary rights and/or remedies, judicial
or otherwise, for the purposes of realizing upon, preserving, protecting,
foreclosing upon or proceeding under forcible entry and detainer for possession
of, any real or personal property, and any such action shall not be deemed an
election of remedies. Such remedies include, without limitation, obtaining
injunctive relief or a temporary restraining order, invoking a power of sale
under any deed of trust or mortgage, obtaining a writ of attachment or
imposition of a receivership, or exercising any rights relating to personal
property, including exercising the right of set-off, or taking or disposing of
such property with or without judicial process pursuant to the Uniform
Commercial Code. Any disputes, claims or controversies concerning the lawfulness
or reasonableness of an act, or exercise of any right or remedy concerning any
property, including any claim to rescind, reform, or otherwise modify any
agreement relating to the property, shall also be arbitrated; provided, however
that no arbitrator shall have the right or the power to enjoin or restrain any
act of either party. Judgment upon any award rendered by any arbitrator may be
entered in any court having jurisdiction. The statute of limitations, estoppel,
waiver, laches and similar doctrines which would otherwise be applicable in an
action brought by a party shall be applicable in any arbitration proceeding, and
the commencement of an arbitration proceeding shall be deemed the commencement
of any action for these purposes. The Federal Arbitration Act (Title 9 of the
United States Code) shall apply to the construction, interpretation, and
enforcement of this arbitration provision.
10.19 JURY WAIVER. THE BORROWER, THE BANKS AND THE ADMINISTRATIVE AGENT
HEREBY VOLUNTARILY, KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT
TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE (WHETHER BASED UPON
CONTRACT, TORT OR OTHERWISE) BETWEEN OR AMONG THE BORROWER AND THE BANKS AND THE
ADMINISTRATIVE AGENT ARISING OUT OF OR IN ANY WAY RELATED TO THIS DOCUMENT, ANY
OTHER CREDIT DOCUMENT, OR ANY RELATIONSHIP BETWEEN THE BANKS, THE ADMINISTRATIVE
AGENT AND THE BORROWER. THIS PROVISION IS A MATERIAL INDUCEMENT TO THE BANKS TO
PROVIDE THE FINANCING DESCRIBED HEREIN OR IN THE OTHER CREDIT DOCUMENTS.
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10.19 Counterparts. This Senior Credit Agreement may be executed in
multiple counterparts, each of which, when so executed, shall be deemed an
original but all such counterparts shall constitute but one and the same
agreement.
IN WITNESS WHEREOF, the undersigned have executed this Senior Credit
Agreement as of the day and year first above written.
BANK ONE, ARIZONA, NA, a national banking
association
By: /s/
-----------------------------------
Name: Xxxxxxx Xxxxxxxx
Its: Vice President
AGENT AND BANK
IMPERIAL BANK ARIZONA, an Arizona banking
corporation
By: /s/
-------------------------------------
Name: Xxxxx Xxxxxxxx
Its: Vice President
BANK
SIMULA, INC., an Arizona corporation
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Treasurer
COMPANY
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SIMULA SAFETY SYSTEMS, INC., formerly
known as Simula Government Products, Inc.,
an Arizona corporation
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Assistant Treasurer
SIMULA AUTOMOTIVE SAFETY DEVICES,
INC., an Arizona corporation, a/k/a
ASD-Simula
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Treasurer
SIMULA TRANSPORTATION EQUIPMENT
CORPORATION, an Arizona corporation
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Assistant Treasurer
AIRLINE INTERIORS, INC., an Arizona
corporation
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Assistant Treasurer
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ARTCRAFT INDUSTRIES CORP., an Arizona
corporation
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Assistant Treasurer
COACH AND CAR EQUIPMENT
CORPORATION, an Arizona corporation
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Assistant Treasurer
VIATECH, INC., a Delaware corporation
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Assistant Treasurer
SIMULA TECHNOLOGIES, INC., an Arizona
corporation
By: /s/
---------------------------------------
Name: Xxxx X. Xxxxx
Its: Treasurer
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SIMULA AUTOMOTIVE SAFETY DEVICES
LIMITED, a company organized under the laws
of the United Kingdom
By: /s/
-----------------------------------------
Name: Xxxx X. Xxxxx
Its: Treasurer
----------------------------------------
INTERNATIONAL CENTER FOR SAFETY
EDUCATION, INC., an Arizona corporation
By: /s/
-----------------------------------------
Name: Xxxx X. Xxxxx
Its: Treasurer
INTAERO, LTD., an Arizona corporation
By: /s/
-----------------------------------------
Name: Xxxx X. Xxxxx
Its: Assistant Treasurer
CO-BORROWERS
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